Marathon Oil Corp. said today it is expanding its footprint in Africa in a deal with Agriterra Limited to acquire the company’s 20 percent working interest in the South Omo concession in Ethiopia.
Tullow Oil, a London-based independent exploration and production company, is the operator of the 7.2 million acre South Omo concession, with a 50 percent working interest. Africa Oil holds the remaining 30 percent working interest.
Marathon said an exploratory well is expected to begin drilling in the fourth quarter.
It will pay Agriterra $40 million before closing adjustments, and an additional $10 million upon Marathon’s participation in a declaration of a commercial discovery on the site, the company said.
The deal marks Houston-based Marathon’s entry into Ethiopia, but it already has operations in three African countries, including Angola, Equatorial Guinea and Libya.
“This acquisition is a strong addition to Marathon Oil’s position in the Tertiary rift trend onshore East Africa and is on trend with the recent Ngamia-1 discovery in Kenya,” Annell Bay, Marathon’s vice president for global exploration said in a statement issued by the company.