Marathon Oil Earnings and Outlook Raised on Increased Production

Houston, Texas oil producer and shale exploration company Marathon Oil reported better than expected first quarter earnings after the close Wednesday. The stock rose after the company guided production and earnings higher.  

Houston, Texas oil producer and shale exploration company Marathon Oil reported better than expected  first quarter earnings after the close Wednesday. The stock rose after the company guided production higher in abusy week for U.S. shale companies releases. 

 Marathon PermianMarathon Oil Northern Delaware Basin Sites

Earnings

Q1 EPS of $0.18 beats by $0.04, revenue of $1.73B (+61.7% Y/Y) beats consensus by $390M. djusted net income was $154 million, or $0.18 per diluted share. Net operating cash flow was $649 million, or $707 million before changes in working capital.

Marathon Oil Corporation NYSE: $MRO

Market Reaction >After hours 18.49 +0.19 (1.04%)

Highlights

  • Received $1.2 billion in proceeds from the Libya sale and the final Canadian oil sands payment
  • Raised 2018 annual resource play oil and boe production guidance to 25 – 30%, up from 20 – 25% previously, while maintaining the $2.3 billion 2018 development capital budget 

Production

  • Total production averaged 398,000 net boed, excluding Libya;
  • U.S. production averaged 284,000 net boed and U.S. oil production averaged 164,000 bopd, both up 9% sequentially on a divestiture-adjusted basis
  • Eagle Ford maintained flat production of 104,000 net boed; 11 wells in Atascosa County had average 30-day IP rates of 1,615 boed (76% oil)
  • Bakken production increased to 74,000 net boed, up 7% sequentially; Arkin well in Hector set new basin Three Forks record with 3,040 bopd 30-day IP; June and Chauncey wells in West Myrmidon set new basin Middle Bakken records with 3,470 bopd average 30-day IP rates
  • Oklahoma production up 17% sequentially to 75,000 net boed; oil production up 25% sequentially; STACK leasehold drilling largely completed in first quarter Northern Delaware production increased to 16,000 net boed; seven wells across Eddy and Lea Counties had average 30-day IP rates of 1,460 boed (69% oil)
  • Captured more than 250,000 net acres in multiple new plays in the last year, including a largely contiguous position in the emerging Louisiana Austin Chalk play at a cost of less than $900 per acre

Outlook 

Raised 2018 annual resource play oil and boe production guidance to 25 – 30%, up from 20 – 25% previously, while maintaining the $2.3 billion 2018 development capital budget

Divesture Program

Marathon Divesture

Source: Marathon

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