EX-99.1 2 mur-20161026xex99_1.htm EX-99.1 3Q 2016 Earnings Exhibit 991

Exhibit 99.1



MURPHY OIL CORPORATION ANNOUNCES PRELIMINARY THIRD QUARTER 2016 FINANCIAL AND OPERATING RESULTS



EL DORADO, Arkansas, October 26, 2016 – Murphy Oil Corporation (NYSE: MUR) today announced its preliminary financial and operating results for the third quarter ended September 30, 2016, including a net loss of $16.2 million, or $0.09 per diluted share.

Operating and financial highlights for the third quarter 2016 include:

·

Produced volumes over 169.8 Mboepd in the third quarter

·

Lowered G&A expense by 23 percent from third quarter 2015

·

Continued successful employment of high-intensity fracs in the Eagle Ford Shale

·

Commenced well flow back on a four well pad in the Kaybob Duvernay

·

Entered into a new $1.2 billion senior unsecured guaranteed revolving credit facility

·

Issued $550.0 million of 6.875 percent senior notes due 2024



THIRD QUARTER FINANCIAL RESULTS

Murphy incurred a net loss of $16.2 million, or $0.09 per diluted share, for the third quarter 2016. The company reported an adjusted loss, which excludes both the results of discontinued operations and certain other items that affect comparability of results between periods, of $31.7 million, or $0.18 per diluted share. Details for third quarter can be found in the attached schedules.



Earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations totaled $278.3 million, or $17.80 per barrel of oil equivalent (boe) sold. Earnings before interest, taxes, depreciation, amortization and exploration expenses (EBITDAX) totaled $298.2 million, or $19.07 per boe sold. Details for third quarter EBITDA and EBITDAX can be found in the attached schedules.



Production in the third quarter 2016 averaged over 169.8 thousand barrels of oil equivalent per day (Mboepd), exceeding the high end of production guidance.



Third quarter 2016 lease operating expense, excluding Syncrude, was $7.65 per boe, a five percent reduction from third quarter 2015. In addition, third quarter 2016 general and administrative cost declined 23 percent from third quarter 2015, to $55.5 million.

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“I am pleased with our third quarter operational results as well as our continued focus on reducing costs. We had an outstanding quarter in our high-cash margin offshore fields and our onshore business achieved continued success in high sand concentration fracs in the Eagle Ford Shale and Tupper Montney. Furthermore, we brought online our first four well pad in the Kaybob Duvernay and are encouraged by the early results,” stated Roger W. Jenkins, President and Chief Executive Officer. “Additionally, we were successful in obtaining a new unsecured credit facility while issuing new senior notes allowing for continued flexibility and ample liquidity on our balance sheet,” Jenkins added.



FINANCIAL STRENGTH AND LIQUIDITY

During the third quarter, Murphy entered into a $1.2 billion revolving credit facility and issued $550.0 million of 6.875 percent senior notes due in August 2024. The new revolving credit facility is a senior unsecured guaranteed facility expiring in August 2019. The net proceeds from the senior notes will be used for general corporate purposes, which may include the repayment, repurchase or redemption of the company’s $550.0 million of 2.5 percent senior notes due in December 2017. Additionally, the company has available borrowing capacity of $630.0 million until June 2017 on its 2011 credit facility.



As of September 30, 2016, the company had $2.8 billion of outstanding debt, exclusive of capital lease obligations, and $871.0 million in cash and liquid invested securities. The long-term, fixed-rate notes, including the $550.0 million notes issued in the third quarter, have a weighted average maturity of 8.5 years and a weighted average coupon of 5.2 percent.



REGIONAL OPERATIONS SUMMARY

North American Onshore

Eagle Ford Shale – Production in the quarter averaged over 46 Mboepd, which includes 87 percent liquids. There were 23 Eagle Ford Shale wells brought online during the quarter including 17 lower Eagle Ford Shale wells, four upper Eagle Ford Shale wells, and two Austin Chalk wells. In the fourth quarter, the company expects to bring online 17 wells late in the quarter, an increase of 10 wells from previous guidance. The drilling program continues with the evaluation and de-risking of multiple zones and optimal spacing across the acreage that is expected to lead to increased resource potential over time.

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Tupper Montney – Murphy produced 192 million cubic feet per day (MMcfd) of natural gas in the quarter. The well data from the longer lateral, high sand concentration test pilots completed earlier in the year is meeting the anticipated type curve of 10 to 14 billion cubic feet equivalent Estimated Ultimate Recoveries (EURs).



Kaybob Duvernay and Placid Montney – Production was over 3 Mboepd, which includes 44 percent liquids, during the quarter. In the operated Kaybob Duvernay, four wells, which were previously drilled by the joint venture partner at an effective average lateral length of 3,400 feet, were brought online in the gas condensate area late in the quarter. The wells are in the early stages of production and performing as expected. Drilling at a new two well pad in the gas condensate window is planned late in the fourth quarter with expected production online in first quarter 2017. These initial gas condensate wells will aid in determining optimal well lengths and completion techniques in association with lowering well costs and de-risking the Kaybob Duvernay.



In the non-operated Placid Montney, four wells were drilled in the third quarter and eight are planned for late 2016 or early 2017. These 12 wells will be completed over the course of the fourth quarter 2016 and first quarter 2017.



Global Offshore

Malaysia – Block K and Sarawak liquids production in the quarter was over 39 thousand barrels of liquids per day, while Sarawak natural gas production was approximately 116 MMcfd. As part of the original field development plan, a second platform at the South Acis oil field was installed and brought online as scheduled during the quarter. The resource size of the South Acis field has doubled since it came online in December 2013.



North America – Gulf of Mexico and East Coast Canada produced over 25 Mboepd, comprised of 89 percent liquids, in the quarter.



2016 AND FOURTH QUARTER GUIDANCE

Production for full-year 2016 is being tightened to the range of 174 – 175 Mboepd with fourth quarter 2016 production estimated in the range of 162 – 164 Mboepd. Capital spending for full-year 2016 is being maintained at $620.0 million, excluding $206.7 million associated with the acquisition cost of the Kaybob Duvernay and Placid Montney joint venture closed earlier this year. Details for production and capital expenditures guidance can be found in the attached schedules.

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CONFERENCE CALL AND WEBCAST SCHEDULED FOR OCTOBER 27, 2016

Murphy will host a conference call to discuss third quarter 2016 results on Thursday, October 27, 2016, at 1:00 p.m. EDT. The call can be accessed either via the Internet through the Investor Relations section of Murphy Oil’s website at http://ir.murphyoilcorp.com or via the telephone by dialing 1-888-587-0613. The telephone reservation number for the call is 3675259. Replays of the call will be available through the same address on the company’s website, and a recording of the call will be available through November 10, 2016, by calling 1-888-203-1112 and referencing reservation number 3675259. A replay of the conference call will also be available on the Murphy website at http://ir.murphyoilcorp.com.



FINANCIAL DATA

Summary financial data, operating statistics and a summary balance sheet for the third quarter and first nine months of 2016 with comparisons to the same periods the previous year are contained in the following schedules. Additionally, a schedule indicating the impacts of items affecting comparability of results between periods and a schedule comparing EBITDA and EBITDAX between periods are included with these schedules as well as guidance for the fourth quarter and full-year.



ABOUT MURPHY OIL CORPORATION

Murphy Oil Corporation is a global independent oil and natural gas exploration and production company. The company’s diverse resource base includes offshore production in Southeast Asia, Canada and Gulf of Mexico, as well as North America onshore plays in the Eagle Ford Shale, Kaybob Duvernay and Montney. Additional information can be found on the company’s website at http://www.murphyoilcorp.com



FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Words such as “targets”, “expectations”, “plans”, “forecasts”, “projections” and other comparable terminology often identify forward-looking statements. These statements, which express management’s current views concerning future events or results are subject to inherent risks and uncertainties. Factors that could cause one or more of these forecasted events not to occur include, but are not limited to, a failure to obtain necessary regulatory approvals, a deterioration in the business or prospects of Murphy, adverse developments in Murphy business’ markets, adverse developments in the U.S. or global capital markets, credit markets or economies in general. Factors that could cause actual results to differ materially from those expressed or implied in our forward-looking statements include, but are

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not limited to, the volatility and level of crude oil and natural gas prices, the level and success rate of our exploration programs, our ability to maintain production rates and replace reserves, customer demand for our products, adverse foreign exchange movements, political and regulatory instability, and uncontrollable natural hazards.  For further discussion of risk factors, see Murphy’s 2015 Annual Report on Form 10-K, on file with the U.S. Securities and Exchange Commission. Murphy undertakes no duty to publicly update or revise any forward-looking statements.



NON-GAAP MEASURES

This news release also contains certain historical non-GAAP measures of financial performance that management believes are good tools for internal use and the investment community in evaluating Murphy Oil Corporation's overall financial performance. These non-GAAP measures are broadly used to value and compare companies in the crude oil and natural gas industry. Please see the attached schedules for reconciliations of the differences between non-GAAP measures used in this news release and the most directly comparable GAAP financial measures.



RESERVE REPORTING TO THE SECURITIES EXCHANGE COMMISSION

The Securities and Exchange Commission (SEC) requires oil and natural gas companies, in their filings with the SEC, to disclose proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We may use certain terms in this news release, such as “resource”, “gross resource”, “recoverable resource”, “net risked PMEAN resource”, “recoverable oil”, “resource base”, “EUR or estimated ultimate recovery” and similar terms that the SEC’s rules strictly prohibit us from including in filings with the SEC. The SEC permits the optional disclosure of probable and possible reserves; however, we have not disclosed the company's probable and possible reserves in our filings with the SEC. Investors are urged to consider closely the disclosures and risk factors in our most recent annual report on Form 10-K and in other reports on file with the SEC, available from Murphy Oil Corporation's offices or website at http://ir.murphyoilcorp.com.



Investor Contacts:

Kelly Whitley, kelly_whitley@murphyoilcorp.com, 281-675-9107

Nancy Perkins, nancy_perkins@murphyoilcorp.com, 281-675-9252

Emily McElroy, emily_mcelroy@murphyoilcorp.com, 870-864-6324



 

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MURPHY OIL CORPORATION

SUMMARIZED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

(Thousands of dollars, except per share amounts)





 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



 

Three Months Ended

 

Nine Months Ended



 

September 30,

 

September 30,



 

2016

 

2015

 

2016

 

2015



 

 

 

 

 

 

 

 

Revenues

$

 500,533 

 

 714,949 

 

 1,368,290 

 

 2,374,986 



 

 

 

 

 

 

 

 

Costs and expenses

 

 

 

 

 

 

 

 

     Lease operating expenses

 

 119,663 

 

 183,826 

 

 435,296 

 

 643,736 

     Severance and ad valorem taxes

 

 9,592 

 

 14,265 

 

 35,668 

 

 54,099 

     Exploration expenses

 

 19,866 

 

 58,149 

 

 83,910 

 

 251,842 

     Selling and general expenses

 

 55,523 

 

 71,791 

 

 196,143 

 

 237,934 

     Depreciation, depletion and amortization

 

 255,900 

 

 433,706 

 

 797,288 

 

 1,318,123 

     Accretion of asset retirement obligations

 

 11,043 

 

 11,918 

 

 35,514 

 

 35,437 

     Impairment of assets

 

– 

 

 2,300,974 

 

 95,088 

 

 2,300,974 

     Interest expense

 

 40,088 

 

 32,009 

 

 107,207 

 

 91,945 

     Interest capitalized

 

 (869)

 

 (1,864)

 

 (3,318)

 

 (5,072)

     Other expense (benefit)

 

 6,486 

 

 18,192 

 

 (1,446)

 

 81,804 



 

 517,292 

 

 3,122,966 

 

 1,781,350 

 

 5,010,822 

Loss from continuing operations before income taxes

 

 (16,759)

 

 (2,408,017)

 

 (413,060)

 

 (2,635,836)

Income tax benefit

 

 (2,176)

 

 (820,935)

 

 (201,897)

 

 (963,298)

Loss from continuing operations

 

 (14,583)

 

 (1,587,082)

 

 (211,163)

 

 (1,672,538)

Loss from discontinued operations, net of income taxes

 

 (1,593)

 

 (8,344)

 

 (885)

 

 (11,163)

Net loss

$

 (16,176)

 

 (1,595,426)

 

 (212,048)

 

 (1,683,701)

Loss per Common share – Basic

 

 

 

 

 

 

 

 

     Continuing operations

$

 (0.08)

 

 (9.22)

 

 (1.23)

 

 (9.55)

     Discontinued operations

 

 (0.01)

 

 (0.04)

 

 (0.01)

 

 (0.07)

         Net loss

$

 (0.09)

 

 (9.26)

 

 (1.24)

 

 (9.62)

Loss per Common share – Diluted

 

 

 

 

 

 

 

 

     Continuing operations

$

 (0.08)

 

 (9.22)

 

 (1.23)

 

 (9.55)

     Discontinued operations

 

 (0.01)

 

 (0.04)

 

 (0.01)

 

 (0.07)

         Net loss

$

 (0.09)

 

 (9.26)

 

 (1.24)

 

 (9.62)

Cash dividends per Common share

$

 0.25 

 

 0.35 

 

 0.95 

 

 1.05 

Average Common shares outstanding (thousands)

 

 

 

 

 

 

 

 

     Basic

 

 172,199 

 

 172,205 

 

 172,165 

 

 175,047 

     Diluted

 

 172,199 

 

 172,205 

 

 172,165 

 

 175,047 



 

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MURPHY OIL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(Thousands of dollars)





 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



 

Three Months Ended

 

Nine Months Ended



 

September 30,

 

September 30,



 

2016

 

2015

 

2016

 

2015

Operating Activities

 

 

 

 

 

 

 

 

Net loss

$

 (16,176)

 

 (1,595,426)

 

 (212,048)

 

 (1,683,701)

Adjustments to reconcile net loss to net cash provided
  by continuing operations activities:

 

 

 

 

 

 

 

 

Loss from discontinued operations

 

 1,593 

 

 8,344 

 

 885 

 

 11,163 

Depreciation, depletion and amortization

 

 255,900 

 

 433,706 

 

 797,288 

 

 1,318,123 

Impairment of assets

 

– 

 

 2,300,974 

 

 95,088 

 

 2,300,974 

Amortization of deferred major repair costs

 

– 

 

 2,046 

 

 3,794 

 

 5,450 

Dry hole costs

 

 956 

 

 21,436 

 

 15,226 

 

 120,459 

Amortization of undeveloped leases

 

 10,409 

 

 16,506 

 

 35,828 

 

 62,331 

Accretion of asset retirement obligations

 

 11,043 

 

 11,918 

 

 35,514 

 

 35,437 

Deferred and noncurrent income tax benefits

 

 (28,956)

 

 (780,880)

 

 (345,157)

 

 (975,120)

Pretax (gains) losses from disposition of assets

 

 730 

 

 (60)

 

 (3,101)

 

 (154,183)

Net (increase) decrease in noncash operating working capital

 

 (65,825)

 

 (10,145)

 

 (152,618)

1

 97,026 

Other operating activities, net

 

 (2,702)

 

 (27,102)

 

 9,651 

 

 (41,431)

Net cash provided by continuing operations activities

 

 166,972 

 

 381,317 

 

 280,350 

 

 1,096,528 

Investing Activities

 

 

 

 

 

 

 

 

Property additions and dry hole costs

 

 (177,081)

 

 (541,454)

 

 (781,668)

2

 (1,975,069)

Proceeds from sales of property, plant and equipment

 

 1,298 

 

 736 

 

 1,154,623 

 

 423,842 

Purchases of investment securities3

 

– 

 

 (235,488)

 

 (651,218)

 

 (865,251)

Proceeds from maturity of investment securities3

 

 11,485 

 

 189,051 

 

 712,863 

 

 852,394 

Other investing activities, net

 

 411 

 

 1,030 

 

 (7,229)

 

 (19,538)

Net cash provided (required) by investing activities

 

 (163,887)

 

 (586,125)

 

 427,371 

 

 (1,583,622)

Financing Activities

 

 

 

 

 

 

 

 

Borrowings of debt

 

 541,444 

 

 62,000 

 

 541,444 

 

 435,000 

Repayments of debt

 

– 

 

– 

 

 (600,000)

 

– 

Capital lease obligation payments

 

 (2,636)

 

 (2,453)

 

 (7,808)

 

 (7,156)

Purchase of treasury stock

 

– 

 

– 

 

– 

 

 (250,000)

Withholding tax on stock-based incentive awards

 

– 

 

– 

 

 (1,138)

 

 (8,976)

Issue cost of debt facility

 

 (13,971)

 

– 

 

 (13,971)

 

– 

Cash dividends paid

 

 (43,051)

 

 (60,208)

 

 (163,586)

 

 (184,789)

Other financing activities, net

 

 (20)

 

 (1)

 

 (20)

 

 (153)

Net cash (required) provided by financing activities

 

 481,766 

 

 (662)

 

 (245,079)

 

 (16,074)

Cash Flows from Discontinued Operations

 

 

 

 

 

 

 

 

Operating activities

 

 (2,355)

 

 80,579 

 

 2,830 

 

 (4,866)

Investing activities

 

– 

 

 21 

 

– 

 

 5,343 

Changes in cash included in current assets held for sale

 

 2,355 

 

 90,548 

 

 (2,830)

 

 179,774 

Net increase in cash and cash equivalents of
discontinued operations

 

– 

 

 171,148 

 

– 

 

 180,251 

Effect of exchange rate changes on cash and cash equivalents

 

 759 

 

 3,721 

 

 7,268 

 

 8,276 

Net increase (decrease) in cash and cash equivalents

 

 485,610 

 

 (30,601)

 

 469,910 

 

 (314,641)

Cash and cash equivalents at beginning of period

 

 267,483 

 

 909,268 

 

 283,183 

 

 1,193,308 

Cash and cash equivalents at end of period

$

 753,093 

 

 878,667 

 

 753,093 

 

 878,667 



1  2016 balance includes payments for deepwater rig contract exit of $266.6 million.

2  Includes costs of $206.7 million associated with acquisition of Kaybob Duvernay and Placid Montney.

3 Investments are Canadian government securities with maturities greater than 90 days at the date of  acquisition.

 

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MURPHY OIL CORPORATION

SCHEDULE OF ADJUSTED LOSS

(A Non-GAAP Financial Measure)

(Unaudited)

(Millions of dollars, except per share amounts)







 

 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended



September 30,

 

September 30,



 

2016

 

2015

 

2016

 

2015

Net loss

$

 (16.2)

 

 (1,595.4)

 

 (212.0)

 

 (1,683.7)

Discontinued operations loss

 

 1.6 

 

 8.3 

 

 0.8 

 

 11.2 

Loss from continuing operations

 

 (14.6)

 

 (1,587.1)

 

 (211.2)

 

 (1,672.5)

Mark-to-market loss (gain) on crude oil derivative contracts

 

 0.8 

 

 (10.9)

 

 52.8 

 

 (15.7)

Foreign exchange gains

 

 (11.5)

 

 (47.8)

 

 (32.9)

 

 (83.0)

Syncrude operations, including tax benefits of $68.0 on sale

 

 –

 

 –

 

 (47.9)

 

 –

Income tax benefits associated with Montney midstream divestiture

 

 –

 

 –

 

 (20.9)

 

 –

Income tax benefits on investments in foreign areas

 

 (6.4)

 

 –

 

 (15.8)

 

 –

Oil Insurance Limited dividends

 

 –

 

 –

 

 (2.2)

 

 (4.5)

Impairments of assets

 

 –

 

 1,536.5 

 

 68.9 

 

 1,536.5 

Restructuring charges

 

 –

 

 6.6 

 

 6.2 

 

 14.1 

Decrease in Malaysia corporate tax rate on certain fields

 

 –

 

 (21.8)

 

 –

 

 (21.8)

Gain on sale of 10% interest in Malaysia

 

 –

 

 –

 

 –

 

 (218.8)

Environmental provisions

 

 –

 

 –

 

 –

 

 35.8 

Increase in Alberta corporate tax rate

 

 –

 

 –

 

 –

 

 23.8 

Total adjustments after taxes

 

 (17.1)

 

 1,462.6 

 

 8.2 

 

 1,266.4 

Adjusted loss

$

 (31.7)

 

 (124.5)

 

 (203.0)

 

 (406.1)

Adjusted loss per diluted share

$

 (0.18)

 

 (0.72)

 

 (1.18)

 

 (2.32)



Non-GAAP Financial Measures

Presented above is a reconciliation of Net loss to Adjusted loss.  Adjusted loss excludes certain items that management believes affect the comparability of results between periods.  Management believes this is important information to provide because it is used by management to evaluate the Company's operational performance and trends between periods and relative to its industry competitors.  Management also believes this information may be useful to investors and analysts to gain a better understanding of the Company's financial results.  Adjusted loss is a non-GAAP financial measure and should not be considered a substitute for Net loss as determined in accordance with accounting principles generally accepted in the United States of America.

Note:  Amounts shown above as reconciling items between Net loss and Adjusted loss are presented net of applicable income taxes based on the statutory rate applicable by jurisdiction.  The 2016 pretax and income tax impacts for adjustments shown above are as follows by area of operations.





 

 

 

 

 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended



September 30, 2016

 

September 30, 2016



Pretax

 

Tax

 

Net

 

Pretax

 

Tax

 

Net

Exploration & Production:

 

 

 

 

 

 

 

 

 

 

 

  United States

 1.3 

 

 (0.5)

 

 0.8 

 

 85.4 

 

 (29.6)

 

 55.8 

  Canada

 –

 

 –

 

 –

 

 123.7 

 

 (122.6)

 

 1.1 

  Malaysia

 –

 

 –

 

 –

 

 1.5 

 

 (0.6)

 

 0.9 

  Other International

 –

 

 (6.4)

 

 (6.4)

 

 2.2 

 

 (16.5)

 

 (14.3)

Total E&P

 1.3 

 

 (6.9)

 

 (5.6)

 

 212.8 

 

 (169.3)

 

 43.5 

Corporate:

 (14.2)

 

 2.7 

 

 (11.5)

 

 (39.8)

 

 4.5 

 

 (35.3)

Total adjustments

 (12.9)

 

 (4.2)

 

 (17.1)

 

 173.0 

 

 (164.8)

 

 8.2 



Income taxes are presented based on the estimated statutory tax effect each adjustment item had on taxes in the applicable tax jurisdiction.

 

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MURPHY OIL CORPORATION

SCHEDULE OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION

AND AMORTIZATION (EBITDA)

(A Non-GAAP Financial Measure)

(Unaudited)

(Millions of dollars, except per barrel of oil equivalents sold)











 

 

 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended

 



September 30,

 

September 30,

 



2016

 

2015

 

2016

 

2015

 

Loss from continuing operations

$

 (14.6)

 

 (1,587.1)

 

 (211.2)

 

 (1,672.5)

 

Income tax benefit

 

 (2.2)

 

 (820.9)

 

 (201.9)

 

 (963.3)

 

Interest expense

 

 40.1 

 

 32.0 

 

 107.2 

 

 91.9 

 

Interest capitalized

 

 (0.9)

 

 (1.9)

 

 (3.3)

 

 (5.1)

 

Depreciation, depletion and amortization expense

 

 255.9 

 

 433.7 

 

 797.3 

 

 1,318.1 

 

Impairments of assets

 

 –

 

 2,301.0 

 

 95.1 

 

 2,301.0 

 

Earnings before interest, taxes, depreciation and
  amortization (EBITDA)

$

 278.3 

 

 356.8 

 

 583.2 

 

 1,070.1 

1

Total barrels of oil equivalents sold (thousands of barrels)

 

 15,637.9 

 

 19,104.8 

 

 48,382.6 

 

 57,536.0 

 

EBITDA per barrel of oil equivalents sold

$

 17.80 

 

 18.68 

 

 12.05 

 

 18.60 

 





Non-GAAP Financial Measures

Presented above is a reconciliation of Loss from continuing operations to Earnings before interest, taxes, depreciation, impairments and amortization (EBITDA).  Management believes EBITDA is important information to provide because it is used by management to evaluate the Company's operational performance and trends between periods and relative to its industry competitors.  Management also believes this information may be useful to investors and analysts to gain a better understanding of the Company's financial results.  EBITDA is a non-GAAP financial measure and should not be considered a substitute for Net loss or Cash provided by operating activities as determined in accordance with accounting principles generally accepted in the United States of America.



1 Includes pre-tax gain on sale of 10% interest in Malaysia in 2015 of $155.1 million.





 

9

 

MURPHY OIL CORPORATION

SCHEDULE OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION,

AMORTIZATION AND EXPLORATION (EBITDAX)

(A Non-GAAP Financial Measure)

(Unaudited)

(Millions of dollars, except per barrel of oil equivalents sold)







 

 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended

 



September 30,

 

September 30,

 



2016

 

2015

 

2016

 

2015

 

Loss from continuing operations

$

 (14.6)

 

 (1,587.1)

 

 (211.2)

 

 (1,672.5)

 

Income tax benefit

 

 (2.2)

 

 (820.9)

 

 (201.9)

 

 (963.3)

 

Interest expense

 

 40.1 

 

 32.0 

 

 107.2 

 

 91.9 

 

Interest capitalized

 

 (0.9)

 

 (1.9)

 

 (3.3)

 

 (5.1)

 

Depreciation, depletion and amortization expense

 

 255.9 

 

 433.7 

 

 797.3 

 

 1,318.1 

 

Impairments of assets

 

 –

 

 2,301.0 

 

 95.1 

 

 2,301.0 

 

Exploration expense

 

 19.9 

 

 58.1 

 

 83.9 

 

 251.8 

 

Earnings before interest, taxes, depreciation, amortization
  and exploration (EBITDAX)

$

 298.2 

 

 414.9 

 

 667.1 

 

 1,321.9 

1

Total barrels of oil equivalents sold (thousands of barrels)

 

 15,637.9 

 

 19,104.8 

 

 48,382.6 

 

 57,536.0 

 

EBITDAX per barrel of oil equivalents sold

$

 19.07 

 

 21.72 

 

 13.79 

 

 22.98 

 



Non-GAAP Financial Measures

Presented above is a reconciliation of Loss from continuing operations to Earnings before interest, taxes, depreciation, impairments, amortization and exploration (EBITDAX).  Management believes EBITDAX is important information to provide because it is used by management to evaluate the Company's operational performance and trends between periods and relative to its industry competitors.  Management also believes this information may be useful to investors and analysts to gain a better understanding of the Company's financial results.  EBITDAX is a non-GAAP financial measure and should not be considered a substitute for Net loss or Cash provided by operating activities as determined in accordance with accounting principles generally accepted in the United States of America.



1 Includes pre-tax gain on sale of 10% interest in Malaysia in 2015 of $155.1 million.



 

10

 

MURPHY OIL CORPORATION

FUNCTIONAL RESULTS OF OPERATIONS (Unaudited)

(Millions of dollars)







 

 

 

 

 

 

 

 



 

 

 

 

 

 

 

 



Three Months Ended
September 30, 2016

 

Three Months Ended
September 30, 2015



 

Revenues

 

Income
(Loss)

 

Revenues

 

Income
(Loss)

Exploration and production

 

 

 

 

 

 

 

 

    United States

$

 201.8 

 

 (27.1)

 

 335.1 

 

 (107.8)

    Canada

 

 80.9 

 

 (4.8)

 

 123.2 

 

 (507.0)

    Malaysia

 

 202.7 

 

 65.0 

 

 207.3 

 

 (952.7)

    Other

 

 0.2 

 

 (8.1)

 

– 

 

 (28.6)

        Total exploration and production

 

 485.6 

 

 25.0 

 

 665.6 

 

 (1,596.1)

Corporate and other

 

 14.9 

 

 (39.6)

 

 49.3 

 

 9.0 

Revenue/loss from continuing operations

 

 500.5 

 

 (14.6)

 

 714.9 

 

 (1,587.1)

Discontinued operations, net of tax

 

– 

 

 (1.6)

 

– 

 

 (8.3)

Total revenues/net loss

$

 500.5 

 

 (16.2)

 

 714.9 

 

 (1,595.4)



 

 

 

 

 

 

 

 



Nine Months Ended
September 30, 2016

 

Nine Months Ended
September 30, 2015



 

Revenues

 

Income
(Loss)

 

Revenues

 

Income
(Loss)

Exploration and production

 

 

 

 

 

 

 

 

    United States

$

 520.2 

 

 (158.5)

 

 955.0 

 

 (218.1)

    Canada

 

 264.4 

 

 (36.7)

 

 428.4 

 

 (577.8)

    Malaysia

 

 541.4 

 

 135.1 

 

 897.6 

 

 (701.9)

    Other

 

 0.2 

 

 (39.4)

 

– 

 

 (130.7)

        Total exploration and production

 

 1,326.2 

 

 (99.5)

 

 2,281.0 

 

 (1,628.5)

Corporate and other

 

 42.1 

 

 (111.7)

 

 94.0 

 

 (44.0)

Revenue/loss from continuing operations

 

 1,368.3 

 

 (211.2)

 

 2,375.0 

 

 (1,672.5)

Discontinued operations, net of tax

 

– 

 

 (0.8)

 

– 

 

 (11.2)

Total revenues/net loss

$

 1,368.3 

 

 (212.0)

 

 2,375.0 

 

 (1,683.7)



Note:  Corporate and other above includes unallocated administrative expenses, interest income and net interest expense, the impacts of foreign exchange, and income taxes associated with these income and expense items.



 

11

 

MURPHY OIL CORPORATION

OIL AND GAS OPERATING RESULTS (Unaudited)

THREE MONTHS ENDED SEPTEMBER 30,  2016 AND 2015



 

 

 

 

 

 

 



 

 

 

 

 

 

 



 

 

Canada

 

 

 



 

United

Conven-

Syn-  

 

 

 

(Millions of dollars)

 

States

tional 

thetic 

Malaysia

Other

Total

Three Months Ended September 30, 2016

 

 

 

 

 

 

 

Oil and gas sales and other revenues

$

 201.8  80.9 

– 

202.7  0.2  485.6 

Lease operating expenses

 

 59.6  30.7 

– 

29.4 

– 

119.7 

Severance and ad valorem taxes

 

 8.5  1.1 

– 

– 

– 

9.6 

Depreciation, depletion and amortization

 

 141.1  46.5 

– 

62.0  1.5  251.1 

Accretion of asset retirement obligations

 

 4.2  2.8 

– 

4.0 

– 

11.0 

Exploration expenses

 

 

 

 

 

 

 

    Dry holes

 

 0.8 

– 

– 

0.4  (0.2) 1.0 

    Geological and geophysical

 

 (0.1)

– 

– 

0.1  0.5  0.5 

    Other

 

 2.5 

– 

– 

– 

5.5  8.0 



 

 3.2 

– 

– 

0.5  5.8  9.5 

    Undeveloped lease amortization

 

 9.3  1.1 

– 

– 

 

 10.4 

        Total exploration expenses

 

 12.5  1.1 

– 

0.5  5.8  19.9 

Selling and general expenses

 

 14.7  5.2 

– 

0.2  7.4  27.5 

Other expenses

 

 1.0 

– 

– 

5.4  0.1  6.5 

Results of operations before taxes

 

 (39.8) (6.5)

– 

101.2  (14.6) 40.3 

Income tax provisions (benefits)

 

 (12.7) (1.7)

– 

36.2  (6.5) 15.3 

Results of operations (excluding
  corporate overhead and interest)

$

 (27.1) (4.8)

– 

65.0  (8.1) 25.0 



 

 

 

 

 

 

 

Three Months Ended September 30, 2015

 

 

 

 

 

 

 

Oil and gas sales and other revenues

$

 335.1  76.4  46.8  207.3 

– 

665.6 

Lease operating expenses

 

 66.9  22.6  37.3  57.0 

– 

183.8 

Severance and ad valorem taxes

 

 12.1  0.9  1.3 

– 

– 

14.3 

Depreciation, depletion and amortization

 

 220.8  51.6  12.1  144.2  1.6  430.3 

Accretion of asset retirement obligations

 

 5.2  1.6  1.3  3.8 

– 

11.9 

Impairment of assets

 

 144.8  683.6 

– 

1,472.6 

– 

2,301.0 

Exploration expenses

 

 

 

 

 

 

 

    Dry holes

 

 10.2 

– 

– 

14.1  (2.9) 21.4 

    Geological and geophysical

 

 2.5 

– 

– 

– 

4.8  7.3 

    Other

 

 1.8  0.1 

– 

– 

11.0  12.9 



 

 14.5  0.1 

– 

14.1  12.9  41.6 

    Undeveloped lease amortization

 

 12.0  3.9 

– 

– 

0.6  16.5 

        Total exploration expenses

 

 26.5  4.0 

– 

14.1  13.5  58.1 

Selling and general expenses

 

 22.9  5.1  0.2  3.3  15.2  46.7 

Other expenses

 

 0.9 

– 

– 

17.3 

– 

18.2 

Results of operations before taxes

 

 (165.0) (693.0) (5.4) (1,505.0) (30.3) (2,398.7)

Income tax benefits

 

 (57.2) (190.2) (1.2) (552.3) (1.7) (802.6)

Results of operations (excluding
  corporate overhead and interest)

$

 (107.8) (502.8) (4.2) (952.7) (28.6) (1,596.1)



 

12

 

MURPHY OIL CORPORATION

OIL AND GAS OPERATING RESULTS (Unaudited)

NINE MONTHS ENDED SEPTEMBER 30,  2016 AND 2015







 

 

 

 

 

 

 



 

 

Canada

 

 

 



 

United

Conven-

Syn-  

 

 

 

(Millions of dollars)

 

States

tional 

thetic 

Malaysia

Other

Total

Nine Months Ended September 30, 2016

 

 

 

 

 

 

 

Oil and gas sales and other revenues

$

 520.2  200.2  64.2  541.4  0.2  1,326.2 

Lease operating expenses

 

 169.6  73.3  69.9  122.5 

– 

435.3 

Severance and ad valorem taxes

 

 30.0  3.2  2.5 

– 

– 

35.7 

Depreciation, depletion and amortization

 

 456.5  137.5  16.5  170.0  4.6  785.1 

Accretion of asset retirement obligations

 

 12.8  8.2  2.4  12.1 

– 

35.5 

Impairment of assets

 

– 

95.1 

– 

– 

– 

95.1 

Exploration expenses

 

 

 

 

 

 

 

    Dry holes

 

 0.4 

– 

– 

4.5  10.4  15.3 

    Geological and geophysical

 

 0.6  2.9 

– 

0.6  4.8  8.9 

    Other

 

 4.5  0.5 

– 

– 

18.9  23.9 



 

 5.5  3.4 

– 

5.1  34.1  48.1 

    Undeveloped lease amortization

 

 31.9  3.4 

– 

– 

0.5  35.8 

        Total exploration expenses

 

 37.4  6.8 

– 

5.1  34.6  83.9 

Selling and general expenses

 

 49.9  20.9  0.5  8.6  26.6  106.5 

Other expenses (benefits)

 

 1.1 

– 

– 

6.3  (8.8) (1.4)

Results of operations before taxes

 

 (237.1) (144.8) (27.6) 216.8  (56.8) (249.5)

Income tax provisions (benefits)

 

 (78.6) (60.2) (75.3) 81.7  (17.6) (150.0)

Results of operations (excluding
  corporate overhead and interest)

$

 (158.5) (84.6) 47.7  135.1  (39.2) (99.5)



 

 

 

 

 

 

 

Nine Months Ended September 30, 2015

 

 

 

 

 

 

 

Oil and gas sales and other revenues

$

 955.0  275.7  152.7  897.6 

– 

2,281.0 

Lease operating expenses

 

 247.3  80.9  124.7  190.8 

– 

643.7 

Severance and ad valorem taxes

 

 46.5  3.5  4.1 

– 

– 

54.1 

Depreciation, depletion and amortization

 

 622.4  171.0  37.4  475.1  4.7  1,310.6 

Accretion of asset retirement obligations

 

 14.9  5.0  4.1  11.4 

– 

35.4 

Impairment of assets

 

 144.8  683.6 

– 

1,472.6 

– 

2,301.0 

Exploration expenses

 

 

 

 

 

 

 

    Dry holes

 

 74.5 

– 

– 

14.1  31.8  120.4 

    Geological and geophysical

 

 7.8 

– 

– 

1.2  21.7  30.7 

    Other

 

 6.7  0.5 

– 

– 

31.1  38.3 



 

 89.0  0.5 

– 

15.3  84.6  189.4 

    Undeveloped lease amortization

 

 48.5  12.4 

– 

 

 1.5  62.4 

        Total exploration expenses

 

 137.5  12.9 

– 

15.3  86.1  251.8 

Selling and general expenses

 

 68.2  18.4  0.7  4.5  44.3  136.1 

Other expenses

 

 8.4  44.0 

– 

17.3  12.1  81.8 

Results of operations before taxes

 

 (335.0) (743.6) (18.3) (1,289.4) (147.2) (2,533.5)

Income tax provisions (benefits)

 

 (116.9) (188.7) 4.6  (587.5) (16.5) (905.0)

Results of operations (excluding
  corporate overhead and interest)

$

 (218.1) (554.9) (22.9) (701.9) (130.7) (1,628.5)





13

 

MURPHY OIL CORPORATION

PRODUCTION-RELATED EXPENSES

(Dollars per barrel of oil equivalents sold)





 

 

 

 

 

 

 

 



 

Three Months Ended

 

Nine Months Ended



 

September 30,

 

September 30,



 

2016

 

2015

 

2016

 

2015

United States – Eagle Ford Shale

 

 

 

 

 

 

 

 

Lease operating expense

$

 10.98 

 

 8.10 

 

 9.32 

 

 10.82 

Severance and ad valorem taxes

 

 1.99 

 

 2.07 

 

 2.19 

 

 2.71 

Depreciation, depletion and amortization (DD&A) expense

 

 25.68 

 

 27.88 

 

 25.28 

 

 27.33 

United States – Gulf of Mexico

 

 

 

 

 

 

 

 

     Lease operating expense

$

 8.84 

 

 7.92 

 

 8.90 

 

 9.14 

     DD&A expense

 

 21.90 

 

 23.57 

 

 23.40 

 

 22.74 

Canada – Conventional operations

 

 

 

 

 

 

 

 

     Lease operating expense

$

 7.03 

 

 5.67 

 

 5.74 

 

 6.51 

     Severance and ad valorem taxes

 

 0.24 

 

 0.23 

 

 0.25 

 

 0.29 

     DD&A expense

 

 10.67 

 

 12.91 

 

 10.75 

 

 13.75 

Canada – Synthetic oil operations1

 

 

 

 

 

 

 

 

     Lease operating expense

$

 –

 

 37.20 

 

 41.15 

 

 40.67 

     Severance and ad valorem taxes

 

 –

 

 1.29 

 

 1.46 

 

 1.32 

     DD&A expense

 

 –

 

 12.00 

 

 9.72 

 

 12.20 

Malaysia – Sarawak

 

 

 

 

 

 

 

 

     Lease operating expense

$

 4.54 

 

 7.44 

 

 5.64 

 

 8.25 

     DD&A expense

 

 8.25 

 

 20.57 

 

 9.12 

 

 22.20 

Malaysia – Block K

 

 

 

 

 

 

 

 

     Lease operating expense

$

 6.13 

 

 14.36 

 

 10.48 

 

 13.53 

     DD&A expense

 

 14.38 

 

 33.06 

 

 13.08 

 

 31.50 

Total oil and gas operations

 

 

 

 

 

 

 

 

     Lease operating expense

$

 7.65 

 

 9.62 

 

 9.00 

 

 11.19 

     Severance and ad valorem taxes

 

 0.61 

 

 0.75 

 

 0.74 

 

 0.94 

     DD&A expense

 

 16.06 

 

 22.53 

 

 16.23 

 

 22.78 

Total oil and gas operations – excluding synthetic oil operations

 

 

 

 

 

 

 

 

     Lease operating expense

$

 7.65 

 

 8.09 

 

 7.83 

 

 9.53 

     Severance and ad valorem taxes

 

 0.61 

 

 0.72 

 

 0.71 

 

 0.92 

     DD&A expense

 

 16.06 

 

 23.11 

 

 16.46 

 

 23.37 



1 The Company sold its 5% non-operated interest in Syncrude Canada Ltd. on June 23, 2016.



 

14

 

MURPHY OIL CORPORATION

OTHER FINANCIAL DATA

(Unaudited)

(Millions of dollars)



 

 

 

 

 

 

 

 



 

Three Months Ended

 

Nine Months Ended



 

September 30,

 

September 30,



 

2016

 

2015

 

2016

 

2015

Capital expenditures

 

 

 

 

 

 

 

 

     Exploration and production

 

 

 

 

 

 

 

 

         United States

$

 83.1 

 

 359.3 

 

 183.8 

 

 1,173.7 

         Canada

 

 44.6 

 

 41.4 

 

 318.1 

2

 141.3 

         Malaysia

 

 38.0 

 

 67.4 

 

 80.0 

 

 199.6 

         Other

 

 6.0 

 

 46.4 

 

 32.7 

 

 116.9 

              Total

 

 171.7 

 

 514.5 

 

 614.6 

 

 1,631.5 

     Corporate

 

– 

 

 11.9 

 

 20.7 

 

 37.5 

              Total capital expenditures

 

 171.7 

 

 526.4 

 

 635.3 

 

 1,669.0 

     Charged to exploration expenses1

 

 

 

 

 

 

 

 

         United States

 

 3.2 

 

 14.5 

 

 5.5 

 

 89.0 

         Canada

 

– 

 

 0.1 

 

 3.4 

 

 0.5 

         Malaysia

 

 0.5 

 

 14.1 

 

 5.1 

 

 15.3 

         Other

 

 5.8 

 

 12.9 

 

 34.1 

 

 84.6 

              Total charged to exploration expenses

 

 9.5 

 

 41.6 

 

 48.1 

 

 189.4 

              Total capitalized

$

 162.2 

 

 484.8 

 

 587.2 

 

 1,479.6 

1  Excludes amortization of undeveloped leases

$

 10.4 

 

 16.5 

 

 35.8 

 

 62.4 



2 Includes costs of $206.7 million associated with acquisition of Kaybob Duvernay and Placid Montney.



 

15

 



 

 

 

 

MURPHY OIL CORPORATION

CONDENSED BALANCE SHEET (Unaudited)

(Millions of dollars)



 

 

 

 



 

September 30,
2016

 

December 31,
2015

     Assets

 

 

 

 

     Cash and cash equivalents

$

 753.1 

 

 283.2 

     Canadian government securities

 

 117.9 

 

 173.3 

     Other current assets

 

 734.1 

 

 991.9 

     Property, plant and equipment – net

 

 8,440.3 

 

 9,818.4 

     Other long-term assets

 

 348.6 

 

 227.0 

          Total assets

$

 10,394.0 

 

 11,493.8 

     Liabilities and Stockholders' Equity

 

 

 

 

     Current maturities of long-term debt

$

 20.4 

 

 18.9 

     Other current liabilities

 

 893.8 

 

 1,655.7 

     Long-term debt1

 

 2,973.9 

 

 3,040.6 

     Other long-term liabilities

 

 1,420.3 

 

 1,471.9 

     Total stockholders' equity

 

 5,085.6 

 

 5,306.7 

          Total liabilities and stockholders' equity

$

 10,394.0 

 

 11,493.8 



1 Includes a capital lease on production equipment of $199.1 million at September 30, 2016 and $209.8 million at December 31, 2015.



 

16

 

MURPHY OIL CORPORATION

STATISTICAL SUMMARY









 

 

 

 

 

 

 



Three Months Ended

 

Nine Months Ended



September 30,

 

September 30, 



2016

 

2015

 

2016

 

2015

Net crude oil and condensate produced – barrels per day

 96,476 

 

 125,170 

 

 106,279 

 

 128,888 

         United States – Eagle Ford Shale

 33,307 

 

 48,304 

 

 36,790 

 

 48,423 

                               – Gulf of Mexico

11,722 

 

 16,992 

 

 12,791 

 

 14,027 

         Canada  – light

 1,288 

 

 91 

 

 791 

 

 104 

                       – heavy

 2,678 

 

 4,975 

 

 2,732 

 

 5,837 

                       – offshore

 9,400 

 

 6,846 

 

 8,483 

 

 7,413 

                       – synthetic1

– 

 

 10,907 

 

 6,194 

 

 11,230 

         Malaysia1 – Sarawak

 12,889 

 

 15,194 

 

 13,288 

 

 15,696 

                          – Block K

 25,192 

 

 21,861 

 

 25,210 

 

 26,158 

Net crude oil and condensate sold – barrels per day

 97,542 

 

 124,549 

 

 104,525 

 

 129,294 

         United States – Eagle Ford Shale

 33,307 

 

 48,304 

 

 36,790 

 

 48,423 

                               – Gulf of Mexico

11,722 

 

 16,992 

 

 12,791 

 

 14,027 

         Canada  – light

 1,288 

 

 91 

 

 791 

 

 104 

                       – heavy

 2,678 

 

 4,975 

 

 2,732 

 

 5,837 

                       – offshore

 9,027 

 

 5,611 

 

 8,576 

 

 7,238 

                       – synthetic1

– 

 

 10,907 

 

 6,194 

 

 11,230 

         Malaysia1 – Sarawak

 12,641 

 

 18,493 

 

 12,024 

 

 17,546 

                          – Block K

 26,879 

 

 19,176 

 

 24,627 

 

 24,889 

Net natural gas liquids produced – barrels per day

 9,703 

 

 11,093 

 

 9,275 

 

 10,431 

         United States – Eagle Ford Shale

 6,940 

 

 8,192 

 

 6,972 

 

 7,744 

                               – Gulf of Mexico

1,502 

 

 2,264 

 

 1,399 

 

 2,020 

         Canada

 307 

 

 1 

 

 162 

 

 9 

         Malaysia1 – Sarawak

 954 

 

 636 

 

 742 

 

 658 

Net natural gas liquids sold – barrels per day

 8,770 

 

 11,789 

 

 9,289 

 

 10,466 

         United States – Eagle Ford Shale

 6,940 

 

 8,192 

 

 6,972 

 

 7,744 

                               – Gulf of Mexico

1,502 

 

 2,264 

 

 1,399 

 

 2,020 

         Canada

 307 

 

 1 

 

 162 

 

 9 

         Malaysia1 – Sarawak

 21 

 

 1,332 

 

 756 

 

 693 

Net natural gas sold – thousands of cubic feet per day

 381,988 

 

 427,937 

 

 376,592 

 

 425,964 

         United States – Eagle Ford Shale

 34,900 

 

 39,543 

 

 36,430 

 

 39,203 

                               – Gulf of Mexico

16,873 

 

 47,987 

 

 19,012 

 

 53,010 

         Canada

 204,816 

 

 196,111 

 

 206,458 

 

 194,136 

         Malaysia1 – Sarawak

 115,535 

 

 128,963 

 

 103,327 

 

 117,339 

                          – Block K

 9,864 

 

 15,333 

 

 11,365 

 

 22,276 

Total net hydrocarbons produced – equivalent barrels per day2

 169,844 

 

 207,586 

 

 178,319 

 

 210,313 

Total net hydrocarbons sold – equivalent barrels per day2

 169,977 

 

 207,661 

 

 176,579 

 

 210,754 



1  The Company sold a 10% interest in Malaysia properties on January 29, 2015.  The Company sold its 5% non-operated interest in Syncrude Canada Ltd. on June 23, 2016.  Production in this table includes production for these sold interests through the date of disposition.

2  Natural gas converted on an energy equivalent basis of 6:1.

17

 

MURPHY OIL CORPORATION

STATISTICAL SUMMARY (Continued)







 

 

 

 

 

 

 

 



 

Three Months Ended

 

Nine Months Ended



 

September 30,

 

September 30,



 

2016

 

2015

 

2016

 

2015

Weighted average sales prices

 

 

 

 

 

 

 

 

     Crude oil and condensate – dollars per barrel

 

 

 

 

 

 

 

 

          United States – Eagle Ford Shale

$

 44.59 

 

 48.70 

 

 40.65 

 

 49.27 

                                – Gulf of Mexico

 

 43.93 

 

 44.94 

 

 40.53 

 

 49.45 

          Canada1   – light

 

 36.36 

 

 37.70 

 

 41.04 

 

 43.41 

                       – heavy

 

 19.50 

 

 20.28 

 

 14.20 

 

 25.09 

                         – offshore

 

 45.87 

 

 48.09 

 

 40.15 

 

 53.77 

                       – synthetic

 

– 

 

 46.53 

 

 35.59 

 

 49.72 

          Malaysia – Sarawak2

 

 47.05 

 

 46.38 

 

 43.62 

 

 50.27 

                          – Block K2

 

 46.24 

 

 46.88 

 

 43.70 

 

 54.24 

     Natural gas liquids – dollars per barrel

 

 

 

 

 

 

 

 

          United States – Eagle Ford Shale

$

 10.89 

 

 10.26 

 

 10.06 

 

 11.52 

                                – Gulf of Mexico

 

 13.65 

 

 10.25 

 

 11.60 

 

 13.13 

          Canada1

 

 39.23 

 

– 

 

 41.04 

 

 22.31 

          Malaysia – Sarawak2

 

 45.12 

 

 54.27 

 

 37.50 

 

 55.23 

     Natural gas – dollars per thousand cubic feet

 

 

 

 

 

 

 

 

          United States – Eagle Ford Shale

$

 2.24 

 

 2.39 

 

 1.69 

 

 2.39 

                                – Gulf of Mexico

 

 2.35 

 

 2.46 

 

 1.81 

 

 2.47 

          Canada1

 

 1.88 

 

 2.42 

 

 1.58 

 

 2.44 

          Malaysia – Sarawak2

 

 3.01 

 

 3.75 

 

 3.25 

 

 4.31 

                          – Block K2

 

 0.23 

 

 0.24 

 

 0.24 

 

 0.24 



1  U.S. dollar equivalent.

2  Prices are net of payments under the terms of the respective production sharing contracts.

18

 

MURPHY OIL CORPORATION

COMMODITY HEDGE POSITIONS

AS OF OCTOBER 25, 2016













 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

Volumes

 

Price

 

Remaining Period

Area

 

Commodity

 

Type

 

(Bbl/d)

 

(USD/Bbl)

 

Start Date

 

End Date

United States

 

WTI

 

Fixed price derivative swap

 

 25,000 

 

$50.67

 

10/1/2016

 

12/31/2016

United States

 

WTI

 

Fixed price derivative swap

 

 18,000 

 

$50.60

 

1/1/2017

 

12/31/2017



 

 

 

 

 

 

 

 

 

 

 

 



 

 

 

 

 

Volumes

 

Price

 

Remaining Period

Area

 

Commodity

 

Type

 

(MMcf/d)

 

(CAD/Mcf)

 

Start Date

 

End Date

Western Canada

 

Natural Gas

 

Fixed price forward sales

 

 99 

 

C$3.00

 

10/1/2016

 

12/31/2016

Western Canada

 

Natural Gas

 

Fixed price forward sales

 

 99 

 

C$2.89

 

1/1/2017

 

12/31/2017

Western Canada

 

Natural Gas

 

Fixed price forward sales

 

 59 

 

C$2.81

 

1/1/2018

 

12/31/2020



 

19

 

MURPHY OIL CORPORATION

FOURTH QUARTER 2016 GUIDANCE



 

 

 



 

 

 



Liquids

 

Gas



BOPD

 

MCFD

Production – net

 

 

 

     U.S.  – Eagle Ford Shale

 38,500 

 

 31,000 

              – Gulf of Mexico

 11,000 

 

 14,500 

     Canada – Seal heavy

 3,000 

 

 2,000 

                  – Montney and Duvernay

 2,000 

 

 220,000 

                  – Offshore

 9,500 

 

– 

     Malaysia – Sarawak

 14,500 

 

 110,000 

                     – Block K

 20,500 

 

 6,500 



 

 

 

            Total net production (BOEPD)

 

162,000 - 164,000

            Total net sales (BOEPD)

 

149,000 - 151,000

Realized oil prices ($ per barrel):

 

 

 

     Malaysia – Sarawak

 

$50.53

                     – Block K

 

$49.30

Realized natural gas price ($ per MCF):

 

 

 

     Malaysia – Sarawak

 

$3.10

Exploration expense ($ millions)

 

$28.0

FULL YEAR  2016 GUIDANCE

Total production (BOEPD)

 

174,000 to 175,000

Capital expenditures ($ millions)

 

$620.0*



*Excludes costs of $206.7 million associated with acquisition of Kaybob Duvernay and Placid Montney.

20