Marathon Oil Corp., which is directing an increasing share of its capital spend to Oklahoma's stacked reservoirs, agreed Monday to sell non-operated energy assets in the Permian Basin for $235 million.
The carbon dioxide and waterflood assets in West Texas and New Mexico are being sold to an undisclosed buyer, the Houston-based producer said. The properties, where Marathon has been using the enhanced recovery techniques, produced an average 4,000 boe/d during the first half of the year. The sale is expected to be completed by year's end.
Since August 2015, Marathon has announced or completed asset sales worth more than $1.5 billion, including other waterflood assets, and the Permian sale is not surprising. Capital spending this year was reduced by half from 2015, and it had set a sales target of between $750 million and $1 billion. Earlier this year, Marathon agreed to sell a basket of upstream and midstream assets in the U.S. onshore and Gulf of Mexico for $950 million (see Shale Daily, April 12).
At the same time, however, Marathon has been buying property and moving more capital to the STACK (Sooner Trend of the Anadarko Basin in Canadian and Kingfisher counties).
Marathon in June agreed to pay $888 million for PayRock Energy Holdings LLC, which gave it a bundle of opportunities in the Anadarko Basin. Marathon now has about 203,000 net acres total in the STACK, with proved and probable reserves estimated at more than 1 billion boe.
Between April and June, Oklahoma output averaged 27,000 boe/d net, and Marathon brought online two operated Meramec extended laterals (see Shale Daily, Aug. 5). Meanwhile, output in the Eagle Ford and Bakken shales continued to decline in the quarter.