A major operator in Oklahoma’s oil patch, Marathon Oil Corporation reported a first quarter 2020 net loss of $46 million or 6 cents a diluted share.
The adjusted net loss was $(125) million, or $(0.16) per diluted share. Net operating cash flow was $701 million, or $550 million before changes in working capital.
Chairman, President, and CEO Lee Tillman said, “While the safety and health of our people remains my top priority, we continue to focus on the financial strength of our Company. In addition to the previously announced $1.1 billion reduction to our 2020 capital budget, we also expect to reduce our annualized cash costs by $350 million.”
The company’s Oklahoma operations averaged 74,000 net boed in the first quarter and oil production averaged 21,000 net bopd.
The company brought 13 gross Company-operated wells to sales during the first quarter. Marathon started 2020 operating three rigs and one frac crew in Oklahoma but suspended all drilling and completion operations before the end of first quarter. The company stated that it does not expect to bring any additional wells to sales in Oklahoma this year.
Otherwise, Marathon said it carried out first quarter operations after cutting $1.1 billion from its capital expenditure budget which now is expected to be around $1.3 billion.
The company anticipates annualized cash cost reductions of $350 million and plans on salary reductions for CEO and other corporate officers and compensation for members of the Board of Directors. It has also temporarily suspended quarterly dividend and a share repurchase program.
“In response to the challenges facing our industry,” Tillman continued, “we’re dramatically reducing our capital expenditures, including a pause in virtually all completion activity during second quarter, and we will continue to optimize our capital program in response to market conditions.”
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Source: Marathon Oil