U.S. oil and gas producer Marathon Oil Corp. reported a jump in third-quarter profit on Nov. 2, helped by a surge in crude prices over tighter energy supplies following Russia’s invasion of Ukraine.
The company also said it would acquire Ensign Natural Resources’ Eagle Ford assets for $3 billion, a deal expected to close by the end of this year.
Energy companies are posting huge profits as crude and natural gas prices have soared following Western sanctions against major exporter Russia and OPEC+’s decision to tighten an already squeezed global supply. U.S. crude has risen nearly 20% so far this year.
Marathon’s average realized U.S. crude price rose to $93.67/bbl in the reported quarter, up from last year’s $69.40/bbl.
The company raised its profit outlook for operations in Equatorial Guinea to $610 million from a midpoint of $540 million previously, due to strong operational performance and exposure to increased European natural gas pricing.
It also boosted its outlook for 2022 spending by $100 million to $1.4 billion, in part due to inflation. Rival Chesapeake Energy on Nov. 2 said a top U.S. natural gas basin could see a 15% jump in costs next year.
Production in the third quarter stood at 352,000 boe/d, above last year's 345,000 boe/d.
Rival Continental Resources Inc. also posted a third-quarter profit of $1.01 billion, which was nearly three-fold higher from last year. APA Corp. posted a quarterly adjusted profit of $651 million, or $1.97 per share, topping Wall Street forecasts of $1.78 per share, according to Refinitiv IBES.
Houston-based Marathon said adjusted net income stood at $832 million, or $1.24 per share, for the three-months ended Sept.30, compared with $310 million, or 39 cents per share, a year earlier. Analysts had anticipated earnings of $1.19 per share, according to Refinitiv IBES.
Shares of Marathon were up a fraction in after-hours trading after closing down 3.7% at $29.76.
Recommended Reading
Kimmeridge Withdraws SilverBow Deal to Focus on E&P’s ‘Broken’ Board
2024-04-16 - Investment firm Kimmeridge said it had withdrawn its offer to combine its Eagle Ford E&P with SilverBow Resources as it promotes a slate of independent directors for SilverBow’s board at the company’s May annual meeting.
SilverBow Gears Up for Proxy Fight with Kimmeridge
2024-04-09 - Both SilverBow Resources and Kimmeridge Energy Management have proposed a slate of candidates for the board of directors with a vote set for May 21.
Making Bank: Top 10 Oil and Gas Dealmakers in North America
2024-02-29 - MergerLinks ranks the key dealmakers behind the U.S. biggest M&A transactions of 2023.
Exclusive: Rockcliff CEO on $2.7B TGNR Deal, Value of Haynesville M&A
2024-04-10 - Rockcliff Energy CEO and President Alan Smith discusses the ups and downs of executing the transaction with TG Natural Resources and what's on the Rockcliff III radar, in this Hart Energy Exclusive interview.
Permian Activity in ‘Low-to-no-growth’ Mode for First Half
2024-02-22 - After multiple M&A moves in 2023 and continued E&P adherence to capital discipline, Permian Basin service company ProPetro sees the play holding steady.