Marathon Oil to double Eagle Ford position through Ensign acquisition

Marathon Oil Corp., Houston, has agreed to acquire the assets of Ensign Natural Resources LLC, Houston, an exploration and production company operating in the Eagle Ford shale in South Texas, for total cash consideration of $3 billion.

The deal nearly doubles Marathon Oil’s Eagle Ford shale position with a high return, high working interest inventory adjacent to the company's legacy position that immediately competes for capital, Marathon Oil said in a release Nov. 2.

Marathon will gain 130,000 net acres (99% operated, 97% working interest) that span Live Oak, Bee, Karnes, and Dewitt Counties across the condensate, wet gas, and dry gas phase windows of the Eagle Ford, and an estimated 600 undrilled locations. Estimated fourth-quarter 2022 production is 67,000 net boe/d (22,000 net b/d of oil).

Marathon Oil believes it can hold fourth quarter production flat with 1 rig and 35-40 wells to sales per year.

The deal also includes 700 existing wells, most completed before 2015 with early generation completion designs, which offers upside redevelopment potential, none of which was considered in the asset valuation or inventory count, Marathon Oil said.

Post-closing, expected by yearend 2022, Marathon Oil will hold 290,000 net acres in the Eagle Ford.