HOUSTON, May 5, 2021 /PRNewswire/ -- Marathon Oil
Corporation (NYSE:MRO) reported first quarter 2021 net income of
$97 million, or $0.12 per diluted share, which includes the
impact of certain items not typically represented in analysts'
earnings estimates and that would otherwise affect comparability of
results. The adjusted net income was $166
million, or $0.21 per diluted
share. Net operating cash flow was $622
million, or $637 million
before changes in working capital.
Highlights
- Strong financial and operational delivery with differentiated
execution across all elements of business
-
- First quarter free cash flow of $443
million
- First quarter capital expenditures of $184 million; committed to capital discipline
with no change to $1 billion 2021
capital expenditure budget
- Minimal production impact from Winter
Storm Uri due to strong operational performance; first
quarter oil production of 172,000 net bopd and first quarter
oil-equivalent production of 345,000 net boed with no change to
2021 production guidance
- Acceleration of balance sheet enhancement and return of capital
to investors
-
- Achieved initial gross debt reduction target of $500 million; now targeting at least $500 million of additional gross debt reduction,
bringing total debt reduction target to at least $1 billion in 2021
- Raised quarterly base dividend over 30% from 3 cents per share to 4
cents per share
- Continued focus on ESG excellence
-
- Strong first quarter safety performance as measured by a Total
Recordable Incident Rate (TRIR) of 0.231
- Reduced 2020 GHG emissions intensity2 by
approximately 25% vs. 2019
- Appointed Holli Ladhani to the
Board in March, the second new Director added this year; Board
composition reflects continued commitment to refreshment,
independence, and diversity
"First quarter was once again characterized by differentiated
execution across all elements of our business, despite challenging
operating conditions associated with Winter
Storm Uri and the ongoing COVID-19 pandemic," said Chairman,
President, and CEO Lee Tillman. "I
am especially proud of the commitment and dedication of our
employees, as well as our strong safety performance to start the
year. Our differentiated execution culminated in just under
$450 million of free cash flow, with
year-to-date free cash flow largely funding $500 million of gross debt reduction. Due to the
strength and sustainability of our financial and operational
performance, we are targeting additional gross debt reduction of at
least $500 million this year and have
also raised our quarterly base dividend. Our actions are fully
consistent with our objective to return more than 30% of our
operating cash flow to investors, as we successfully progress both
balance sheet enhancement and direct return of capital. We believe
that our commitment to ESG excellence and our transparent capital
allocation framework that prioritizes free cash flow generation, a
low enterprise free cash flow breakeven oil price, balance sheet
improvement, and return of capital to investors is a recipe for
success relative to both our E&P peer group and the broader
S&P 500."
ESG Excellence
SAFETY: Marathon Oil views safety as a core value and key
component of its ESG performance. During the first quarter of 2021,
the Company achieved an excellent start to the year for safety
performance, as measured by a TRIR of 0.23.
ENVIRONMENTAL: During 2020 the Company made significant progress
in improving its environmental performance, achieving an estimated
25% reduction to its GHG emissions intensity in comparison to the
prior year, based on final calculations. This represents an
improvement over preliminary estimates that had indicated an
approximate 20% GHG emissions intensity reduction was achieved in
2020. The Company continues to work toward achieving its 2021 GHG
intensity reduction target of at least 30% and its 2025 GHG
intensity reduction goal of at least 50%, both relative to
2019.
GOVERNANCE: In March, the Marathon Oil Board of Directors
appointed Holli C. Ladhani to the
Board. Ms. Ladhani most recently served as President and CEO of
Select Energy, a provider of end-to-end water management solutions
for energy producers. Ms. Ladhani is the second Director added to
the Board this year, following the previously announced appointment
of Brent Smolik. Following the 2021
Annual Meeting of Stockholders, Marcela
Donadio, Director since 2014, is expected to serve as
Independent Lead Director. Marathon Oil continues to prioritize
strong Board of Director refreshment, independence, and diversity.
Of the 8 Directors standing for election this year, 7 are
independent, 3 are female, and 2 self-identify as an ethnicity
other than Caucasian/White. Average Director tenure is below the
S&P 500 average while maintaining a diverse mix of short and
longer-tenured Directors that reflects a balance of Company
experience and new perspectives.
United States (U.S.)
U.S. production averaged 276,000 net barrels of oil equivalent
per day (boed) for first quarter 2021. Oil production averaged
160,000 net barrels of oil per day (bopd). U.S. unit production
costs were $4.46 per boe for
first quarter.
During first quarter, the Company brought a total of 28 gross
Company-operated wells to sales. In the Eagle Ford, Marathon Oil's
first quarter production averaged 77,000 net boed. Oil production
averaged 51,000 net bopd on 25 gross Company-operated wells to
sales. In the Bakken, production averaged 112,000 net boed,
including oil production of 77,000 net bopd. The Company brought
just 3 gross Company-operated wells to sales in the Bakken.
Oklahoma production averaged
53,000 net boed, including oil production of 12,000 net bopd.
Northern Delaware production
averaged 26,000 net boed, including oil production of 15,000 net
bopd.
International
Equatorial Guinea production
averaged 69,000 net boed for first quarter 2021, including 12,000
net bopd of oil. First quarter sales totaled 66,000 net boed,
including 9,000 net bopd of oil. Unit production costs averaged
$1.68 per boe. First gas was achieved
from the 3rd party Alen project in February. Marathon Oil's equity
method investees process Alen gas under a combination of a tolling
and profit-sharing agreement, the benefits of which are included in
the Company's share of net income from equity method investees.
Corporate
CASH FLOW AND CAPEX: Net cash provided by operations was
$622 million during first quarter
2021, or $637 million before changes
in working capital. First quarter capital expenditures totaled
$184 million. The company's
$1.0 billion capital expenditure
budget for 2021 remains unchanged.
BALANCE SHEET AND RETURN OF CAPITAL: Marathon Oil ended first
quarter with total liquidity of $4.1
billion, which consisted of an undrawn revolving credit
facility of $3.0 billion and
$1.1 billion in cash and cash
equivalents. The Company continues to maintain an investment grade
credit rating at all three primary rating agencies, with Moody's
recently upgrading their rating outlook to stable.
Subsequent to the end of first quarter, the Company achieved its
initial 2021 gross debt reduction target by redeeming its
$500 million aggregate principal
amount of 2.8% Senior Notes Due 2022. The transaction will reduce
annual cash interest expense by $14
million and fully retires the Company's next significant
debt maturity. Having achieved its initial 2021 gross debt
reduction target, the Company is now targeting at least
$500 million of additional gross debt
reduction, bringing its total debt reduction target to at least
$1 billion in 2021. Subsequent to the
end of first quarter the Company also raised its quarterly base
dividend from 3 cents per share to
4 cents per share. These actions are
fully consistent with Marathon Oil's objective to return more than
30% of its cash flow from operations to investors, as the Company
successfully progresses both balance sheet enhancement and direct
return of capital.
ADJUSTMENTS TO NET INCOME: The adjustments to net income for
first quarter 2021 totaled $69
million, primarily due to the income impact associated with
unrealized losses on derivative instruments, gain recorded in
respect of forward starting interest rate swaps, corporate aircraft
lease termination expense, and severance expenses associated with a
workforce reduction.
A slide deck and Quarterly Investor Packet will be posted to the
Company's website following this release today, May 5. On Thursday, May
6, at 9:00 a.m. ET, the
Company will conduct a question and answer webcast/call, which will
include forward-looking information. The live webcast, replay and
all related materials will be available at
https://ir.marathonoil.com/.
Footnotes:
1 Total Recordable incident rate (TRIR) measures
combined employee and contractor workforce incidents per 200,000
work hours
2 Methodology and definitions for GHG emissions and
safety performance are based on information from the Company's 2019
Sustainability Report that can be found on the Company's website
(www.marathonoil.com). The Company reports direct (scope 1) and
indirect (scope 2) GHG emissions, with emissions intensity measured
by metric tonnes carbon dioxide equivalent (CO2e)
emissions per thousand barrels of oil equivalent hydrocarbons
produced from Marathon Oil-operated facilities.
Non-GAAP Measures
In analyzing and planning for its business, Marathon Oil
supplements its use of GAAP financial measures with non-GAAP
financial measures, including adjusted net income (loss), adjusted
net income (loss) per share, free cash flow, net cash provided by
operations before changes in working capital and total capital
expenditures.
Our presentation of adjusted net income (loss) and adjusted
net income (loss) per share is a non-GAAP measure. Adjusted net
income (loss) is defined as net income (loss) adjusted for
gains/losses on dispositions, impairments of proved and certain
unproved properties, goodwill and equity method investments,
certain exploration expenses relating to a strategic decision to
exit conventional exploration, unrealized derivative gain/loss on
commodity and interest rate derivative instruments, effects of
pension settlements and curtailments and other items that could be
considered "non-operating" or "non-core" in nature. Management
believes this is useful to investors as another tool to
meaningfully represent our operating performance and to compare
Marathon to certain competitors. Adjusted net income (loss) and
adjusted net income (loss) per share should not be considered in
isolation or as an alternative to, or more meaningful than, net
income (loss) or net income (loss) per share as determined in
accordance with U.S. GAAP.
Our presentation of free cash flow is a non-GAAP measure.
Free cash flow before dividend ("free cash flow") is defined as net
cash provided by operating activities adjusted for working capital,
capital expenditures, and EG LNG return of capital and other.
Management believes this is useful to investors as a measure of
Marathon's ability to fund its capital expenditure programs,
service debt, and fund other distributions to stockholders. Free
cash flow should not be considered in isolation or as an
alternative to, or more meaningful than, net cash provided by
operating activities as determined in accordance with U.S.
GAAP.
Our presentation of net cash provided by operations before
changes in operating working capital is defined as net cash
provided by operating activities adjusted for operating working
capital and is a non-GAAP measure. Management believes this is
useful to investors as an indicator of Marathon's ability to
generate cash quarterly or year-to-date by eliminating differences
caused by the timing of certain working capital items. Net cash
provided by operations before changes in working capital should not
be considered in isolation or as an alternative to, or more
meaningful than, net cash provided by operating activities as
determined in accordance with U.S. GAAP.
Our presentation of total capital expenditures is a non-GAAP
measure. Total capital expenditures is defined as cash additions to
property, plant and equipment adjusted for the change in working
capital associated with property, plant and equipment and additions
to other assets. Management believes this is useful to investors as
an indicator of Marathon's commitment to capital expenditure
discipline by eliminating differences caused by the timing of
certain working capital and other items. Total capital expenditures
should not be considered in isolation or as an alternative to, or
more meaningful than, cash additions to property, plant and
equipment as determined in accordance with U.S. GAAP.
These non-GAAP financial measures reflect an additional way
of viewing aspects of the business that, when viewed with GAAP
results may provide a more complete understanding of factors and
trends affecting the business and are a useful tool to help
management and investors make informed decisions about Marathon
Oil's financial and operating performance. These measures should
not be considered in isolation or as an alternative to their most
directly comparable GAAP financial measures. A reconciliation
to their most directly comparable GAAP financial measures can be
found in our investor package on our website at
https://ir.marathonoil.com/ and in the tables below.
Marathon Oil strongly encourages investors to review the
Company's consolidated financial statements and publicly filed
reports in their entirety and not rely on any single financial
measure.
Forward-looking Statements
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. All statements, other
than statements of historical fact, including without limitation
statements regarding the Company's future capital budgets, future
performance, expected free cash flow, emission targets and
estimated emission reductions, future debt reduction, balance sheet
enhancement, returns of cash flow to investors, business strategy,
asset quality, drilling plans, production guidance, and other plans
and objectives for future operations, are forward-looking
statements. Words such as "anticipate," "believe," "could,"
"estimate," "expect," "forecast," "future," "guidance," "intend,"
"may," "outlook," "plan," "positioned," "project," "seek,"
"should," "target," "will," "would," or similar words may be used
to identify forward-looking statements; however, the absence of
these words does not mean that the statements are not
forward-looking. While the Company believes its assumptions
concerning future events are reasonable, a number of factors could
cause actual results to differ materially from those projected,
including, but not limited to: conditions in the oil and gas
industry, including supply/demand levels for crude oil and
condensate, NGLs and natural gas and the resulting impact on price;
changes in expected reserve or production levels; changes in
political or economic conditions in the U.S. and Equatorial Guinea, including changes in
foreign currency exchange rates, interest rates, inflation rates;
actions taken by the members of the Organization of the Petroleum
Exporting Countries (OPEC) and Russia affecting the production and pricing of
crude oil; and other global and domestic political, economic or
diplomatic developments; capital available for exploration and
development; risks related to the Company's hedging activities;
voluntary or involuntary curtailments, delays or cancellations of
certain drilling activities; well production timing; liability
resulting from litigation; drilling and operating risks; lack of,
or disruption in, access to storage capacity, pipelines or other
transportation methods; availability of drilling rigs, materials
and labor, including the costs associated therewith; difficulty in
obtaining necessary approvals and permits; non-performance by third
parties of contractual obligations; unforeseen hazards such as
weather conditions, a health pandemic (including COVID-19), acts of
war or terrorist acts and the government or military response
thereto; cyber-attacks; changes in safety, health, environmental,
tax and other regulations, requirements or initiatives, including
initiatives addressing the impact of global climate change, air
emissions, or water management; other geological, operating and
economic considerations; and the risk factors, forward-looking
statements and challenges and uncertainties described in the
Company's 2020 Annual Report on Form 10-K, Quarterly Reports on
Form 10-Q and other public filings and press releases, available at
https://ir.marathonoil.com/. Except as required by law, the Company
undertakes no obligation to revise or update any forward-looking
statements as a result of new information, future events or
otherwise.
Media Relations Contact:
Rebecca Skiba: 713-296-2584
Investor Relations Contacts:
Guy Baber: 713-296-1892
John Reid: 713-296-4380
Consolidated
Statements of Income (Unaudited)
|
Three Months
Ended
|
|
Mar.
31
|
Dec.
31
|
Mar.
31
|
(In millions,
except per share data)
|
2021
|
2020
|
2020
|
Revenues and other
income:
|
|
|
|
Revenues from
contracts with customers
|
$
|
1,177
|
|
$
|
822
|
|
$
|
1,024
|
|
Net gain (loss) on
commodity derivatives
|
(153)
|
|
(15)
|
|
202
|
|
Income (loss) from
equity method investments
|
44
|
|
13
|
|
(12)
|
|
Net gain (loss) on
disposal of assets
|
—
|
|
1
|
|
9
|
|
Other
income
|
3
|
|
9
|
|
7
|
|
Total revenues and
other income
|
1,071
|
|
830
|
|
1,230
|
|
Costs and
expenses:
|
|
|
|
Production
|
121
|
|
137
|
|
160
|
|
Shipping, handling and
other operating
|
152
|
|
164
|
|
144
|
|
Exploration
|
21
|
|
100
|
|
28
|
|
Depreciation,
depletion and amortization
|
496
|
|
521
|
|
644
|
|
Impairments
|
1
|
|
46
|
|
97
|
|
Taxes other than
income
|
74
|
|
55
|
|
66
|
|
General and
administrative
|
89
|
|
57
|
|
76
|
|
Total costs and
expenses
|
954
|
|
1,080
|
|
1,215
|
|
Income (loss) from
operations
|
117
|
|
(250)
|
|
15
|
|
Net interest and
other
|
(13)
|
|
(61)
|
|
(64)
|
|
Other net periodic
benefit (costs) credits
|
3
|
|
(2)
|
|
—
|
|
Loss on early
extinguishment of debt
|
—
|
|
(28)
|
|
—
|
|
Income (loss)
before income taxes
|
107
|
|
(341)
|
|
(49)
|
|
Provision (benefit)
for income taxes
|
10
|
|
(3)
|
|
(3)
|
|
Net income
(loss)
|
$
|
97
|
|
$
|
(338)
|
|
$
|
(46)
|
|
|
|
|
|
Adjusted Net
Income (Loss)
|
|
|
|
Net income
(loss)
|
$
|
97
|
|
$
|
(338)
|
|
$
|
(46)
|
|
Adjustments for
special items (pre-tax):
|
|
|
|
Net (gain) loss on
disposal of assets
|
—
|
|
(1)
|
|
(9)
|
|
Proved property
impairments
|
1
|
|
46
|
|
2
|
|
Exploratory dry well
costs, unproved property impairments and other
|
—
|
|
78
|
|
—
|
|
Goodwill
impairment
|
—
|
|
—
|
|
95
|
|
Pension
settlement
|
—
|
|
5
|
|
2
|
|
Unrealized (gain) loss
on derivative instruments
|
82
|
|
66
|
|
(171)
|
|
Unrealized (gain) on
interest rate swaps
|
(41)
|
|
(12)
|
|
—
|
|
Reduction in
workforce
|
11
|
|
2
|
|
—
|
|
Impairment of equity
method investment
|
—
|
|
1
|
|
—
|
|
Loss on early
extinguishment of debt
|
—
|
|
28
|
|
—
|
|
Other
|
16
|
|
27
|
|
2
|
|
Adjustments for
special items
|
69
|
|
240
|
|
(79)
|
|
Adjusted net
income (loss) (a)
|
$
|
166
|
|
$
|
(98)
|
|
$
|
(125)
|
|
Per diluted
share:
|
|
|
|
Net income
(loss)
|
$
|
0.12
|
|
$
|
(0.43)
|
|
$
|
(0.06)
|
|
Adjusted net income
(loss) (a)
|
$
|
0.21
|
|
$
|
(0.12)
|
|
$
|
(0.16)
|
|
Weighted average
diluted shares
|
789
|
|
790
|
|
794
|
|
|
|
(a)
|
Non-GAAP financial
measure. See "Non-GAAP Measures" above for further
discussion.
|
Supplemental
Statistics (Unaudited)
|
Three Months
Ended
|
|
Mar.
31
|
Dec.
31
|
Mar.
31
|
(In
millions)
|
2021
|
2020
|
2020
|
Segment income
(loss)
|
|
|
|
United
States
|
$
|
212
|
|
$
|
(33)
|
|
$
|
(20)
|
|
International
|
50
|
|
29
|
|
(1)
|
|
Not allocated to
segments
|
(165)
|
|
(334)
|
|
(25)
|
|
Net income
(loss)
|
$
|
97
|
|
$
|
(338)
|
|
$
|
(46)
|
|
Cash
flows
|
|
|
|
Net cash provided by
operating activities
|
$
|
622
|
|
$
|
418
|
|
$
|
701
|
|
Changes in working
capital
|
15
|
|
10
|
|
(151)
|
|
Net cash provided
by operating activities before changes in working capital
(a)
|
$
|
637
|
|
$
|
428
|
|
$
|
550
|
|
|
|
|
|
Free Cash
Flow
|
|
|
|
Net cash provided by
operating activities before changes in working capital
(a)
|
$
|
637
|
|
$
|
428
|
|
$
|
550
|
|
Adjustments for free
cash flow:
|
|
|
|
Capital
expenditures
|
(184)
|
|
(267)
|
|
(569)
|
|
EG LNG return of
capital and other
|
(10)
|
|
—
|
|
1
|
|
Free cash flow
(a)
|
$
|
443
|
|
$
|
161
|
|
$
|
(18)
|
|
Capital
Expenditures
|
|
|
|
Cash additions to
property, plant and equipment
|
$
|
(209)
|
|
$
|
(253)
|
|
$
|
(620)
|
|
Change in working
capital associated with PP&E
|
25
|
|
(14)
|
|
52
|
|
Additions to other
assets
|
—
|
|
—
|
|
(1)
|
|
Total capital
expenditures (a)
|
$
|
(184)
|
|
$
|
(267)
|
|
$
|
(569)
|
|
|
|
(a)
|
Non-GAAP financial
measure. See "Non-GAAP Measures" above for further
discussion.
|
Supplemental
Statistics (Unaudited)
|
Three Months
Ended
|
Year
Ended
|
|
Mar.
31
|
Dec.
31
|
Mar.
31
|
Dec.
31
|
Net
Production
|
2021
|
2020
|
2020
|
2020
|
Equivalent
Production (mboed)
|
|
|
|
|
United
States
|
276
|
|
280
|
|
340
|
|
306
|
|
International
|
69
|
|
72
|
|
82
|
|
77
|
|
Total net
production
|
345
|
|
352
|
|
422
|
|
383
|
|
Oil Production
(mbbld)
|
|
|
|
|
United
States
|
160
|
|
159
|
|
207
|
|
177
|
|
International
|
12
|
|
13
|
|
14
|
|
13
|
|
Total net
production
|
172
|
|
172
|
|
221
|
|
190
|
|
Supplemental
Statistics (Unaudited)
|
Three Months
Ended
|
|
Mar.
31
|
Dec.
31
|
Mar.
31
|
|
2021
|
2020
|
2020
|
United States -
net sales volumes
|
|
|
|
Crude oil and
condensate (mbbld)
|
159
|
|
159
|
|
205
|
|
Eagle Ford
|
50
|
|
51
|
|
72
|
|
Bakken
|
77
|
|
78
|
|
88
|
|
Oklahoma
|
12
|
|
15
|
|
20
|
|
Northern
Delaware
|
15
|
|
11
|
|
17
|
|
Other United States
(a)
|
5
|
|
4
|
|
8
|
|
Natural gas liquids
(mbbld)
|
53
|
|
54
|
|
57
|
|
Eagle Ford
|
12
|
|
14
|
|
19
|
|
Bakken
|
19
|
|
18
|
|
12
|
|
Oklahoma
|
17
|
|
17
|
|
20
|
|
Northern
Delaware
|
4
|
|
4
|
|
5
|
|
Other United States
(a)
|
1
|
|
1
|
|
1
|
|
Natural gas
(mmcfd)
|
378
|
|
402
|
|
454
|
|
Eagle Ford
|
91
|
|
103
|
|
138
|
|
Bakken
|
93
|
|
86
|
|
58
|
|
Oklahoma
|
145
|
|
164
|
|
197
|
|
Northern
Delaware
|
35
|
|
34
|
|
44
|
|
Other United States
(a)
|
14
|
|
15
|
|
17
|
|
Total United States
(mboed)
|
275
|
|
280
|
|
338
|
|
International -
net sales volumes
|
|
|
|
Crude oil and
condensate (mbbld)
|
9
|
|
14
|
|
13
|
|
Equatorial
Guinea
|
9
|
|
14
|
|
13
|
|
Natural gas liquids
(mbbld)
|
8
|
|
8
|
|
9
|
|
Equatorial
Guinea
|
8
|
|
8
|
|
9
|
|
Natural gas
(mmcfd)
|
295
|
|
306
|
|
352
|
|
Equatorial
Guinea
|
295
|
|
306
|
|
352
|
|
Total International
(mboed)
|
66
|
|
73
|
|
81
|
|
Total Company -
net sales volumes (mboed)
|
341
|
|
353
|
|
419
|
|
Net sales volumes
of equity method investees
|
|
|
|
LNG (mtd)
|
3,766
|
|
3,510
|
|
5,064
|
|
Methanol
(mtd)
|
1,092
|
|
1,080
|
|
1,185
|
|
Condensate and LPG
(boed)
|
10,730
|
|
10,288
|
|
10,638
|
|
|
|
(a)
|
Includes sales
volumes from the sale of certain non-core proved properties in our
United States segment.
|
Supplemental
Statistics (Unaudited)
|
Three Months
Ended
|
|
Mar.
31
|
Dec.
31
|
Mar.
31
|
|
2021
|
2020
|
2020
|
United States -
average price realizations (a)
|
|
|
|
Crude oil and
condensate ($ per bbl) (b)
|
$
|
55.38
|
|
$
|
39.71
|
|
$
|
44.23
|
|
Eagle Ford
|
57.52
|
|
40.69
|
|
46.82
|
|
Bakken
|
53.65
|
|
38.66
|
|
41.14
|
|
Oklahoma
|
55.63
|
|
40.43
|
|
44.87
|
|
Northern
Delaware
|
57.06
|
|
41.49
|
|
46.78
|
|
Other United States
(c)
|
54.83
|
|
40.08
|
|
47.82
|
|
Natural gas liquids
($ per bbl)
|
$
|
23.94
|
|
$
|
16.30
|
|
$
|
9.97
|
|
Eagle Ford
|
24.43
|
|
16.34
|
|
9.50
|
|
Bakken
|
23.22
|
|
15.66
|
|
8.43
|
|
Oklahoma
|
25.08
|
|
17.46
|
|
11.69
|
|
Northern
Delaware
|
22.60
|
|
14.77
|
|
8.14
|
|
Other United States
(c)
|
20.89
|
|
15.10
|
|
11.74
|
|
Natural gas ($ per
mcf)
|
$
|
6.31
|
|
$
|
2.31
|
|
$
|
1.60
|
|
Eagle Ford
|
5.78
|
|
2.55
|
|
1.84
|
|
Bakken
|
2.96
|
|
1.49
|
|
1.54
|
|
Oklahoma
|
8.36
|
|
2.72
|
|
1.60
|
|
Northern
Delaware
|
7.85
|
|
1.75
|
|
0.80
|
|
Other United States
(c)
|
6.81
|
|
2.02
|
|
1.94
|
|
International -
average price realizations
|
|
|
|
Crude oil and
condensate ($ per bbl)
|
$
|
44.13
|
|
$
|
35.08
|
|
$
|
36.88
|
|
Equatorial
Guinea
|
44.13
|
|
35.08
|
|
36.88
|
|
Natural gas liquids
($ per bbl)
|
$
|
1.00
|
|
$
|
1.00
|
|
$
|
1.00
|
|
Equatorial Guinea
(d)
|
1.00
|
|
1.00
|
|
1.00
|
|
Natural gas ($ per
mcf)
|
$
|
0.24
|
|
$
|
0.24
|
|
$
|
0.24
|
|
Equatorial Guinea
(d)
|
0.24
|
|
0.24
|
|
0.24
|
|
Benchmark
|
|
|
|
WTI crude oil (per
bbl)
|
$
|
58.14
|
|
$
|
42.70
|
|
$
|
45.78
|
|
Brent (Europe) crude
oil (per bbl) (e)
|
$
|
60.82
|
|
$
|
44.29
|
|
$
|
50.44
|
|
Mont Belvieu NGLs (per
bbl) (f)
|
$
|
23.98
|
|
$
|
17.42
|
|
$
|
13.27
|
|
Henry Hub natural gas
(per mmbtu) (g)
|
$
|
2.69
|
|
$
|
2.66
|
|
$
|
1.95
|
|
|
|
(a)
|
Excludes gains or
losses on commodity derivative instruments.
|
(b)
|
Inclusion of realized
gains (losses) on crude oil derivative instruments would have
decreased average price realizations by $4.61 for the first
quarter 2021 and increased average price realizations by $3.52 and
$1.47 for the fourth quarter 2020 and the first quarter
2020.
|
(c)
|
Includes sales
volumes from the sale of certain non-core proved properties in our
United States segment.
|
(d)
|
Represents fixed
prices under long-term contracts with Alba Plant LLC, Atlantic
Methanol Production Company LLC and/or Equatorial Guinea LNG
Holdings Limited, which are equity method investees. The Alba Plant
LLC processes the NGLs and then sells secondary condensate,
propane, and butane at market prices. Marathon Oil includes its
share of income from each of these equity method investees in the
International segment.
|
(e)
|
Average of monthly
prices obtained from Energy Information Administration
website.
|
(f)
|
Bloomberg Finance
LLP: Y-grade Mix NGL of 55% ethane, 25% propane, 5% butane, 8%
isobutane and 7% natural gasoline.
|
(g)
|
Settlement date
average per mmbtu.
|
Full Year
2021
Production
Guidance
|
Oil Production
(mbpod)
|
|
Equivalent
Production (mboed)
|
1Q21
|
2021
Guidance
|
|
1Q21
|
2021
Guidance
|
Net
production
|
|
|
|
|
|
United
States
|
160
|
158 - 162
|
|
276
|
270 - 280
|
International
|
12
|
11 - 13
|
|
69
|
60 - 70
|
Total net
production
|
172
|
169 - 175
|
|
345
|
330 - 350
|
The following table sets forth outstanding derivative contracts
as of May 3, 2021, and the weighted
average prices for those contracts:
|
|
2021
|
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
Crude
Oil
|
|
|
|
|
|
|
NYMEX WTI
Three-Way Collars
|
|
|
|
|
|
|
Volume
(Bbls/day)
|
|
40,000
|
|
|
20,000
|
|
|
10,000
|
|
Weighted average price
per Bbl:
|
|
|
|
|
|
|
Ceiling
|
|
$
|
61.45
|
|
|
$
|
68.41
|
|
|
$
|
71.64
|
|
Floor
|
|
$
|
39.75
|
|
|
$
|
47.50
|
|
|
$
|
50.00
|
|
Sold put
|
|
$
|
29.75
|
|
|
$
|
37.50
|
|
|
$
|
40.00
|
|
NYMEX WTI
Two-Way Collars
|
|
|
|
|
|
|
Volume
(Bbls/day)
|
|
50,000
|
|
|
30,000
|
|
|
30,000
|
|
Weighted average price
per Bbl:
|
|
|
|
|
|
|
Ceiling
|
|
$
|
52.98
|
|
|
$
|
51.54
|
|
|
$
|
51.54
|
|
Floor
|
|
$
|
35.80
|
|
|
$
|
35.67
|
|
|
$
|
35.67
|
|
Basis Swaps -
NYMEX WTI / UHC (a)
|
|
|
|
|
|
|
Volume
(Bbls/day)
|
|
15,000
|
|
|
—
|
|
|
—
|
|
Weighted average price
per Bbl
|
|
$
|
(1.80)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
NYMEX Roll
Basis Swaps
|
|
|
|
|
|
|
Volume
(Bbls/day)
|
|
50,000
|
|
|
—
|
|
|
—
|
|
Weighted average price
per Bbl
|
|
$
|
(0.13)
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Natural
Gas
|
|
|
|
|
|
|
Henry Hub
("HH") Two-Way Collars
|
|
|
|
|
|
|
Volume
(MMBtu/day)
|
|
200,000
|
|
|
200,000
|
|
|
200,000
|
|
Weighted average price
per MMBtu:
|
|
|
|
|
|
|
Ceiling
|
|
$
|
3.05
|
|
|
$
|
3.05
|
|
|
$
|
3.05
|
|
Floor
|
|
$
|
2.50
|
|
|
$
|
2.50
|
|
|
$
|
2.50
|
|
HH Fixed Price
Swaps
|
|
|
|
|
|
|
Volume
(MMBtu/day)
|
|
50,000
|
|
|
50,000
|
|
|
50,000
|
|
Weighted average price
per MMBtu
|
|
$
|
2.88
|
|
|
$
|
2.88
|
|
|
$
|
2.88
|
|
NGL
|
|
|
|
|
|
|
Fixed Price
Ethane Swaps (b)
|
|
|
|
|
|
|
Volume
(Bbls/day)
|
|
1,341
|
|
|
2,000
|
|
|
2,000
|
|
Weighted average price
per Bbl
|
|
$
|
10.66
|
|
|
$
|
10.66
|
|
|
$
|
10.66
|
|
Fixed Price
Propane Swaps (c)
|
|
|
|
|
|
|
Volume
(Bbls/day)
|
|
5,000
|
|
|
5,000
|
|
|
5,000
|
|
Weighted average price
per Bbl
|
|
$
|
23.19
|
|
|
$
|
23.19
|
|
|
$
|
23.19
|
|
|
|
(a)
|
The basis
differential price is indexed against U.S. Sweet Clearbrook ("UHC")
and NYMEX WTI.
|
(b)
|
The fixed price
ethane swap is priced at OPIS Mont Belvieu Purity
Ethane.
|
(c)
|
The fixed price
propane swap is priced at OPIS Mont Belvieu Non-TET
Propane.
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/marathon-oil-reports-first-quarter-2021-results-301284841.html
SOURCE Marathon Oil Corporation