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The Unexpected $17B Marathon Oil Deal by ConocoPhillips

The Unexpected $17B Marathon Oil Deal by ConocoPhillips

ConocoPhillips to Acquire Marathon Oil in $17.1 Billion Deal

In a surprising move, ConocoPhillips has announced plans to acquire Marathon Oil in an all-stock deal, valued at $17.1 billion. ConocoPhillips (COP) is set to boost its asset portfolio, though Tortoise Portfolio Manager Rob Thummel has noted that Marathon Oil’s assets are “good, not great”.

Free Cash Flow Yield a Key Benefit

Despite his lukewarm assessment of the assets, Thummel commends Marathon Oil’s management team for their capital discipline. The resulting high free cash flow yield will be a significant benefit for ConocoPhillips. To get further expert insights and latest market developments, watch the full episode of Morning Brief here.

Transcript Highlights

Thummel expressed surprise at the acquisition, noting that few likely expected Marathon Oil to be taken over by ConocoPhillips. The acquisition, however, makes sense given Marathon Oil’s high free cash flow yield, one of the highest in the oil and gas space. The merger will add a significant amount of free cash flow that ConocoPhillips can further deploy.

ConocoPhillips Boosts Asset Portfolio

ConocoPhillips will gain some good assets across the Bakken in North Dakota, and the Permian and Eagle Ford in Texas. The additional cash allows ConocoPhillips to further its capital allocation, whether to shareholders or future acquisitions.

Possible Regulatory Scrutiny

The deal will likely face regulatory scrutiny, though Thummel anticipates that it may receive less attention than other transactions. The process will follow the usual rigour at the Federal Trade Commission. Regardless, the consensus is that ConocoPhillips will benefit from the acquisition, thanks to Marathon Oil’s disciplined approach and high free cash flow yield.

Original Story at finance.yahoo.com

Trending News

Mississippi River Faces Persistent Saltwater Intrusion, Region Seeks Long-Term Solutions



For the third consecutive year, the Mississippi River is experiencing significant saltwater intrusion, prompting local communities and environmental experts to search for sustainable solutions. This recurring issue arises as the river’s flow decreases, allowing saltwater to move upstream and threaten drinking water supplies. The U.S. Army Corps of Engineers is actively involved in addressing this problem, employing temporary measures like saltwater barriers to mitigate the impact on affected areas.



Saltwater infiltration poses serious risks to public health and agriculture, as freshwater sources become compromised. The situation is exacerbated by prolonged periods of drought, which have reduced freshwater flow in the Mississippi River. According to the National Weather Service, drought conditions have worsened due to climate change, increasing the frequency and severity of saltwater intrusion events.



Local authorities are collaborating with federal agencies to explore permanent solutions. Among the proposed strategies are enhanced levee systems and improved water management techniques. The U.S. Army Corps of Engineers is evaluating the feasibility of long-term infrastructure projects to prevent further saltwater encroachment. Additionally, community leaders are advocating for increased funding to support these initiatives and safeguard the region’s water resources.



The impact of saltwater intrusion extends beyond drinking water concerns, affecting local ecosystems and agricultural productivity. Farmers in the region have reported crop damage due to elevated salinity levels in irrigation water. The Natural Resources Conservation Service is working with farmers to implement adaptive practices, such as planting salt-tolerant crops and improving soil management techniques.



As the Mississippi River continues to face challenges from saltwater intrusion, stakeholders emphasize the importance of collaborative efforts and innovative solutions. The ongoing threat underscores the need for comprehensive planning and investment to protect one of America’s most vital waterways from the impacts of climate change and environmental stressors.

November 19, 2024



Environmental activists have raised concerns over the fossil fuel sector’s significant impact on COP29, the latest United Nations Climate Change Conference. Activists argue that the industry’s presence diverts focus from critical climate actions.



The conference, designed to promote global climate agreements, faces criticism for allowing fossil fuel companies to participate extensively. Environmental groups claim these companies undermine efforts to reduce carbon emissions and transition to renewable energy sources.



According to Climate Action Network, fossil fuel representatives have increased their lobbying activities, aiming to weaken climate policies. These industries allegedly influence negotiations, leading to watered-down commitments that fail to address the urgency of climate change effectively.



Experts suggest that the influence of these companies stems from financial contributions and longstanding relationships with decision-makers. Critics argue that this affects the conference’s ability to enforce meaningful climate change regulations.



During the event, several protests highlighted the need for transparency and a stronger focus on sustainable energy solutions. Activists are calling for increased participation of renewable energy stakeholders in future conferences.



The controversy surrounding fossil fuel involvement at COP29 underscores the ongoing challenge of balancing industrial interests with the global imperative to combat climate change.



November 19, 2024