THIRD QUARTER 2017 Financial and Operational Review November 1, 2017
Marathon Oil Playbook Profitable growth Simplifying within and cash flows Relentless concentrating focus on portfolio Strengthened costs balance sheet 3
Strengthened Financial Flexibility Reduced gross debt and lowered corporate costs 10-Year Debt Maturities (MM) Retired Reduced gross debt by with cash on hand 765MM 1,035 1,000 Reduced annual interest 854 900 682 expense by 65MM…
Continued Cost Savings Year Over Year Improving trend despite inflationary pressures E&P Production Expenses 1,500 12 Total E&P production expense 1,200 10 expected decrease of 40% 8 from 2014 900 Guidance /BOE MM 6 600…
Successful Portfolio Management Concentrating capital allocation to U.S. resource plays Capital Allocation 100% Executed 3.8B in divestitures since 2016 80% 60% New Continued portfolio shift to 4 of the 40% 82% 95% normal…
Higher Production and Lower Capex Outstanding execution drives momentum into 2018 Total E&P Available for Sale Volumes Guidance Raising 2017 production guidance 400 E&P: 350 - 360 327** while lowering capex to 2.1B* 300 9% 9% total…
Expect 2017 Free Cash Flow Neutrality 3Q liquidity at 5.2B, including 1.8B cash Increased YTD cash balance before A&D and debt transactions Anticipate 2017 free cash flow neutrality at current strip price, including dividends and…
Third Quarter Highlights Consistent execution delivers 14% sequential oil growth in resource plays Production 4 Basin Execution Total Company production (ex. Eagle Ford production up to 101 Libya) of 371 MBOED, up 6% MBOED despite…
U.S. E&P Production Above Top End of 3Q Guidance Resource play growth continues Available for Sale Volumes U.S. E&P 300 Guidance: 255 - 265 243* 250 220* 207* 207* 206* 16* 18* 200 15* 16* 15* MBOED 150 227 100 192…
Eagle Ford Outperforms Despite Impact from Harvey 90 day cumulative well production up 40% since 2011 Production Volumes and Wells to Sales Production averaged 101 net MBOED; up 120 90 from 2Q 2017 despite Harvey effects Co-Op…
Positive 3Q Results Inside & Outside Core Karnes County Consistent execution across multiple counties Gonzales Wilson Oxford 6 well pad Avg: 1,294 BOED (80% oil) Karnes Wingnut 4 well pad Avg: 1,671 BOED (75% oil) Atascosa…
Bakken Delivered 20% Growth in 3Q Materially exceeding historical performance trends Production Volumes and Wells to Sales Production averaged 59 net MBOED, up 80 30 20% from 2Q 2017 Co-Op Wells to Sales 60 20 20 gross operated…
Bakken Wells Continue Setting Benchmarks Hector performance competing with best in Williston basin Historic Industry Middle Bakken Well Performance 3,000 Hector area Clarice well sets Top 10 of 8,750+ wells 30-day IP (BOPD) 2,500…
Strong Well Performance in Myrmidon and Hector Eastern Hector step-out wells delivering promising initial results Mountrail Grady Pad Shrader Pad 4 wells 2 wells Avg: 2,471 BOED (78% oil) Myrmidon Avg: 1,410 BOED (78% oil)…
Oklahoma Continues Sequential Growth STACK Meramec volatile oil wells outperforming Production Volumes and Wells to Sales Production averaged 58 net MBOED; up 80 30 18% from 2Q 2017 Co-Op Wells to Sales 60 20 15 gross operated…
Oklahoma Resource Basin 3Q Activity Predominately leasehold and delineation White 1607 1-13OH (Osage) HR Potter 1511 1-3-34MXH Kingfisher IP30: 850 BOED (55% oil) IP30: 1,700 BOED (63% oil) Blaine Robert 1513 1-16MH Eve 6-well…
Positive Early Results in Northern Delaware Dedicated frac crew; increased activity to 4 rigs in October Production Volumes and Wells to Sales Production averaged 9 net MBOED; up 10 25 from 2Q 2017 and reflecting full quarter 8 20…
Play Extension of Northern Delaware Continues Recent wells and notable upcoming well activity CHAVES COUNTY Cypress Spacing Pilot 4Q spud Wolfcamp and Bone Spring El Presidente 2 State 4H LEA COUNTY Wolfcamp X-Y Grama…
International E&P Highlights EG consistently delivering substantial free cash flow Intl E&P Production Volumes (Excl. Libya) International E&P production 126 Intl E&P 150 Guidance: net MBOED, above top of guidance 120 - 130 125…
Raising Guidance While Living Within Our Means 9% 2017 total E&P production growth (oil and boe) at midpoint* 25 - 30% 2017 resource plays exit rate growth (oil and boe) Oklahoma Resource Basins Eagle Ford Continues…
Appendix
Volumes, Exploration Expenses & Effective Tax Rate 2017 (excluding Libya) 1Q 2Q 3Q 4Q Year United States E&P Net Sales Volumes: - Liquid Hydrocarbons (MBD) 158 165 183 - Natural Gas (MMCFD) 304 341 369 - United States E&P Total…
2017 Estimates Volumes Available for Sale Available for Sale Comments 4QE Year Estimate United States E&P Total (MBOED) 255 265 - Liquid Hydrocarbons (MBD) 193 201 - Natural Gas (MMCFD) 371 385 International E&P Total (MBOED)*…
2017 Estimates Exploration expenses & annual production operating costs per BOE 4QE Year Estimate Exploration Expenses (Pre-tax): United States E&P ( millions) 35 45 International E&P ( millions) 24 United States E&P Cost Data…
E&P Production Performance Increased 3Q volumes due to continued outstanding operational performance U.S. E&P Divestiture-Adj. Sales Volumes Intl E&P Production & Sales Volumes 300 175 150 23 23 11 11 125 200 MBOED 100…
2017 3Q Production Mix Eagle Ford Oklahoma Resource Bakken Northern Delaware* Basins 7% 21% 10% 29% 30% 46% 57% 2% 22% 83% 68% 25% Total U.S. Resource Plays 24% 57% 19% Crude Oil/Condensate NGLs Natural Gas 27…
United States E&P Crude Oil Derivatives As of September 30, 2017 Crude Oil (Benchmark to NYMEX WTI) 4Q 2017 1Q 2018 2Q 2018 3Q 2018 4Q 2018 Three-Way Collars(a) Volume (Bbls/day) 50,000 75,000 75,000 62,000 62,000 Weighted Avg Price…
United States E&P Natural Gas Derivatives As of September 30, 2017 Natural Gas (Benchmark to NYMEX HH) 4Q 2017 1Q 2018 2Q 2018 3Q 2018 4Q 2018 Three-Way Collars Volume (MMBtu/day) 120,000 200,000 160,000 160,000 160,000 Weighted…
Capital, Investment & Exploration 2017 budget reconciliation MM 2017 Revised 2017 YTD Budget Actual Capital expenditures 2,100 1,512 M&S Inventory 0 (5) Investments in equity method investees & others 0 0 Exploration costs other…
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