Houston-based Marathon Oil Co., a wholly owned subsidiary of Marathon Oil Corp., said Tuesday it has acquired the rights of bankrupt Enron Corp. to deliver and sell liquefied natural gas (LNG) at the El Paso Corp.-owned Elba Island terminal facilities near Savannah, GA. The U.S. Bankruptcy Court for the Southern District of New York last week approved the transfer of ownership to Marathon, which was the successful bidder for the rights at $31.9 million.

Under the terms of the agreement, Marathon Oil can supply up to 58 Bcf of LNG per year for 17 years to El Paso Merchant Energy at the Elba Island LNG regasification terminal. Marathon Oil’s contractual commitment is expected to take effect immediately, according to the company.

“This agreement will enable us to capture value from the expected growth in LNG imports into the U.S., while also providing options to commercialize our significant natural gas resources in Equatorial Guinea,” said Marathon Oil President and CEO Clarence P. Cazalot Jr.

Marathon “has quite a bit of natural gas resources” in Equatorial Guinea,” and “LNG is one of the options we’re looking at to bring the gas to market” in the United States and Europe, said Marathon spokeswoman Susan Richardson. The company estimates its Alba field in New Guinea has a resource base of 5 Tcf.

In another foray into the LNG market, Marathon Oil has partnered with Pertamina, Golar LNG Ltd., and Grupo GGS S.A. de C.V. to develop a major LNG regasification and 400 MW power generation complex near Tijuana in Baja California. The complex is expected to become operational in 2005 and supply an estimated 750 MMcf/d of gas.

Marathon Oil has been involved in the export side of the LNG business for approximately 30 years through a joint venture operation in Alaska with Phillips Petroleum, which delivers LNG to markets in Japan, she noted. In 2001, Marathon reported it shipped 67 Bcf of LNG overseas.

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