* About 97,000 acres on the market
* Highest price seen at $25,000 per acre -analyst
* Marathon shedding "non-core" assets
By Anna Driver
HOUSTON, Oct 15 Marathon Oil Corp is
selling a large portion of its undeveloped oil and gas acreage
in the Eagle Ford basin in south Texas as the U.S. oil and gas
company sheds properties it no longer considers essential to its
Marathon has spent heavily in recent years to acquire oil
and gas properties in the Eagle Ford in a strategy aimed at
growing production of crude oil and pricier natural gas liquids.
Houston-based Marathon, which has 325,000 acres in the Eagle
Ford, is selling about 97,000 acres in Wilson, Karnes and Bee
Counties, according to a marketing brochure from the Oil and Gas
Asset Clearinghouse, its adviser on the sale.
About of those 200,000 acres are considered "core," or
having the best potential by Marathon. The planned sale will not
affect the company's core acreage, strategy or production
targets, a spokeswoman said.
"No question, this asset is a priority for us, and our
investment reflects that - over the next five years - we plan to
spend approximately $1.6 billion annually to grow this asset,"
Dave Roberts, Marathon's head of exploration said in a speech on
Monday in San Antonio.
During its second-quarter earnings call, Marathon said its
oil and gas output in the Eagle Ford rose 50 percent from the
prior quarter, and it is on track to produce an average of
30,000 barrels of oil equivalent per day in 2012.
Valuations in the Eagle Ford have remained high as oil
companies and financial firms seek exposure to the light sweet
crude produced from rocks in the basin that stretches into
Private equity firm KKR & Co LP in July agreed to
pay $25,000 per acre for a one-third stake in Comstock
Resources' undeveloped Eagle Ford acreage.
Marathon's properties may fetch as much as $25,000 per acre,
with the low end seen at $15,000, according to Allen Good, oil
analyst with Morningstar in Chicago.
In May, Marathon bought privately held Paloma Partners II
LLC for $750 million. At the time, Paloma owned about 17,000
acres and production of about 7,000 barrels of oil equivalent
per day. In 2011, it paid nearly $25,000 per acre to acquire
141,000 acres from privately held Hilcorp.
Bids on the properties are due Oct. 25.