Marathon Oil Corporation adjusts quarterly dividend

Marathon Oil Corporation has announced that the Company's board of directors declared a quarterly dividend of 5 cents per share on the Company's common stock, compared to the previous quarterly dividend of 21 cents per share. The dividend is payable on Dec. 10, 2015, to stockholders of record on Nov. 18, 2015.

Lee M. Tillman, Marathon Oil President and CEO, commented on the Board's decision to adjust the dividend saying, "We believe the revised dividend appropriately addresses the uncertainty of a lower for longer commodity price environment. The decision aligns with our priority of maintaining a strong balance sheet through the cycle and provides us additional capital flexibility to support growth from our deep inventory of investment opportunities in the US resource plays when commodity prices improve."

The adjustment to the dividend is expected to increase annual free cash flow by more than US$425 million. At Sept. 30, the Company had US$5.4 billion in liquidity, including US$2.4 billion in cash and short-term investments, US$1 billion of which will be used to retire maturing debt in November 2015.

"We've made great strides so far this year focusing on those elements of the business that we control by reducing activity levels and capturing capital efficiencies, as well as lowering production expenses and G&A costs," Tillman said. "The Company also continues to make progress advancing its plan to divest at least US$500 million of non-core assets, consistent with our ongoing portfolio management strategy."

Addressing the topic of capital investment, Tillman added, "Our 2015 capital, investment and exploration program is now expected to be reduced by US$200 million, to US$3.1 billion. In addition, based on our current outlook and preliminary plan discussions, we would anticipate a total Company 2016 capital, investment and exploration program of up to US$2.2 billion which would give us the flexibility to deliver 2016 annual average production in the US resource plays flat to 2015 exit rate." The Company expects its 2016 budget to be approved by the Board of Directors later this year.

The decision to adjust the dividend is not an indication of Marathon Oil's current financial performance including our third quarter 2015 results, which will be released Nov. 4, and are expected to be above current consensus expectations for earnings per share on an adjusted basis, excluding the impact of certain items not typically represented in analysts' estimates and that would otherwise affect comparability of results. Those adjustments primarily include certain non-cash charges comprised largely of losses and asset impairments resulting from lower forecasted commodity prices and changes in the Company's conventional exploration strategy.

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