Marathon Oil’s lifting costs
In 3Q16, Marathon Oil’s (MRO) reported a lifting cost of ~$9.03 per boe (barrel of oil equivalent), which is ~9% lower than in 3Q15.
Lifting costs, also referred to as production costs, are the costs required to operate and maintain wells after drilling is complete. The lifting cost is derived by adding LOE (lease operating expenses), workover costs, and production taxes.
In 3Q16, Marathon Oil’s LOE was $7.98 per boe, which is ~20% lower when compared sequentially with 2Q16. For 3Q16, upstream companies Denbury Resources (DNR) and Diamondback Energy (FANG) reported LOEs of $18.82 per boe and $5.37 per boe, respectively.
The Energy Select Sector SPDR ETF (XLE) typically invests at least 95% of its total assets in oil and gas companies.