Join our crew and become one of the 104,480 members that receive our newsletter.

Marathon Oil Mulling “Farming Down” Gulf of Mexico Portfolio

Marathon Oil Mulling “Farming Down” Gulf of Mexico Portfolio

GCaptain
Total Views: 17
October 6, 2011

HOUSTON (Dow Jones)–Marathon Oil Corp. (MRO) said Thursday it is considering selling minority stakes in its U.S. Gulf of Mexico assets in order to increase returns for shareholders.

“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,” said company spokeswoman Lee Warren.

The Houston-based company said the move was part of Marathon Oil’s strategy to periodically optimize select assets to strengthen the company’s portfolio and increase returns.

Marathon Oil became an independent energy producer in June after the company spun off its refining arm. As a stand-alone exploration and production company, Marathon Oil has said its priority is to increase its production growth profile and optimize capital spending. Before the split was completed, the company spent $3.5 billion doubling its acreage in the Eagle Ford Shale formation in South Texas.

Marathon Oil has significant interests in seven producing fields in the Gulf of Mexico, of which it operates four, according to the company’s website. The company has also rebuilt its inventory of prospects for future exploration activity in the deepwater Gulf of Mexico.

Deutsche Bank said Thursday that new regulations in the Gulf are far more onerous than they were before last-year’s BP PLC (BP, BP.LN) oil spill, which is likely to result in small and medium-sized companies exiting the area. Marathon declined to comment on whether that was one of the reasons it was looking to reduce its stakes in the region.

The news on Marathon’s possible Gulf of Mexico stake sale was first reported by the Houston Chronicle.

-By Isabel Ordonez, Dow Jones Newswires

Unlock Exclusive Insights Today!

Join the gCaptain Club for curated content, insider opinions, and vibrant community discussions.

Sign Up
Back to Main
polygon icon polygon icon

Why Join the gCaptain Club?

Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.

Sign Up
close

JOIN OUR CREW

Maritime and offshore news trusted by our 104,480 members delivered daily straight to your inbox.

gCaptain’s full coverage of the maritime shipping industry, including containerships, tankers, dry bulk, LNG, breakbulk and more.