May 15, 2006 at 10:34 pm #4197
Marathon and LUKOIL Enter Into an Approximately $787 Million Purchase Agreement for Marathon’s Russian Businesses
5/15/2006 6:01:00 PM
HOUSTON, May 15 /PRNewswire-FirstCall/ — Marathon Oil Corporation (NYSE: MRO) announced today that it has entered into a definitive agreement with OAO LUKOIL, acting through its subsidiary OOO LUKOIL Western Siberia (LUKOIL), under which Marathon will sell its oil exploration and production businesses in the Khanty Mansiysk Region of Western Siberia to LUKOIL. Under the terms of the agreement, LUKOIL will pay approximately $787 million plus working capital and other closing adjustments. The transaction is expected to close in mid-July of this year, subject to government approvals and other closing conditions.
“Since acquiring these assets almost three years ago, Marathon has doubled oil production to more than 30,000 barrels per day, resulting in the creation of substantial value,” said Clarence P. Cazalot, Jr., Marathon president and CEO. “We have elected to monetize the value of these particular assets, while continuing to evaluate other attractive opportunities in the Russian Federation.”
Assuming a mid-July closing of this transaction, Marathon estimates its production available for sale during 2006 will average approximately 360,000 to 380,000 barrels of oil equivalent per day (boepd), excluding the effects of any further acquisitions or dispositions, compared to the earlier estimate of 365,000 to 395,000 boepd.
This release contains forward-looking statements with respect to the anticipated closing date for the sale of Marathon’s wholly-owned subsidiary, KMOC, and the timing and levels of the Company’s worldwide liquid hydrocarbon, natural gas and condensate production. The forward-looking information concerning the expected closing date for the sale is subject to necessary government approvals and other customary closing conditions. Some factors that could potentially affect worldwide liquid hydrocarbon, natural gas and condensate production include pricing, supply and demand for petroleum products, amount of capital available for exploration and development, regulatory constraints, inability or delay in obtaining government and third- party approvals and permits, timing of commencing production from new wells, drilling rig availability, unforeseen hazards such as weather conditions, acts of war or terrorist acts and the governmental or military response thereto, acquisitions or dispositions of oil and gas properties, and other geological, operating and economic considerations. The foregoing factors (among others) could cause actual results to differ materially from those set forth in the forward-looking statements. In accordance with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, Marathon Oil Corporation has included in its Annual Report on Form 10-K for the year ended December 31, 2005, and subsequent Forms 10-Q and 8-K, cautionary language identifying other important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward-looking statements.CONTACT: media relations, Paul Weeditz, +1-713-296-3910
Scott Scheffler, +1-713-296-4102
investor relations, Ken Matheny, +1-713-296-4114
Howard Thill, +1-713-296-4140
You must be logged in to reply to this topic.