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Chart in Focus: Marathon Oil’s Operating Netbacks

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Marathon Oil’s operating netbacks

In 3Q16, Marathon Oil (MRO) reported an operating netback of ~$17.23 per boe (barrel of oil equivalent), which is ~21% lower than in 3Q15.

Operating netback, also referred to as production netback, is the oil and gas revenue realized per boe after all the costs to bring one barrel of oil equivalent to the marketplace are subtracted from the realized price. Operating netback is derived by subtracting field operating expenses or production expenses, production taxes, and transportation expenses from the realized price, including hedging benefit.

Among the other S&P 500 (SPY) upstream companies, ConocoPhillips (COP), Pioneer Natural Resources (PXD), and Murphy Oil (MUR) have operating netbacks of $26.34 per boe, $39.24 per boe, and $16.77 per boe, respectively.

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