USX-Marathon Group 2001 Capital, Investment and Exploration Budget Set At $1.8 Billion
USX Corporation announced today that it has approved a 2001 Marathon Group (NYSE: MRO) capital, investment and exploration budget of $1.8 billion. This is an increase of 9 percent over the actual spend of $1.64 billion for the previous year. The budget does not include an additional $500 million earmarked for the acquisition of Pennaco Energy, Inc., announced December 22. Thomas J. Usher, chairman and chief executive officer, commented, "The 2001 spending plan for exploration and production activities demonstrates a commitment to fund continued improvement of our base business, while providing for future profitable growth opportunities. In refining, marketing and transportation, we aim to leverage our competitive edge by continuing to invest in targeted opportunities to grow market share and improve efficiency."
The Group's capital and investment program of $1.5 billion is 12 percent higher than in 2000. It includes $762 million for production activities, $641 million for refining, marketing and transportation and $87 million for corporate administration and other energy related businesses.
The worldwide exploration program for 2001 amounts to $309 million compared to $314 million in 2000. Approximately $194 million, or 63 percent, is allocated to U.S. domestic exploration programs, with the major emphasis on the Gulf of Mexico. The balance of $115 million, or 37 percent is allocated to international drilling projects offshore Angola, the North Sea and both onshore and offshore Canada.
For U.S. Domestic operations, upstream capital spending plans total $508 million spread across numerous projects. The corresponding spending level for 2000 was $417 million.
Internationally, upstream capital and investment plans total $254 million compared to $217 million in 2000. Around $80 million of this is allocated to the continuing development of the Foinaven area of the UK Atlantic Margin. Marathon acquired an interest in this location through the exchange of its Sakhalin interests with Shell Oil in the fourth quarter of 2000.
Downstream capital expenditures, which include 100 percent of Marathon Ashland Petroleum LLC (MAP), are expected to be $641 million compared to 2000 expenditures of $657 million. This year's budget includes $292 million for refining and brand marketing, $201 million for Speedway SuperAmerica, $121 million for supply and transportation and $27 million for administration and other. Marathon Oil holds a 62 percent interest in MAP. Planned activities include completion of the Garyville delayed coker project, convenience stores and facilities upgrades, and expansion of Speedway SuperAmerica's truck stop program.
The Marathon Group is also undertaking an $85 million conversion to the enterprise resource planning system, SAP™. It is anticipated that around $73 million of this amount will be spent by the end of 2001.
Marathon Oil Company, part of the USX-Marathon Group and a unit of USX Corporation, is a large fully integrated oil firm engaged in the worldwide exploration and production of crude oil and natural gas. Through Marathon Ashland Petroleum LLC, the Company also refines, markets and transports petroleum products in the United States. Visit the company's Web site at http://www.marathon.com/ or http://www.usx.com/.
This release contains forward-looking statements with respect to expected capital, investment and exploration expenditures. This forward-looking information is based on certain assumptions including (among others), prices, worldwide supply and demand for petroleum products, regulatory constraints, timing and results of future development drilling, levels of company cash flow, drilling rig availability and other geological operating and economic considerations. This forward-looking information may prove to be inaccurate and actual results may differ significantly from those presently anticipated. In accordance with "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, USX has included in the Annual Report on Form 10-K, for the period ending December 31, 1999, and on subsequent Forms 10-Q and 8-K, cautionary language identifying other important factors, though not necessarily all such factors, that could cause future outcomes to differ from those set forth in forward-looking statements.
SOURCE: USX Corporation
Contact: Roger Holliday of USX Corporation, 713-296-3911