As oil prices continue to hover around $50 per barrel, it seems that all the news these days revolves around acquisitions and divestments of oil assets. Sometimes, though, it simply makes more sense to try to extend the life of the assets you already own. Marathon Oil (MRO -0.76%), which has been heavily involved over the past year in divestments and acquisitions, opted to invest in its already-owned Equatorial Guinea Alba Field by installing a compression platform. That platform has just produced its first gas, which is very good news for the company. Here's why.

Extending the life of the field

Marathon holds substantial positions in Equatorial Guinea, making it a key contributor to the company's international production. In fact, the country provides the majority of Marathon's natural gas production. Gas production from Equatorial Guinea, though, fell precipitously, from 438 million cubic feet per day (MMCF/D) in the fourth quarter of 2015 to 351 MMCF/D in the first quarter of 2016 because of low gas prices and planned downtime. Production is expected to decrease further within two years because of depleted obtainable reserves.

To boost the production life of the Alba Field, which provides a large portion of its Equatorial Guinea natural gas production, Marathon added a compression platform. The compression platform compresses gas to increase the pressure necessary to pull it out of the ground. It attaches to the pre-existing Alba offshore facility and increases the amount of proven reserves from the field.

As a Marathon executive explains, "The Alba B3 compression project will allow us to maintain plateau production for the next two years, mitigating base decline, while extending the Alba Field's life by up to eight years." To be more specific, this adds approximately 130 million barrels of oil equivalent of proven reserves, which doubles Alba's remaining reserves.

How this fits into its larger business

Marathon's latest acquisitions and divestments have focused on building its North American core assets in some major plays such as the STACK in Oklahoma and the Eagle Ford basin. To remain diversified, though, Marathon has maintained some of its premier international positions in the United Kingdom and Equatorial Guinea. This is for good reason.

In the first quarter of this year, operating costs per barrel equivalent in its international production averaged $6.08, down from over $8 in 2014. Further, its international production led to net income of $0.44 per barrel. For comparison, its North American production averaged a comparable $6.17 in operating costs per barrel but tallied losses of $8.97. This is becoming a trend, as Marathon has posted losses from North American production per barrel dating back to the fourth quarter of 2014 because of revenue drops from lower oil prices.

This is why its ability to increase the life and reserves of its Alba play in Equatorial Guinea is so critical. Marathon has made it clear that it is focusing on its North American plays to drive future profits. But until those investments can begin to turn profits -- with higher oil prices and continued cost savings -- Marathon will rely on its international positions to help balance out its profits.

Investor takeaway

Marathon Oil has been hit hard by the oil downturn, but it's making moves to reverse its fortunes. Some of those moves, such as its resent acquisition in the Oklahoma STACK region, will be crucial to its future returns. In the meantime, building on currently productive positions seems like a solid approach. Now that its Alba B3 compression platform is producing oil, Marathon just extended one of its most valuable international positions for eight years. The company still needs to show investors it can turn a profit, which may not happen in 2016, but it's comforting to see that its proven production will be producing a little longer.