Marathon Oil Update on '14 Strategic Plan - Analyst Blog

Oil and natural gas exploration and production (E&P) company, Marathon Oil Corporation MRO announced updates on its 2014 strategic business plans which were revealed in the analyst meet held last December.

Marathon Oil has successfully ramped up its rig operations in the U.S. resource plays – Eagle Ford, Bakken and Woodford – and reached its 28-rig target in January. Management expects downspacing and well optimization activities to drive growth and aid in achieving the projected long-term growth target.

Marathon Oil intends to expand its resource base through development activities in its North American resource plays. Accordingly, it is exploring development opportunities in Austin Chalk in the Eagle Ford and Three Forks in the Bakken. Moreover, it is assessing the potential of the Southern Mississippi Trend and Granite Wash horizons, while development activities are in full swing in the South Central Oklahoma Oil Province properties, in the Oklahoma resource basin.

The company also announced that it would start accepting bids for its North Sea business in the second quarter of the year. The marketing of these businesses is in accordance with Marathon Oil's portfolio optimization strategy.

Further, the company revealed a $500 million share buyback program. This follows the $1 billion, two-phased share repurchase program which concluded recently. Post this $500 million buyback, the company will have $1.5 billion share repurchase authorization left.

Houston, Texas-based Marathon Oil is a leading 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. equity market over the next one to three months.

Meanwhile, one can consider better-ranked players in the energy sector like Valero Energy Corporation VLO, Range Resources Corporation RRC and Helmerich & Payne Inc HP. All these stocks sport a Zacks Rank #1 (Strong Buy).