Marathon Announces Total Consideration For Its Dutch Auction Cash Tender Offer

HOUSTON, March 30 /PRNewswire-FirstCall/ -- Marathon Oil Corporation (NYSE: MRO) announced today the reference yield and the range of the Dutch Auction Offer Total Consideration and Dutch Auction Offer Tender Consideration for each series of Notes subject to the Dutch Auction Offer based on the minimum and maximum possible premium for each series of notes subject to its previously announced Dutch Auction Offer. The reference yields were calculated by the Dealer Managers, J.P. Morgan Securities Inc. and Goldman, Sachs & Co., at 2:00 p.m. EDT today.

The Dutch Auction Offer Total Consideration for each series per each $1,000 principal amount of notes validly tendered and accepted for payment is based on the reference yield plus a base spread specified for the series minus a premium that is not less than one basis point or greater than 15 basis points, as determined by the modified "Dutch Auction" procedure described in the Offer to Purchase. Holders whose notes are purchased pursuant to the Dutch Auction Offer will also receive accrued and unpaid interest thereon from the applicable last interest payment date up to, but not including, the Dutch Auction Offer Settlement Date, which is expected to be April 21, 2010, unless the Dutch Auction Offer is extended.

    
    
    
                              Reference                Base      Premium
                              U.S.                     Spread    Range
        Title of    CUSIP     Treasury      Reference  (basis    (basis
        Security    Numbers   Security      Yield      points)   points)*
        --------    -------   ---------     ---------  -------   --------
    Dutch Auction
     Offer
    -------------
                               3.625% U.S.
                                Treasury
    6.000% Senior               Note due
     Notes due 2017 565849AD8   02/2020       3.874%    105.0    1 to 15
                               3.625% U.S.
                                Treasury
    5.900% Senior               Note due
     Notes due 2018 565849AF3   02/2020       3.874%    110.0    1 to 15
                               3.625% U.S.
    7.500%                      Treasury
     Debentures due             Note due
     2019           565849AH9   02/2020       3.874%    135.0    1 to 15
    --------------- ---------   -------       -----     -----    -------
    
    
                        Range of Total           Range of Tender
                       Consideration per        Consideration per
                        $1000 principal          $1000 principal
        Title of       amount (Including        amount (Excluding
        Security       Early Tender Premium)    Early Tender Premium)
        --------       ---------------------    ---------------------
                      Minimum     Maximum       Minimum     Maximum
                      Price*      Price         Price*      Price
                     --------     -------      --------     -------
    Dutch Auction
     Offer
    -------------
    6.000% Senior
     Notes due 2017  $1,066.35   $1,076.02     $1,036.35   $1,046.02
    5.900% Senior
     Notes due 2018  $1,059.83   $1,069.94     $1,029.83   $1,039.94
    7.500%
     Debentures due
     2019            $1,159.06   $1,170.63     $1,129.06   $1,140.63
    ---------------  ---------   ---------     ---------   ---------
    
    
    * The premium range is for holders specifying a premium.  Holders who
    tender their Notes without specifying a premium will be deemed to have
    specified a premium of zero basis points. The Minimum Prices reflect 
    the price assuming a premium of zero basis points.

Annex A to this release contains matrices indicating the nominal dollar prices associated with tenders made at different premiums for each series of notes per $1,000 principal amount of Notes (including the $30 early tender premium) and excluding accrued and unpaid interest. Notes tendered after the Early Tender Date will receive $30 less than amounts listed in Annex A.

The Dutch Auction Offer will expire at 5:00 p.m. EDT on April 19, 2010, unless extended. Holders of notes subject to the Dutch Auction Offer must validly tender and not validly withdraw their notes before 5:00 p.m. EDT on April 1, 2010, unless extended, to be eligible to receive the applicable Dutch Auction Offer Total Consideration, which includes an Early Tender Premium of $30 per $1,000 principal amount of notes accepted for purchase pursuant to the Dutch Auction Offer. Holders of notes subject to the Dutch Auction Offer who validly tender their notes after April 1, 2010 (the "Early Tender Date") will only be eligible to receive an amount equal to the applicable Dutch Auction Offer Tender Consideration, which is equal to the Dutch Auction Offer Total Consideration minus the Early Tender Premium.

Notes subject to the Dutch Auction Offer tendered before the Early Tender Date may be validly withdrawn at any time before 5:00 p.m. EDT on the Early Tender Date, but not thereafter unless otherwise required by applicable law. Notes subject to the Dutch Auction Offer tendered after the Early Tender Date may not be validly withdrawn, unless otherwise required by applicable law.

Under the modified "Dutch Auction" procedure, Marathon will accept notes validly tendered in the order of lowest to highest premiums specified by the Holders and will select the single lowest premium that will enable Marathon to purchase notes in the Dutch Auction Offer in an aggregate principal amount up to the Tender Cap. Holders who tender their notes without specifying a premium will be deemed to have specified a premium of zero basis points.

The terms and conditions of the Dutch Auction Offer, including the conditions of Marathon's obligation to accept the notes tendered and to pay the Total Consideration or Tender Consideration plus accrued and unpaid interest, are set forth in the Offer to Purchase dated March 22, 2010 and the related Letter of Transmittal. The Dutch Auction Offer is conditioned upon satisfaction or waiver of certain conditions described in the Offer to Purchase.

Marathon has retained J.P. Morgan Securities Inc. and Goldman, Sachs & Co. to serve as the Dealer Managers.  J.P. Morgan Securities Inc. may be contacted at (866) 834-4666 (toll free) or (212) 834-3424 (collect) and Goldman, Sachs & Co. may be contacted at (800) 828-3182 (toll free) or (212) 902-5128 (collect).  Marathon has also retained Global Bondholder Services Corporation to serve as the Depositary and Information Agent for the tender offer.

Any questions or requests for assistance or additional copies of the Offer to Purchase and the Letter of Transmittal may be directed to Global Bondholder Services Corporation by phone at (866) 873-7700, or in writing at 65 Broadway - Suite 723, New York, NY, 10006, Attention: Corporate Actions.  You may also contact your broker, dealer, commercial bank or trust company or other nominee for assistance concerning the Offer.

This press release is not a tender offer to purchase or a solicitation of acceptance of a tender offer, which may be made only pursuant to the terms of the Offer to Purchase and the Letter of Transmittal.  In any jurisdiction where the laws require the tender offer to be made by a licensed broker or dealer, the tender offer will be deemed made on behalf of Marathon by J.P. Morgan Securities Inc. and Goldman, Sachs & Co., or one or more registered brokers or dealers under the laws of such jurisdiction.

This release contains forward-looking statements with respect to the timing and principal amount of debt to be purchased in the offer, including certain terms and conditions of the offer.  Although Marathon believes that the expectations contained in this release are based on reasonable assumptions, no assurance can be given that such expectations will prove to have been correct.  Actual results may differ materially from the anticipated results or expectations expressed in this release.  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 Form 8-K, cautionary language identifying 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.


Media Relations Contacts:

Lee Warren

713-296-4103


John Porretto

713-296-4102

Investor Relations Contacts:

Howard Thill

713-296-4140


Chris Phillips

713-296-3213




    
    
    Annex A
    
       6.000% Senior Notes   5.900% Senior Notes    7.500% Debentures 
             due 2017               due 2018              due 2019
       -------------------   -------------------    --------------------
                 Nominal                Nominal                 Nominal
       Premium   Price*      Premium    Price*      Premium     Price*
       -------   -------     -------    -------     -------     -------
        0        1,066.35     0        1,059.83      0         1,159.06
        1        1,066.99     1        1,060.50      1         1,159.83
        2        1,067.64     2        1,061.17      2         1,160.60
        3        1,068.28     3        1,061.84      3         1,161.36
        4        1,068.92     4        1,062.51      4         1,162.13
        5        1,069.56     5        1,063.19      5         1,162.90
        6        1,070.21     6        1,063.86      6         1,163.67
        7        1,070.85     7        1,064.53      7         1,164.44
        8        1,071.50     8        1,065.20      8         1,165.21
        9        1,072.14     9        1,065.88      9         1,165.99
       10        1,072.79    10        1,066.55     10         1,166.76
       11        1,073.43    11        1,067.23     11         1,167.53
       12        1,074.08    12        1,067.90     12         1,168.31
       13        1,074.73    13        1,068.58     13         1,169.08
       14        1,075.38    14        1,069.26     14         1,169.86
       15        1,076.02    15        1,069.94     15         1,170.63
       ---       --------    ---       --------     ---        --------
    
    * Per $1,000 principal amount of Notes (including the $30 early tender
    premium ) and excluding accrued and unpaid interest.  Notes tendered
    after the Early Tender Date will receive $30 less than amounts listed
    above.
    

SOURCE Marathon Oil Corporation

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