(RTTNews) - Marathon Oil Corp. (MRO: News ) said Tuesday that its third quarter profit plunged from last year, hurt by lower price realizations, partially offset by lower operating expenses. The company also reported higher production over the year-ago. Quarterly earnings, on adjusted basis, breezed ahead of Street consensus, as did its quarterly revenues. Looking ahead, the company reduced its outlook for production available for sale for the full year 2009.

The Houston, Texas-based company posted net income of $413 million or $0.58 per share for the third quarter, much lower than $2.06 billion or $2.90 per share in the prior year quarter.

Result for the latest quarter included non-cash after-tax mark-to-market loss of $7 million on two natural gas sales contracts in the United Kingdom, compared to a gain of $101 million last year.

Excluding items, adjusted net income plunged to $436 million or $0.61 per share from $1.963 billion or $2.76 per share in the previous year quarter. On average, 18 analysts polled by Thomson Reuters expected the company to report earnings of $0.57 per share for the third quarter. Analysts' estimates typically exclude special items.

Third quarter total revenues and other income declined to $14.48 billion from $23.30 billion in the same quarter last year. Four Wall Street analysts expected the company to record a revenue of $13.70 billion for the third quarter.

Exploration and Production or E&P segment income dropped to $491 million in the third quarter from $869 million in the year-ago quarter, due to lower liquid hydrocarbon and natural gas price realizations, partially offset by lower operating expenses.
U.S E&P income plunged to $32 million from $285 million, hurt by lower price realizations - 43% lower for liquid hydrocarbons and 53% lower for natural gas.

International E&P income fell to $459 million from $584 million in the third quarter of 2008, as a result of lower price realizations - 42% lower for liquid hydrocarbons and 55% lower for natural gas.

Third quarter 2009 sales volumes, which exclude the company's Gabonese operations now reported as discontinued operations, averaged 366,000 barrels of oil equivalent per day or boepd.

Production available for sale improved 5% to 393,000 boepd from 375,000 boepd in the prior year quarter. The company noted that the primary difference between recorded sales volumes and production volumes available for sale is due to the timing of international oil lifting.

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