Mike Henderson
Executive Vice President, Operations at Marathon Oil
Thanks, Rob. With strong first quarter execution, consistent with our plan. We've made no changes to our annual guidance and remain fully on track to deliver our 2024 program, but once again benchmarks at the top of our sector on metrics that we believe matter most. The combination of free cash flow generation, capital efficiency and shareholder returns. During the first quarter, oil production of 181,000 barrels of oil per day was slightly better than our guidance, while capital expenditures of $603 million were enlarged. It's been a very strong start to the year for our asset teams. That's especially true in the Eagle Ford is our first quarter drilling rate of penetration was among the best it's been in the last five years. First quarter Eagle Ford completion efficiencies also continue to improve. And in the Bakken, despite the challenging winter weather, we held on to the same execution efficiencies on both the drilling on completion site that we were delivering during the second half of last year, a trend, which bodes very well for execution in future quarters. Referencing slide 14 of our deck. I'd like to highlight the performance of our Permian team. First quarter was another excellent execution quarter, marked by significant production growth. The primary driver of the production increase was our growth while outperformance three Upper Wolfcamp wells in core Red Hills at all at 100% working interest are significantly outperforming tight, realizing early well productivity, almost four times that of the average Delaware Basin well. The business isn't just about one pad or one quarter performance. Our Permian team has now built up a clear track record of execution success.
We're all wells brought online since 2022, our Permian program has delivered among the best results of any Delaware Basin operator for oil productivity per foot. And the team has done so very competitive drilling and completion execution now almost exclusively bringing online two-mile-plus laterals. Additionally, after taking a two-year break in the Permian during the 2020 pandemic, we now have one of the more likely developed acreage positions in the play, with over two decades of high-quality drilling inventory at current activity levels. We're allocating more capital to Permian and the asset will continue to be a growth driver for us. But we'll continue to increase our capital investment at a disciplined pace with an eye on maintaining our execution excellence. With this exceptionally strong start across our U.S. asset bases, our annual guidance midpoints for both production and capital expenditures remain unchanged. And my confidence in delivering on our full year guidance commitment is high. Consistent with our initial outlook, we expect our 2024 capital program to be heavily weighted in the first half of the year, similar to the profile we've seen from us before. Driven by relying execution efficiencies, we're pulling forward some of our activity. This should result in a slight increase to both our expected capital spending and our oil production during second quarter versus our original assumptions. We now expect our capital spending to be just over 6% weighted for the first half of the year. which will drive a significant sequential increase in second quarter oil for production, up to the midpoint of our annual guidance range, 190,000 barrels of oil per day.
In addition to delivering on our guidance commitments. We also remain focused on continuing to enhance our capital efficiency and the strength of our underlying asset base through both the application of extended laterals and other organic enhancement initiatives summarized in more detail on slide 13 of our deck. Extended laterals remain a compelling opportunity to continue enhancing our capital efficiency. At a high level, we're expecting significantly lower total well cost per foot, yet similar EUR per foot. And thus, better returns and higher per well NPV in comparison to shorter laterals. And that's exactly what our initial cohort of 12, three milers during first quarter representing 25% of our total well set is delivering. Execution on the cost front is a clear positive as we're consistently realizing well cost savings on a per foot basis of more than 20% versus comparable two-mile laterals. While early train production in the Bakken and Eagle Ford has been consistent with our expectations. Our first three-mile pad in the Permian Basin, as previously mentioned, has dramatically outperformed. It's shaping up to be one of the strongest pads in Basin history. In addition to the extending laterals, we also continue to further bolster the strength of our asset base through refracs and redevelopment. More specifically, we're disclosing approximately 600 high-quality refrac and redevelopment opportunities across the Bakken and Eagle Ford. Approximately 30% of these opportunities are concentrated in our Ensign acreage in the Eagle Ford, representing upside to our acquisition based. These refrac and redevelopment opportunities are complementary and additive to our decade-plus primary drilling inventory at the total company level.
With this derisk through multiple years of tank work numerous trials over the last five-plus years and a recent track record of very strong bottom line results. Importantly, we progressed this opportunity set with tremendous discipline and intentionality. Redev and refrac testing has been a key part of what we've long described as our organic enhancement program, which typically comprises 5% to 10% of our total capital budget for a given year. This capital dedicated to enhancing the returns and resource recovery of our existing asset base through targeted testing of the best concepts the asset teams bring forward each year. For redevs and refracs, we've specifically identified potentially stranded resource from early advantage completions that we can economically access through integration into our primary plan of development. In total, we brought online over 100 refracs and 50 redevelopment wells across the Bakken and Eagle Ford to date. So we've compiled a rich technical data set and a master deep operational understanding. All 600 of future opportunities we are disclosing are strongly economic and prevailing commodity prices and about half of the 600 we believe, are directly competitive with a Tier one primary development inventory industry is drilling today. More recently, we've been bringing on around 20 or so of these opportunities per year. This year, we're expecting to bring online just over 25. Again, this can account for around 10% of our activity in the Bakken and Eagle Ford. In terms of our development approach, for the most part, we aren't doing refracs or redevelopment as part of a separate stand-alone program. Rather, these opportunities are mostly integrated into our primary plan of development, typically directly offsetting our primary activity with the goal of maximizing the capital efficiency financial returns of our overall program.
Recent results have been very strong, proving out the economic attractiveness of these opportunities supporting the disclosure we're now providing. In the Bakken, our opportunity set is more heavily weighted to refracs, where we've had good success. Over the last couple of years, our refrac program has delivered six-month oil productivity per foot that is competitive of the basin average for industry new drills. And we delivered this competitive productivity with a total well cost per foot more than 20% below the industry average for a new drill well. Again, most of our Bakken refracs have not been stand-alone, rather they offset new development wells. This has had the added benefit of improving the productivity of direct off-set Middle Bakken wells by around 10%. In the Eagle Ford, our opportunity set is a bit more balanced, split roughly 55% to refracs and 45% to redevelopment. Over the last couple of years, our refrac and redevelopment productivity has actually even better than the basin average for industry new drills. In fact, it's been closer to top quartile. And with our refracs, we realized the same positive impact to offset wells that we see in the Bakken. To summarize, at approximately 10% of our activity in the Bakken, Eagle Ford, our refrac and redevelopment programs aren't primary drivers of our capital spend in those big basins. But they still represent a very valuable opportunity set that is positively contributing to our bottom line results and extending effective inventory life and they're a great example of our ability to extract the most value possible out of our existing high-quality resource base.
I'll now turn the call back to Lee, who will wrap up with an EG update and some closing thoughts.
