Oil and natural gas exploration and production firm, Marathon Oil Corp. (MRO) announced that it has completed the sale of its Norway operations. From the divestment, Marathon Oil received $2.1 billion − after adjusting debt, net working capital and interest on purchase price – from Det norske oljeselskap ASA, an Norwegian upstream energy.
The divested properties comprise 10 operated licenses and a few non-operated licenses on the Continental Shelf of Norway in the North Sea. The assets also include a floating production, storage and offloading (FPSO) vessel in Alvheim field situated on the Norwegian Continental Shelf. The resources contributed roughly 80,000 barrels of oil equivalent (BOE) every day to Marathon Oil’s total output in 2013.
Marathon Oil added that the divestiture favors its long-term growth plans in which its Norway assets do not fit. The company plans to utilize the net proceeds as investment in organic growth.
In Jul 2011, Marathon Oil completed the spin-off of its refining/sales business into a separate, independent and publicly traded company Marathon Petroleum Corp. (MPC). Since then, Marathon Oil has sold approximately $6.2 billion worth of non-core oil and gas properties around the world, thereby freeing up capital to concentrate on its long-term high-grade prospects.
Houston, TX-based Marathon Oil currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, one can look at better-ranked players in the energy sector like World Point Terminals LP (WPT) and Cobalt International Energy Inc. (CIE). Both players sport a Zacks Rank #1 (Strong Buy).
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