Marathon Enters Ethiopia’s South Omo Block

Agriterra has sold its 20% stake in Ethiopia’s South Omo Block to US independent Marathon Oil. The entrance of Marathon into Ethiopia marks another major US independent's entrance into East Africa.

Marathon will pay a cash consideration of $40 million for the Agriterra stake in the South Omo Block, and a further $10 million toward Marathon’s participation in a commercial discovery on the block.

Completion of the agreement was conditional on the consent of the Ethiopian Ministry of Mines as well as the waiver of pre-emption rights by Tullow Oil and Africa Oil, all of which have been given.

Marathon’s acquisition of the stake comes just in time for it to participate in the drilling of the Sabisa-1 well on the block. Currently Tullow, the operator, is finalizing plans to mobilize the OGEC-75 rig for the drilling campaign. The well is expected to spud before the end of the year.

"This acquisition is a strong addition to Marathon Oil's position in the Tertiary rift trend onshore East Africa and is on trend with the recent Ngamia-1 discovery in Kenya," said Annell Bay, Marathon Oil VP, Global Exploration. "We are excited to build on our partnership with Tullow and Africa Oil."