I am proud to share with you Marathon's 2007 Living Our Values Report. Our actions and results in 2007 reinforce my belief that putting Marathon's values front and center in our business is having more positive effects on our Company, employees and communities than we could have foreseen. This Report also points out the need and expectation for Marathon and other companies to be actively involved in making a difference in our society.
At Marathon, we strive to embed our values into every aspect of our business. Our values, in fact, have made it possible for us to conceive, plan, execute and manage a wide range of operations and projects worldwide. These values — health and safety, environmental stewardship, honesty and integrity, corporate citizenship, and a high performance team culture — align with the execution of our business strategy to deliver energy solutions around the world.
Reflecting on Marathon's progress in 2007, it is clear that Living Our Values remains a decisive factor in our operational performance. Emphasizing our employees' accountability and responsibility to our stakeholders — shareholders, communities, business partners and others with whom we work — has set the stage for sound decision-making.
Across the board, Marathon employees deserve the credit for our progress. They put our high performance culture into action every day, working with honesty, integrity and respect to create sustainable value. While their work advanced Marathon on many strategic fronts in 2007, I would like to mention several key examples that demonstrate how our values support our business strategy.
Creating a Safe Work Environment
In all of our operations, achieving high standards of safety performance is part
of our business strategy. We took a major step forward for operational safety and
integrity in 2007 with the creation of a comprehensive corporate standard for
process safety management (PSM). Marathon also implemented a PSM improvement plan
with a continuing focus on awareness training. We are applying new metrics in 2008
to gauge our progress towards eliminating process safety incidents.
While safety remains a constant priority wherever we work, I am saddened to report that the Marathon family lost four colleagues in four separate work-related incidents in 2007. We have responded to these tragedies on many fronts and with a conviction to achieve a 100 percent safe workplace. One of our actions was to establish an advisory panel to explore enhancements to new employee orientation and training. The panel includes experts from several large companies known for their safety culture and performance, as well as Marathon staff.
Leveraging Our Strengths to Address Global Challenges
Living Our Values guides the way we manage societal issues and challenges wherever
we operate. One of the most pressing issues for the energy industry and society at large
is climate change, especially in light of forecasts that signal increasing global demand
for carbon-based energy resources through 2030. Marathon's core value of environmental
stewardship shapes how we address climate change as a company, an industry participant
and a global citizen. We will continue seeking creative solutions and leveraging our
technology strengths, energy efficiency measures and partnerships such as the Global Gas
Flaring Reduction (GGFR) initiative to address this global concern.
The growing global demand for crude oil and refined products is one of several factors in the increasing cost of retail gasoline and diesel fuels. We recognize that rising fuel prices are a major concern for consumers. Marathon is responding by working to increase the supply of crude oil through our exploration and production efforts, and by expanding our refining capacity. The Garyville, Louisiana, refinery expansion and the planned Detroit, Michigan, heavy oil upgrading project use technologies that minimize environmental impacts while increasing the supply of ultra clean transportation fuels to the marketplace.
Developing Meaningful Programs for Community Development
One of Marathon's achievements in 2007, the on-budget and early start-up of the liquefied
natural gas (LNG) production facility in Equatorial Guinea (EG), embodies the Living Our
Values framework. Marathon continues to develop this strategic asset, while also making a
meaningful difference to the people of EG. Our signature project in this Central African
nation is the Bioko Island Malaria Control Project, which has dramatically reduced the
presence of malaria parasites in children. In 2007, the EG government expanded malaria
control to mainland EG using the model Marathon and its partners developed on Bioko Island.
This comprehensive approach is a model for entering new countries and regions, notably the
Indonesian island of Sulawesi, where we began an offshore seismic survey in 2008.
In the U.S., we are tackling methamphetamine (meth) abuse, a social issue that threatens the safety and well-being of our employees, their families and communities. After learning about the impacts of this illegal drug, Marathon launched a meth awareness and prevention program in 2006. Thousands of citizens, including schoolchildren, participated in the program in 2007. Now, Marathon is leading the way to fight this drug through the Corporate Meth Alliance. Marathon is proud to offer avenues for communities and businesses to take a strong stand against meth abuse.
Living Our Values
Marathon and our industry face many challenges to supplying energy that is affordable
and readily available, while ensuring the safety of employees and communities, and addressing
environmental impacts.
We believe that our values will enhance our ability to face the challenges and manage the risks of our business. They will allow Marathon to attract talented technical professionals, develop innovative business partnerships, gain access to resources, minimize our impact on the environment, assist communities and navigate changing economic conditions.
Our values show us the way to grow and compete ethically, safely, and in a manner that is environmentally sound and socially conscious. Ultimately, Marathon's business strategy guides only what we do; Living Our Values guides how we do it. In an interconnected world, knowing how to deliver energy solutions globally will allow Marathon to create sustainable value.
Sincerely,
Clarence P. Cazalot Jr.
President and Chief Executive Officer
June 2008
Clarence P. Cazalot Jr.President and
Chief Executive Officer