Marathon Oil KDV B.V., an affiliate of the oil and natural gas exploration and production (E&P) firm Marathon Oil Corporation (MRO), has made an oil and natural gas discovery in the Kurdistan region of Iraq.
The company announced that the discovery, in the Harir Block of the region, was made through the exploratory well, Jisik-1. The well, drilled to a depth of about 15,000 feet, is located 40 miles northeast of Erbil.
The well produced a flow of 6,100 barrels per day of oil using a drill-stem testing program. The multiple non-associated gas areas resulted in a flow rate of about 10–15 million cubic feet per day. Marathon Oil stated that the exploratory well could be used as a producing well in the future and hence, will be currently suspended.
Marathon Oil has 45% stake in the Harir block and also acts as its operator. TOTAL S.A. (TOT) has 35% working interest in the block while the remaining stake is held by the Kurdistan Regional Government.
Houston, TX-based Marathon Oil is a leading integrated oil and gas firm with extensive upstream operations. On Nov 3, 2014 the company posted third-quarter adjusted earnings from continuing operations of 57 cents per share that not only lagged the Zacks Consensus Estimate by a penny, but also fell almost 10% from 63 cents in third-quarter 2013. Considerable lower realized crude oil and condensate prices along with higher exploration expenses hurt the results.
Also, E&P firms like Marathon Oil are likely to suffer further due to the recent OPEC decision to not cut production. Currently, the company holds a Zacks Rank #5 (Strong Sell).
Meanwhile, one could consider better-ranked players from the industry like Atlas Resource Partners, L.P. (ARP) and Cheniere Energy, Inc. (LNG). Both these stocks hold a Zacks Rank #2 (Buy).
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