Marathon Agrees to Acquire Paloma II in Eagle Ford Expansion
by Dow Jones Newswires
|Wednesday, May 09, 2012
Marathon Oil Corp. has agreed to acquire Paloma Partners II LLC for around $750 million in cash, as the company expands its operations in the oil-rich Eagle Ford shale.
Paloma II, a private oil-and-gas exploration and production company, owns around 17,000 acres in the Eagle Ford shale formation in south Texas, mostly in Karnes and Live Oak counties. Its net production as of April 1 was roughly 7,000 barrels of oil equivalent per day.
Its principal shareholders are Paloma Resources LLC, Encap Energy Capital Fund VII LP, and Macquarie Americas Corp.
The deal comes after Marathon spun off its refining business last year to focus its drilling efforts on unconventional U.S. oil shales, which also include the Bakken Field in North Dakota and Anadarko Woodford in Oklahoma.
Marathon recently reported that its first-quarter earnings fell from a year-ago quarter that included contributions from the refining business.
The transaction, which is subject to closing terms and conditions, is expected to close in the third quarter.
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