By: Al Lewis – Houston Chronicle – Marathon Oil earned a ranking near the top of the Chronicle 100 following a year of rising oil prices, strong sales and production, and an expansion of its oil reserves.
Marathon, however, touted its improved balance sheet as its biggest success of the year as it maintained its financial discipline amid whipsawing oil prices in the pandemic and its aftermath. The improvements stemmed from financial and operational objectives that the company outlined when oil prices softened after the shale boom went bust several years ago.
“I can best describe 2021 as a year of comprehensive delivery against our framework for success, highlighted by financial results that are not only superior to our peers but more importantly, superior to any other sector of the S&P 500, “ CEO Lee Tillman said in a February conference call discussing 2021 results.
Despite a world of distractions, Marathon kept its focus on driving cash flow, reducing debt, and returning more to shareholders.
In the fourth quarter alone, the company said it returned more than 70 percent of its cash flow from operations — or more than $800 million — to its stockholders. In addition to raising its dividend, the company also repurchased $1 billion worth of its stock, reducing outstanding shares and boosting their price.
Marathon Oil shares, which trade under the symbol MRO on the New York Stock Exchange, have soared from about $12 at the beginning of 2021 to nearly $30.
The company reported revenue of more than $5 billion in 2021, up from about $3 billion the previous year. Its net income rose to $941 million from a loss of nearly $1.5 billion in 2020.
The company’s U.S. operations are focused on the Eagle Ford in Texas, the Bakken Field in North Dakota, and other formations in Oklahoma, producing crude oil, condensate, natural gas and natural gas liquids. Internationally, the company is focused on Equatorial Guinea.
Marathon boasts that the course it has set will yield impressive results for the long haul. In 2021, its proved reserves grew 14 percent to more than 1.1 billion barrels of oil equivalent. Oil accounted for 52 percent of those reserves.
“These financial outcomes are sustainable for years to come and are underpinned by over a decade of high-return, high-confidence inventory,” Lee said.
