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Marathon Oil EPS from $2.45 to $2.64

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Staff writer ▼ | February 7, 2014
Marathon OilMarathon Oil Corporation reported full-year 2013 adjusted net income of $1.874 billion, or $2.64 per diluted share, compared to $1.736 billion, or $2.45 per diluted share, for full-year 2012.

For the fourth quarter of 2013, adjusted net income was $418 million, or $0.60 per diluted share, compared to adjusted net income of $617 million, or $0.87 per diluted share, for the third quarter of 2013.

The company reported fourth quarter 2013 net income of $375 million, or $0.54 per diluted share, compared to net income in the third quarter of 2013 of $569 million, or $0.80 per diluted share. The decrease in quarterly earnings was primarily due to a significant decline in domestic and Canadian crude oil price realizations during the fourth quarter as well as higher non-cash unproved property impairments.

Driven by strong reserves growth in the company's U.S. resource plays, Marathon Oil's total net proved reserves were approximately 2.2 billion boe at the end of 2013, an increase of 8 percent from the prior year. Eighty percent of the 2.2 billion boe were LHC and SCO; 71 percent were developed.

The company's reserve replacement ratio, excluding dispositions of 13 million boe, was 194 percent, with 344 million boe of net proved reserves added, while producing 177 million boe. Including dispositions, the reserve replacement ratio was 187 percent. The Company's finding and development cost was approximately $16 per boe.

Net additions, including acquisitions, were driven primarily by U.S. resource play activity in the Eagle Ford, Oklahoma resource basins and Bakken as well as additions in Oil Sands Mining (OSM) and Norway.

Marathon Oil added a total of 298 million barrels of net proved LHC and SCO reserves, excluding dispositions of 1 million barrels, while producing 125 million barrels, resulting in a total liquids reserve replacement ratio of 238 percent.

For the three-year period ended Dec. 31, 2013, Marathon Oil added net proved reserves of slightly more than 1 billion boe, excluding dispositions of 13 million boe, while producing 494 million boe, resulting in a three-year average reserve replacement ratio of 211 percent.

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