Marathon posts loss on breakup

Allen Baker

Marathon Oil Corp. took some major charges in the fourth quarter as it broke away from the steel unit of USX to realign its businesses and become independent again. The overall loss amounted to $1.07 billion, compared with a loss of $449 million a year earlier. But subtracting out split-off expenses and other unusual costs, the Houston-based company said it had an operating profit of $98 million for the quarter, still barely a fourth of the $386 million gleaned from oil operations in the same period of 2000. In the third quarter, Marathon had a group profit of $193 million.

For the year, operating earnings were $1.49 billion, up 14 percent from 2000. Overall earnings, with the special charges, were $157 million, down from $411 million in 2000.

With all the changes, Marathon still managed to boost production 2 percent for the year as a whole, though liquids production dipped to 201,300 barrels daily for the fourth quarter from 209,100 barrels a year ago. Gas production rose a bit to 1.31 billion cubic feet daily, up 6 percent from 1.24 billion cubic feet in the final 2000 quarter As with the other oil companies, sharply lower prices for its products drove down profits. Marathon got an average of $14.48 a barrel for its domestic oil, barely half of the $25.89 it received a year earlier. Domestic natural gas brought $2.08 per thousand cubic feet, less than half of the $4.44 an Mcf that gas brought in the 2000 quarter.

Exploration and production brought in $117 million for the quarter, down from $403 million in 2000. Refining, marketing and transportation profits were $221 million, down roughly a third from a year ago. Other energy businesses contributed $22 million, up from $15 million. Revenues for the quarter were $6.85 billion, down 15 percent from $8.05 billion in 2000. For the year, revenues reached $33.07 billion, down just 2 percent from $33.8 billion for 2000.