Global energy giant Exxon Mobil (XOM) manages to retain its position as king of the energy heap by being one of the lowest cost producers among its peers. The low cost is attributed to its integration of all aspects of exploration, production, upstream, midstream and downstream asset. Companies such as ConocoPhillips (COP) and Marathon Oil (MRO) has taken a different approach and spun off downstream assets such as energy marketing, transmission and refinery operations into separate corporate entities. Shareholders in these companies have been rewarded with shares in two separate public companies with heightened ability to be flexible in business strategy and better transparency in reporting of corporate actions.
Marathon Oil announced that it had successfully completed the spin-off of Marathon Petroleum (MPC) to an independent publicly traded company on June 27, 2011. Since then, its exploration and production assets have been measured in Marathon Oil. Today, let’s look at what Marathon Oil, a pure exploration and production play, offers its shareholders.
On July 3, 2012 Henry Hub spot is shown some signs of life up $0.03 at $2.77 per mcf. West Texas crude and Brent oil are trading over $87 and at $100, respectively. Natural gas is off its recent two decade lows and oil is getting comfortable above $80, where it was below just last week. All of the prices have shown some volatility and are expected to continue to do so until there is some clear direction in all of the aforementioned macro factors.To continue reading, click here.