HAPPY TUESDAY READERS!

Readers from the Jonesboro area in Jackson Parish, I received an e-mail today from a customer that Woolys One Stop - Conoco at 1799 South Hudson Avenue has converted to ethanol gas. The stations tanks and pumps are owned by McCartney Oil. I spoke with them and confirmed the report. McCartney told me that since they can no longer get ethanol free gas from the Arcadia Terminal (because Marathon Oil stopped selling ethanol free gas in late June) they had to make the switch. That now makes a total of 65 stations, grocery and convenience stores that have converted to ethanol gas since Marathon stopped selling ethanol free gas. I really believe they will regret their decision.

I posted a new link on my website's "Links" page. It is under the section titled "Other Links of Interest". The website is called "Etha-Test". It's a website operated by a reader in Covington. He sells ethanol gas test kits. The kit price is $8.95.......that's a pretty good price. His website address is: http://www.bidlist.org/Etha-Test/

Check it out!

Thought you might be interested in reading this article about corn prices and ethanol costs escalating.......may make it much more difficult economics for refineries to blend so much of their gasoline as ethanol gas when they lose their "golden goose" $0.45/gallon tax credit next year!

As you read this, keep in mind that before the Feds began pushing ethanol gas, corn was selling for about $1.75/bushel. Note the current price towards the end of the article. Is it any wonder why all food products made from corn has skyrocketed in price over the past 3 years or so?

Ethanol Increases as Government Reduces Corn Supply Projection

QBy Mario Parker - Sep 12, 2011 3:06 PM CT

Ethanol futures increased in Chicago after the U.S. government reduced its outlook for the nation’s corn supply, threatening higher production costs for the biofuel.

Futures gained after the Agriculture Department said corn production will total 12.497 billion bushels (317.4 million metric tons), less than the 12.914 billion forecast in August. The grain is used to manufacture ethanol in the U.S.

“Ethanol’s higher and that definitely has something to do with corn,” said Jim Damask, a manager at BiofuelsConnect, a Jupiter, Florida-based alternative energy broker. “Ethanol is up just because the feedstock’s up. Corn stocks are pretty tight.”

Denatured ethanol for October delivery advanced 1.7 cents, or 0.6 percent, to $2.781 a gallon on the Chicago Board of Trade, the highest price since Sept. 7. Futures have gained 41 percent in the past year.

In cash market trading, ethanol in the U.S. Gulf was unchanged at $2.925 a gallon and on the West Coast the additive jumped 4.5 cents, or 1.5 percent, to $3.01, according to data compiled by Bloomberg.

Ethanol in New York added 3 cents, or 1 percent, to $2.95 a gallon and in Chicago the biofuel rose 2 cents, or 0.7 percent, to $2.825.

Corn for December delivery climbed 9 cents, or 1.2 percent, to $7.455 a bushel in Chicago. One bushel makes at least 2.75 gallons of ethanol.

"Pete" Comments are welcome at way2gopete@yahoo.com

HAPPY MONDAY READERS!

I do hope that everyone enjoyed the weekend, the beautiful weather we've been having and all the College football games this weekend.

A reader e-mailed me today that two stations in Lincoln Parish have converted to ethanol gas. One is the Raceway at 1804 Farmerville Hwy in Ruston and the second is Cranfords Northside at 2893 LA Hwy 33 in Ruston also. That now makes 64 stations I've had to take off my website's list of Ethanol Free Gas List since Marathon Oil in Garyville stopped selling ethanol free gas on June 21st. Marathon was the largest remaining supplier of ethanol free gas to south and particularly north Louisiana before they abandoned their customers and like the other majors, started selling only ethanol gas. I've heard that several distributors in turn abandoned Marathon due to their refusal to sell ethanol free gas. I've heard that they said that they could get ethanol gas at many other refineries and no longer had to stick with Marathon as they did in the past to get ethanol free gas. I've also heard that as a result of this, Marathon's Louisiana gasoline sales plummeted in July, the month after they stopped selling ethanol free gas. Hopefully they will learn from their mistake............but I doubt it. It's usually greed for the $0.45/gallon VEETC tax credit that drives them to sell all their gas as ethanol gas. It will be interesting to see what the "major" refiners do in 2012 since it appears they will lose their "gravy train" tax credit. The US Senate has already voted overwhelmingly not to extend it past the current December 31st expiration date, and my US Congressman from my district tells me the House will also vote on this soon, and he predicts, like the Senate, they too will vote to kill the tax credit subsidy to refineries.

Today, I'd like to offer a suggestion to gas stations, convenience and grocery stores that sell only ethanol free gas. Readers, if you know of a station that indicates to you that they are thinking of converting to sell ethanol gas because they can't compete financially with stations selling ethanol gas in their area, offer this alternative to them.

Most of the stations that are currently selling ethanol free gas are older "Mom and Pop" stations, grocery and convenience stores. Most have older pumps that are not capable of blending mid grade gas in the pump like newer stations. Therefore, most have 3 tanks in the ground - one for regular (87 octane), another for mid grade (89 octane) and a third for premium (91 octane). In most cases, the plumbing of these older stations tanks have valves that enable isolating one tank from the other two and lining it up to feed one pump or bank of pumps. By doing this, the station owner can elect to put his smallest tank into regular ethanol free gas and label the pump or set of pumps as "NO ETHANOL or ETHANOL FREE" and then sell regular and premium ethanol gas in his other two tanks, and of course, label them "Contains Up to 10% Ethanol".

I have about several stations on my list that have done this very arrangement, and all have reported huge increases in sales. This way, they can compete with the other stations selling ethanol gas (and often "out price them") and also keep their ethanol free gas customers. I suggested this arrangement to one store owner in Ascension Parish when he dropped his contract with a "major" refiner, which allowed him to sell ONLY ethanol gas. His contract with the "major" expired at the end of 2010, and he went independent. He told me in June of this year that his sales have gone from about 40,000 gals/ month when he was with the major refiner to over 100,000 gals/month since going independent with this tank arrangement, allowing him to sell ethanol gas and also keep his ethanol free gas customers.

So, if you are friends with a store owner who is selling ethanol FREE gas only, and who may be struggling to compete with other stores in his area that are selling ethanol gas, you may want to suggest this tank arrangement to him, provided of course, that he has 3 tanks.

Let me know if you know of any station owners that have gone to this arrangement. I show them as selling both ethanol free and ethanol on my website's "Ethanol Free Gas Station List".

Comments welcome............way2gopete@yahoo.com

"Pete"

HAPPY SATURDAY & A GREAT WEEKEND READERS!

I was not able to post last night as we were without power for the post 24 hours. Those in the New Orleans metropolitan area may have seen on the news that a grocery delivery truck delivering product at a supermarket behind the shopping complex on Airline Hwy knocked down 7 power polls, transformers were on fire, power lines were knocked atop the supermarket.......one huge mess.

You may recall that in a post on Wednesday (see August archives) August 31st, I posted a proposed resolution that I presented to the St. John Parish Council on August 23rd. The proposed resolution requested our Parish's State and US Congressional Delegations to help us in getting our State refineries to produce ethanol free gas. In another post on Thursday, September 8th, I posted a letter from Marathon Oil in Garyville opposing my resolution. I mentioned in my last post after posting the Marathon letter, that I would post my rebuttal letter to the St. John Parish Council, the Parish President and the Plant Manager of Marathon's Garyville refinery.

I was infuriated that the Marathon letter was faxed to the Parish President, Ms. Natalie Robottom, the day BEFORE the council meeting, and despite chatting casually with her just before the Council meeting when I presented my proposed resolution, she did NOT HAVE THE COURTESY OR DECENCY to mention the letter to me! I've had over 14 phone calls from residents who were at the Council meeting and others who saw the Council meeting on cable expressing shock and frustration at their Councilmen because they would not even offer a motion to bring my proposed resolution to a vote. I made each and everyone aware that Parish President Robottom had received the Marathon letter the day before the meeting when I gave my proposal, and did not have the decency to make me aware of it. Most said that they were already frustrated with Ms. Robottom and that sealed their opinion that they would NOT vote for her in her bid for re-election. Most also told me that they would NOT vote for their current Councilman since they would not approve my resolution.

To all St. John Parish readers of this blog, I strongly suggest you give serious consideration to who you cast your vote for in the upcoming elections for Council and Parish President. As you saw at the Council meeting when I made my presentation, they are not interested in what is important to you......not one bit! Read the following rebuttal letter which I sent to each Councilman/woman, Parish President and the Marathon Plant Manager.........it is a little lengthy because I replied to each and every paragraph in his letter. If his letter were a book, it would be filed under "Fiction" in the library catalogue. Here's the letter (if you have any comments to my rebuttal letter, e-mail me at way2gopete@yahoo.com):

Alton J. Landry, Jr.

39 Holly Drive

LaPlace, LA 70068

August 31, 2011

Mr. Lucien J. Gauff, III
670 West 2nd Street
LaPlace, LA 70068

Mr. Steve Lee

38 Muirfield

LaPlace, LA 70068

Mr. Haston Lewis, Sr.

117 Lewis Court

Edgard, LA 70049

Mr. Danny Millet

296 Annex Drive

Reserve, LA 70084

Mr. Charles Julien

P. O. Box 2489
Reserve, LA 70084

Ms. Jaclyn Hotard

1801 W Airline Hwy

LaPlace, LA 70068

Ms. Darnel C. Usry

500 Palm Street
LaPlace, LA 70068

Mr. Ronnie Smith

1801 W Airline Hwy

LaPlace, LA 70068

Ms. Cheryl Millet

1925 Ridgefield Drive
LaPlace, LA 70068

RE: Followup to August 23, 2011 Council Meeting

Ladies and Gentlemen of the St John Parish Council:

You may recall that I addressed you at your Tuesday, August 23^rd Council Meeting in LaPlace to seek your support in passing a resolution regarding giving St John Parish consumers a choice between ethanol and ethanol free gasoline.

I was informed by the Council Secretary shortly before the meeting that a letter from Marathon was received regarding my proposed resolution. She told me that she thought it was in support of my proposal. I spoke with Council Chairman, Mr. Ronnie Smith in the Council chambers a few minutes before the start of the meeting. He too told me it was his understanding that Marathon’s letter was in support of my proposed resolution, although he had not yet seen it.

So, you can imagine my surprise and shock after I completed my presentation to you when Mr. Smith read the letter from the Manager of Marathon Oil’s Garyville Refinery, Mr A.J. Anderson, in staunch opposition to my proposal. I was caught totally off guard and felt like I had been “blind sided”! I obviously didn’t have enough time to provide a factual rebuttal to Mr. Anderson’s letter, not having the benefit of reading it before the meeting. In hindsight, as I told Mr. Ronnie Smith later, I wish I would have asked the Council to postpone a vote on the proposed resolution until I was able to get a copy of the Marathon letter and have sufficient time to investigate Mr. Anderson’s claims and re-address the Council. What bothered me even more was when I later did obtain a copy of the letter to find that it was addressed to the St John Parish President and was dated August 22, 2011, the day before the Council meeting. I would have thought that someone in St John Parish government, being fully aware of the contents of my proposed resolution, would have had the courtesy to make me aware of the contents of Mr. Anderson’s letter before hearing it read at the Council meeting. That is shameful!

Attached is a copy of Mr. Anderson’s letter. I’d like to address the reasons why Mr. Anderson claims Marathon is opposed to the proposed resolution. I’ve hi-lited the sections I’ll address.

Paragraph #1: Mr. Anderson claims that the proposed resolution, while well intended, is in direct conflict with the Federal renewal fuel requirements.

The proposed resolution does NOT ask refineries to stop blending ethanol gasoline, but rather blend a portion of their gas as ethanol free gasoline. Currently, all the major refineries in Louisiana are blending ALL of their gasoline as ethanol gasoline, even though the Federal Environmental Protection Agency (EPA) only requires them to blend a mere 8.01% of their total gasoline sales as ethanol gas in 2011. You can read the EPA’s RFS standard for 2011 on the EPA website here:

http://www.epa.gov/otaq/fuels/renewablefuels/420f10056.htm#3

Many believe that major refineries are blending all of their gas as ethanol gas because of the extremely attractive VEETC tax credit of $0.45/gallon they have been getting from Washington since 2004 to blend ethanol gasoline.

Mr. Anderson also claims that blending both ethanol and ethanol free gasoline would increase the “fuel supply complexity and has the potential of increasing the cost for consumers”. I have spoken to two different area gasoline distributors who tell me that they have been buying both ethanol and ethanol free gasoline from Marathon’s Garyville refinery for over two years. So, why all of a sudden would blending both types of gas be more complex than it has been for the past several years? Regarding the potential for increasing the cost to consumers, many gas stations, convenience and grocery store owners have told me that they receive between 4.5 – 5 cents/gallon tax credit to sell ethanol gas. So, theoretically, the price of ethanol free gasoline, in the same grade and brand should not cost greater than 5 cents/gallon more than ethanol gasoline. However, nearly all stations that sell ethanol free gas are selling it at 10-20 cents/gallon more and sometimes as high as 50 cents/gallon higher than ethanol gas. Why is that I wonder? All the consumers I’ve spoken with are very willing to spend 5-10 cents/gallon more for “real gas”, without ethanol. Most tell me that the cost of constant and recurring repairs to lawn and garden tools and marine engines is way above the cost of a marginal cost increase of ethanol free gasoline. Also, the loss is gas mileage on 10% ethanol of between 6-8% on highway driving (much higher on city driving) more than offsets the marginally higher cost of the ethanol free gasoline.

Paragraph #2: Mr. Anderson references the 2007 Energy Independence and Security Act. I am very familiar with this regulation. I am fully aware that it requires refineries to sell 14 billion gallons of renewal fuels (nearly all ethanol) in 2011 and 36 billion gallons in 2022. He additionally suggests that “the U.S. is rapidly approaching the day when nearly all gasoline contains 10% ethanol”.

The EPA has calculated the percentage of total U.S. gasoline consumption in the Country that must be ethanol blend and determined that to achieve the 14 billion gallon ethanol target, refineries would have to blend 8.01% of their total gasoline sales as ethanol gas in 2011. Reference the EPA’s website link I provided in response to paragraph #1.

I spoke with a gentleman from the U.S. Energy Information Administration (EIA) today.

The U.S. Energy Information Administration (EIA) is the statistical and analytical agency within the U.S. Department of Energy. The total US consumption of gasoline in the U.S. in 2010 was approximately 140 billion gallons. Basis that volume, which he predicts will not change substantially by 2022, for the EPA to meet their target of 36 billion gallons of ethanol sold, refineries would have to blend only 26% of their total gasoline sold in 2022, WELL BELOW the 100% Mr. Anderson is predicting in his claim that “the US is rapidly approaching the day when nearly all gasoline contains 10% ethanol”. The information I explained here can be viewed on the EIA’s website here:

EIA Website: http://www.eia.gov/tools/faqs/faq.cfm?id=27&t=10

So, as you can see from this information, it is NOT necessary for refineries to blend ALL of their total gasoline sales as ethanol blend. The maximum they will be required to blend to meet the EPA’s 2022 target is ONLY 26% , or just slightly over one fourth of their total gasoline sales.

Paragraph #3: Mr. Anderson claims that “most gasoline-powered vehicles and engines can operate efficiently on E-10; however, E-10 may not be appropriate for certain applications, such as marine engines, vintage vehicles and some small engines”.

While most passenger vehicles and light trucks perform adequately on E-10 gas, except for the 6-8% mileage loss, that is NOT the case for the other applications Mr. Anderson references. Marine engines and lawn and garden tools experience considerable trouble with ethanol gas and routine maintenance is necessary. If Mr. Anderson is not aware of this, I’d be happy to give him the names and phone numbers of several marine repair shops and at least one lawn and garden tool repair shop here in LaPlace who will explain the serious issues with E-10 in these engines.

Furthermore, by Mr. Anderson’s own admission, ethanol gasoline is not appropriate for all engines, so then why does he not blend ethanol free regular gas to alleviate this consumer issue?

Paragraph #4: Mr. Anderson references that when “the company converts to an E-10 slate of fuels in a market, we also offer a mid grade gasoline (90 octane minimum) that is not blended with ethanol”.

Mr. Anderson is NOT giving the consumer a reasonable alternative in this offering. First 99.9% of all marine engines and lawn and garden tools are designed to operate on 87 octane regular gasoline and operate quite well on this grade. The “recreational gas” he refers to is not mid grade. All stations in our area offer: 87 octane regular, 89 octane mid-grade, and 91 octane premium (some ethanol blend premium is 93 octane). The 90 octane ethanol free his refinery offers “upon request” from Garyville is an “odd” octane level. Where do stations put this gas? Those that have three tanks in the ground have them in regular (87 octane), mid-grade (89 octane) or premium (91-93) octane. There is no place for storage of 90 octane gas.

Then there is the price issue. A 90 octane grade ethanol free gas will cost consumers a whopping 35-40+ cents/gallon or higher than E-10 (it will likely be priced like premium gas. I was told this by a Marathon Oil PR person at their Findlay,Ohio office). And, as I mentioned above, there is not one of the affected engines that have problems with ethanol gasoline that requires anything higher than 87 octane regular gas (except the very new 300 hp marine engines which require premium gas). Why don’t you blend your so called “recreational ethanol free fuel” as 87 octane regular Mr. Anderson? Marathon has blended 87 octane non ethanol gas for several years, so why can’t they continue to do it?

Paragraph #5: Mr. Anderson claims that “imposing an additional mandate requiring all refineries to supply gasoline without ethanol would further complicate fuel-supply logistics and impose additional, unnecessary costs”.

If Marathon has been supplying both E-10 and non ethanol gasoline for several years according to several area gas distributors I’ve spoken with, what is different today?

I would ask Mr. Anderson how a State like Nebraska, which has not one refinery in the State, can offer consumers a choice of either ethanol or ethanol free gas at all gas stations in the State? I know this from personal experience.

A close friend and I attended the baseball College World Series in Omaha, Nebraska (the heart of corn country and ethanol plants) in 2009. We were there for two weeks, during which time we fueled our car several times. At each station we used (including a Shell and Exxon/Mobil station), the consumer was given a choice to buy either ethanol free gas or E-10 gas, on each pump. We checked many other stations while in Omaha, including all the majors and several independents, and all stations gave consumers the same choice of buying either ethanol or ethanol free gas. If refiners, particularly major refiners, blended ethanol free gas, and provided Louisiana consumers the choice that Nebraska does, consumers would not have the problem they are experiencing today and there would be no need for this resolution. I called the Agriculture Commissioner of Nebraska upon returning home from our trip to Omaha and asked him if there was a law in Nebraska that required all gas stations to sell both ethanol and ethanol free gas. The Commissioner told me that there was not such a law, but that all stations in Nebraska did that voluntarily. The regular, non ethanol gas sold for 5 cents/gallon higher than 10% ethanol gas at each station we checked.

So, if Nebraska can do this without having one refinery in their State, how is it that doing this in Louisiana would present such a complexity and increased cost as Mr. Anderson asserts? I’d really like to hear his explanation on this issue.

Ladies and gentlemen of the Council, I have presented you with facts to rebut Marathon’s reasons why it would not be practical and more costly to offer Louisiana consumers with a choice of either ethanol blend or ethanol FREE gasoline. The current availability of ethanol free gasoline is becoming less and less. Since Marathon Oil has discontinued the sale of ethanol free regular gas from it’s Garyville refinery on June 21^st, I have had to remove 60 stations from my website’s ethanol free gas station list (PeteLandrysRealGas.com) that previously sold ethanol free gas, but had to switch to ethanol gas as their distributor was no longer able to supply them with ethanol free gas. As I explained to you at your meeting on August 23^rd, when the newest ethanol blend, 15% ethanol gasoline starts showing up in stations as early as late this year, this will offer consumers an even smaller choice as this new fuel cannot be used in any of the following equipment according to the EPA in their announcement of the new E-15 gasoline blend:

• All motorcycles.

• All vehicles with heavy-duty engines, such as school buses, transit buses, and delivery trucks.

• All off-road vehicles, such as boats and snowmobiles (includes four wheelers and jet skis).

• All engines in off-road equipment, such as lawnmowers and chain saws.

• All 2000 model-year and older cars (and light trucks).

(Gasoline powered home generators cannot operate on E-15 gasoline either)

So, Council members, what are consumers to do if all current E-10 stations convert to the new E-15 gas and if a source of ethanol free gasoline is not readily available in their communities? This is the MAJOR issue facing us soon, which could affect millions of consumers in Louisiana. Only by refineries blending ethanol free gasoline can this potential crisis be avoided. I’m not sure if Mr. Anderson, or for that matter, any other major oil company management fully understands this potential dilemma.

In Mr. Anderson’s final paragraph, he indicates that “MPC opposes adoption of any resolution that could lead to additional fuel mandates. Instead, we believe free-market competition will best serve the needs of consumers”.

If Marathon and other major refiners “manipulate” and manage their gas offerings by manufacturing ONLY ethanol gasoline, for whatever reasons, such that there is NO COMPETITION, since none of them offer ethanol free regular gas, how can consumers possibly be best served with what they want and need if they are not offered ethanol free regular gas by any major refiner? Is that “free market” competition? I think not.

In closing, I would urge you to re-consider the draft resolution I offered to you at your Council meeting on August 23^rd. I am willing to meet with you at another meeting, and offer Mr. Anderson an invitation to also appear at the meeting to clarify our positions on this matter and answer any questions you may still have on this subject. While I understand your attention to Marathon’s concerns, I would also remind you that you represent the St John Parish constituents who elected you to your office. Their concerns should be heard also. I don’t feel that they were at our meeting in considering the proposed resolution since not even one Councilman would offer a motion to bring the draft resolution to a vote.

Sincerely,

Alton “Pete” Landry

Attachment: August 22, 2011 Letter from Marathon Petroleum Company

cc: Ms. Natalie Robottom, President

St John the Baptist Parish

1801 W. Airline Hwy.
LaPlace LA 70068

Mr. A.J. Anderson, Manager

Marathon Louisiana Refining Division

P.O. Box AC

155 Sugar Cane Road

Garyville, LA 70051

HAPPY FRIDAY READERS

Readers of Avoylles Parish, added a new non ethanol gas station yesterday:

Rogers Wrecker Service

16269 LA Hwy 1

Simmesport

318-941-2670

He has only Premium non ethanol currently, but will be getting non ethanol regular later.

Also had to remove "Handy Stop" store in Mansura. Learned they are an Exxon station.

You recall that I posted a letter from Marathon Oil Company in staunch opposition to my proposed resolution to the St John Parish Council to ask our Louisiana and US Congressional delegation to help us in getting Louisiana refineries to make ethanol free gasoline.

I will post my rebuttal letter to the Marathon letter in tomorrow's blog.....be sure to read it as it exposed the false hoods that refineries are trying to get us to believe.

"Pete"

WELCOME TO "Pete" LANDRYS ETHANOL BLOG PAGE

Hello readers:
I will attempt to use this "blog" page to keep readers up to date on any changes to the gas list and issues related to ethanol gas quicker than I've been able to do in the past. With this blog page, I don't have to depend on my webmaster to enter articles, etc so this will be much, much quicker. I will attempt to post issues on this page daily, except Sundays. Note the ethanol related articles on the right hand side of the blog page also. Be sure to read the "Ethanol Forum" page also. You don't have to register on the Forum just to read the posts, only if you want to post.

Note: To escape the Blog page and return to PeteLandrysRealGas.com home page, click the "Back to RealGas.com" button on the blog page tool bar and follow instructions on the next page it opens.

"Pete" Landry
way2gopete@yahoo.com

HAPPY THURSDAY READERS!

First, I am sorry to report to readers from the Lafayette area that the Bendel Service Station on 1500 Pinhook Road in Lafayette, which was on the website's "Ethanol Free Gas Station List" was removed today. It was reported by a customer and reader of my site that he was switching to ethanol gas; however, I spoke with one of the owners yesterday and they are putting the business up for sale next week. The station was removed from the website's list.

Also, for Shreveport readers, the Fultz Service Center located at 101 Southfield Road in Shreveport was told by his distributor, Smith Oil that he could no longer supply him with non ethanol regular and mid grade. He has only Premium grade non ethanol gas currently. I told the owner that I was rather surprised to hear this as Smith Oil gets it's ethanol free gas from the Teepco Terminal south of Shreveport. I was told by a Citgo PR Manager over a month ago that they supply this terminal with non ethanol gas, all grades, through an exchange agreement with Conoco/Philips in Westlake, near Lake Charles. More to follow on this.

You recall I explained in a blog last week of my attempt to have the St. John Parish Council approve a resolution to ask our Parishes Louisiana and US Congressional delegations to help us in getting Louisiana's major refineries sell non ethanol gas. I explained that the Council failed to act on my proposal after the Council Chairman read a letter from Marathon Oil's Garyville Refinery Plant Manager in staunch opposition to my proposed resolution. I would like to now post the letter from Marathon here (I had to copy the letter from a scanned copy since I did not have an original digital copy, so the Marathon symbol and the Marathon Manager's signature does not appear on this copy):

A.J. Anderson
Manager
Louisiana Refining Division

Marathon Petroleum Company LLC
P.O. Box AC
155 Sugar Cane Road
Garyville, LA 70051
Telephone 985/535-2241
FAX 985/536-7587

Natalie Robottom, President
St. John the Baptist Parish
1801 W. Airline Hwy.
LaPlace, LA 70068

Dear Natalie:

RE: Resolution to Mandate Refinery Supply of Non-Ethanol Gasoline

Thank you for sharing information on the Tangipahoa Parish resolution that urges Congress to
require refineries to supply non-ethanol gasoline. While likely well intended, the resolution is in conflict with federal renewable-fuel requirements. Moreover, it would increase fuel-supply complexity and has the potential to increase fuel costs for consumers. Marathon Petroleum Company (MPC) urges St. John the Baptist Parish Council not to adopt a similar resolution.

As you may be aware, the Energy Independence and Security Act enacted by Congress in 2007 requires petroleum refiners and importers to assure that nearly 14 billion gallons of renewable fuels are blended into the nation’s transportation fuels this year (2011), and that at least 36 billion gallons of renewable fuels are blended annually by 2022. As a direct result of this federal mandate, the U.S. is rapidly approaching the day when nearly all gasoline contains10% ethanol (a blend commonly referred to as “E 10”).

Most gasoline-powered vehicles and engines can operate effectively on E10; however, E10 may not be appropriate for certain applications, such as marine, vintage vehicles and some small engines. Consumers should consult the vehicle or engine owner’s manual to determine if E10 is approved for use.

MPC recognizes that E l0 is not appropriate for all engines. Accordingly, when the company converts to an E10 slate of fuels in a market, we also offer a mid-grade gasoline (90 octane, minimum) that is not blended with ethanol. It is intended for those applications where the consumer believes an ethanol-blended fuel is not appropriate.

In many markets, one or more other suppliers may also offer a non-ethanol fuel, depending on consumer demand. Imposing an additional mandate requiring all refineries to supply gasoline without ethanol would further complicate fuel-supply logistics and impose additional, unnecessary costs.

MPC opposes adoption of any resolution that could lead to additional fuel mandates. Instead, we believe free-market competition will best serve the needs of consumers

Sincerely,

A.J. Anderson
Manager Louisiana Refining Division
==========================================================

In a future blog, I will post a rebuttal letter which I developed in response to this Marathon letter. My rebuttal was sent last week and was sent to the St. John Parish President and each Parish Council Member and also a copy to the Marathon Plant Manager.

"Pete"

HAPPY WEDNESDAY READERS

Finally no rain and a beautiful fall day!

I did not get a chance to post on Tuesday. I am including in this post a copy of an article on the new and upcoming 15% ethanol gas. It was written by Bob Marshall, sports writer for the New Orleans Times Picayune. Many readers of the Picayune in the New Orleans area I'm sure saw the article in the Sunday Picayune this past weekend. I'm attaching here a commentary for those outside of the New Orleans area, followed by the actual article.

To those of you who read Times Picayune's Bob Marshall's article on 15% ethanol in the Sunday Picayune, I would like to clarify something.

I thought the article was a little more dramatic than I would have written. I did not intend to come across that way when Bob interviewed me for the article earlier last week. Plus, there were a few minor technical errors. He didn't offer to let me proof read the article before he went to press. There were two objectives I was trying to get across to readers:

1. This new 15% gasoline CANNOT be used in any type of engines except in 2001 and newer cars and light trucks and 'Flex' vehicles.

2. And, IF current 10% ethanol stations ALL convert to the new 15% ethanol gas AND if consumers were not able to find a readily available source of ethanol free gas in their communities, we'd have a very serious dilemma, potentially affecting millions of consumers in Louisiana.

The number of ethanol free stations in the State continues to decline ever since Marathon stopped selling ethanol free gas at their Garyville Refinery. I've already had to take 60 stations off my website's ethanol free gas station list. Marathon was the major supplier of ethanol free gas to south and north Louisiana. Because we still have Murphy Refinery (however, I recently learned that Murphy Refinery is being sold to Valero, which sells ALL their gas as ethanol gas!) and the Chalmette Refining Company (formerly Exxon-Mobil refinery) in Chalmette and the Placid Refinery in Port Allen, we are still able to get ethanol free gas to most of south Louisiana, but at a slightly higher price due to the added cost to truck it a longer distance than distributors had to do from the Marathon plant. However, the same cannot be said for north Louisiana. The majority of stations I've had to take off my ethanol free gas station list were from the Monroe , Bossier City and Shreveport area.

I'm glad that Mr. Marshall showed the new EPA gas pump label in the article for the new 'E-15' gas so readers would at least be familiar with it when they start seeing it on pumps later this year as stations start to receive the new blend.

I was not trying to predict 'doom and gloom' in the article. But, I was at least happy that he put out the article. I thank him for that.

Here is the article:

Increase of ethanol in gas will cause damage to certain vehicles

Published: Sunday, September 04, 2011, 8:15 AM Updated: Sunday, September 04, 2011, 8:31 AM

By Bob Marshall, The Times-Picayune

I was trying to summarize the nightmare Pete Landry was describing, and suggested this: Come fall, Louisiana's 320,000 boaters will begin unwittingly filling their tanks with the new 15 percent ethanol fuel blends (E-15), resulting in millions of dollars in unnecessary damage, not to mention broken dreams.

"Oh no," Landry said, "It's much worse than that."

Worse?

"This won't just impact sportsmen. The E-15 can't be used in 2000 and older cars and light trucks, marine engines, motorcycles, jet skies, four wheelers, chain saws, any lawn equipment, gas powered home generators or anything else that that uses these small, air-cooled engines.

"We're talking probably millions of people impacted. We're facing a real crisis."

Landry is no Chicken Little. He's a retired oil- and petrochemical-industry chemist who has spent the past few years as a pro-bono researcher investigating the impacts of ethanol blends on sportsmen and others. When you check out the results on his website, PeteLandrysRealGas.com, you realize the sky really could fall.

Some history.

In 2007, President George Bush signed the Energy Independence and Security Act, which, among other things, required a 20-percent reduction in gasoline consumption by 2017. Much of that was to be achieved by the use of renewable fuels, a goal encouraged by a 45-cent per gallon tax credit to refiners for producing ethanol blends -- the Volumetric Ethanol Tax Credit.

This was a hugely popular event across political lines, but the euphoria didn't last long. Turned out corn-based ethanol actually costs more energy to produce than it saves. The rapid expansion of corn acres resulted in an increase in fertilizers that harm waterways, a loss of wildlife habitat, and soaring food prices worldwide.

While those impacts were generating headlines, what had been thought would be a small list of costs to a whole range of internal combustion engines began climbing. Ethanol, which is basically grain alcohol, collects moisture in fuel tanks, and is corrosive to hoses and engine parts not specifically engineered to handle it. That list would only climb as the refiners moved to meet the government's gradually increasing percent of ethanol.

This fall, we'll be hitting the E-15 mark, a level considered unsuitable even for new outboards, almost all small engines, and any car built before 2001.

The Environmental Protection Agency will require retailers to post a label on pumps stating the fuel should not and, in fact, cannot legally be used in anything other than passenger vehicles produced after 2001 and Flex-fuel vehicles.

But Landry says chaos is bound to ensue for two reasons: That label is much too small and not specific enough, and neither state nor federal governments are requiring refiners and retailers to produce enough ethanol-free fuel.

In fact, the alternative fuel subsidies give refiners a market incentive to produce most, if not all, of their fuel with ethanol, a far higher volume than the government currently requires. In June, the Marathon refinery in Garyville, which had been the state's largest ethanol-free producer, went all-ethanol. Since then, Landry said, the list of gas stations selling ethanol-free fuel dropped by 54 to just 977 -- this out of an estimated 3,650 stations.

"Availability is a huge problem for retailers," he said. "And that's going to get worse. Louisiana now has only four refineries producing ethanol-free fuel, and that number could drop because a federal exemption for small refineries is about to expire."

"Ethanol-free gas is already more expensive, and when we start losing in-state refineries, it will just go higher," Landry said. "My fear is that when this E-15 goes into effect, people who don't know the danger will pull up to a gas station and miss that label, or just look at the price and go to the cheaper fuel and do real damage to their engines."

So what can be done?

Some help may be coming soon as Congress considers repealing what has become a $5 billion annual subsidy of ethanol. That could lead some refiners into becoming producers of ethanol-free fuels.

But what really needs to happen is for governments -- state and federal -- to require retailers to offer at least one pump of non-ethanol fuel. That would provide the market for refiners to offer that product.

I'm not suggesting the nation should leave the alternative fuel race. If anything, we should invest more in supporting technologies that help get us off carbon fuels. If we don't, there isn't much of a future for southeast Louisiana. But neither should millions of Americans be needlessly caught in Pete Landry's nightmare.

In the meantime, keep checking PeteLandrysRealGas.com for safe fuel near you.

"Pete" Landry