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Revenue from Contracts with Customers
 12 Months Ended
Dec. 31, 2020
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers
Note C – Revenue from Contracts with Customers
Nature of Goods and Services
The Company explores for and produces crude oil, natural gas and natural gas liquids (collectively oil and gas) in select basins around the globe. The Company’s revenue from sales of oil and gas production activities are primarily subdivided into two key geographic segments: the U.S. and Canada.  Additionally, revenue from sales to customers is generated from three primary revenue streams: crude oil and condensate, natural gas liquids, and natural gas.
For operated oil and gas production where the non-operated working interest owner does not take-in-kind its proportionate interest in the produced commodity, the Company acts as an agent for the working interest owner and recognizes revenue only for its own share of the commingled production. The exception to this is the reporting of the noncontrolling interest in MP GOM as prescribed by ASC 810-10-45.
U.S. - In the United States, the Company primarily produces oil and gas from fields in the Eagle Ford Shale area of South Texas and in the Gulf of Mexico.  Revenue is generally recognized when oil and gas are transferred to the customer at the delivery point. Revenue recognized is largely index based with price adjustments for floating market differentials.
Canada - In Canada, contracts are primarily long-term floating commodity index priced, except for certain natural gas physical forward sales fixed-price contracts. For the Offshore business in Canada, contracts are based on index prices and revenue is recognized at the time of vessel load based on the volumes on the bill of lading and point of custody transfer.
In 2019, the Company made an immaterial reclassification to correct its financial statements to report transportation, gathering, and processing costs as a separate line item (previously reported net in revenue) in the Consolidated Statements of Operations and revised the 2018 period to reflect this presentation. There was no resultant change in net income attributable to Murphy.
Disaggregation of Revenue
The Company reviews performance based on two key geographical segments and between onshore and offshore sources of Revenue within these geographies.
For the years ended December 31, 2020, 2019, and 2018 the Company recognized $1,751.7 million, $2,817.1 million and $1,806.5 million, respectively, from contracts with customers for the continuing operations sales of oil, natural gas liquids and natural gas.
Years Ended December 31,
(Thousands of dollars)202020192018
Net crude oil and condensate revenue
United StatesOnshore$353,311 750,278 786,537 
                     Offshore940,265 1,477,816 417,527 
Canada    Onshore93,591 116,174 111,836 
Offshore71,495 159,254 176,291 
Other1,806 11,642 6,079 
Total crude oil and condensate revenue1,460,468 2,515,164 1,498,270 
Net natural gas liquids revenue
United States Onshore22,504 30,615 61,810 
 Offshore19,749 26,968 11,832 
Canada Onshore8,921 12,001 14,670 
Total natural gas liquids revenue51,174 69,584 88,312 
Net natural gas revenue
United States Onshore20,132 27,668 36,070 
Offshore49,300 46,259 17,559 
Canada   Onshore170,635 158,436 166,262 
Total natural gas revenue240,067 232,363 219,891 
Total revenue from contracts with customers 1
1,751,709 2,817,111 1,806,473 
Gain (loss) on crude contracts202,661 (856)(41,975)
Gain on sale of assets and other income 2
12,971 12,798 26,903 
Total revenue and other income$1,967,341 2,829,053 1,791,401 
1 Includes revenue attributable to noncontrolling interest in MP GOM, effective November 30, 2018.
2 Gain on sale of Malaysia operations of $985.4 million in 2019 is reported in discontinued operations. See Note E.
Contract Balances and Asset Recognition
As of December 31, 2020, and 2019, receivables from contracts with customers, net of royalties and associated payables, on the balance sheet from continuing operations, were $135.2 million and $186.8 million, respectively. Payment terms for the Company’s sales vary across contracts and geographical regions, with the majority of the cash receipts required within 30 days of billing. Based on a forward-looking expected loss model in accordance with ASU 2016-13 (see Note B), the Company did not recognize any impairment losses on receivables or contract assets arising from customer contracts during the reporting periods.
The Company has not entered into any upstream oil and natural gas sale contracts that have financing components as of December 31, 2020.
The Company does not employ sales incentive strategies such as commissions or bonuses for obtaining sales contracts. For the periods presented, the Company did not identify any assets to be recognized associated with the costs to obtain a contract with a customer.
Performance Obligations
The Company recognizes oil and gas revenue when it satisfies a performance obligation by transferring control over a commodity to a customer.  Judgment is required to determine whether some customers simultaneously receive and consume the
benefit of commodities. As a result of this assessment for the Company, each unit of measure of the specified commodity is considered to represent a distinct performance obligation that is satisfied at a point in time upon the transfer of control of the commodity.
For contracts with market or index-based pricing, which represent the majority of sales contracts, the Company has elected the allocation exception and allocates the variable consideration to each single performance obligation in the contract. As a result, there is no price allocation to unsatisfied remaining performance obligations for delivery of commodity product in subsequent periods.
The Company has entered into several long-term, fixed-price contracts in Canada. The underlying reason for entering a fixed price contract is generally unrelated to anticipated future prices or other observable data and serves a particular purpose in the company’s long-term strategy.
As of December 31, 2020, the Company had the following sales contracts in place which are expected to generate revenue from sales to customers for a period of 12 months or more starting at the inception of the contract:
Current Long-Term Contracts Outstanding at December 31, 2020
LocationCommodityEnd DateDescriptionApproximate Volumes
U.S.OilQ4 2021Fixed quantity delivery in Eagle Ford17,000 BOED
U.S.Natural Gas and NGLQ1 2023Deliveries from dedicated acreage in Eagle FordAs produced
CanadaNatural GasQ4 2021Contracts to sell natural gas at USD Index pricing10 MMCFD
CanadaNatural GasQ4 2022Contracts to sell natural gas at USD Index pricing7 MMCFD
CanadaNatural GasQ4 2022Contracts to sell natural gas at USD index fixed pricing20 MMCFD
CanadaNatural GasQ4 2023Contracts to sell natural gas at USD Index pricing25 MMCFD
CanadaNatural GasQ4 2024Contracts to sell natural gas at USD Index pricing32 MMCFD
CanadaNatural GasQ4 2024Contracts to sell natural gas at Alberta AECO fixed prices115 MMCFD
CanadaNatural GasQ4 2024Contracts to sell natural gas at USD index fixed pricing15 MMCFD
CanadaNatural GasQ4 2026Contracts to sell natural gas at USD Index pricing49 MMCFD