Regional

Marathon oil looks to exit north sea

Marathon Oil has launched the sale of its British North Sea oil and gas fields, a document seen by Reuters showed, the latest U.S. firm to retreat from the basin to focus on onshore shale production at home.

The sale includes stakes in the BP-operated Foinaven fields in the west of Shetland area as well as interests in the Brae complex northeast of Aberdeen, according to a sales document seen by Reuters.

The process, launched this week, is being run by Jefferies and bids are due by December. The assets could fetch up to $200 million, according to two banking sources.

Marathon Oil joins several companies including Chevron, ConocoPhillips and EOG Resources that have sought to pull out of the North Sea in recent years as they focus operations on rapidly expanding shale production.

Marathon Oil spokeswoman Lee Warren declined to comment directly on the sale but said “portfolio management is an ongoing and integral element of our successful business model as we continue to simplify and concentrate our portfolio to our highest return opportunities with a focus on our differentiated position in the U.S. resource plays.”

The company, which produced around 419,000 barrels of oil equivalent per day in the second quarter, will invest over 90 percent of its 2018 capital in U.S. shale production, according to its website.

The North Sea, one of the oldest offshore basins that started production in the 1970s, has undergone a broad change of guard in recent years as veteran producers have been replaced by smaller, often privately-owned companies, which say they can squeeze more oil and gas out of the fields.

According to the sales document, Marathon’s North Sea assets have a total production of 15,000 barrels of oil equivalent per day, a resource of 31 million barrels and are expected to produce $85 million of cash flow in 2019.

Marathon holds a 40 percent stake in the Brae Area complex, one of the oldest in the basin, as well as stakes in pipelines. One of the complex’s platforms, Brae Bravo, is being dismantled after production ceased in recent years in what is known as decommissioning.

The Foinaven area comprises of two producing fields, Foinaven and Foinaven East, in which Marathon holds 28 percent and 47 percent interests respectively, the document said.

Marathon agreed to sell its Libyan assets to France’s Total earlier this year for $450 million.

Published: 04-10-2018

Share:

Subscribe for the Latest News and Updates

Marketing Permissions

OGV Energy will use the information you provide on this form to be in touch with you and to provide updates and marketing through the following methods:

  • Email
  • Direct Mail
  • Customised Online Advertising

Read the latest issue of the OGV Energy magazine

More News

Latest Magazine Banner

Marine and Lifting - OGV Magazine - Issue 87

WellPro Group Banner

WellPro Group Banner - OGV Energy

Cegal Banner

Leyton Banner

Leyton Banner

Advertise with OGV Energy Banner