Leading integrated oil and gas firm, Marathon Oil Corp. (MRO) has been permitted by the Regional Government of Kurdistan to develop oil from the Atrush block, located roughly 50 miles northwest of Erbil. The authorization is given for the first phase of the project for a period of 25 years.
Per the approval, Marathon Oil is expected to drill three wells and will also construct a central facility for processing crude oil. The company will likely start production by the first half of 2015. Initially, Marathon Oil will produce at a rate of 30,000 barrels of oil per day (bpd).
Marathon Oil is now planning to drill the fourth well in the Atrush block. The company will proceed with the second phase of the project depending on further government approval along with appraisal drilling result from the well. The Phase 2 is likely to incorporate an additional production facility with a capacity of 30,000-bpd.
In the Atrush block, Marathon Oil KDV BV, a fully owned affiliate of Marathon Oil, has a 15% working interest, while 25% ownership is retained by the Kurdistan Regional Government.
Moreover, in the Sarsang Block, Marathon Oil holds 25% non-operated working interest. Additionally, the company operates and owns a 45% working interest in each of the Harir and Safen blocks. All the three blocks are located in the Kurdistan Region.
Houston, Texas-based Marathon Oil’s business is organized into three segments – North America Exploration and Production, International Exploration and Production and Oil Sands Mining.
Marathon Oil currently holds a Zacks Rank #3 (Hold), implying that it is expected to perform in line with the broader U.S. equity market over the next one to three months.
Meanwhile, one can look at energy firms like Dril-Quip Inc. (DRQ), Stone Energy Corp. (SGY) and Natural Gas Services Group Inc. (NGS) that offer value. All the stocks sport a Zacks Rank #1 (Strong Buy).
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