Marathon Oil Corporation (NYSE:MRO) Q1 2018 Earnings Conference Call Transcript
May 03, 2018 • 09:00 am ET
Welcome to the MRO First Quarter 2018 Earnings Conference Call. My name is Hilda, and I will be your operator for today.
At this time all participants are in a listen-only mode later we will conduct a question-and-answer session.
(Operator Instructions) Please note that this conference is being recorded.
I will now turn the call over to Mr. Zach Dailey. Mr. Dailey, you may begin.
Thanks and good morning. Last night, we issued a press release, slide presentation and investor package that address our first quarter results. Those documents can be found on our at marathonoil.com.
Today's call will contain forward-looking statements subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. I will refer everyone to the cautionary language included in the press release and presentation materials, as well as to the risk factors described in our SEC filings.
With that, I'll turn the call over to Lee Tillman, our President and CEO, who will provide a few opening remarks, before we open the call to Q&A.
Lee M. Tillman
Thanks Zach and thank you to everyone joining us this morning. After a pivotal 2017, 2018 is off to a great start and is continued our returns focused momentum with our development capital program on-track to deliver over 65% annual improvement in corporate cash returns at strip pricing. Our differentiated multi-basin model delivered strong 9% sequential US oil growth and our asset level execution unpinned our confidence to raise our full-year 2018 resource play guidance, while also steering to the upper end of our total company guidance. All of this with our $2.3 billion development capital budget unchanged.
An important point to note is that our first quarter development CapEx is not ratable, due primarily to some higher working interest relative to the remainder of 2018 and other timing effects. Highlights for the quarter were numerous, but I would like to underscore just a few. We continue to expand the core of our Bakken and Eagle Ford position, through enhanced well-performance in the Hector area and Atascosa County, respectively. Uplifting economics and inventory quality, while generating significant free cash flow from both assets.
Bakken grew production 7% sequentially and continued it's basin-leading performance setting new 30 day oil IP records in both the Middle Bakken and the Three Forks. The June and Chauncey wells in West Myrmidon established new records for the basin in oil production with an average IP 30 of almost 3,500 barrels of oil per day. The Arkin well in the Hector area, setting new Williston Basin record for the Three Forks formation, at an IP 30 of just over 3,000 barrels of oil per day. And just to underscore the compelling economics of this well, the Arkin has already achieved payout.
Finally, a West Myrmidon well brought to sales late in the quarter, achieved a remarkable IP 24 of over 10,000 oil equivalent barrels per day, but is not yet achieved 30 days of production. In part, because