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By Saabira Chaudhuri
Marathon Oil Corp. (MRO) has sold part of its stake in two
blocks in the Kurdistan region of Iraq to Total S.A. (TOT, FP.FR)
as the two companies look to better evaluate the region's
potential.
Total's subsidiaries have acquired 35% working interest in the
two blocks, from Marathon subsidiary Marathon Oil KDV B.V. for an
undisclosed amount.
"This partnership combines the extensive exploration, drilling
and completion experience of Marathon Oil and Total to fully
evaluate the potential of these two blocks," Marathon Oil Global
Exploration Vice President Annell R. Bay said.
Marathon spun off its refining business last year to focus its
drilling efforts on unconventional U.S. oil shales, which also
include the Bakken Field in North Dakota and Anadarko Woodford in
Oklahoma.
Marathon has inked a series of deals of late as the energy
company looks to expand its operations. Last week, it signed an
agreement with Africa Oil Corp. (AOIFF, AOI.V) to jointly develop
two onshore exploration areas in northwest Kenya, underscoring East
Africa's increasing attractiveness for oil prospectors. And in May,
the company agreed to acquire Paloma Partners II LLC for around
$750 million in cash, a move that helps expand operations in the
oil-rich Eagle Ford shale in Texas.
On Tuesday, Marathon revealed that it now has a reduced working
stake in the Harir and Safen blocks of 45%, while remaining
operator of the Harir block and exploration operator of the Safen
block. A subsidiary of Total will become the operator of any
development of the Safen block. The Kurdistan Regional Government
continues to have a fully carried 20% interest in each of the
blocks.
The Harir block is about 705-square kilometers and the Safen
block is about 424-square kilometers. Both blocks are located
northeast of Erbil.
Marathon also said a 2-D seismic program on both blocks is
ongoing and expected to be completed by the end of the third
quarter of this year. The first exploration well on the Harir block
began drilling Monday and will be exploring Mesozoic fractured
carbonates with main reservoir objectives in the Cretaceous,
Jurassic and Triassic formations. The first exploration well on the
Safen block is planned for the first half of 2013.
In May, Marathon reported its first-quarter earnings fell from a
year-ago quarter that included contributions from its former
refining business.
Shares of Marathon closed at $26.90 Monday and were inactive
premarket. The stock is down 13% in the past 12 months.
Write to Saabira Chaudhuri at saabira.chaudhuri@dowjones.com
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