Marathon Oil Corp., which recently completed the spinoff of its refining arm to concentrate on exploration and production, is evaluating whether to sell some of its interests in the Gulf of Mexico (GOM), a spokesperson confirmed Wednesday.
“We have said that as a normal course of business Marathon Oil will periodically optimize select assets to strengthen our portfolio and increase returns,” Marathon’s Lee Warren told NGI. “Consistent with this plan, and given the significant prospect inventory we’ve built in the Gulf and our focus on capital discipline, we are evaluating the opportunity to farm down a minority working interest in our Gulf of Mexico portfolio.”
Warren said there was nothing definite; “this is simply an evaluation.”
In late June Houston-based Marathon Oil spun off its refining and marketing business as Marathon Petroleum Corp., which now is headquartered in Ohio (see Daily GPI, July 1).
The spinoff is part of a strategy to recast itself, in part as a North American unconventional oil and gas player. The company recently spent close to $3.5 billion to double its acreage in the Eagle Ford Shale in South Texas (see Daily GPI, June 2). It also has a substantial leasehold in the Williston Basin’s Bakken Shale (see Daily GPI, April 26, 2006), as well as operations in the Woodford Cana, Haynesville and Bossier shales, the Denver-Julesburg Basin (Niobrara) of Colorado and in Canadian oilsands (see Daily GPI, April 11; Feb. 3).
However, the GOM has long been a core business unit. Marathon has significant interests in seven producing fields and it operates four. An inventory of future deepwater prospects also is in development. Among its holdings are the following:
This year the company budgeted $5.267 billion for capital, investment and exploration, which was 9% higher than in 2010 — and mostly directed at onshore assets. Total upstream spending is set at $3.7 billion, or 71% of the budget. Almost $1.9 billion was earmarked for “growth assets” that include North American unconventional plays. About $465 million is budgeted “specifically for impact exploration,” said CEO Clarence Cazalot.
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