November 11, 2016 - 8:15 AM EST
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Post Earnings Coverage as Marathon Oil Earnings Performance Improve; FY16 Production Outlook Raised

Upcoming AWS Coverage on Occidental Petroleum Post-Earnings Results

LONDON, UK / ACCESSWIRE / November 11, 2016 / Active Wall St. announces its post-earnings coverage on Marathon Oil Corp. (NYSE: MRO). The company released its financial results for the third quarter fiscal 2016 on November 02nd, 2016. The Houston exploration-and-production company's loss narrowed, supported by higher-than-projected production and lower costs. Register with us now for your free membership at:

One of Marathon's competitors within the Independent Oil & Gas space, Occidental Petroleum Corp. (NYSE: OXY), announced its third quarter 2016 financial results ON November 01, 2016. AWS will be initiating a research report on Occidental Petroleum in the coming days.

Today, AWS is promoting its earnings coverage on MRO; touching on OXY. Get our free coverage by signing up to:

Earnings Reviewed

For the three months ended on September 30th, 2016, Marathon reported net loss of $192 million, or $0.23 per diluted share, compared to net loss of $749 million, or 1.11 per share, in the year earlier period. Excluding rig-termination payments and other items, the adjusted loss declined to $0.11 per share from loss of $0.20 per share in the year earlier quarter. The energy company posted revenue of $1.23 billion in Q3 2016 down from the prior year's quarter revenue of $1.32 billion, thus outperforming Street's forecasts of $1.09 billion.

Results in Details

North America E&P

During Q3 2016, Marathon's North America Exploration and Production (E&P) production available for sale averaged 216,000 net barrels of oil equivalent per day (boed), lower compared to 224,000 net boed in Q2 2016. On a divestiture-adjusted basis, production was down 7% from the year-ago period. For the reported quarter, production cost in the company's North American region declined 37% lower than the year-ago period. Unit production costs were $5.70 per barrel of oil equivalent (boe), down 23% from the year earlier quarter.

In the North America region, the Oklahoma Resource Basins production averaged 41,000 net boed during Q3 2016, surging by 78% compared to 23,000 net boed in the year-ago quarter. During Q3 2016, Marathon brought online 10 gross Company-operated STACK Meramec wells and two SCOOP Woodford wells. For Q3 2016, Marathon's production in the Eagle Ford averaged 97,000 net boed compared to 128,000 net boed in Q3 2015.

For the Bakken region, Marathon averaged 54,000 net boed of production in Q3 2016 compared to the average production of 61,000 net boed in the prior year's period. Three gross wells in East Myrmidon were brought to sales in the reported quarter, all performing at or above expectations with completions ranging from 600 to 1,500 pounds per lateral foot of proppant and 45 to 50 stages per well. The Company plans to return to drilling in the Bakken with one rig expected to be added in Q4 2016.

International E&P

Production for Marathon's International E&P available for sale (excluding Libya) averaged 128,000 net boed for Q3 2016, up 12% versus the year earlier quarter. The production for the region benefited from the Alba B3 compression project in Equatorial Guinea, which came online in early July. Equatorial Guinea's production available for sale averaged 110,000 net boed in the reported quarter compared to 99,000 net boed in comparable year ago quarter. Production available for sale from U.K. production averaged 18,000 net boed in the latest quarter, up compared to 15,000 net boed in Q3 2015. During Q3 2016, International E&P's production costs (excluding Libya) were 43% below the year-ago quarter. The company recorded Unit production costs (excluding Libya) of $3.31 per boe, down 46% from Q3 2015.

Oil Sands Mining

For the reported period, Oil Sands Mining (OSM) production available for sale averaged 58,000 net barrels per day (bbld) compared to 57,000 net bbld in Q3 2015. The increase in production was driven by strong reliability at the mines and upgrader and less downtime compared to Q2 2016 when wildfires caused disruptions. Operating expense per synthetic barrel (before royalties) was $20.69, 20% lower than the year-ago quarter due primarily to cost reduction efforts, the lowest per unit cost performance recorded by OSM to date.


During Q3 2016, Marathon reported that net cash provided by operating activities was $366 million, and net cash provided by operations before changes in working capital was $288 million. Cash additions to property, plant and equipment were $230 million in the reported quarter. As of September 30th, 2016, the company had total liquidity worth $5.3 billion, which consists of $2 billion in cash and cash equivalents and an undrawn revolving credit facility of $3.3 billion.


For Q4 FY16, Marathon Oil expects North America E&P's production available for sale to average 205,000 to 215,000 net boed. Q4 FY16 International E&P's production available for sale (excluding Libya) is expected to be within a range of 120,000 to 130,000 net boed. OSM synthetic crude oil production is expected to range from 40,000 to 45,000 net bbld. Marathon also raised the low end of its full-year 2016 E&P production guidance range, resulting in a new range of 335,000 to 345,000 net boed.

Stock Performance

Marathon's share price finished yesterday's trading session at $15.14, climbing 1.75%. A total volume of 19.25 million shares exchanged hands, which was higher than the 3 months average volume of 17.08 million shares. The stock has advanced 3.20% and 24.01% in the last three months and past six months, respectively. Furthermore, since the start of the year, shares of the company have gained 22.02%. The stock has a dividend yield of 1.32% and currently has a market cap of $11.59 billion.

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Source: ACCESSWIRE Investor Awareness (November 11, 2016 - 8:15 AM EST)

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