Marathon Oil(MRO) - 2024 Q3 - Quarterly Results

Financial Performance - Marathon Oil reported third quarter 2024 net income of $287 million or $0.51 per diluted share, with adjusted net income of $360 million or $0.64 per diluted share[1]. - Total revenues and other income for Q3 2024 were $1,791 million, a decrease of 1.2% compared to $1,813 million in Q3 2023[15]. - Net income for Q3 2024 was $287 million, down 36.7% from $453 million in Q3 2023[15]. - Adjusted net income per diluted share for Q3 2024 was $0.64, compared to $0.77 in Q3 2023, reflecting a decrease of 17%[16]. - Total costs and expenses increased to $1,251 million in Q3 2024, up from $1,144 million in Q3 2023, marking an increase of 9.4%[15]. - Net cash provided by operating activities was $1,209 million in Q3 2024, compared to $1,066 million in Q3 2023, indicating a year-over-year increase of 13.4%[18]. - Free cash flow for Q3 2024 was $659 million, an increase from $573 million in Q3 2023, representing a growth of 15%[18]. Production and Operations - U.S. production averaged 379,000 net boed during the third quarter, with oil production averaging 198,000 net bopd, a significant increase from 183,000 net bopd in the second quarter[2]. - Marathon Oil raised full-year 2024 production guidance to 192,000 net bopd and 393,000 net boed, compared to prior guidance midpoints of 190,000 net bopd and 390,000 net boed[5]. - The company brought a total of 72 gross Company-operated wells to sales during the third quarter[2]. - The average U.S. unit production cost for the third quarter was $5.97 per boe[2]. - The company expects fourth quarter oil production to moderate to approximately 190,000 net bopd, consistent with the phasing of its capital program[5]. - Total net production for Q3 2024 was 421 mboed, unchanged from Q3 2023[19]. Debt and Cash Management - The company achieved a sequential gross debt reduction of $545 million in the third quarter, with cash and cash equivalents increasing by $57 million[1]. - Marathon Oil discontinued its share repurchase program due to the pending merger with ConocoPhillips[1]. Price Realizations and Market Conditions - Average price realizations for crude oil and condensate in the U.S. decreased to $73.92 per bbl in Q3 2024 from $80.90 per bbl in Q3 2023, representing a decline of 8.9%[23]. - The average price for natural gas liquids in the U.S. was $20.40 per bbl in Q3 2024, down from $21.37 per bbl in Q3 2023, a decrease of 4.5%[23]. - International average price realizations for crude oil and condensate increased to $61.68 per bbl in Q3 2024 from $64.30 per bbl in Q3 2023, a decline of 4.1%[23]. - The average total natural gas price increased to $5.75 per mcf in Q3 2024 from $0.24 per mcf in Q3 2023, a significant increase[23]. - The average price for natural gas sold as LNG increased to $10.76 per mcf in Q3 2024 from $8.52 per mcf in Q3 2023, an increase of 26.3%[23]. - The average price for WTI crude oil decreased to $75.27 per bbl in Q3 2024 from $82.22 per bbl in Q3 2023, a decline of 8.9%[23]. - The company reported a decrease in average price realizations for natural gas in the U.S. to $1.45 per mcf in Q3 2024 from $2.28 per mcf in Q3 2023, a decline of 36.4%[23]. Derivative Contracts - The company has outstanding derivative contracts for crude oil with a ceiling price of $95.95 per bbl and a floor price of $65.00 per bbl for 50,000 bbls/day in Q4 2024[24]. - For natural gas, the company has a ceiling price of $5.85 per MMBtu and a floor price of $2.50 per MMBtu for 150,000 MMBtu/day in Q1 2025[24]. - The company is actively managing its derivative contracts to mitigate price volatility in the crude oil and natural gas markets[24]. Reinvestment and Gains - The reinvestment rate for Q3 2024 was 44%, down from 65% in Q2 2024[18]. - The company reported a net gain on commodity derivatives of $9 million in Q3 2024, compared to a net gain of $1 million in Q3 2023[15].