Oil and natural gas exploration and production firm Marathon Oil Corporation (MRO) announced that its subsidiary, Marathon Oil Exploration Limited, has inked an exploration and production sharing contract (:EPSC) for a block located offshore Gabon.
The Block G13 is situated in the high-potential deepwater, pre-salt play and was named Tchicuate post the contract signing. The agreement follows the license bid that took place in Oct 2013 in which Marathon Oil was the highest bidder for the Block.
The Block comprises 275,000 acres and is located in water depths of 3,250 to 8,250 feet. Marathon Oil has secured full participating interest in the Block and will also act as the operator. However, if the project reaches the development stage, the Republic of Gabon will hold 20% interest in the contract when production starts.
Marathon Oil stated that the addition is in accordance with its strategic plans and the Tchicuate block should add value to its existing exploration portfolio. The company holds 21.25% working interest in the Diaba License G4-223, also located offshore Gabon. It is in the Diaba Block that Marathon Oil made the Diaman-1B discovery last year.
Houston, TX-based Marathon Oil is a leading integrated oil and gas firm with extensive upstream operations. The company’s business is organized into three segments — North America Exploration and Production, International Exploration and Production and Oil Sands Mining.
Marathon Oil currently carries a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. market in the next one to three months.
Meanwhile, one can consider better-ranked players in the energy sector like Sunoco Logistics Partners L.P. (SXL), Patterson-UTI Energy Inc. (PTEN) and Cameron International Corporation (CAM). All these stocks sport a Zacks Rank #1 (Strong Buy).