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Local News

Wednesday, February 03, 2010

Higher oil prices help Marathon earn $355M
By CHRIS KAHN

AP Energy Writer

Marathon Oil Corp. on Tuesday said higher oil prices helped it earn $355 million in the fourth quarter, reversing a loss from a year ago.

The Houston oil company reported net income of 50 cents per share in the final three months of 2009. Marathon lost $41 million, or 6 cents a share, in the same quarter of 2008.

Revenue increased 11.5 percent to $15.9 billion.

Excluding the sale of assets in Gabon and other special items, the company said it earned $229 million, or 32 cents a share.

The results came one day after Marathon said it plans to cut capital spending by 17 percent this year to $5.1 billion, slashing its budget for refineries by more than half.

The refining business has been a sore spot throughout the oil patch. Americans aren't burning as much fuel as they did in the past, and the price of gas hasn't increased at the same pace as the oil that's used to make it.

In the fourth quarter, oil prices increased by more than $11 a barrel, about 17 percent, while Americans consumed less petroleum for the third year in a row, according to the Energy Information Administration. Retail gasoline prices were flat in the quarter, adding just 3 cents a gallon, or 1 percent in the final three months of the year.

Marathon's refining business lost $18 million in the fourth quarter. Full-year refining profits dropped 61 percent to $464 million.

The refining business sank profits throughout the industry in the fourth quarter.

To save money, companies have slowed their refineries to some of the lowest levels on record for this time of year. Chevron said it plans to restructure its refining operation and cut jobs, while Valero Energy Corp. shuttered one of its refineries at a cost of $1.2 billion.

"It's a tough business," said Jim Byrne, an analyst with VMO Capital Markets-Canada. There's so much excess supply of gasoline, diesel and other fuels in the U.S. that some refineries are just going to break even this year, Byrne said.

"You're going to see more refinery shutdowns this year, but it's hard to predict which ones are going to be turned off," he said.

BP, which also reported fourth-quarter income Tuesday, fell short of analysts' estimates in part because of weak refining profits. Europe's second-largest oil company said its refining indicator margin, a broad measure of profitability, dropped from $5.20 a barrel in the last quarter of 2008 to $1.49 a barrel in the recent period.

Exxon Mobil said earlier that its U.S. refineries lost $287 million in the fourth quarter, and Chevron's refineries lost $613 million. Valero, America's largest independent petroleum refiner, lost almost $2 billion in 2009.

After expanding its refinery in Garyville, La., Marathon said Monday it would devote most of its capital spending this year to oil and gas exploration, which has propped up its bottom line with higher profits.

The company pumped 8 percent more oil and gas in 2009 while cutting production costs by 15 percent. When oil prices surged in the fourth quarter, Marathon's exploration and production business saw profits jump 83 percent.

Marathon said it will focus this year on exploring potential petroleum deposits in the Gulf of Mexico. It also will target two "high-reward, but also high-risk" deepwater wells in Indonesia and look for more natural gas in the rich underground shale beds of the U.S.

Marathon estimated that it would produce between 390,000 and 410,000 barrels of oil equivalent per day.

For all of 2009, Marathon earned $1.46 billion, or $2.06 per share, compared with $3.5 billion, or $4.95 per share in 2008.

Marathon shares added 25 cents to close at $30.90.


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News Briefs Firefighters discover 20 marijuana plants in house
After fighting a house fire early Monday at 815 Howard St., firefighters found 20 marijuana plants in the residence.

"They ran across it and called us," said police Sgt. Justin Hendren with the Hancock County METRICH Drug Enforcement Unit.

Police seized all 20 plants, and Hendren said charges are pending.

High-powered growing lights, fans, and a box filled with dried marijuana were also found in the house, according to a police report.

Investigators said an electrical short started the fire before 3 a.m. Monday.

The blaze caused an estimated $12,000 in damage to the residence, owned by Amanda Crawford. No one was injured, according to the Findlay Fire Department.

Carey announces holiday closing
CAREY -- Carey offices, including administrative, income tax and utilities, electric, wastewater treatment plant, and public works, will be closed Monday in observance of Labor Day.

The curbside recycling program will be held Tuesday through Thursday, Sept. 7-9.

Findlay trooper named sergeant
Trooper Jacob L. Fletcher, assigned to the Findlay post of the State Highway Patrol, was promoted to sergeant Wednesday by Patrol Superintendent Col. David Dicken.

With the promotion, Fletcher will stay at the Findlay post and serve as an assistant post commander, according to the patrol.

Fletcher began his patrol career in 2002 after graduating from the 139th Academy class and has been assigned to the Findlay post since.

Owens announces holiday schedule
The Toledo and Findlay campuses of Owens Community College will be closed Saturday through Monday for the Labor Day holiday.

There will be no classes and the college offices will be closed.

Classes will resume and offices will open again on Tuesday.

Holiday changes ad deadlines
The Courier won't be published on Monday, in observance of the Labor Day holiday.

Because of the holiday, some advertising deadlines have been moved up this week:

Black and white display advertising for Tuesday's newspaper must be placed by noon Friday. Display advertising for Wednesday's newspaper must be placed by 2:30 p.m. Friday.

Color display advertising for the Thursday, Sept. 9 newspaper must be placed by Friday.

Classified advertising and City and Country advertising for Saturday's newspaper must be placed by 2 p.m. Friday. Classified ads for Tuesday's newspaper must be placed by 2:30 p.m. Friday.

Courier business and advertising offices will close at 3 p.m. Friday for the holiday.