Marathon Signs Letter of Intent for Sale of Minnesota Downstream Assets

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May 19, 2010, 08:27 ET

HOUSTON, May 19 /PRNewswire-FirstCall/ -- Marathon Oil Corporation (NYSE: MRO) today announced that it has entered into a non-binding Letter of Intent with ACON Investments, LLC, NTR Partners LLC and TPG Capital, L.P. for the sale of most of Marathon's Minnesota downstream assets. These assets include the 74,000 barrel per day St. Paul Park refinery and associated terminal, 166 SuperAmerica convenience stores along with the SuperMom's Bakery (a baked goods supply operation), SuperAmerica Franchising LLC, interests in pipeline assets in Minnesota and associated inventories. The estimated overall transaction value is expected to be in excess of $800 million, including inventories at current market values. Marathon may also receive additional contingent payments over a number of years. Under the Letter of Intent, the investment group will have a period of exclusivity to work towards negotiation of definitive agreements. Marathon anticipates closing to occur within the late third or fourth quarter. The sale of these assets is subject to, among other things, conclusion of definitive agreements and Marathon board approval. Marathon would provide services to support the operation of the facilities during a transition period following a successful closing of this transaction.

This proposed sale is part of Marathon's ongoing efforts to ensure the Company's asset portfolio is strategically aligned with its business plans, while maintaining its position as one of the leading refining, marketing and transportation operations in the nation. Marathon expects to continue to be one of the largest suppliers of finished products in the Midwest and Southeast through its remaining refining, distribution and marketing system.

This transaction would not affect Marathon's Brand marketing operations in Minnesota. Marathon plans to continue to provide reliable refined product supply to these operations in accordance with the agreements with its Marathon Brand customers.

Marathon's financial advisor for this transaction is Morgan Stanley.

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, Indonesia, Libya, Norway, Poland and the United Kingdom. Marathon is the fourth largest United States-based integrated oil company and the nation's fifth largest refiner.

This release contains forward-looking statements with respect to the potential sale of the St. Paul Park refinery and associated terminal, 166 SuperAmerica sites, SuperAmerica Franchising LLC, and pipeline assets in Minnesota. Some factors that could potentially affect the sale of these interests are completion of due diligence, execution of a definitive agreement, board approval, buyer financing and customary closing conditions, including government and regulatory approvals. 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, 2009 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.