• 5 minutes Trump vs. MbS
  • 9 minutes Saudis Threaten Retaliation If Sanctions are Imposed
  • 15 minutes Can the World Survive without Saudi Oil?
  • 38 mins WTI @ $75.75, headed for $64 - 67
  • 11 hours The Dirt on Clean Electric Cars
  • 1 hour These are the world’s most competitive economies: US No. 1
  • 38 mins The end of "King Coal" in the Wales
  • 17 hours Uber IPO Proposals Value Company at $120 Billion
  • 1 hour Saudi-Kuwaiti Talks on Shared Oil Stall Over Chevron
  • 7 hours EU to Splash Billions on Battery Factories
  • 8 hours Closing the circle around Saudi Arabia: Where did Khashoggi disappear?
  • 40 mins Coal remains a major source of power in Europe.
  • 21 hours COLORADO FOCUS: Stocks to Watch Prior to Midterms
  • 8 hours Poland signs 20-year deal on U.S. LNG supplies
  • 22 hours Saudis Pull Hyperloop Funding As Branson Temporarily Cuts Ties With The Kingdom
  • 18 hours U.N. About Climate Change: World Must Take 'Unprecedented' Steps To Avert Worst Effects
Hedge Funds Continue To Reduce Bullish Bets On Oil

Hedge Funds Continue To Reduce Bullish Bets On Oil

Money managers and hedge funds…

U.S. Oil Production May Jump To 14 Million Bpd By 2020

U.S. Oil Production May Jump To 14 Million Bpd By 2020

Secretary of the Interior Ryan…

Marathon Oil Sells Canadian Oil Sands Assets, Bets On Permian

Mountains

In a sign that oil companies have realized where the biggest returns can be reaped after the downturn, Marathon Oil Corporation said on Thursday that it is divesting its Canadian oil sands operations and acquiring acreage in the Permian Basin.

Marathon Oil has signed a deal to sell its Canadian subsidiary—that includes a 20-percent non-operated interest in the Athabasca Oil Sands Project (AOSP)—to Shell and Canadian Natural Resources Limited for US$2.5 billion in cash, excluding closing adjustments. The sale further simplifies and concentrates Marathon Oil’s portfolio to the lower cost, higher margin U.S. resource plays, the company said.

One of the buyers of the AOSP, Shell, said earlier today that it is selling all its oil sands production assets in Canada, except for the stake in the Athabasca Oil Sands Project. Shell’s divestitures in the oil sands are part of its US$30-billion divestment program aimed at reducing its debt load that it accumulated with the acquisition of BG Group.

Apart from selling assets in Canada, Marathon Oil signed a deal to buy around 70,000 net surface acres in the Permian basin from BC Operating, Inc and other entities for US$1.1 billion in cash, excluding closing adjustments. The acquisition includes 51,500 acres in the Northern Delaware basin of New Mexico, with current output of around 5,000 net barrels of oil equivalent per day (boed).

Related: Oil Prices Continue Plunging As Speculators Rush For Exit

Commenting on the rationales for the two deals, Marathon Oil President and CEO Lee Tillman said in the company statement:

Historically, our interest in the Canadian oil sands has represented about a third of our Company's other operating and production expenses, yet only about 12 percent of our production volumes. The Northern Delaware basin features outstanding well economics that compete at the top of our organic portfolio and is experiencing a positive rate of change in well performance unrivaled in U.S. unconventional basins.”

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:


x

Join the discussion | Back to homepage

Leave a comment
  • sixpacktwo on March 10 2017 said:
    Looks like a good move by MRO. May be a problem 20 years from now. Oil looks like it is staying in the 50 range, so production cost must be kept low, and that is what this move does..

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News