Marathon Oil Corp.’s third quarter profits jumped 11% year/year on strong revenue growth and increased production, especially from the Eagle Ford Shale.

The Houston producer, which last year propelled its downstream and petroleum properties, shifted its U.S. onshore presence to unconventional shales, and in particular, three onshore plays: the Eagle Ford, Bakken and Anadarko Woodford.

Compared with year-ago numbers, production from July through September increased 14% to 49,000 boe/d, “driven by growth in the company’s U.S. resource plays,” said CEO Clarence Cazalot. “The increase was primarily a result of increased sales from the Eagle Ford, Bakken and Anadarko Woodford plays.”

The company only entered the Eagle Ford play about a year ago, but so far so great, he told analysts in a conference call Tuesday.

“Marathon Oil’s producing assets exceeded expectations in the third quarter, driven by superior execution in our U.S. resource plays and continued strong reliability from our base assets,” he said. “Our investment in the Eagle Ford Shale a little more than a year ago, and our bolt-on acquisitions since then, continue to deliver value beyond original expectations.

“Not only have we improved the speed and efficiency of our drilling and completions there, we also continue to optimize well spacing, which could significantly increase drillable locations and recoverable reserves.”

As an example, the CEO pointed to a “monster” well in Gonzales County, TX, the Burrow 2-H (100% working interest), which achieved a 24-hour initial production rate of 6,275 boe/d, of which 4,646 bbl were oil and condensate.

Eagle Ford output nearly doubled in the latest quarter to about 40,000 boe/d net, compared with 2Q2012 output of 21,000 boe/d net; 75% was crude oil/condensate and 11% was natural gas liquids. Currently, the company is producing more than 60,000 boe/d net with 29 gross operated wells awaiting completion.

Marathon reduced its rig count in the South Texas play as it had said it would to 18 rigs while maintaining four dedicated and two spot-market hydraulic fracturing crews. It drilled 78 gross wells and brought 73 wells to sales. Up to 260 Eagle Ford gross wells are planned for 2012, which would be an increase of about 20 wells from previous forecasts. The average time to drill a well in the Eagle Ford is now about 24 days.

Bakken Shale output in 3Q2012 hit 30,000 boe/d net in the latest period, up 3,000 boe/d net sequentially. At the end of October, production was more than 32,000 boe/d net. Twenty-five gross wells were drilled in the latest period using seven rigs. Average time to drill a well in the Bakken was 25 days spud-to-spud, down from about 30 days in the first three months of this year. At the end of October, the company had reduced its Bakken drilling operations to five rigs.

Marathon averaged 9,600 boe/d net in the Anadarko Woodford Shale in Oklahoma, which was 68% higher sequentially. Eight new wells were brought to sales; average net output in September was about 12,000 boe/d.

“With a strong position in U.S. resource plays and the very good operational performance we’ve had this year, Marathon Oil is positioned to meet or exceed our full-year production targets,” said Cazalot. “In the case of exploration and production (E&P), we are raising our 2012 available for sale estimates to between 375,000 and 385,000 net boe/d, excluding Libya, which further demonstrates our confidence in our ability to grow production at a 5-7% compound annual rate from 2010 through 2017.” Libya production numbers are excluded in Marathon’s E&P figures.

Profits in 3Q2012 totaled $450 million (63 cents/share) versus $405 million (57 cents) a year ago. Excluding one-time items, earnings were 64 cents from 59 cents. Revenue jumped 9.5% to $4.16 billion. Wall Street had forecast earnings of 64 cents/share on revenue of $3.5 billion. Operating margins grew to 42.8% from 35.1%; total expenses fell 3.5%.

E&P segment income totaled $486 million in 3Q2012, ahead of $417 million in 2Q2012. E&P sales volumes per day averaged 399,000 boe/d net, which was 10% higher sequentially. The quarterly output exceeded company guidance of 365,000-380,000 boe/d net. Production totals included two months of output from the Paloma Partners II LLC acquisition in the Eagle Ford, which was completed in early August (see Shale Daily, May 11).