Last month, Marathon Oil (MRO 0.61%) reported solid third-quarter results, fueled primarily by higher North American production and higher-realized hydrocarbon prices. Let's take a closer look at the key drivers of Marathon's growth and what investors can expect from the company going forward.

Onshore U.S. liquids opportunities
While Marathon was a relative latecomer to liquids-rich shale plays, it has quickly made up for its late entrance over the past few years by amassing sizable stakes in two of the highest-growth onshore U.S. shale plays, currently boasting roughly 200,000 net acres in Texas' Eagle Ford and nearly 380,000 net acres in North Dakota's Bakken shale.

Fueled by strong results from these plays, Marathon's third-quarter production increased to 200,000 barrels of oil equivalent per day from 172 mboe/d in the same quarter a year ago, with income from the company's North American E&P segment more than doubling to $242 million, up from $107 million in the year-earlier quarter.

Indeed, Marathon is now one of the leading producers in the Eagle Ford, competing with the likes of EOG Resources (EOG 0.67%), which delivered 39% year-over-year oil-production growth during the third quarter and is currently the Eagle Ford's largest oil producer, and Chesapeake Energy (CHKA.Q), which reported a whopping 82% year-over-year increase in third-quarter Eagle Ford production and currently holds the No. 2 spot in terms of total gross oil production in the play.

Despite competing against a formidable array of world-class operators, Marathon has shown continuous improvement in delivering top-tier-drilling performance across both plays. In the Eagle Ford, the company has averaged 1,455 feet per day from spud to total depth year to date, nearly double its competitors' performance and up from an average of just 641 feet per day in 2011. In the Bakken it averaged nearly 1,000 feet per day from spud to total depth last year, as compared to its closest Bakken competitor, which averaged a little more than 800 feet per day.

Marathon also continues to make good progress in reducing drilling expenses through pad drilling and downspacing. In the Eagle Ford, these cost-saving techniques helped the company reduce both drilling times and drilling-and-completion costs by about 20% compared to a year ago. Similarly, in the Bakken, drilling times fell by 20% year over year, with the company averaging just 14 days spud to total depth during the third quarter.

Going forward, the company expects Bakken and Eagle Ford production to keep growing at a rapid clip as it increasingly shifts toward multi-well pad drilling. The company hopes to achieve a year-end exit rate of 100,000 barrels of oil equivalent per day in the Eagle Ford, as compared to an average of 81,000 barrels of oil equivalent per day during the third quarter.

Peer comparison and other growth drivers
Thanks to Marathon's solid operational performance in these plays, the company expects to deliver annual-production growth of 5%-7% through 2017. Peer Anadarko Petroleum (APC), which also expects U.S. onshore assets such as the Eagle Ford and Colorado's Wattenberg field to drive much of its future growth, is also forecasting 5%-7% annual production growth over the period 2012-2017. Meanwhile, ConocoPhillips (COP 0.39%) -- which has aggressively divested much of its international portfolio in an effort to concentrate on key onshore liquids-rich plays such as the Eagle Ford, Bakken, and Permian Basin -- is hoping to grow production at a slower rate of 3%-5% annually through 2017, which is still impressive for a company of its size.

In addition to Marathon's solid U.S. onshore position, the company also has some attractive opportunities internationally, especially in Gabon, where it recently announced encouraging results from an offshore exploration well, and Kenya, where it recently acquired interests in two exploration projects from Africa Oil Corp, a Canadian oil and gas company. It also has interests in Norway, Equatorial Guinea, and the Kurdistan region of Iraq.

The bottom line
Going forward, investors can expect an increasing share of Marathon's growth to come from its U.S. onshore operations, which are expected to account for more than half of company-wide production by 2017, up from roughly a third last year. Considering the high quality of its acreage, significant improvements in drilling days and costs, and more than 10 years of remaining drilling inventory across the Bakken and Eagle Ford, Marathon appears well positioned to grow production at a targeted 5%-7% compound annual rate from 2012 to 2017.