CNPC, Petronas eye Marathon Oil's stake in Angola offshore blocks

China National Petroleum Corp (CNPC) and Malaysia's Petronas are planning to bid for Marathon Oil Corp's stakes in two Angolan offshore oil and gas fields, Reuters yesterday reported, citing people familiar with the matter.

The move is in line with the Houston-based oil company's plan, announced in late 2011, to sell non-core assets worth up to $3 billion, in order to fund its lucrative operations. It has so far sold $1.3 billion worth of assets.

Marathon will sell its entire 10 per cent stake each in Blocks 31 and 32 in offshore Angola, which is expected to fetch around $2.8 billion, according to industry experts.

Marathon, the fourth-largest integrated oil company in the US and its fifth largest refiner, is also planning to sell 10 per cent in Canada's Athabasca oil sands assets, valued at $3 billion.

Marathon and its partners have drilled more than 30 successful exploration wells in Blocks 31 and 32.

Block 31 struck first oil in the fourth quarter of 2012, where net production is expected to plateau at 14 mbbld in the first half of 2014 and remain at that level for approximately three years.

Other stakeholders in the block are BP Exploration Angola with 26.67 per cent and operatorship, Sonangol EP with 25 per cent, Sonangol P&P with 20 per cent, Statoil with 13.33 per cent and SSI 31 Ltd with 5 per cent.

Marathon and its partners are developing the Kaombo field in the southeastern part of Block 32, where front-end engineering and design for the development is under way, and expects first production from two FPSO vessels in 2016.

The other partners in Block 32 are French energy giant Total with 30 per cent stake and is the operator, Sonangol Pesquisa & Produção with 20 per cent, China Sonangol International Holding with 20 per cent, Esso Exploration and Production Angola with 15 per cent and Petrogal with 5 per cent.

Angola's state-owned oil company Sonangol has the right of first refusal over Marathon's stake. In 2009, Sonangol blocked Marathon's plan to sell a 20-per cent stake in Block 32 to Cnooc and Sinopec for $1.3 billion.