Marathon Oil to Focus Majority of $4.8B Budget on Eagle Ford
Marathon Oil (NYSE:MRO) plans to spend $4.8 billion in 2012 on investments and exploration, with more than half of those funds going toward new operations in the Eagle Ford shale in Texas.
The company will focus 65% of that budget on its liquids-rich developments in the Eagle Ford to help it combat weak natural gas prices and help it reach a projected 5% to 7% compound average production growth from 2010 to 2016.
The $3 billion investment will be allocated to growth projects, including drilling about 250 to 300 net wells in 2012, ramping up 17 rigs and drilling 155 to 170 net wells in the Eagle Ford, Marathon said on Wednesday.
The company also plans to focus on the Bakken and Woodford shale plays and establish operations in the emerging Niobrara shale.
Marathon, which spun off its refining arm earlier this year, will spend the remaining money on its existing base of exploration and production assets, including those in North America, Africa and Europe.
“These large, stable assets are an integral part of our global portfolio and provide the solid cash foundation for investing in our future growth,” Marathon CEO Clarence Cazalot said.
Marathon has budgeted $275 million for its oil sands mining segments in 2012 and about $160 million for its corporate budget, half of which represents capitalized interests on assets under construction.