Marathon Oil Corporation (NYSE: MRO) announced today it has signed and closed on the sale of its subsidiary, Marathon Oil Libya Limited, which holds the Company’s 16.33 percent non-operated interest in the Waha concessions in Libya, to a subsidiary of Total S.A. (Elf Aquitaine SAS) for cash consideration of $450 million. The divestiture represents a complete country exit for Marathon Oil.
“Today’s announcement to divest Libya at an attractive valuation continues the simplification and concentration of our portfolio to the high margin, high return U.S. resource plays,” said Lee Tillman, Marathon Oil president and CEO. “Our relentless focus on portfolio management has driven seven country exits since 2013 and generated proceeds of over $4 billion just in the last 2 years. As a result, 95 percent of our 2018 development capital allocation and about 70 percent of the Company’s total production mix will be associated with the U.S. resource plays, naturally expanding our margins in 2018 and beyond.”
At year-end 2017, the Company carried 199 million barrels of oil equivalent of proved reserves in Libya. The divestiture price equates to 9 times Marathon Oil’s estimate of its 2018 free cash flow from Libya at strip pricing. The divestiture closed on March 1, 2018 with an effective date of Jan. 1, 2018.