Marathon Oil Explained

Marathon Oil Corporation
Former Names:The Ohio Oil Company
(1887–1962)
Type:Subsidiary
Fate:Acquired by ConocoPhillips in 2024
Predecessor:
Founded: as "The Ohio Oil Company"
Hq Location:Houston, Texas U.S.
Industry:Petroleum
Products:Fuel
Natural gas
Production:383e3BOE per day
Revenue: $3.086 billion (2020)
Net Income: -$1.451 billion (2020)
Assets: $17.956 billion (2020)
Equity: $10.561 billion (2020)
Num Employees:1,672 (2020)
Brands:Marathon (1930–)
Parent:ConocoPhillips
Subsid:Marathon Petroleum (2009–11)
Footnotes:[1]

Marathon Oil Corporation was an American company engaged in hydrocarbon exploration. In November 2024, it was acquired by ConocoPhillips.

Marathon was founded in Lima, Ohio as the Ohio Oil Company. In 1899, the company was acquired by the Standard Oil Company (New Jersey). After the antitrust case against Jersey Standard in 1911 and subsequent breakup of its holdings, Ohio Oil once again became an independent company. In 1930, Ohio Oil acquired the Transcontinental Oil Company, which operated the "Marathon" brand of retail gasoline stations. Ohio Oil continued to use the Marathon brand, and in 1962, Ohio changed its name to the Marathon Oil Company.

In January 1982, Marathon was acquired by U.S. Steel. After the acquisition, the USX Corporation was created to act as the parent of U.S. Steel and Marathon Oil, which operated as divisions. In 2001, USX spun off Marathon under the name Marathon Oil Corporation. In 2011, Marathon Oil spun off its downstream operations as Marathon Petroleum.

As of December 31, 2020, the company had 972e6BOE of estimated proven reserves, of which 86% was in the United States and 14% was in Equatorial Guinea.[1] The company's proved reserves consisted 52% of petroleum, 30% natural gas and 18% natural gas liquids. In 2020, the company sold 383e3BOE per day, of which 26% was from the Eagle Ford Group, 27% was from the Bakken formation, 17% was from Oklahoma, 7% was from the Northern Delaware Basin, 2% was from other U.S. sources, and 20% was from Equatorial Guinea.

History

Marathon Oil began as "The Ohio Oil Company" in 1887.[2] In 1889, the company was purchased by John D. Rockefeller's Standard Oil. It remained a part of Standard Oil until Standard Oil was broken up in 1911. In 1930, The Ohio Oil Company bought the Transcontinental Oil Company, including the "Marathon" brand name. In 1962, the company changed its name to "Marathon Oil Company".[3]

In 1959, the Ohio Oil Company acquired Detroit based Aurora Oil Company which operated Speedway 79 stations and became an Ohio Oil subsidiary.[4]

In 1962, the Speedway 79 and Marathon stations were consolidated under the Marathon name and the Ohio Oil Company is renamed Marathon Oil Company.[5] [6]

In 1981, Mobil made a hostile takeover offer to buy the company.[7] [8] However, the board of Marathon Oil rejected the offer and instead sold the company to United States Steel. A legal battle ensued thereafter.[9]

In 1990, the headquarters was moved to Houston, Texas, but the company's refining subsidiary maintained its headquarters in Findlay, Ohio.[10]

In 1984, Marathon purchased the U.S. unit of Husky Energy for $505 million.[11]

In 1998, Marathon and Ashland Global contributed their refining operations to Marathon Ashland Petroleum LLC (MAP), now Marathon Petroleum.[12]

In 2001, USX, the holding company that owned United States Steel and Marathon, spun off the steel business and, in 2002, USX renamed itself Marathon Oil Corporation.[13]

In 2003, Marathon sold its Canadian operations to Husky Energy.[14]

In 2003, the company sold its interest in the Yates Oil Field to Kinder Morgan for $225 million.[15] [16]

In 2007, Marathon acquired Western Oil Sands for $6.6 billion and gained ownership of its 20% stake in the Athabasca oil sands in northern Alberta, Canada and other assets in the midwestern United States.[17]

In 2011, Marathon completed the corporate spin-off of Marathon Petroleum, distributing a 100% interest to its shareholders.[18]

In June 2013, Marathon sold its Angolan oil and gas field to Sinopec for $1.52 billion.[19]

In September 2013, Marathon sold a 10% stake in an oil and gas field offshore Angola for $590 million to Sonangol Group.[20]

In October 2014, the company sold its business in Norway to Det Norske Oljeselskap ASA for $2.1 billion.[21]

In 2017, it sold its interests in the Athabasca oil sands for $2.5 billion and acquired assets in the Permian Basin for $1.2 billion.[22] [23]

In March 2018, it sold its assets in Libya for $450 million to TotalEnergies SE.[24] [25]

In December 2022, the company acquired assets in the Eagle Ford from Ensign Natural Resources for $3.0 billion in cash.[26] [27]

In November 2024, ConocoPhillips acquired the company in a $22.5 billion transaction.[28] [29]

Lawsuits

In July 2024, Marathon agreed to a $241.5 million settlement with the US Department of Justice and the Environmental Protection Agency to resolve allegations of failing to obtain required permits at dozens of the company's oil and gas facilities on the Fort Berthold Indian Reservation in North Dakota and releasing thousands of tons of illegal air pollution as a result.[30] The settlement included Marathon denying liability for the allegations but agreeing to pay a $64.5 million civil penalty, the largest fine ever imposed for violations of the Clean Air Act from stationary sources, as well as agreeing to invest $177 million to bring its facilities into compliance.

Corporate philanthropy

Since 2003, Marathon Oil and its partners Noble Energy and AMPCO have invested in the Bioko Island Malaria Control Project (BIMCP) in Equatorial Guinea. The project includes distribution of insecticide nets, indoor residual spraying and larval source management, preventive therapy for pregnant women and malaria case management, and investment in a possible malaria vaccine. The project has resulted in a 63% reduction in malaria parasite prevalence and a 63% reduction in the mortality rate and 97% reduction in severe anemia in children under 5 years old.

Criticism

Environmental record

According to a 2017 study, the company was responsible for 0.19% of global industrial greenhouse gas emissions from 1988 to 2015.[31]

As of 2022, Marathon was the seventh-largest emitter of greenhouse gas emissions in the oil and gas industry.[32]

Dealings in Equatorial Guinea

The company was investigated for payments made to Teodoro Obiang Nguema Mbasogo, the president of Equatorial Guinea.[33] The SEC completed its investigation in 2009 and did not recommend any enforcement action in the matter.[34]

Leadership

President

James C. Donnell, 1911–1927
Otto D. Donnell, 1927–1948
James C. Donnell, II, 1948–1972
Harold D. Hoopman, 1972–1985
William E. Swales, 1985–1987
Victor G. Beghini, 1987–1999
Clarence P. Cazalot, Jr., 2000–2013
Lee M. Tillman, 2013–

Chairman of the Board

James C. Donnell, II, 1972–1975
Thomas J. Usher, 2001–2011
Clarence P. Cazalot, Jr., 2011–2013
Dennis H. Reilley, 2013–2019
Lee M. Tillman, 2019–

Bibliography

Notes and References

  1. Web site: Marathon Oil Corporation 2020 Form 10-K Annual Report . . 2021-04-11 . 2021-10-01 . https://web.archive.org/web/20211001152500/https://www.sec.gov/ix?doc=/Archives/edgar/data/101778/000010177821000018/mro-20201231.htm . live .
  2. Web site: Marathon Oil Company American corporation Britannica . 2023-03-27 . www.britannica.com . en . 2023-03-27 . https://web.archive.org/web/20230327090858/https://www.britannica.com/topic/Marathon-Oil-Company . live .
  3. Web site: Marathon Petroleum . Our History Marathon Petroleum . September 29, 2022 . February 6, 2019 . https://web.archive.org/web/20190206120115/http://www.marathonpetroleum.com/About_MPC/Corporate_Profile/History/ . live .
  4. https://www.crainsdetroit.com/article/20050303/SUB/503030854/philanthropist-max-fisher-dead-at-96
  5. Web site: Aurora Merges with the Ohio Oil Company | Max Fisher .
  6. Web site: Speedway 79 Photos .
  7. News: Cole . Robert J. . A $5 BILLION OFFER FOR MARATHON OIL IS MADE BY MOBIL . 20 August 2022 . The New York Times . 31 October 1981 . 20 August 2022 . https://web.archive.org/web/20220820124809/https://www.nytimes.com/1981/10/31/business/a-5-billion-offer-for-marathon-oil-is-made-by-mobil.html . live .
  8. News: Williams . Winston . MARATHON OIL WINS CHEERS IN FINDLAY . 20 August 2022 . The New York Times . 26 November 1981.
  9. Web site: Mobil Corp. v. Marathon Oil Co.: Tender Offeror's Right to Injunctive Relief Recognized . Pace Law Review . April 1983 . 2021-04-11 . 2021-04-11 . https://web.archive.org/web/20210411221223/https://digitalcommons.pace.edu/cgi/viewcontent.cgi?referer=&httpsredir=1&article=1660&context=plr . live .
  10. Web site: Marathon Oil Company . 25 August 2023 . 27 March 2023 . 27 March 2023 . https://web.archive.org/web/20230327090858/https://www.britannica.com/topic/Marathon-Oil-Company . live .
  11. News: MARATHON WILL BUY HUSKY UNIT . SALPUKAS . AGIS . . March 30, 1984 . February 10, 2017 . October 8, 2016 . https://web.archive.org/web/20161008083330/http://www.nytimes.com/1984/03/30/business/marathon-will-buy-husky-unit.html . live .
  12. News: Ashland, Marathon Announce Alliance . Breed . Alan G. . . May 16, 1997.
  13. News: USX Reorganizes . CSN . October 30, 2001 . April 11, 2021 . April 11, 2021 . https://web.archive.org/web/20210411221224/https://csnews.com/usx-reorganizes . live .
  14. News: Husky snaps up Marathon assets . PATRICK . BRETHOUR . . August 21, 2003.
  15. News: Kinder Morgan to acquire Yates field interests from Marathon . . November 3, 2003 . April 11, 2021 . April 11, 2021 . https://web.archive.org/web/20210411221222/https://www.ogj.com/general-interest/companies/article/17255803/kinder-morgan-to-acquire-yates-field-interests-from-marathon . live .
  16. News: Marathon to sell stake in Yates to Kinder Morgan Energy Partners . . October 30, 2003 . April 11, 2021 . February 9, 2006 . https://web.archive.org/web/20060209061116/http://www.bizjournals.com/houston/stories/2003/10/27/daily39.html . live .
  17. News: Marathon to buy Western Oil Sands for $6.5B . . July 31, 2007 . April 11, 2021 . January 16, 2021 . https://web.archive.org/web/20210116130815/https://www.cbc.ca/news/business/marathon-to-buy-western-oil-sands-for-6-5b-1.642960 . live .
  18. News: Marathon spin-off gives Ohio fifth largest refiner . . . June 30, 2011 . April 11, 2021 . April 11, 2021 . https://web.archive.org/web/20210411221223/https://www.cleveland.com/business/2011/06/marathon_spin-off_gives_ohio_f.html . live .
  19. News: China's Sinopec buys Marathon's Angola oil fields for $1.52 billion . Fayen . Wong . . June 23, 2013 . April 11, 2021 . April 11, 2021 . https://web.archive.org/web/20210411221225/https://www.reuters.com/article/instant-article/idUKBRE95M07B20130623 . live .
  20. News: Marathon Oil to sell stake in Angolan field for $590 million . Swetha . Gopinath . . September 10, 2013 . April 11, 2021 . May 20, 2022 . https://web.archive.org/web/20220520134944/https://www.reuters.com/article/us-hon-angola/marathon-oil-to-sell-stake-in-angolan-field-for-590-million-idUSBRE9890MV20130910 . live .
  21. News: Marathon Oil Closes Transaction for Sale of Norway Business . . October 15, 2014 . April 11, 2021 . April 11, 2021 . https://web.archive.org/web/20210411221223/https://rss.globenewswire.com/en/news-release/2014/10/15/673547/18839/en/Marathon-Oil-Closes-Transaction-for-Sale-of-Norway-Business.html . live .
  22. News: Marathon Oil Announces $2.5 Billion Canadian Oil Sands Divestiture and $1.1 Billion Permian Basin Acquisition . . March 9, 2017 . April 11, 2021 . April 11, 2021 . https://web.archive.org/web/20210411221226/https://www.globenewswire.com/news-release/2017/03/09/933718/0/en/Marathon-Oil-Announces-2-5-Billion-Canadian-Oil-Sands-Divestiture-and-1-1-Billion-Permian-Basin-Acquisition.html . live .
  23. News: Houston energy co. sells Canadian subsidiary, buys Permian assets in billion-dollar deals . Jack . Witthaus . . March 9, 2017 . April 11, 2021 . March 24, 2017 . https://web.archive.org/web/20170324034436/http://www.bizjournals.com/houston/news/2017/03/09/houston-energy-co-sells-canadian-subsidiary-buys.html . live .
  24. Marathon Oil Announces Libya Divestiture for $450 Million . . March 2, 2018.
  25. News: Marathon Oil exits Libya with $450M divestiture . Olivia . Pulsinelli . . March 2, 2018 . subscription . April 11, 2021 . January 18, 2023 . https://web.archive.org/web/20230118033109/https://www.bizjournals.com/houston/news/2018/03/02/marathon-oil-exits-libya-with-450m-divestiture.html . live .
  26. Marathon Oil Completes Eagle Ford Acquisition . . December 27, 2022 . November 23, 2024 . September 27, 2024 . https://web.archive.org/web/20240927212913/https://www.prnewswire.com/news-releases/marathon-oil-completes-eagle-ford-acquisition-301710369.html . live .
  27. News: Marathon closes Ensign Eagle Ford acquisition . . December 27, 2022 . November 23, 2024 . March 4, 2024 . https://web.archive.org/web/20240304014859/https://www.ogj.com/general-interest/companies/article/14287665/marathon-closes-ensign-eagle-ford-acquisition . live .
  28. ConocoPhillips completes acquisition of Marathon Oil Corporation . . November 22, 2024.
  29. News: ConocoPhillips closes $22.5 billion deal for Marathon Oil . Sourasis . Bose . . November 22, 2024.
  30. Web site: Karnowski . Steve . 2024-07-11 . Marathon Oil reaches $241 million settlement with EPA for environmental violations in North Dakota . live . https://web.archive.org/web/20240711225749/https://abcnews.go.com/Business/wireStory/marathon-oil-reaches-241-million-settlement-epa-environmental-111854790 . 2024-07-11 . 2024-07-20 . . en.
  31. News: Riley . Tess . 2017-07-10 . Top 100 producers and their cumulative greenhouse gas emissions from 1988-2015 . live . https://web.archive.org/web/20240710150756/https://www.theguardian.com/sustainable-business/2017/jul/10/100-fossil-fuel-companies-investors-responsible-71-global-emissions-cdp-study-climate-change . 2024-07-10 . 2024-07-20 . The Guardian.
  32. Web site: EPA Press Office . 2024-07-11 . EPA and Justice Department Announce $241.5M Settlement with Marathon Oil to Reduce Climate- and Health-Harming Emissions in North Dakota . live . https://web.archive.org/web/20240711164330/https://www.epa.gov/newsreleases/epa-and-justice-department-announce-2415m-settlement-marathon-oil-reduce-climate-and . 2024-07-11 . 2024-07-20 . . en.
  33. News: Oil Firms' Rich Concessions to Tainted African Ruler Probed . KEN . SILVERSTEIN . . December 18, 2004.
  34. Web site: Investigation into Marathon Oil's Activities in Equatorial Guinea . 2021-09-01 . 2021-09-01 . https://web.archive.org/web/20210901162257/https://fcpa.stanford.edu/investigation.html?id=164 . live .

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