Marathon Oil Corporation Reports Third Quarter 2012 Results

Marathon Oil Corporation Reports Third Quarter 2012 Results

HOUSTON, Nov. 6, 2012 (GLOBE NEWSWIRE) -- Marathon Oil Corporation (NYSE:MRO)
today reported third quarter 2012 net income of $450 million, or $0.63 per
diluted share, compared to net income in the second quarter of 2012 of $393
million, or $0.56 per diluted share. For the third quarter of 2012, adjusted
net income was $454 million, or $0.64 per diluted share, compared to adjusted
net income of $416 million, or $0.59 per diluted share, for the second quarter
of 2012.

                   Three Months Ended
                   September 30                  June 30
(In millions,
except per diluted  2012                          2012
share data)
Adjusted net income $454                          $416
(a)
Adjustments for
special items (net                               
of taxes):
Unrealized gain on
crude oil            29  
derivative                                        -
instruments
Pension settlement   (22) 
                                                  -
Loss on              (11)  (23)
dispositions
Net income          $450                          $393
Adjusted net income
- per diluted share $0.64                         $0.59
(a)
Net income - per    $0.63                         $0.56
diluted share
Revenues and other  $4,161                        $3,784
income
Weighted average     709    709
shares - diluted
Cash Flow                                        
Cash flow from
operations before   $992                          $1,268
changes in working
capital (b)
Changes in working   78   (499)
capital
Cash flow from      $1,070                        $769
operations

(a) Adjusted net income is a non-GAAP financial measure and should not be
considered a substitute for net income as determined in accordance with
accounting principles generally accepted in the United States. See below for
further discussion of adjusted net income.

(b) Cash flow from operations before changes in working capital is a
non-GAAP financial measure and should not be considered a substitute for cash
flow from operations as determined in accordance with accounting principles
generally accepted in the United States. See below for further discussion of
cash flow from operations before changes in working capital.

"Marathon Oil's producing assets exceeded expectations in the third quarter,
driven by superior execution in our U.S. resource plays and continued strong
reliability from our base assets," said Clarence P. Cazalot Jr., Marathon Oil
chairman, president and CEO.

"Our investment in the Eagle Ford shale a little more than a year ago, and
our bolt-on acquisitions since then, continue to deliver value beyond original
expectations. Not only have we improved the speed and efficiency of our
drilling and completions there, we also continue to optimize well spacing
which could significantly increase drillable locations and recoverable
reserves. One recent Gonzales County well, the Burrow 2-H in which we hold a
100 percent working interest, achieved a 24-hour rate of 6,275 barrels of oil
equivalent per day (boed), of which 4,646 barrels were oil and condensate.

"With a strong position in U.S. resource plays and the very good operational
performance we've had this year, Marathon Oil is positioned to meet or exceed
our full-year production targets. In the case of exploration and production
(E&P), we are raising our 2012 available for sale estimates to between 375,000
and 385,000 net boed, excluding Libya, which further demonstrates our
confidence in our ability to grow production at a 5 to 7 percent compound
annual rate from 2010 through 2017.

"Additionally, over the past year, we have built a more balanced exploration
program with significant resource potential and lower risk. In the next 15
months, Marathon Oil plans to drill a number of impact wells in emerging and
proven oil plays across the Rift Trends in Kenya and Ethiopia, in the
Kurdistan Region of Iraq, and offshore in the Gabon presalt, Norway and the
Gulf of Mexico," Cazalot said.

Segment Results

Total segment income was $590 million in the third quarter of 2012, compared
to $481 million in the prior quarter.

                    Three Months Ended
                    September 30                 June 30
(In millions)        2012                         2012
Segment Income                                   
Exploration and                                  
Production
 United States      $110                         $70
 International       376   347
 Total E&P         486   417
Oil Sands Mining      65  51
Integrated Gas        39  13
 Segment Income (a) $590                         $481

(a) See  Supplemental  Statistics below  for  a reconciliation  of  segment 
income to net income as reported under United States GAAP.

                                     Three Months Ended
                                     September 30 June 30
                                     2012         2012
Production Available for Sale (mboed)             
E&P                                   466          406
OSM                                   46           39
 Total Upstream                     512          445
Libya                                 74(a)        44
 Total Upstream Excluding Libya     438          401

(a) Includes 32 mboed related to the impact of a natural gas sales contract
executed during the third quarter.

Exploration and Production

E&P segment income totaled $486 million in the third quarter of 2012, compared
to $417 million in the second quarter of 2012. The increase was primarily the
result of higher liquid hydrocarbon and natural gas sales volumes, partially
offset by higher operating costs and depreciation, depletion and amortization
(DD&A) associated with the additional volumes.

E&P sales volumes per day (excluding Libya) during the third quarter of 2012
averaged 399,000 net boed, up 10 percent compared to 363,000 net boed for the
second quarter. The increase was primarily a result of increased sales from
the Eagle Ford, Bakken and Anadarko Woodford plays. Timing of international
liftings resulted in increased sales in Equatorial Guinea and Norway,
partially offset by a decrease in the U.K.

E&P production available for sale per day for the third quarter of 2012
averaged 392,000 net boed (excluding Libya), exceeding the Company's 365,000
to 380,000 net boed third quarter guidance and was 8 percent higher than the
previous quarter. Both production available for sale and guidance included two
months of production from the Paloma Partners II, LLC acquisition in the Eagle
Ford that closed Aug. 1. Second quarter production available for sale was
362,000 net boed (excluding Libya). The increase was a result of the continued
ramp up in the U.S. resource plays and the second quarter turnaround in
Equatorial Guinea, partially offset by planned downtime in the U.K.

Compared to the third quarter of 2011, production available for sale
(excluding Libya) in the third quarter of 2012 increased 49,000 net boed, or
14 percent, driven by growth in the Company's U.S. resource plays.

The difference between production volumes available for sale and recorded
sales volumes was primarily due to the timing of international liftings.

Production operations in Libya were suspended in the first quarter of 2011 and
resumed with limited production in the fourth quarter of 2011. During the
third quarter of 2012, net production available for sale averaged 74,000 boed,
compared to 44,000 boed in the second quarter, and net sales averaged 53,000
boed compared to 44,000 boed in the second quarter. Production available for
sale was higher than the second quarter and higher than third quarter net
sales due to a natural gas sales agreement executed in the third quarter. This
agreement resulted in the Company reflecting Jan. 1, 2006 through Sept. 4,
2012 production available for sale in the third quarter, and the Company
anticipates recovering these volumes through increased natural gas sales over
approximately the next 20 months. Marathon Oil has not included production
from Libya in forecasts because of the uncertainty around sustained production
levels.

Marathon Oil estimates fourth quarter E&P production available for sale will
be between 400,000 and 415,000 net boed (excluding Libya). Guidance for
full-year E&P production available for sale has been increased to between
375,000 and 385,000 net boed. This guidance excludes any Libyan production but
includes the production impacts of recent Eagle Ford acquisitions.

United States E&P income was $110 million for the third quarter of 2012,
compared to $70 million in the second quarter. The increase was primarily a
result of higher liquid hydrocarbon and natural gas sales volumes, partially
offset by higher operating costs and DD&A associated with the increased
volumes.

International E&P income was $376 million in the third quarter of 2012,
compared to $347 million in the second quarter. Higher liquid hydrocarbon and
natural gas sales volumes, lower DD&A costs and increased equity earnings as a
result of the second quarter turnaround in Equatorial Guinea, contributed to
the overall increase in international E&P income.

Total E&P exploration expenses were $176 million for the third quarter of
2012, compared to $173 million in the previous quarter. Third quarter
exploration expenses included $51 million pre-tax related to unproved property
impairments associated with approximately 100,000 net non-core acres in the
Eagle Ford.

Marathon Oil is currently drilling the Innsbruck exploration well (45 percent
working interest) in the Gulf of Mexico and had incurred costs of a net $71
million as of the end of the third quarter. The well has drilled through
multiple horizons with no commercial hydrocarbons found to date. The Company
anticipates it will reach total depth within the next few days at a total net
cost, including asset retirement obligations and leasehold costs, of
approximately $100 million.

                Three Months Ended
                September 30                   June 30
                2012                           2012
Key E&P                                        
Statistics
Net Sales                                      
 United States
- Liquids         111     93
(mbbld)
 Bakken       29    25
 Eagle Ford   33    18
 Anadarko     3  2
Woodford
 Other U.S.   46    48
 United States
- Natural Gas     366     319
(mmcfd)
 Bakken       7  8
 Eagle Ford   46    18
 Anadarko     38    23
Woodford
 Alaska       88    82
 Other U.S.   187     188
 International
- Liquids         182     177
(mbbld)
 Equatorial   39    35
Guinea
 Norway       80    77
 U.K.         14    22
 Libya        49    43
 International
- Natural Gas     585     501
(mmcfd)
 Equatorial   459     394
Guinea
 Norway       54    53
 U.K.         46    49
 Libya        26    5
 Worldwide Net   452     407
Sales (mboed)

EAGLE FORD: Marathon Oil's production in the Texas Eagle Ford shale nearly
doubled in the third quarter compared to the second quarter, to approximately
40,000 net boed from 21,000 net boed, of which 75 percent was crude
oil/condensate and 11 percent was natural gas liquids (NGLs). The increase in
production was made up of 5,900 net boed from the Paloma acquisition, with the
remainder coming from organic growth and subsequent development of the Paloma
assets. Currently, the Company is producing over 60,000 net boed with 29 gross
operated wells awaiting completion. In line with previously announced plans,
Marathon Oil has reduced its rig count to 18 while maintaining four dedicated
and two spot-market hydraulic fracturing crews. During the third quarter,
Marathon Oil drilled 78 gross wells and brought 73 wells to sales, for 180
gross wells drilled in 2012. The Company now expects to drill 250 - 260 Eagle
Ford gross wells by year-end 2012, an increase of approximately 20 wells from
previous estimates. The Company's average time to drill a well in the Eagle
Ford is now approximately 24 days, a top-quartile performance in the areas in
which Marathon Oil operates.

On Nov. 1, the Company closed a previously announced acquisition in the Eagle
Ford of approximately 4,300 net acres for an estimated $232 million, excluding
purchase price adjustments. This increased the Company's average working
interest by 4.6 to 7.3 percent in four core areas of mutual interest (AMI),
included 2,900 net boed of production at the time of closing, and added at
least 40 net drilling locations to Marathon Oil's inventory in the Eagle Ford.

BAKKEN: Marathon Oil averaged production of approximately 30,000 net boed
during the third quarter compared to almost 27,000 net boed in the previous
quarter. At the end of October, the Company was producing in excess of 32,000
net boed. The Company drilled 25 gross wells during the third quarter with
seven rigs, and brought 30 wells to sales. In the third quarter Marathon Oil's
average time to drill a well was 25 days spud-to-spud, down from approximately
30 days in the first quarter. By the end of October, the Company had reduced
its operations to five rigs. Marathon Oil's Bakken production averages
approximately 90 percent crude oil, 5 percent NGLs and 5 percent natural gas.

ANADARKO WOODFORD: The Company averaged production of 9,600 net boed during
the third quarter compared to 5,700 net boed in the previous quarter, a 68
percent increase. During the third quarter, eight new wells were brought to
sales. For the month of September, the Company's net production averaged
approximately 12,000 boed. 

NORWAY: The Alvheim floating, production, storage and offloading (FPSO) vessel
in Norway achieved another quarter with strong operational performance and
reliability. Production available for sale was essentially flat from the
second quarter averaging over 89,000 net boed during the third quarter.
Marathon has a 65 percent operated interest in Alvheim and in Volund, and a 47
percent operated interest in Vilje.

KURDISTAN: In July Marathon Oil spud its first operated exploration well on
the Harir block in the Kurdistan Region of Iraq and anticipates reaching the
target depth of approximately 12,000 feet in December. The Company plans to
spud an exploration well on its other operated block, Safen, in the first
quarter of 2013. In each of the Harir and Safen blocks, Marathon Oil holds a
45 percent working interest and carries the Government for an additional 11.25
percent.

On the Atrush block, the Company participated in a non-operated appraisal well
that was flow tested at more than 42,000 gross boed. On the Sarsang block, the
non-operated Mangesh exploration well was spud in September. The Company holds
a 20 percent working interest in the Atrush block, and holds a 25 percent
working interest in the Sarsang block.

ETHIOPIA: Marathon Oil announced in October an agreement to acquire a 20
percent working interest in the South Omo concession onshore Ethiopia with an
effective date of Aug. 17, 2012. An exploration well is anticipated to spud in
South Omo in the fourth quarter.The transaction is expected to close before
year end, subject to completion of the necessary Ethiopian government
approvals.

KENYA: In October Marathon Oil closed on a transaction to acquire positions in
onshore exploration Block 9 and Block 12A in northwest Kenya. The Company now
holds a 50 percent working interest in Block 9, where an exploration well is
currently planned in mid-2013, and a 15 percent working interest in Block 12A.

GABON: In October Marathon Oil closed on a transaction to acquire a 21.25
percent working interest in the Diaba License G4-223, offshore Gabon in the
presalt. Exploration drilling is expected to begin in the first quarter of
2013.

Oil Sands Mining

The OSM segment reported income of $65 million for the third quarter of 2012,
compared to $51 million in the second quarter. The increase in segment income
was the result of higher synthetic crude oil sales and prices, partially
offset by higher operating costs.

                                                  Three Months Ended
                                                  September 30 June 30
                                                  2012         2012
Key Oil Sands Mining Statistics                                
Net Synthetic Crude Oil Sales (mbbld)              53           44
Synthetic Crude Oil Average Realizations (per bbl) $81.13       $79.31

Marathon Oil's third quarter 2012 net synthetic crude oil production (upgraded
bitumen excluding blendstocks) from its non-operated position in the Athabasca
Oil Sands Project (AOSP) mining operation was 46,000 barrels per day (bbld),
which was above previous guidance. Marathon Oil anticipates producing an
average of 35,000 to 40,000 net bbld of synthetic crude oil (upgraded bitumen
excluding blendstocks) in the fourth quarter, and as a result of decreased
reliability expects to average 38,000 to 42,000 net bbld for the full year
2012. Marathon Oil holds a 20 percent working interest in the AOSP.

Integrated Gas

Integrated Gas segment income was $39 million in the third quarter of 2012,
compared to $13 million in the second quarter. The increase was due primarily
to higher sales volumes and lower costs in the third quarter due to a planned
turnaround in the second quarter.

                                 Three Months Ended
                                 September 30 June 30
                                 2012         2012
                                             
Key Integrated Gas Statistics                 
Net Sales (metric tonnes per day)             
 LNG                          7,065        5,467
 Methanol                     1,146        1,268

Corporate and Special Items As previously announced, Marathon Oil anticipates
divestitures of $1.5 billion to $3 billion over the period of 2011 through
2013 in an ongoing effort to optimize the Company's portfolio for profitable
growth. To date, the Company has entered into agreements for approximately
$1.1 billion in divestitures, of which more than $700 million have been
completed. Also in October Marathon Oil issued $2 billion of debt. It issued
$1 billion aggregate principal amount of senior notes bearing interest at 0.9
percent with a maturity date of Nov. 1, 2015, and $1 billion aggregate
principal amount of senior notes bearing interest at 2.8 percent with a
maturity date of Nov. 1, 2022.

In August Marathon Oil entered into crude oil derivative instruments related
to a portion of its forecast U.S. E&P crude oil sales. For the third quarter
of 2012, an after-tax unrealized gain of $29 million ($45 million pre-tax) was
recorded related to these crude oil derivative instruments. The table below
summarizes these commodity derivatives.

                                      Weighted                   
Term           Bbls per day             Average Price              Benchmark
Swaps
Oct 2012 -     20,000  $96.29                    WTI
Dec 2013
Oct 2012 -     25,000  $109.19                   Brent
Dec 2013
                                                                
                                      Weighted                   
Term           Bbls per day             Average Price              Benchmark
Option Collars
Oct 2012 -     15,000  $90 floor/$101.17         WTI
Dec 2013                                 ceiling
Oct 2012 -     15,000  $100 floor/$116.30        Brent
Dec 2013                                 ceiling

Marathon Oil recorded an after-tax settlement charge of $22 million ($34
million pre-tax) in connection with the Company's U.S. pension plans during
the third quarter of 2012.

Marathon Oil recorded an after-tax loss of $11 million ($18 million pre-tax)
on the sale of undeveloped acreage outside the core of the Eagle Ford shale.

The Company will conduct a conference call and webcast today, Nov. 6, at 2:00
p.m. EST, during which it will discuss third quarter 2012 results and will
include forward-looking information. The Company anticipates providing an
expanded update on current operations across its resource plays and
exploration prospects. The webcast is expected to last approximately 90
minutes including questions and answers. To listen to the webcast of the
conference call and view the slides, visit the Marathon Oil website at
http://www.marathonoil.com. Replays of the webcast will be available through
Nov. 20, 2012. Quarterly financial and operational information will also be
provided via the Quarterly Investor Packet available on Marathon Oil's website
at http://ir.marathonoil.com and on its mobile app available for Apple and
Android devices. The webcast slides and Quarterly Investor Packet will be
posted to the Company's website and to its mobile app later this morning.

                                    # # #

In addition to net income determined in accordance with generally accepted
accounting principles (GAAP), Marathon Oil has provided supplementally
"adjusted net income," a non-GAAP financial measure which facilitates
comparisons to earnings forecasts prepared by stock analysts and other third
parties. Such forecasts generally exclude the effects of items that are
considered non-recurring, are difficult to predict or to measure in advance or
that are not directly related to Marathon Oil's ongoing operations. A
reconciliation between GAAP net income and "adjusted net income" is provided
in a table on page 1 of this release. "Adjusted net income" should not be
considered a substitute for net income as reported in accordance with GAAP.
Management, as well as certain investors, uses "adjusted net income" to
evaluate Marathon Oil's financial performance between periods. Management also
uses "adjusted net income" to compare Marathon Oil's performance to certain
competitors.

In addition to cash flow from operations determined in accordance with GAAP,
Marathon Oil has provided supplementally "cash flow from operations before
changes in working capital," a non-GAAP financial measure, which management
believes demonstrates the Company's ability to internally fund capital
expenditures, pay dividends and service debt. A reconciliation between GAAP
cash flow from operations and "cash flow from operations before changes in
working capital" is provided in a table on page 1 of this release. "Cash flow
from operations before changes in working capital" should not be considered a
substitute for cash flow from operations as reported in accordance with GAAP.
Management, as well as certain investors, uses "cash flow from operations
before changes in working capital" to evaluate Marathon Oil's financial
performance between periods. Management also uses "cash flow from operations
before changes in working capital" to compare Marathon Oil's performance to
certain competitors.

This release contains forward-looking statements with respect to the timing
and levels of the Company's worldwide liquid hydrocarbon and natural gas
production, synthetic crude oil production, the expected number of wells to be
drilled in the Eagle Ford play, timing of the expected realization of Libya
gas volumes, anticipated exploration drilling activity in the Kurdistan
Region of Iraq, Ethiopia, Kenya, Gabon, Norway and the Gulf of Mexico, the
expected closing of an agreement in Ethiopia, the anticipated timing of
reaching total depth of the Innsbruck well, and projected asset dispositions
through 2013. The 24-hour production rate referenced in the release may not be
indicative of future production rates. The average times to drill a well
referenced in the release may not be indicative of future drilling times.
Factors that could potentially affect the timing and levels of the Company's
worldwide liquid hydrocarbon and natural gas production, synthetic crude oil
production, the expected number of wells to be drilled in the Eagle Ford play,
timing of the expected realization of Libya gas volumes, and anticipated
exploration drilling activity in the Kurdistan Region of Iraq, Ethiopia,
Kenya, Gabon, Norway and the Gulf of Mexico include pricing, supply and demand
for liquid hydrocarbons and natural gas, the amount of capital available for
exploration and development, regulatory constraints, timing of commencing
production from new wells, drilling rig availability, unforeseen hazards such
as weather conditions, acts of war or terrorist acts and the governmental or
military response thereto, and other geological, operating and economic
considerations. The closing of the agreement in Ethiopia is subject to
completion of the necessary Ethiopian government approvals. The anticipated
timing of reaching total depth of the Innsbruck well and projected asset
dispositions are based on current expectations, estimates and projections are
not guarantees of future performance. Actual results may differ materially
from these expectations, estimates and projections and are subject to certain
risks, uncertainties and other factors, some of which are beyond the Company's
control and difficult to predict. The foregoing factors (among others) could
cause actual results to differ materially from those set forth in the
forward-looking statements. In accordance with the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995, Marathon Oil Corporation
has included in its Annual Report on Form 10-K for the year ended December 31,
2011, and 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 materially from those set forth in the
forward-looking statements.

Condensed Consolidated Statements of Income (Unaudited)            
              Three Months Ended
              September 30              June 30                   September 30
(In millions,
except per     2012                      2012                      2011
share data)
Revenues and                                                     
other income:
 Sales and
other          $4,018                    $3,718                    $3,633
operating
revenues
 Sales to
related        16                        13                        16
parties
 Income from
equity method  122                       60                        123
investments
 Net gain
(loss) on      (12)                      (28)                      13
disposal of
assets
 Other       17                        21                        14
income

Total revenues 4,161                     3,784                     3,799
and other
income
Costs and                                                        
expenses:
 Cost of
revenues       1,296                     1,302                     1,600
(excludes
items below)
 Purchases
from related   72                        56                        57
parties

Depreciation,  625                       580                       517
depletion and
amortization
 Impairments 8                         1                         
                                                                   -
 General and
administrative 139                       130                       104
expenses
 Other taxes 63                        67                        59
 Exploration 176                       173                       129
expenses

Total costs    2,379                     2,309                     2,466
and expenses
Income from    1,782                     1,475                     1,333
operations
 Net
interest and   (53)                      (57)                      (30)
other
Income from
operations     1,729                     1,418                     1,303
before income
taxes
 Provision
for income     1,279                     1,025                     898
taxes
Net income     $450                      $393                      $405
Adjusted net   $454                      $416                      $421
income (a)
Adjustments
for special                                                      
items (net of
taxes):
Unrealized
gain on crude    
oil derivative 29                        -                         -
instruments
Pension           
settlement     (22)                      -                         -
Loss on          (23)                      (1)
dispositions   (11)
Deferred        
income tax     -                         -                         (15)
items
Net income     $450                      $393                      $405
Per Share Data                                                   
Basic:                                                           
Net income     $0.64                     $0.56                     $0.57
Diluted:                                                         
Adjusted net   $0.64                     $0.59                     $0.59
income (a)
Net income     $0.63                     $0.56                     $0.57
Weighted
Average                                                          
Shares:
 Basic        706                       706                       711
 Diluted      709                       709                       714

(a) Adjusted net income is a non-GAAP financial measure and should not be
considered a substitute for net income as determined in accordance with
accounting principles generally accepted in the United States. See above for
further discussion of adjusted net income.

Supplemental
Statistics                                                           
(Unaudited)
              Three Months Ended
              September 30                June 30                     September 30
(In millions)  2012                        2012                        2011
Segment Income                                                       

Exploration                                                          
and Production
      $110                        $70                         $81
United States
      376                         347                         249
International
 486                         417                         330
E&P segment
 Oil Sands 65                          51                          92
Mining
           39                          13                          55
Integrated Gas
Segment income 590                         481                         477
Items not
allocated to
segments, net                                                        
of income
taxes:
 Corporate
and other      (136)                       (65)                        (56)
unallocated
items

Unrealized                                  
gain on crude  29                          -                         -
oil derivative
instruments
 Pension   (22)                         
settlement                                 -                         -
 Loss on   (11)                        (23)                        (1)
dispositions
 Deferred   
income tax     -                         -                         (15)
items
 $450                        $393                        $405
Net income
Capital
Expenditures                                                         
(b)

Exploration                                                          
and Production
      $1,046                      $983                        $502
United States
      228                         201                         182
International
 1,274                       1,184                       684
E&P segment
 Oil Sands 41                          43                          36
Mining
           1                           1                           1
Integrated Gas
 Corporate 23                          17                          7
 $1,339                      $1,245                      $728
Total
Exploration                                                          
Expenses
 United    $132                        $144                        $75
States
           44                          29                          54
International
 $176                        $173                        $129
Total

(b) Capital expenditures include changes in accruals.

Supplemental Statistics (Unaudited)                             
                                            Three Months Ended
                                            September 30 June 30 September 30
                                            2012         2012    2011
E&P Operating Statistics                                        
 Net Crude Oil Sales (mbbld)                                
 United States                      98           85      65
 Europe                             93           98      107
 Africa                             77           68      23
 Total International           170          166     130
 Worldwide           268          251     195
 Net Natural Gas Liquids Sales (mbbld)                      
 United States                      13           8       4
 Europe                             1            1       1
 Africa                             11           10      11
 Total International           12           11      12
 Worldwide           25           19      16
 Total Net Liquid Hydrocarbon Sales                         
(mbbld)
 United States                      111          93      69
 Europe                             94           99      108
 Africa                             88           78      34
 Total International           182          177     142
 Worldwide           293          270     211
 Net Natural Gas Sales (mmcfd)                              
 United States                      366          319     296
 Europe (c)                         100          102     79
 Africa                             485          399     453
 Total International           585          501     532
 Worldwide           951          820     828
 Total Worldwide Sales (mboed)           452          407     349
 Average Realizations (d)                                  
 Liquid Hydrocarbons (per bbl)                          
 United States                   $83.80       $84.40  $88.89
 Europe                          112.34       111.12  117.05
 Africa                          98.65        96.84   63.51
 Total International          105.71       104.82  104.24
 Worldwide            97.40        97.81   99.24
 Natural Gas (per mcf)                                  
 United States                   3.61         3.42    4.85
 Europe                          10.10        10.05   9.81
 Africa (e)                      0.63         0.25    0.24
 Total International          2.25         2.25    1.67
 Worldwide            $2.77        $2.70   $2.81
OSM Operating Statistics                                        
 Net Synthetic Crude Oil Sales (mbbld)   53           44      50
(f)
 Synthetic Crude Oil Average Realizations $81.13       $79.31  $87.29
(per bbl) (d)
IG Operating Statistics                                         
 Net Sales (mtd) (g)                                       
 LNG                                 7,065        5,467   6,935
 Methanol                            1,146        1,268   1,366

(c) Includes natural gas acquired for injection and subsequent resale of 18
mmcfd and 17 mmcfd for the third and second quarters of 2012 and 16 mmcfd for
the third quarter of 2011.

(d) Excludes gains and losses on derivative instruments.

(e) Primarily represents a fixed price under long-term contracts with Alba
Plant LLC, Atlantic Methanol Production Company LLC ("AMPCO") and Equatorial
Guinea LNG Holdings Limited ("EGHoldings"), equity method investees. The
Company includes its share of Alba Plant LLC's income in its E&P segment and
includes its share of AMPCO's and EGHoldings' income in its Integrated Gas
segment.

(f) Includes blendstocks.

(g) Includes both consolidated sales volumes and our share of the sales
volumes of equity method investees in the third quarter of 2011. LNG sales
from Alaska, conducted through a consolidated subsidiary, ceased when these
operations were sold in the third quarter of 2011. LNG and methanol sales
from Equatorial Guinea are conducted through equity method investees.

CONTACT: Media Relations Contacts:
         Lee Warren: 713-296-4103
         John Porretto: 713-296-4102
        
         Investor Relations Contacts:
         Howard Thill: 713-296-4140
         Chris Phillips: 713-296-3213