Marathon Board Approves Deepwater Gulf of Mexico Droshky and Ozona Development Projects

HOUSTON, Oct. 30 /PRNewswire-FirstCall/ -- Marathon Oil Corporation (NYSE: MRO) announced today that its Board of Directors has sanctioned two Gulf of Mexico development projects, Droshky and Ozona. The Board approved a total project cost of $1.3 billion for the Droshky development and $300 million for the Ozona development.

"As we continue to strengthen Marathon's Gulf of Mexico portfolio, the Droshky development will add profitable production and contribute significantly to our near- and long-term growth," said Clarence P. Cazalot, Jr., Marathon president and CEO.

The Company expects to initially book proved reserves of approximately 29 million barrels of oil equivalent (BOE) for Droshky and Ozona, with additional bookings expected upon completion and with production history.

The Droshky discovery is located in approximately 2,900 feet of water in Green Canyon Block 244, about 140 miles south-southwest of Venice, La., and about 18 miles southeast of Shell's Bullwinkle platform. The project will consist of four development wells, which will be tied back to Bullwinkle. Marathon has secured the Noble Paul Romano rig to begin drilling in 2009, and first production is targeted for 2010. Expected net peak production is about 45,000 barrels per day (bpd) of oil and 43 million cubic feet per day (MMcf/d) of natural gas, after royalties.

The initial Droshky discovery well and two sidetracks were drilled in 2007 to a total depth of 21,190 feet and followed in 2008 by a second delineation and sidetrack. Marathon holds a 100 percent working interest in Droshky.

The Ozona discovery is located in approximately 3,000 feet of water on Garden Banks Block 515, about 175 miles southeast of Sabine, Texas, and about six miles from Shell's Auger platform. Marathon has contracted with the Noble Jim Day rig to complete one previously drilled appraisal well, which will be tied back to the Auger platform. First production is expected in 2011, with an anticipated net peak rate of about 6,000 bpd of oil and 13 MMcf/d of natural gas, after royalties. Marathon holds a 68 percent working interest in Ozona. Marubeni holds a 32 percent working interest.

Marathon is an integrated international energy company engaged in exploration and production; oil sands mining; integrated gas; and refining, marketing and transportation operations. Marathon, which is based in Houston, has principal operations in the United States, Angola, Canada, Equatorial Guinea, Gabon, Indonesia, Ireland, Libya, Norway and the United Kingdom. Marathon is the fourth largest United States-based integrated oil company and the nation's fifth largest refiner.

Unlike capital expenditures reported under generally accepted accounting principles, the projected costs for the Droshky and Ozona projects discussed in this release do not include capitalized interest. Capitalized interest is budgeted at the corporate level.

This release contains forward-looking statements with respect to, the two Gulf of Mexico development projects, proved reserves of liquid hydrocarbons and anticipated future development and drilling activity. Some factors that could potentially affect the two Gulf of Mexico development projects include necessary regulatory and third-party approvals, transportation logistics, availability of materials and labor, unforeseen hazards such as weather conditions, and other risks customarily associated with construction projects. The forward-looking statements related to proved reserves of liquid hydrocarbons are based on certain assumptions including, among others, presently known physical data concerning size and character of reservoirs, economic recoverability, technology development, future drilling success, production experience, industry economic conditions, levels of cash flow from operations and operating conditions. Anticipated future development and drilling activity may be affected by a number of factors or are based on a number of assumptions including, among others, pricing, supply and demand for petroleum products, amount of capital available for exploration and development, regulatory constraints, timing of commencing production from new wells, 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 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, 2007, 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.

Media Relations Contacts:     Lee Warren      713-296-4103
                                  Paul Weeditz    713-296-3910

    Investor Relations Contacts:  Howard Thill    713-296-4140
                                  Chris Phillips  713-296-3213

SOURCE  Marathon Oil Corporation
    -0-                             10/30/2008
    /CONTACT:  Media Relations: Lee Warren, +1-713-296-4103, or Paul Weeditz,
+1-713-296-3910; Investor Relations: Howard Thill, +1-713-296-4140, or Chris
Phillips, +1-713-296-3213, all of Marathon Oil Corporation/
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              PRN Photo Desk, photodesk@prnewswire.com/
    /Web site:  http://www.marathon.com /
    (MRO)

CO:  Marathon Oil Corporation
ST:  Texas
IN:  OIL
SU:

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