Marathon Oil acquires Hilcorp for US$3.5B
Acquisition supports our view on Aurora’s assets
Marathon Oil’s acquisition of Hilcorp’s Eagle Ford assets for US$3.5 billion definitely supports our view that Aurora’s non-op working interest position is within the sweet spot of the trend and is a great fit with Marathon’s existing assets on the play. The deal metrics work out to approximately $25,000/acre for the land, $500,000/boe/d for current production $43,750/boe/d based on the 2016 estimated production and $35.00/boe for the potential proven booked reserves at the end of this year. AEF is currently trading at roughly $28.00/boe on the same basis. We note that this is the largest transaction in the Eagle Ford to date and brings the total value of the transactions in the play close to $10 billion over the past couple of years.
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