"Marathon's 2009 capital program demonstrates a balanced approach that will maintain solid production performance, enhance our strong downstream business, and provide necessary capital investments in profitable mid- and long-term growth projects. Our balanced approach to investing is designed to maintain our solid financial position, deliver a competitive dividend, and enhance shareholder value," said Clarence P. Cazalot, Jr., Marathon president and CEO.

"With more constrained investment levels, as well as the completed and announced non-core asset sales, we now expect the combined production for 2011 from our upstream and oil sands mining segments to be approximately 450,000 barrels of oil equivalent per day (boepd). This is a 7 percent compound average growth rate from our 2007 production level and 4 percent from our 2008 level, both also adjusted for announced asset sales," said Cazalot.

Exploration and Production

Marathon's 2009 worldwide exploration and production budget of $2.5 billion reflects a decrease of 26 percent over 2008 capital spending of $3.3 billion.

Oil Sands Mining

Marathon has budgeted $887 million for its Oil Sands Mining segment in 2009 compared to 2008 spending of just under $1 billion. The 2009 budget decrease compared to the 2008 Oil Sands Mining spend reflects a stronger U.S. dollar to Canadian dollar exchange rate and expectations that non-essential projects will be deferred.

The majority of the 2009 Oil Sands Mining budget will fund the Athabasca Oil Sands Project Expansion 1. The expansion, which includes construction of mining and extraction facilities at the Jackpine Mine, expansion of froth treatment facilities at the existing Muskeg River Mine, expansion of the Scotford upgrader, and development of associated infrastructure, is expected to begin operations in the 2010/2011 timeframe.

Net bitumen production from the oil sands mining segment for 2009 is expected to be between 25,000 to 30,000 barrels per day (BPD) before royalties.

The Company holds a 20 percent interest in the Athabasca Oil Sands Project, a world-class project with a long-life, stable production profile that will contribute to Marathon's success well into the future.

Refining, Marketing and Transportation

Refining, marketing and transportation spending is expected to total $1.9 billion for 2009, down from $2.9 billion expended in 2008. The 2009 downstream budget includes approximately $1 billion for the Garyville Major Expansion Project, $330 million for the Detroit Heavy Oil Upgrading Project (DHOUP), and $200 million to address the Mobile Source Air Toxics II regulations which go into effect on Jan. 1, 2011. The remainder of the 2009 budget is for facilities maintenance and to meet other regulatory requirements.

The Garyville refinery expansion is approximately 75 percent complete and on schedule for fourth quarter 2009 startup. The project, which is designed to improve scale efficiencies and feedstock flexibility, will increase the refinery's capacity to process heavy crude by 180,000 BPD and add an additional 7.5 million gallons of clean transportation fuels to the market each day.

In order to better align timing of the DHOUP completion with changes in Canadian oil sands production projections and to optimize the completion of this project, the scheduled start-up date has been deferred until mid-2012. The cost of the project has increased approximately 15 percent to $2.2 billion due to additional costs associated with the project deferral as well as a scope change that will allow the Detroit refinery to process heavier and higher acidic crudes.

Corporate

During 2009, corporate spending is expected to total approximately $439 million, of which $406 million represents capitalized interest on assets under construction.