Marathon Oil Net Income Rises

Marathon Oil Net Income Rises

Marathon Oil Corporation reported full-year 2013 adjusted net income of $1.874 billion, compared to adjusted net income of $1.736 billion for 2012.

Full-year 2013 net income was $1.753 billion, compared to $1.582 billion in 2012.

During 2013, we continued to maintain a sharp focus on our core values, operating reliability and execution excellence, marked by our 11 percent overall production growth (excluding Alaska and Libya), exceeding 2013 growth guidance. This focus on excellence drove best-in-class operating reliability across our Company-operated assets. In particular, our strong year-over-year net production growth in the top U.S. liquids resource plays — 136 percent in the Eagle Ford, 34 percent in the Bakken and 68 percent in the Oklahoma resource basins — demonstrated our ability to drive superior operating results,” said Lee M. Tillman, Marathon Oil’s president and CEO.

Our robust capital allocation combined with these strong operating results led to a 2013 reserve replacement of 194 percent, excluding dispositions, at a very competitive finding and development cost of approximately $16 per boe. We ended 2013 with net proved reserves of approximately 2.2 billion boe, an 8 percent increase from 2012, topping the 40-year proved reserves record set last year.

Our strong fourth quarter operating results were offset by decreased price realizations, particularly in the U.S. and Canada. Fourth quarter U.S. liquid hydrocarbon (LHC) realizations fell almost 12 percent and synthetic crude oil (SCO) realizations declined 23 percent compared to the third quarter of 2013.

As outlined at our Analyst Day in December, we expect our resource play production to grow more than 30 percent in 2014 compared to 2013 and to achieve a total Company production growth rate of approximately 4 percent (excluding Alaska, Angola and Libya). We’ve allocated more than 60 percent of our $5.9 billion 2014 capital, investment and exploration budget to our three outstanding resource plays, where we’ve accelerated activity and already ramped up to our committed 28-rig program. It’s clear these high-value assets and our relentless pursuit of reliability are integral to our ongoing strategy to grow profitable production volumes and reserves. In 2014, we again expect greater than 100 percent reserve replacement, excluding acquisitions and divestitures.

As part of our commitment to rigorous portfolio management integrated with robust capital allocation, we announced plans in December to market our U.K. and Norway businesses. Additionally, we will commence the remaining $500 million of our previously announced $1 billion share repurchase upon close of the sale of our interest in Angola Block 31.

I’m proud of this Company’s steadfast commitment to the core values that drive our operations around the world. We recognize that conducting our business safely and responsibly is fundamental to protecting our license to operate and achieving competitive returns for shareholders,” Tillman added.

Press Release, February 6, 2014