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Marathon Oil Corporation Reports Second Quarter 2008 Results

July 31, 2008

HOUSTON, July 31 /PRNewswire-FirstCall/ — Marathon Oil Corporation today reported second quarter 2008 net income of $774 million, or $1.08 per diluted share. Net income in the second quarter 2007 was $1.550 billion, or $2.25 per diluted share. For the second quarter 2008, net income adjusted for special items was $858 million, or $1.20 per diluted share, compared to net income adjusted for special items of $1.548 billion, or $2.25 per diluted share, for the second quarter 2007.

   (Logo:  http://www.newscom.com/cgi-bin/prnh/20051027/DATH029LOGO )                                                      2nd Quarter Ended June 30   (In millions, except per diluted share data)        2008           2007    Net income adjusted for special items(a)            $858         $1,548   Adjustments for special items (net of income taxes):     Loss on U.K. natural gas contracts                 (84)            (5)     Gain on sale of discontinued operations              -              8     Loss on early extinguishment of debt                 -             (1)   Net income                                          $774         $1,550     Net income adjusted for special items(a) -      per diluted share                               $1.20          $2.25     Net income - per diluted share                   $1.08          $2.25     Revenues and other income                      $22,225        $16,887     Weighted average shares - diluted                  714            689     (a) Net income adjusted for special items 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        net income adjusted for special items.    

Marathon’s second quarter 2008 results include a non-cash, after-tax mark- to-market loss of $220 million on derivatives intended to mitigate price risk related to future sales of Canadian synthetic crude. The last of these derivatives is set to expire in the fourth quarter of 2009.

“The second quarter 2008, compared to the second quarter 2007, was a challenging quarter financially, particularly as a result of the significantly lower refining and wholesale marketing realized margins in a very difficult downstream environment and the derivatives loss incurred in the Oil Sands Mining segment. However, our Upstream business had a record quarter in profitability and our Integrated Gas segment continues to perform well,” said Clarence P. Cazalot, Jr., Marathon president and CEO.

“Operationally, the quarter saw Marathon delivering on our defined profitable growth in the Upstream segment, with production available for sale increasing more than 8 percent over the same period in 2007 and we have had two high-margin major development projects brought online within the last two months.

“The Alvheim/Vilje development offshore Norway achieved first oil in early June and is currently producing from five wells in the Alvheim portion of the development, and the non-operated Neptune development in the Gulf of Mexico began operations just after the quarter ended. Strong production from Alvheim and Neptune, and solid operations across our entire Upstream business will help drive Marathon’s production performance for the year and will contribute significantly to Marathon’s production growth through 2012.

“While the downstream environment remains challenged with tight margins, Marathon is focused on lowering feedstock costs and increasing efficiency and flexibility by expanding our coking capacity. The 180,000 barrels per day (bpd) refinery expansion at our facility in Garyville, La., is almost 60 percent complete, on budget and scheduled for late 2009 startup. Construction recently started on the Detroit Heavy Oil Upgrading Project, and upon completion in late 2010, it will allow us to refine an additional 80,000 bpd of heavy crude oil,” Cazalot said.

Segment Results

Total segment income was $931 million in the second quarter of 2008, compared to $1.658 billion in the second quarter of 2007.

                                                   2nd Quarter Ended June 30   (In millions)                                       2008           2007   Segment Income (Loss)     Exploration & Production (E&P)       United States                                   $359           $173       International                                    469            227         Total E&P                                      828            400     Oil Sands Mining (OSM)                            (157)             -     Refining, Marketing & Transportation (RM&T)        158          1,246     Integrated Gas (IG)                                102             12       Segment Income(a)                               $931         $1,658    (a) See Preliminary Supplemental Statistics below for a       reconciliation of segment income to net income as reported under       generally accepted accounting principles.     Exploration and Production  

Exploration and Production segment income totaled $828 million in the second quarter of 2008, which was more than double the $400 million in the second quarter of 2007. The increase was primarily a result of higher liquid hydrocarbon realizations as well as higher natural gas volumes.

Sales volumes during the quarter averaged 350,000 barrels of oil equivalent per day (boepd), compared to 338,000 boepd for the same period last year. Due to timing of a lifting, the sales volumes were lower than the estimate of 356,000 boepd provided in the interim update.

Production available for sale in the second quarter 2008 averaged 374,000 boepd, an increase of more than 8 percent from 345,000 boepd in the same period last year. The difference between production volumes available for sale and the recorded sales volumes is due to the timing of international oil liftings and natural gas held in storage. Production available for sale exceeded estimates provided in the first quarter, primarily due to the deferral of planned plant maintenance in Equatorial Guinea and the better- than-forecast reliability of the Alvheim/Vilje facilities during ramp-up of production. The Company has narrowed its expectations for 2008 production available for sale to be between 380,000 and 400,000 boepd, excluding the effects of any dispositions.

United States upstream income was $359 million in the second quarter of 2008, compared to $173 million in the second quarter of 2007, primarily as a result of higher liquid hydrocarbon and natural gas realizations, partially offset by lower sales volumes.

International upstream income was $469 million in the second quarter of 2008, compared to $227 million in the second quarter of 2007. The increase was primarily due to higher liquid hydrocarbon and natural gas realizations, and higher natural gas sales that included a full quarter of operations at the EG LNG plant, which commenced production in May 2007.

                                                   2nd Quarter Ended June 30                                                       2008           2007   Key Production Statistics   Net Sales     United States - Liquids (mbpd)                      63             65     United States - Natural gas (mmcfpd)               431            460     International - Liquids (mbpd)                     119            134     International - Natural gas (mmcfpd)               573            374   Total Net Sales (mboepd)                             350            338    

The Alvheim/Vilje development offshore Norway commenced production on June 8, 2008 and to date has achieved an uptime of approximately 80 percent. Currently, there are five wells producing from the Alvheim portion of the development and the Vilje field is expected to come onstream in early August. Based on the results thus far, Alvheim/Vilje is expected to reach a combined production rate of 75,000 net (120,000 gross) boepd before the end of this year. Marathon has a 65 percent operated interest in the Alvheim fields and a 47 percent outside-operated working interest in the Vilje field.

In the Gulf of Mexico, the Neptune development began production on July 6, 2008, and reached full facility oil capacity after only 15 days of operations. While the production did not have an impact on the second quarter results, the field is currently producing from five wells and the sixth well is expected online in early August. Marathon holds a 30 percent outside-operated working interest in Neptune. The facility’s design capacity is 50,000 bpd of oil and 50 mmcfd of natural gas.

Marathon continues to ramp up production in the Bakken Shale resource play in North Dakota. The Company currently has seven rigs drilling which are achieving best-in-class drilling performance and continue to improve drilling time and well costs. Marathon expects to drill approximately 65 company- operated Bakken wells in 2008, and will have approximately 100 wells in the play by the end of the year. The Company’s net production from the Bakken Shale increased 130 percent from the fourth quarter 2007 rate of 2,170 boepd to the second quarter of 2008 rate of 5,070 boepd, and is currently producing 6,200 boepd.

Offshore Angola, Marathon and its co-venturers received approval to proceed with the first deepwater oil development project on Block 31, comprised of the Plutao, Saturno, Venus and Marte (PSVM) fields. Key contracts are ready to be awarded and construction work is expected to begin later this year. Gross production at a rate of about 150,000 bpd is targeted in 2012. A total of 48 production, gas and water injection plus infill wells are planned for PSVM.

Marathon has participated in three deepwater Angola exploration/appraisal wells that have reached total depth during the year, but for which disclosure of the results is pending receipt of government and partner approvals. The Company is also currently participating in an appraisal well on Block 32. Marathon holds a 10 percent outside-operated interest in Block 31 and a 30 percent outside-operated interest in Block 32.

In early July, Marathon entered into a definitive agreement with Centrica plc, the parent company of British Gas, under which Centrica will purchase Marathon’s non-operated interests in the Heimdal infrastructure, related producing fields and associated undeveloped acreage offshore Norway. Total proceeds before closing adjustments are expected to be $416 million. The companies anticipate closing the transaction during the late third quarter or early fourth quarter of 2008.

Oil Sands Mining

The Oil Sands Mining segment reported a loss of $157 million for the second quarter of 2008. This includes a $250 million after-tax loss on derivative instruments, of which $220 million was unrealized. These derivative instruments were put in place by Western Oil Sands Inc. prior to its acquisition by Marathon in October 2007 to mitigate price risk related to future sales of synthetic crude oil. The last of these derivative instruments is set to expire in the fourth quarter of 2009.

Marathon’s second quarter 2008 net bitumen production before royalties from the Athabasca Oil Sands Project (AOSP) mining operation was 24,000 bpd. Production was lower than expected due to a revised plan to manage the disposal of tailings that resulted in mining a lower grade ore, as well as planned and unplanned maintenance at the mine. (Tailings consist primarily of water and sediment that remain after the bitumen is extracted from the ore.)

Due in large part to the temporary decrease in ore grade, Marathon has reduced its 2008 Oil Sands Mining production expectations to between 25,000 and 28,000 boepd.

                                                   2nd Quarter Ended June 30                                                       2008           2007   Key Oil Sands Mining Statistics     Net Bitumen Production (mbpd)(a)                    24              -     Net Synthetic Crude Oil Sales (mbpd)                31              -     Synthetic Crude Oil Average Realization      (per bbl)(b)                                  $116.40             $-     (a) Before royalties.    (b) Excludes losses on derivative instruments.     Refining, Marketing and Transportation  

The Refining, Marketing and Transportation (RM&T) segment income was $158 million in the second quarter of 2008 compared to $1.246 billion in the second quarter of 2007, with the decrease primarily a result of the lower refining and wholesale marketing gross margin.

The refining and wholesale marketing gross margin per gallon was 8.35 cents in the second quarter of 2008, compared to 39.25 cents in the second quarter of 2007. The primary factor contributing to this decrease was the decline in the relevant market indicators [Light Louisiana Sweet (LLS) 6-3-2-1 crack spreads] in the Midwest (Chicago) and Gulf Coast markets. For example, the Light Louisiana Sweet (LLS) 6-3-2-1 crack spread on a two-thirds Chicago, one-third Gulf Coast basis decreased to $2.47 per barrel in second quarter 2008 from $15.47 per barrel in second quarter 2007. In addition, the Company was not able to fully pass along to its wholesale customers the substantial increase in refined product spot market prices experienced in the second quarter of 2008. Consequently, the Company’s wholesale price realizations in the second quarter did not increase over the comparable prior year period as much as the spot market prices used in the market indicators increased quarter over quarter.

Crude oil refined during the second quarter of 2008 averaged 1,023,000 bpd, a 49,000 bpd decrease from the second quarter of 2007, and total refinery throughputs were 1,203,000 bpd, 6 percent lower than the 1,280,000 bpd in the second quarter of 2007.

Marathon’s refining and wholesale marketing gross margin included pre-tax derivatives losses of $187 million for the second quarter of 2008 compared to losses of $139 million for the second quarter of 2007. In the second quarter of 2008, Marathon decreased its use of derivatives to mitigate crude oil price risk between the time that domestic crude oil purchases are priced and when they are actually refined into salable petroleum products. Approximately half of the losses recognized in the second quarter of 2008 were incurred in April before these steps to decrease the use of derivatives were fully in place. Marathon will selectively continue its practice of using derivatives to protect the carrying value of seasonal RM&T inventories and long-haul foreign crude oil spot purchases.

Speedway SuperAmerica (SSA) gasoline and distillates gross margin per gallon averaged 8.62 cents in the second quarter of 2008, compared to 10.29 cents in the second quarter of 2007. SSA same store gasoline sales volume declined by 4.8 percent during the second quarter of 2008 while same store merchandise sales increased by 1 percent during the same period. Starting in June 2007, SSA ran a special sales promotion that was estimated to increase SSA’s 2007 second quarter same store gasoline sales volume by almost 3 percent. Excluding this special sales promotion, the Company estimates that SSA’s 2008 second quarter same store gasoline sales volume decline would have been about 2.1 percent compared to the actual 4.8 percent decline.

                                                   2nd Quarter Ended June 30                                                       2008           2007   Key Refining, Marketing & Transportation Statistics     Crude Oil Refined (mbpd)                         1,023          1,072     Other Charge and Blend Stocks (mbpd)               180            208       Total Refinery Inputs (mbpd)                   1,203          1,280   Refined Product Sales Volumes (mbpd)               1,369          1,426   Refining and Wholesale Marketing Gross Margin    ($/gallon)                                      $0.0835        $0.3925    

In June 2008, Marathon began construction on the projected $1.9 billion Detroit heavy oil upgrading project. With expected completion in late 2010, the project will increase the refinery’s ability to process heavy crude oil by 80,000 bpd.

The projected $3.2 billion Garyville refinery expansion project in Louisiana continues to progress on time and on budget toward a 2009 start-up.

Integrated Gas

Integrated Gas segment income was $102 million in the second quarter of 2008 compared to $12 million in the second quarter of 2007. The increase was primarily related to income from the Equatorial Guinea LNG production facility which commenced operations in May 2007. The production facility, in which Marathon holds a 60 percent interest, delivered 14 cargoes during the second quarter of 2008. Expenses for Gas-to-Fuels(TM) and other natural gas commercialization technologies in the second quarter of 2008 were $22 million compared to $10 million in the second quarter of 2007.

                                                   2nd Quarter Ended June 30                                                       2008           2007   Key Integrated Gas Statistics   Net Sales (mtpd)     LNG                                              6,402          1,997     Methanol                                         1,188          1,107    

Net LNG sales for the second quarter of 2008 exceeded original estimates because the planned maintenance at the Equatorial Guinea LNG production facility originally scheduled for the second quarter was deferred to the third quarter. The operational availability of the facility has been superior, operating at 93 percent year-to-date.

Corporate

Marathon continued its share repurchase program during the second quarter, repurchasing approximately 3 million shares at a cost of approximately $152 million. Since January 2006, Marathon’s Board of Directors has authorized the repurchase of up to $5 billion of Marathon’s common stock. As of the end of the second quarter, approximately $2.8 billion in Marathon shares had been repurchased, bringing total shares repurchased so far to 63.6 million.

Special Items

Marathon has two natural gas sales contracts in the United Kingdom that are accounted for as derivative instruments. Mark-to-market changes in the valuation of these contracts must be recognized in current period income. In the second quarter of 2008, the non-cash after-tax mark-to-market loss on these contracts related to sales of natural gas from the Brae field complex totaled $84 million. Due to the volatility in the fair value of these contracts, Marathon consistently excludes these non-cash gains and losses from net income adjusted for special items.

The Company will conduct a conference call and webcast today, July 31, at 2:00 p.m. EDT during which it will discuss second quarter results. The webcast will include synchronized slides. To listen to the webcast of the conference call and view the slides, visit the Marathon website at http://www.marathon.com/. Replays of the webcast will be available through Aug. 14, 2008. Quarterly financial and operational information is also provided on Marathon’s Web site at http://ir.marathon.com/ in the Quarterly Investor Packet.

In addition to net income determined in accordance with generally accepted accounting principles, Marathon has provided supplementally “net income adjusted for special items,” 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’s ongoing operations. A reconciliation between GAAP net income and “net income adjusted for special items” is provided in a table previously in this release. “Net income adjusted for special items” should not be considered a substitute for net income as reported in accordance with GAAP. Management, as well as certain investors, uses “net income adjusted for special items” to evaluate Marathon’s financial performance between periods. Management also uses “net income adjusted for special items” to compare Marathon’s performance to certain competitors.

Unlike capital expenditures reported under generally accepted accounting principles, the projected costs for the Garyville refinery expansion project and the Detroit refinery heavy oil upgrading and expansion project 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 2008 worldwide net liquid hydrocarbon and natural gas production available for sale, bitumen production, timing and levels of production from the Alvheim/Vilje development and Neptune development, Blocks 31 and 32 offshore Angola, the anticipated disposition of interests in the Heimdal area and related assets, anticipated future exploratory and development drilling activity, the Garyville refinery expansion project, the Detroit refinery heavy oil upgrading and expansion project, and the common stock repurchase program. Some factors that could potentially affect 2008 worldwide net liquid hydrocarbon and natural gas production available for sale, bitumen production, the timing and levels of production from the Alvheim/Vilje development and Neptune development, Blocks 31 and 32 offshore Angola, and anticipated future exploratory and development drilling activity include pricing, supply and demand for petroleum products, 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. Worldwide net liquid hydrocarbon and natural gas production available for sale could also be affected by the occurrence of acquisitions or dispositions of oil and gas properties. Development of Block 32 may be further affected by the inability or delay in obtaining government and third-party approvals and permits. The disposition of interests in the Heimdal area could be adversely affected by the inability or delay in obtaining necessary government and third party approvals and other customary closing conditions. Factors that could affect the Garyville refinery expansion and the Detroit refinery heavy oil upgrading and expansion projects include transportation logistics, availability of materials and labor, unforeseen hazards such as weather conditions, delays in obtaining or conditions imposed by necessary government and third-party approvals, and other risks customarily associated with construction projects. The common stock repurchase program could be affected by changes in prices of and demand for crude oil, natural gas and refined products, actions of competitors, disruptions or interruptions of the Company’s production or refining operations due to unforeseen hazards such as weather conditions or acts of war or terrorist acts, and other 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                                 Michol Ecklund  713-296-3919                                 Chris Phillips  713-296-3213      Condensed Consolidated Statements of Income (Unaudited)                                         2nd Quarter Ended   Six Months Ended                                              June 30            June 30   (In millions, except per share data)    2008     2007      2008     2007   Revenues and other income:     Sales and other operating revenues      (including consumer excise taxes) $21,226   16,325   $38,506  $28,874     Sales to related parties               686      411     1,228      731     Income from equity method investments  256      117       465      224     Net gain on disposal of assets          12        7        22       18     Other income                            45       27       104       42       Total revenues and other income   22,225   16,887    40,325   29,889    Costs and expenses:     Cost of revenues (excludes items      below)                             17,988   11,804    32,440   21,407     Purchases from related parties         226       89       365      136     Consumer excise taxes                1,295    1,307     2,511    2,504     Depreciation, depletion and      amortization                          504      396       955      789     Selling, general and administrative      expenses                              361      327       661      614     Other taxes                            127       93       250      191     Exploration expenses                   130      115       259      176       Total costs and expenses          20,631   14,131    37,441   25,817    Income from operations                 1,594    2,756     2,884    4,072     Net interest and other financing      income (costs)                        (10)      20        (1)      39     Loss on early extinguishment of debt     -       (1)        -       (3)     Minority interests in loss of      Equatorial Guinea       LNG Holdings Limited                   -        1         -        3    Income before income taxes             1,584    2,776     2,883    4,111     Provision for income taxes             810    1,234     1,378    1,852   Income from continuing operations        774    1,542     1,505    2,259     Discontinued operations                  -        8         -        8    Net income                              $774   $1,550    $1,505   $2,267    Income from continuing operations     Per share - basic                    $1.09    $2.26     $2.11    $3.29     Per share - diluted                  $1.08    $2.24     $2.10    $3.27   Net income     Per share - basic                    $1.09    $2.27     $2.11    $3.30     Per share - diluted                  $1.08    $2.25     $2.10    $3.28     Dividends paid per share             $0.24    $0.24     $0.48    $0.44   Weighted Average Shares:     Basic                                  710      683       711      686     Diluted                                714      689       716      691      Preliminary Supplemental Statistics (Unaudited)                                          2nd Quarter Ended  Six Months Ended                                              June 30            June 30   (Dollars in millions, except as noted)  2008     2007      2008     2007   Segment Income (Loss)     Exploration and Production       United States                       $359     $173      $603     $323       International                        469      227       909      462         E&P segment                        828      400     1,512      785     Oil Sands Mining                      (157)       -      (130)       -     Refining, Marketing and Transportation 158    1,246        83    1,591     Integrated Gas                         102       12       201       31       Segment income                       931    1,658     1,666    2,407     Items not allocated to segments, net      of income taxes:       Corporate and other unallocated        items                               (73)    (111)      (41)    (154)       Discontinued operations                -        8         -        8       Gain (loss) on U.K. natural gas        contracts                           (84)      (5)     (120)       6         Net income                        $774   $1,550    $1,505   $2,267    Capital Expenditures     Exploration and Production            $874     $580    $1,649   $1,041     Oil Sands Mining                       262        -       510        -     Refining, Marketing and Transportation 702      334     1,213      551     Integrated Gas(a)                        -       34         1       91     Corporate                                7       14         9       16       Total                             $1,845     $962    $3,382   $1,699    Exploration Expenses     United States                          $55      $47      $105      $84     International                           75       68       154       92       Total                               $130     $115      $259     $176    E&P Operating Statistics     Net Liquid Hydrocarbon Sales (mbpd)(b)       United States                         63       65        63       67       Europe                                38       34        31       34       Africa                                81      100        92       98         Total International                119      134       123      132           Worldwide                        182      199       186      199      Net Natural Gas Sales (mmcfd)(b)(c)       United States                        431      460       456      485       Europe                               175      178       214      213       Africa                               398      196       396      143         Total International                573      374       610      356           Worldwide                      1,004      834     1,066      841    Total Worldwide Sales (mboepd)           350      338       364      339    (a) Through April 2007, includes EGHoldings at 100 percent.  Effective       May 1, 2007, Marathon no longer consolidates EGHoldings and its       investment in EGHoldings is accounted for prospectively using the       equity method of accounting; therefore, EGHoldings' capital       expenditures subsequent to April 2007 are not included in Marathon's       capital expenditures.   (b) Amounts are net after royalties, except for Ireland where amounts are       before royalties.   (c) Includes natural gas acquired for injection and subsequent resale of       25 mmcfd and 54 mmcfd in the second quarters of 2008 and 2007 and 31       mmcfd and 47 mmcfd in the first six months of 2008 and 2007.      Preliminary Supplemental Statistics (Unaudited)   (continued)                                          2nd Quarter Ended  Six Months Ended                                              June 30            June 30   (Dollars in millions, except as noted)  2008     2007      2008     2007   E&P Operating Statistics (continued)     Average Realizations(d)       Liquid Hydrocarbons (per bbl)         United States                  $109.85   $55.19    $96.96   $52.19         Europe                         $121.96   $61.34   $111.54   $59.12         Africa                         $108.70   $60.91    $98.33   $55.79           Total International          $112.99   $61.02   $101.66   $56.63             Worldwide                  $111.90   $59.11   $100.07   $55.13        Natural Gas (per mcf)         United States                    $8.66    $6.16     $7.70    $6.03         Europe                           $7.86    $4.47     $7.82    $5.71         Africa                           $0.25    $0.25     $0.25    $0.26           Total International            $2.58    $2.27     $2.90    $3.51             Worldwide                    $5.19    $4.41     $4.95    $4.96    OSM Operating Statistics     Net Bitumen Production (mbpd)(e)        24        -        24        -     Net Synthetic Crude Sales (mbpd)(e)     31        -        31        -     Synthetic Crude Average Realization      (per bbl)(d)                      $116.40       $-   $102.70       $-    RM&T Operating Statistics     Refinery Runs (mbpd)       Crude oil refined                  1,023    1,072       934    1,021       Other charge and blend stocks        180      208       207      217         Total                            1,203    1,280     1,141    1,238     Refined Product Yields (mbpd)       Gasoline                             607      680       604      651       Distillates                          367      377       326      350       Propane                               23       26        22       23       Feedstocks and special products      116       96       108      121       Heavy fuel oil                        23       27        27       25       Asphalt                               86       89        73       83         Total                            1,222    1,295     1,160    1,253     Refined Product Sales Volumes      (mbpd)(f)                           1,369    1,426     1,324    1,385     Refining and Wholesale Marketing      Gross Margin (per gallon)(g)      $0.0835  $0.3925   $0.0420  $0.2634     Speedway SuperAmerica       Retail outlets                     1,625    1,637         -        -       Gasoline & distillates sales        (millions of gallons)               788      828     1,580    1,628       Gasoline & distillates gross        margin (per gallon)             $0.0862  $0.1029   $0.1005  $0.1121       Merchandise sales                   $722     $714    $1,369   $1,358       Merchandise gross margin            $181     $182      $344     $342    IG Operating Statistics     Sales Volumes (mtpd)(h)       LNG                                6,402    1,997     6,657    1,582       Methanol                           1,188    1,107     1,159    1,215    (d) Excludes gains and losses on derivative instruments (including the       unrealized effects of U.K. natural gas sales contracts that are       accounted for as derivatives).   (e) Amount is before royalties.   (f) Total average daily volumes of all refined product sales to wholesale,       branded and retail customers.   (g) Sales revenue less cost of refinery inputs, purchased products and       manufacturing expenses, including depreciation.   (h) LNG sales volumes include both consolidated sales (Alaska) and our       share of the sales of an equity method investee (Equatorial Guinea).       Methanol sales volumes represent our share of sales of an equity       method investee in Equatorial Guinea.  

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Marathon Oil Corporation

CONTACT: Media Relations: Lee Warren, +1-713-296-4103, Paul Weeditz,+1-713-296-3910, or Investor Relations Contacts: Howard Thill,+1-713-296-4140, Michol Ecklund, +1-713-296-3919, Chris Phillips,+1-713-296-3213, all of Marathon Oil Corporation

Web site: http://www.marathon.com/




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