Marathon Oil to sell 20% stake in Angola block 32 to China National Offshore Oil and Sinopec International Petroleum Exploration

Marathon Oil Corporation, through its subsidiary Marathon International Petroleum Angola Block 32 Limited, has entered into a definitive agreement with China National Offshore Oil Corporation ( CNOOC ), and Sinopec International Petroleum Exploration and Production Corporation ( SINOPEC ) under which CNOOC and SINOPEC will acquire an undivided 20% participating interest in the production sharing contract and joint operating agreement in block 32 offshore located in Angola. The transaction is valued at $1,300 million.

Marathon Oil is a US-based energy company engaged in the exploration and production, refining, marketing, transportation, and mining of oil sands and gas. SINOPEC is a wholly-owned subsidiary of China Petrochemical Corporation, while CNOOC is an oil and gas producer. Both SINOPEC and CNOOC are based in China. Block 32, with an acreage of 5,090 square kilometers, is an oil rich deepwater exploration block with 12 oil discoveries. The block is located about 150 kilometers off the coast in a water depth of 1,400 to 2,200 meters. The transaction is expected to close by the end of 2009. Marathon will retain a 10% interest in the block after the transaction. Block 32 is operated by Total SA of France, which owns a 30% stake and acts as the operator. Angola's state-owned oil company Sonangol E.P. owns 20% stake in the block while Exxon Mobil Corp. and Galp Energia, SGPS, S.A. hold 15% and 5%, respectively. Update on October 2, 2008: According to Bloomberg, the Wall Street Journal reported that CNOOC and SINOPEC have agreed to acquire Angola-based oil and gas assets from Marathon Oil. CNOOC and SINOPEC are reportedly agreed to pay $1,800 million for the assets. Rumor (August 11, 2008): According to Forbes, the South China Morning Post reported that CNOOC and SINOPEC are planning to bid for Angola-based oil and gas assets from Marathon Oil. The transaction is valued at approximately $1,500 million. Reportedly, India-based Oil & Natural Gas Corporation (ONGC) and Brazil-based Petroleo Brasileiro S.A. ( Petrobras ), are also expected to join the race to acquire the assets. Marathon is selling a 20% stake in an offshore oil and gas asset called block 32 and it will retain a 10% stake. Standard Chartered Bank is acting as financial advisor to Marathon Oil. Credit Suisse Group is acting as financial advisor to both CNOOC and SINOPEC. Bank of America Corporation is acting as financial advisor to CNOOC.