Le Lézard
Classified in: Business, Covid-19 virus
Subjects: EARNINGS, Conference Call, Webcast

 Murphy Oil Corporation Announces Third Quarter 2022 Results, Production Above Upper End of Guidance Range


Murphy Oil Corporation (NYSE: MUR) today announced its financial and operating results for the third quarter ended September 30, 2022, including net income attributable to Murphy of $528 million, or $3.36 per diluted share. Excluding discontinued operations and other one-off items, adjusted net income was $290 million, or $1.84 per diluted share.

Unless otherwise noted, the financial and operating highlights and metrics discussed in this commentary exclude noncontrolling interest (NCI).1

THIRD QUARTER HIGHLIGHTS:

SUBSEQUENT TO QUARTER-END HIGHLIGHTS:

"I am very pleased with our outstanding performance this quarter, which led to exceptional financial results, and we continue to focus on our key priorities of Delever, Execute and Explore. We are on track to achieve our 2022 debt reduction goal by the end of the year, and since establishing our delevering priority two years ago, will have repaid $1.0 billion of senior notes. After announcing our capital allocation framework in the previous quarter, we have made great progress as we position the company for the second stage of our framework, known as Murphy 2.0, in 2023 which allows for additional shareholder returns. Our financial success was primarily due to our high-margin, oil-weighted portfolio in the Gulf of Mexico and Eagle Ford Shale," said Roger W. Jenkins, President and Chief Executive Officer. "In exploration, we are excited about our upcoming operated drilling program as we prepare to spud two wells later this month: Tulum in offshore Mexico and Oso in the Gulf of Mexico."

THIRD QUARTER 2022 RESULTS

The company recorded net income attributable to Murphy of $528 million, or $3.36 per diluted share, for the third quarter 2022. Adjusted net income, which excludes both the results of discontinued operations and certain other items that affect comparability of results between periods, was $290 million, or $1.84 per diluted share for the same period. The adjusted net income from continuing operations adjusts for the following after-tax items: $189 million non-cash mark-to-market gain on derivative instruments, $25 million non-cash mark-to-market gain on contingent consideration and $26 million of other items. Details for third quarter results can be found in the attached schedules.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) attributable to Murphy was $637 million, or $36.35 per barrel of oil equivalent (BOE) sold. Adjusted earnings before interest, tax, depreciation, amortization and exploration expenses (EBITDAX) attributable to Murphy was $647 million, or $36.90 per BOE sold. Details for third quarter EBITDA and EBITDAX reconciliations can be found in the attached schedules.

Production for the third quarter averaged 188.5 MBOEPD with 51 percent oil and 57 percent liquids. Production was above the top end of guidance due to several factors, including a less active Gulf of Mexico hurricane season and strong well performance in the Eagle Ford Shale, which more than offset 3 MBOEPD of price-related royalty impacts in the Tupper Montney. Details for third quarter production results can be found in the attached schedules.

FINANCIAL POSITION

Murphy had approximately $2.0 billion of liquidity as of September 30, 2022, comprised of the $1.6 billion undrawn senior unsecured credit facility and $466 million of cash and cash equivalents, inclusive of NCI.

As established in Murphy 1.0 of the capital allocation framework, Murphy executed $248 million of debt reduction transactions during the quarter through the redemption of the remaining $42 million of senior notes due 2024, as well as the aggregate tender of $198 million of senior notes due 2025 and 2028, and open market repurchases of $8 million of senior notes due 2042.

As of September 30, 2022, the company's total debt of $2.0 billion consisted of long-term, fixed-rate notes with a weighted average maturity of 7.5 years and a weighted average coupon of 6.1 percent.

Subsequent to quarter end, Murphy announced the redemption of $200 million of 5.75 percent senior notes due 2025, to occur on November 30, 2022.

"By the end of this year, we will have reduced our total debt to approximately $1.8 billion," stated Jenkins. "Upon reaching this goal, we can begin Murphy 2.0 of our capital allocation framework in 2023, allowing us to allocate 25 percent of adjusted free cash flow2 to shareholder returns through share repurchases and dividend increases."

OPERATIONS SUMMARY

Onshore

The onshore business produced approximately 110 MBOEPD in the third quarter of 2022, including 36 percent liquids volumes.

Eagle Ford Shale ? Murphy produced an average 39 MBOEPD in the third quarter with 73 percent oil volumes and 87 percent liquids volumes. The company executed its third-quarter plan to bring four operated Catarina wells online, as well as three non-operated Tilden wells.

Tupper Montney ? In the third quarter, natural gas production averaged 376 million cubic feet per day (MMCFD). Murphy completed its 2022 well delivery program by bringing five operated wells online during the quarter.

Kaybob Duvernay ? During the third quarter, production averaged 6 MBOEPD with 78 percent liquids volumes. As previously stated, the three-well 2022 operated program was completed in the first quarter.

Offshore

Excluding NCI, the offshore business produced 78 MBOEPD during the third quarter, which included 81 percent oil.

Gulf of Mexico ? Production averaged 76 MBOEPD, consisting of 80 percent oil during the quarter. Murphy closed the previously announced acquisition of an additional 3.4 percent working interest in the non-operated Lucius field, as well as the divestment of its 50 percent working interest in the operated Thunder Hawk field. Murphy also spud the Dalmatian #1 (Desoto Canyon 90) well, reaching total depth after quarter-end with positive results from initial evaluations.

As of the end of the third quarter, five wells from the Khaleesi and Mormont fields were flowing into the Murphy-operated King's Quay FPS, and the first well from the Samurai field began producing shortly after quarter-end. Combined, these wells continue to exceed expectations and are currently achieving a total gross production rate of approximately 120 MBOEPD, or 32 MBOEPD net, with 85 percent oil. Notably, oil volumes are averaging approximately 20 percent above original projections.

Completion work continues, with the remaining well in the initial seven-well program expected to be online by year-end. Murphy previously disclosed the discovery of new pay zones while drilling in the Samurai field, which led to identifying an additional well opportunity. As a result, the company is preparing to spud the Samurai #5 (Green Canyon 432) well in the fourth quarter.

Canada ? Production averaged 2 MBOEPD in the third quarter, comprised of 100 percent oil. The asset life extension project is ongoing for the non-operated Terra Nova floating, production, storage and offloading vessel, and it is anticipated to return to production in early 2023.

EXPLORATION

Gulf of Mexico ? During the quarter, Anadarko US Offshore LLC (Oxy) and Ridgewood Energy Corporation entered into an agreement with Murphy to participate in the Oso-1EXP (Atwater Valley 138) exploration well. Murphy will remain the operator with a 33.34 percent working interest, and the company expects to spud this well in the fourth quarter of 2022.

Mexico ? The company continued preparations for the operated Tulum-1EXP (Block 5) exploration well in the third quarter and all permits have been received. Located in the Salina Basin, Murphy holds a 40 percent working interest and plans to spud this well in the fourth quarter of 2022.

Brazil ? During the quarter, Murphy assumed Wintershall Dea's 70 percent working interest in the Potiguar Basin at no cost following the partner's announcement to exit Brazil. Murphy now holds 100 percent working interest in the three Potiguar Basin blocks and, as previously announced, has been approved as an offshore operator by the Brazilian National Agency of Petroleum, Natural Gas and Biofuels.

REVISED 2022 CAPITAL EXPENDITURE AND PRODUCTION GUIDANCE

Third quarter accrued capital expenditures (CAPEX) of $209 million were in-line with guidance of $205 million, excluding acquisitions.

Murphy is revising its annual 2022 accrued CAPEX guidance, with an 8 percent increase in the midpoint and an adjusted range of $975 million to $1.025 billion, excluding acquisitions. The majority of the $75 million revision is due to operated offshore scope changes, with approximately $40 million of the increase attributable to Gulf of Mexico projects, including the addition of the new Samurai #5 well (Green Canyon 432). Approximately $20 million of the revision is primarily attributable to the Eagle Ford Shale, in particular non-operated activity, with approximately $10 million associated with non-operated Gulf of Mexico activity and $5 million for additional exploration costs.

2022 Revised CAPEX by Quarter ($ MMs)

1Q 2022A

 

2Q 2022A

 

3Q 2022A

 

4Q 2022E

 

FY 2022E

$301

 

$266

 

$209

 

$224

 

$1,000

Accrual CAPEX, based on midpoint of guidance range and excluding NCI and acquisitions

"Following review of our operational success throughout the year, we elected to commit additional capital to key high-returning, oil-weighted assets. A significant portion of the CAPEX guidance increase is to fund drilling of the new Samurai #5 well after discovering additional pay zones earlier this year. Building on our successful onshore operations, we also elected to participate in additional non-operated Eagle Ford Shale wells, which have had strong results to-date," stated Jenkins.

Full year 2022 production guidance is being revised to a range of 164 to 172 MBOEPD, with a production mix of approximately 54 percent oil and 60 percent total liquids volumes.

Fourth quarter 2022 production is estimated to be in the range of 173.5 to 181.5 MBOEPD with 55 percent oil volumes. This range is impacted by 9.5 MBOEPD of total offshore downtime, including 1.6 MBOEPD for downstream weather impacts associated with Hurricane Ian, as well as an estimated 10.5 MBOEPD for forecasted Tupper Montney royalties. Both production and CAPEX guidance ranges exclude Gulf of Mexico NCI.

"We have increased oil volumes throughout the year. However, our natural gas volumes going forward will be impacted in the Tupper Montney due to significant royalty increases caused by faster well payouts and higher AECO natural gas prices. While this has a production impact, it is reflected minimally in our cash flow, and we anticipate it will not affect the timing of our capital allocation framework," stated Jenkins.

"With regards to the Gulf of Mexico, we experienced unplanned downtime early in the fourth quarter; however, most of those issues have already been resolved. Additionally, while Hurricane Ian did not come close to our assets, downstream evacuations caused delays in our maintenance program. Our forecast has also been impacted by the results of the non-operated Kodiak #3 well. The well has performed below expectations, and work plans are being developed by the operator for remediation. Fortunately, outstanding performance at the Khaleesi, Mormont, Samurai field development project partially offsets those impacts," said Jenkins.

COMMODITY HEDGES

Murphy employs commodity derivative instruments to manage certain risks associated with commodity price volatility and underpin capital returns associated with certain assets.

Murphy utilizes collars to provide hedge protection on 25 MBOPD for full-year 2022 with a weighted average put price of $63.24 per barrel and weighted average call price of $75.20 per barrel.

The company also utilizes swaps to protect 20 MBOPD of full-year 2022 production with an average fixed price of $44.88 per barrel.

Murphy maintains a combination of fixed price forward sales contracts and diversification contracts tied to US pricing points to lessen its dependence on variable AECO prices. These contracts are for physical delivery of natural gas volumes at a fixed price, with no mark-to-market income adjustments. Details for the current fixed price contracts can be found in the attached schedules.

CONFERENCE CALL AND WEBCAST SCHEDULED FOR NOVEMBER 3, 2022

Murphy will host a conference call to discuss third quarter 2022 financial and operating results on Thursday, November 3, 2022, at 10:00 a.m. EDT. The call can be accessed either via the Internet through the Investor Relations section of Murphy's website at http://ir.murphyoilcorp.com or via the telephone by dialing toll free 1-888-886-7786, reservation number 08535739.

FINANCIAL DATA

Summary financial data and operating statistics for third quarter 2022, with comparisons to the same period from the previous year, are contained in the following schedules. Additionally, a schedule indicating the impacts of items affecting comparability of results between periods, a reconciliation of EBITDA and EBITDAX between periods, as well as guidance for the fourth quarter and full year 2022, are also included.

1In accordance with GAAP, Murphy reports the 100 percent interest, including a 20 percent noncontrolling interest (NCI), in its subsidiary, MP Gulf of Mexico, LLC (MP GOM). The GAAP financials include the NCI portion of revenue, costs, assets and liabilities and cash flows. Unless otherwise noted, the financial and operating highlights and metrics discussed in this news release, but not the accompanying schedules, exclude the NCI, thereby representing only the amounts attributable to Murphy.

2Adjusted free cash flow is defined as cash flow from operations before working capital change, less capital expenditures, distributions to NCI and projected payments, quarterly dividend and accretive acquisitions.

ABOUT MURPHY OIL CORPORATION

As an independent oil and natural gas exploration and production company, Murphy Oil Corporation believes in providing energy that empowers people by doing right always, staying with it and thinking beyond possible. Murphy challenges the norm, taps into its strong legacy and uses its foresight and financial discipline to deliver inspired energy solutions. Murphy sees a future where it is an industry leader who is positively impacting lives for the next 100 years and beyond. Additional information can be found on the company's website at www.murphyoilcorp.com.

FORWARD-LOOKING STATEMENTS

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identified through the inclusion of words such as "aim", "anticipate", "believe", "drive", "estimate", "expect", "expressed confidence", "forecast", "future", "goal", "guidance", "intend", "may", "objective", "outlook", "plan", "position", "potential", "project", "seek", "should", "strategy", "target", "will" or variations of such words and other similar expressions. These statements, which express management's current views concerning future events, results and plans, are subject to inherent risks, uncertainties and assumptions (many of which are beyond our control) and are not guarantees of performance. In particular, statements, express or implied, concerning the company's future operating results or activities and returns or the company's ability and decisions to replace or increase reserves, increase production, generate returns and rates of return, replace or increase drilling locations, reduce or otherwise control operating costs and expenditures, generate cash flows, pay down or refinance indebtedness, achieve, reach or otherwise meet initiatives, plans, goals, ambitions or targets with respect to emissions, safety matters or other ESG (environmental/social/governance) matters, or pay and/or increase dividends or make share repurchases and other capital allocation decisions are forward-looking statements. Factors that could cause one or more of these future events, results or plans not to occur as implied by any forward-looking statement, which consequently could cause actual results or activities to differ materially from the expectations expressed or implied by such forward-looking statements, include, but are not limited to: macro conditions in the oil and gas industry, including supply/demand levels, actions taken by major oil exporters and the resulting impacts on commodity prices; increased volatility or deterioration in the success rate of our exploration programs or in our ability to maintain production rates and replace reserves; reduced customer demand for our products due to environmental, regulatory, technological or other reasons; adverse foreign exchange movements; political and regulatory instability in the markets where we do business; the impact on our operations or market of health pandemics such as COVID-19 and related government responses; other natural hazards impacting our operations or markets; any other deterioration in our business, markets or prospects; any failure to obtain necessary regulatory approvals; any inability to service or refinance our outstanding debt or to access debt markets at acceptable prices; or adverse developments in the U.S. or global capital markets, credit markets or economies in general. For further discussion of factors that could cause one or more of these future events or results not to occur as implied by any forward-looking statement, see "Risk Factors" in our most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K that we file, available from the SEC's website and from Murphy Oil Corporation's website at http://ir.murphyoilcorp.com. Murphy Oil Corporation undertakes no duty to publicly update or revise any forward-looking statements.

NON-GAAP FINANCIAL MEASURES

This news release contains certain non-GAAP financial measures that management believes are useful tools for internal use and the investment community in evaluating Murphy Oil Corporation's overall financial performance. These non-GAAP financial measures are broadly used to value and compare companies in the crude oil and natural gas industry. Not all companies define these measures in the same way. In addition, these non-GAAP financial measures are not a substitute for financial measures prepared in accordance with GAAP and should therefore be considered only as supplemental to such GAAP financial measures. Please see the attached schedules for reconciliations of the differences between the non-GAAP financial measures used in this news release and the most directly comparable GAAP financial measures.

 

MURPHY OIL CORPORATION

SUMMARIZED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

(Thousands of dollars, except per share amounts)

2022

 

2021

 

2022

 

2021

Revenues and other income

 

 

 

 

 

 

 

Revenue from production

$

1,120,909

 

 

687,549

 

 

$

3,101,736

 

 

2,038,905

 

Sales of purchased natural gas

 

45,500

 

 

?

 

 

 

132,285

 

 

?

 

Total revenue from sales to customers

 

1,166,409

 

 

687,549

 

 

 

3,234,021

 

 

2,038,905

 

Gain (Loss) on derivative instruments

 

115,191

 

 

(59,164

)

 

 

(308,654

)

 

(499,794

)

Gain on sale of assets and other income

 

21,825

 

 

2,315

 

 

 

32,076

 

 

21,217

 

Total revenues and other income

 

1,303,425

 

 

630,700

 

 

 

2,957,443

 

 

1,560,328

 

Costs and expenses

 

 

 

 

 

 

 

Lease operating expenses

 

198,710

 

 

130,131

 

 

 

482,887

 

 

403,708

 

Severance and ad valorem taxes

 

15,140

 

 

11,670

 

 

 

47,340

 

 

32,215

 

Transportation, gathering and processing

 

55,348

 

 

44,588

 

 

 

152,219

 

 

137,196

 

Costs of purchased natural gas

 

43,622

 

 

?

 

 

 

125,258

 

 

?

 

Exploration expenses, including undeveloped lease amortization

 

9,491

 

 

24,517

 

 

 

72,208

 

 

49,840

 

Selling and general expenses

 

29,348

 

 

27,210

 

 

 

90,007

 

 

85,826

 

Depreciation, depletion and amortization

 

214,521

 

 

189,806

 

 

 

574,501

 

 

615,372

 

Accretion of asset retirement obligations

 

11,286

 

 

12,198

 

 

 

34,725

 

 

34,854

 

Other operating (income) expense

 

(27,129

)

 

(32,791

)

 

 

115,726

 

 

58,616

 

Impairment of assets

 

?

 

 

?

 

 

 

?

 

 

171,296

 

Total costs and expenses

 

550,337

 

 

407,329

 

 

 

1,694,871

 

 

1,588,923

 

Operating income (loss) from continuing operations

 

753,088

 

 

223,371

 

 

 

1,262,572

 

 

(28,595

)

Other income (loss)

 

 

 

 

 

 

 

Other income (expense)

 

18,301

 

 

(1,593

)

 

 

21,114

 

 

(11,459

)

Interest expense, net

 

(37,440

)

 

(46,925

)

 

 

(116,102

)

 

(178,399

)

Total other loss

 

(19,139

)

 

(48,518

)

 

 

(94,988

)

 

(189,858

)

Income (loss) from continuing operations before income taxes

 

733,949

 

 

174,853

 

 

 

1,167,584

 

 

(218,453

)

Income tax expense (benefit)

 

159,451

 

 

36,838

 

 

 

247,574

 

 

(62,498

)

Income (loss) from continuing operations

 

574,498

 

 

138,015

 

 

 

920,010

 

 

(155,955

)

Loss from discontinued operations, net of income taxes

 

(422

)

 

(706

)

 

 

(1,916

)

 

(600

)

Net income (loss) including noncontrolling interest

 

574,076

 

 

137,309

 

 

 

918,094

 

 

(156,555

)

Less: Net income attributable to noncontrolling interest

 

45,648

 

 

28,853

 

 

 

152,445

 

 

85,509

 

NET INCOME (LOSS) ATTRIBUTABLE TO MURPHY

$

528,428

 

 

108,456

 

 

$

765,649

 

 

(242,064

)

 

 

 

 

 

 

 

 

INCOME (LOSS) PER COMMON SHARE ? BASIC

 

 

 

 

 

 

 

Continuing operations

$

3.40

 

 

0.70

 

 

$

4.94

 

 

(1.57

)

Discontinued operations

 

?

 

 

?

 

 

 

(0.01

)

 

?

 

Net income (loss)

$

3.40

 

 

0.70

 

 

$

4.93

 

 

(1.57

)

 

 

 

 

 

 

 

 

INCOME (LOSS) PER COMMON SHARE ? DILUTED

 

 

 

 

 

 

 

Continuing operations

$

3.36

 

 

0.70

 

 

$

4.87

 

 

(1.57

)

Discontinued operations

 

?

 

 

?

 

 

 

(0.01

)

 

?

 

Net income (loss)

$

3.36

 

 

0.70

 

 

$

4.86

 

 

(1.57

)

Cash dividends per Common share

$

0.250

 

 

0.125

 

 

 

0.575

 

 

0.375

 

Average Common shares outstanding (thousands)

 

 

 

 

 

 

 

Basic

 

155,446

 

 

154,439

 

 

 

155,221

 

 

154,239

 

Diluted

 

157,336

 

 

155,932

 

 

 

157,407

 

 

154,239

 

MURPHY OIL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

(Thousands of dollars)

2022

 

2021

 

2022

 

2021

Operating Activities

 

 

 

 

 

 

 

Net income (loss) including noncontrolling interest

$

574,076

 

 

137,309

 

 

$

918,094

 

 

(156,555

)

Adjustments to reconcile net income (loss) to net cash provided by continuing operations activities

 

 

 

 

 

 

 

Loss from discontinued operations

 

422

 

 

706

 

 

 

1,916

 

 

600

 

Depreciation, depletion and amortization

 

214,521

 

 

189,806

 

 

 

574,501

 

 

615,372

 

Unsuccessful exploration well costs and previously suspended exploration costs

 

1,122

 

 

17,266

 

 

 

35,224

 

 

17,899

 

Amortization of undeveloped leases

 

2,671

 

 

4,990

 

 

 

10,651

 

 

13,872

 

Accretion of asset retirement obligations

 

11,286

 

 

12,198

 

 

 

34,725

 

 

34,854

 

Deferred income tax (benefit) expense

 

140,414

 

 

36,046

 

 

 

207,105

 

 

(65,149

)

Mark to market (gain) loss on contingent consideration

 

(31,367

)

 

28,434

 

 

 

98,451

 

 

105,111

 

Mark to market (gain) loss on crude contracts

 

(239,050

)

 

(55,863

)

 

 

(138,707

)

 

228,497

 

Long-term non-cash compensation

 

17,145

 

 

16,762

 

 

 

57,612

 

 

42,080

 

Impairment of assets

 

?

 

 

?

 

 

 

?

 

 

171,296

 

(Gain) from sale of assets

 

(18,836

)

 

?

 

 

 

(18,871

)

 

?

 

Net decrease (increase) in noncash working capital

 

61,724

 

 

90,765

 

 

 

(59,874

)

 

117,330

 

Other operating activities, net

 

(14,643

)

 

(73,418

)

 

 

(42,101

)

 

(33,924

)

Net cash provided by continuing operations activities

 

719,485

 

 

405,001

 

 

 

1,678,726

 

 

1,091,283

 

Investing Activities

 

 

 

 

 

 

 

Property additions and dry hole costs 1

 

(248,043

)

 

(118,483

)

 

 

(800,868

)

 

(541,324

)

Acquisition of oil and gas properties 1

 

(79,111

)

 

(433

)

 

 

(125,602

)

 

(22,906

)

Proceeds from sales of property, plant and equipment

 

(2,176

)

 

675

 

 

 

(2,129

)

 

270,038

 

Property additions for King's Quay FPS

 

?

 

 

?

 

 

 

?

 

 

(17,734

)

Net cash (required) by investing activities

 

(329,330

)

 

(118,241

)

 

 

(928,599

)

 

(311,926

)

Financing Activities

 

 

 

 

 

 

 

Borrowings on revolving credit facility

 

200,000

 

 

?

 

 

 

300,000

 

 

165,000

 

Repayment of revolving credit facility

 

(200,000

)

 

?

 

 

 

(300,000

)

 

(365,000

)

Retirement of debt

 

(246,032

)

 

(150,000

)

 

 

(446,032

)

 

(726,358

)

Debt issuance, net of cost

 

?

 

 

(61

)

 

 

?

 

 

541,913

 

Early redemption of debt cost

 

(1,981

)

 

(2,579

)

 

 

(5,419

)

 

(36,756

)

Distributions to noncontrolling interest

 

(50,419

)

 

(25,642

)

 

 

(145,273

)

 

(100,880

)

Contingent consideration payment

 

?

 

 

 

 

 

(81,742

)

 

?

 

Cash dividends paid

 

(38,863

)

 

(19,306

)

 

 

(89,354

)

 

(57,896

)

Withholding tax on stock-based incentive awards

 

(641

)

 

(1,078

)

 

 

(17,338

)

 

(4,973

)

Capital lease obligation payments

 

(155

)

 

(272

)

 

 

(475

)

 

(643

)

Net cash (required) by financing activities

 

(338,091

)

 

(198,938

)

 

 

(785,633

)

 

(585,593

)

Cash Flows from Discontinued Operations

 

 

 

 

 

 

 

Operating activities

 

(14,500

)

 

?

 

 

 

(14,500

)

 

?

 

Net cash (required) by discontinued operations

 

(14,500

)

 

?

 

 

 

(14,500

)

 

?

 

Effect of exchange rate changes on cash and cash equivalents

 

(3,585

)

 

(855

)

 

 

(5,180

)

 

697

 

Net increase (decrease) in cash and cash equivalents

 

33,979

 

 

86,967

 

 

 

(55,186

)

 

194,461

 

Cash and cash equivalents at beginning of period

 

432,019

 

 

418,100

 

 

 

521,184

 

 

310,606

 

Cash and cash equivalents at end of period

$

465,998

 

 

505,067

 

 

$

465,998

 

 

505,067

 

 

¹ Certain prior-period amounts have been reclassified to conform to the current period presentation.

MURPHY OIL CORPORATION

SCHEDULE OF ADJUSTED INCOME (LOSS) (unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

(Millions of dollars, except per share amounts)

2022

 

2021

 

2022

 

2021

Net income (loss) attributable to Murphy (GAAP)

$

528.4

 

 

108.5

 

 

$

765.6

 

 

(242.1

)

Discontinued operations loss

 

0.4

 

 

0.7

 

 

 

1.9

 

 

0.6

 

Income (loss) from continuing operations

 

528.8

 

 

109.2

 

 

 

767.5

 

 

(241.5

)

Adjustments (after tax):

 

 

 

 

 

 

 

Mark-to-market (gain) loss on derivative instruments

 

(188.8

)

 

(44.1

)

 

 

(109.5

)

 

180.5

 

Mark-to-market (gain) loss on contingent consideration

 

(24.8

)

 

22.4

 

 

 

77.5

 

 

83.0

 

Foreign exchange gain

 

(15.5

)

 

(2.0

)

 

 

(21.4

)

 

(1.1

)

Gain on sale of assets

 

(11.9

)

 

?

 

 

 

(11.9

)

 

?

 

Early redemption of debt cost

 

1.9

 

 

2.7

 

 

 

5.3

 

 

31.9

 

Impairment of assets

 

?

 

 

?

 

 

 

?

 

 

128.0

 

Charges related to Kings Quay transaction

 

?

 

 

?

 

 

 

?

 

 

3.9

 

Unutilized rig charges

 

?

 

 

2.5

 

 

 

?

 

 

6.7

 

Asset retirement obligation gains

 

?

 

 

(53.6

)

 

 

?

 

 

(53.6

)

Total adjustments after taxes

 

(239.1

)

 

(72.1

)

 

 

(60.0

)

 

379.3

 

Adjusted income from continuing operations attributable to Murphy

$

289.7

 

 

37.1

 

 

$

707.5

 

 

137.8

 

 

 

 

 

 

 

 

 

Adjusted income from continuing operations per average diluted share

$

1.84

 

 

0.24

 

 

$

4.49

 

 

0.89

 

Non-GAAP Financial Measures

Presented above is a reconciliation of Net income (loss) to Adjusted income from continuing operations attributable to Murphy. Adjusted income 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 income is a non-GAAP financial measure and should not be considered a substitute for Net income (loss) as determined in accordance with accounting principles generally accepted in the United States of America.

Amounts shown above as reconciling items between Net income (loss) and Adjusted income are presented net of applicable income taxes based on the estimated statutory rate in the applicable tax jurisdiction. The pretax and income tax impacts for adjustments shown above are as follows by area of operations and exclude the share attributable to non-controlling interests.

 

Three Months Ended
September 30, 2022

 

Nine Months Ended
September 30, 2022

(Millions of dollars)

Pretax

 

Tax

 

Net

 

Pretax

 

Tax

 

Net

Exploration & Production:

 

 

 

 

 

 

 

 

 

 

 

United States

$

(46.6

)

 

9.9

 

(36.7

)

 

$

83.2

 

 

(17.6

)

 

65.6

 

Corporate

 

(257.4

)

 

55.0

 

(202.4

)

 

 

(160.6

)

 

35.0

 

 

(125.6

)

Total adjustments

$

(304.0

)

 

64.9

 

(239.1

)

 

$

(77.4

)

 

17.4

 

 

(60.0

)

MURPHY OIL CORPORATION

SCHEDULE OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION

AND AMORTIZATION (EBITDA)

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

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

2022

 

2021

 

2022

 

2021

Net income (loss) attributable to Murphy (GAAP)

$

528.4

 

 

108.5

 

 

$

765.6

 

 

(242.1

)

Income tax expense (benefit)

 

159.5

 

 

36.8

 

 

 

247.6

 

 

(62.5

)

Interest expense, net

 

37.4

 

 

46.9

 

 

 

116.1

 

 

178.4

 

Depreciation, depletion and amortization expense ¹

 

207.7

 

 

182.8

 

 

 

552.5

 

 

588.4

 

EBITDA attributable to Murphy (Non-GAAP)

$

933.0

 

 

375.0

 

 

$

1,681.8

 

 

462.2

 

Mark-to-market (gain) loss on derivative instruments

 

(239.1

)

 

(55.9

)

 

 

(138.7

)

 

228.5

 

Mark-to-market (gain) loss on contingent consideration

 

(31.4

)

 

28.4

 

 

 

98.5

 

 

105.1

 

Foreign exchange gain

 

(20.7

)

 

(2.8

)

 

 

(28.7

)

 

(1.5

)

Gain on sale of assets ¹

 

(15.2

)

 

?

 

 

 

(15.2

)

 

?

 

Accretion of asset retirement obligations ¹

 

10.0

 

 

10.8

 

 

 

30.7

 

 

30.8

 

Discontinued operations loss

 

0.4

 

 

0.7

 

 

 

1.9

 

 

0.6

 

Impairment of assets

 

?

 

 

?

 

 

 

?

 

 

171.3

 

Unutilized rig charges

 

?

 

 

3.2

 

 

 

?

 

 

8.5

 

Asset retirement obligation gains

 

?

 

 

(71.8

)

 

 

?

 

 

(71.8

)

Adjusted EBITDA attributable to Murphy (Non-GAAP)

$

637.1

 

 

287.6

 

 

$

1,630.3

 

 

933.7

 

 

 

 

 

 

 

 

 

Total barrels of oil equivalents sold from continuing operations attributable to Murphy (thousands of barrels)

 

17,525

 

 

14,219

 

 

 

44,973

 

 

43,536

 

 

 

 

 

 

 

 

 

Adjusted EBITDA per barrel of oil equivalents sold

$

36.35

 

 

20.23

 

 

$

36.25

 

 

21.45

 

 

¹ Depreciation, depletion, and amortization expense, gain on sale of assets and accretion of asset retirement obligations used in the computation of Adjusted EBITDA exclude the portion attributable to the non-controlling interest (NCI).

Non-GAAP Financial Measures

Presented above is a reconciliation of Net income (loss) to Earnings before interest, taxes, depreciation and amortization (EBITDA) and adjusted EBITDA. Management believes EBITDA and adjusted EBITDA are important information to provide because they are 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 and adjusted EBITDA are non-GAAP financial measures and should not be considered a substitute for Net income (loss) or Cash provided by operating activities as determined in accordance with accounting principles generally accepted in the United States of America.

Presented above is adjusted EBITDA per barrel of oil equivalent sold. Management believes adjusted EBITDA per barrel of oil equivalent sold is important information because it is used by management to evaluate the Company's profitability of one barrel of oil equivalent sold in that period. Adjusted EBITDA per barrel of oil equivalent sold is a non-GAAP financial metric.

MURPHY OIL CORPORATION

SCHEDULE OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION

AND AMORTIZATION AND EXPLORATION (EBITDAX)

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

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

2022

 

2021

 

2022

 

2021

Net income (loss) attributable to Murphy (GAAP)

$

528.4

 

 

108.5

 

 

$

765.6

 

 

(242.1

)

Income tax expense (benefit)

 

159.5

 

 

36.8

 

 

 

247.6

 

 

(62.5

)

Interest expense, net

 

37.4

 

 

46.9

 

 

 

116.1

 

 

178.4

 

Depreciation, depletion and amortization expense ¹

 

207.7

 

 

182.8

 

 

 

552.5

 

 

588.4

 

EBITDA attributable to Murphy (Non-GAAP)

 

933.0

 

 

375.0

 

 

 

1,681.8

 

 

462.2

 

Exploration expenses

 

9.5

 

 

24.5

 

 

 

72.2

 

 

49.8

 

EBITDAX attributable to Murphy (Non-GAAP)

 

942.5

 

 

399.5

 

 

 

1,754.0

 

 

512.0

 

Mark-to-market (gain) loss on derivative instruments

 

(239.1

)

 

(55.9

)

 

 

(138.7

)

 

228.5

 

Mark-to-market (gain) loss on contingent consideration

 

(31.4

)

 

28.4

 

 

 

98.5

 

 

105.1

 

Foreign exchange gain

 

(20.7

)

 

(2.8

)

 

 

(28.7

)

 

(1.5

)

Gain on sale of assets ¹

 

(15.2

)

 

?

 

 

 

(15.2

)

 

?

 

Accretion of asset retirement obligations ¹

 

10.0

 

 

10.8

 

 

 

30.7

 

 

30.8

 

Discontinued operations loss

 

0.4

 

 

0.7

 

 

 

1.9

 

 

0.6

 

Impairment of assets

 

?

 

 

?

 

 

 

?

 

 

171.3

 

Unutilized rig charges

 

?

 

 

3.2

 

 

 

?

 

 

8.5

 

Asset retirement obligation gains

 

?

 

 

(71.8

)

 

 

?

 

 

(71.8

)

Adjusted EBITDAX attributable to Murphy (Non-GAAP)

$

646.6

 

 

312.1

 

 

$

1,702.5

 

 

983.5

 

 

 

 

 

 

 

 

 

Total barrels of oil equivalents sold from continuing operations attributable to Murphy (thousands of barrels)

 

17,525

 

 

14,219

 

 

 

44,973

 

 

43,536

 

 

 

 

 

 

 

 

 

Adjusted EBITDAX per barrel of oil equivalents sold

$

36.90

 

 

21.95

 

 

$

37.86

 

 

22.59

 

 

¹ Depreciation, depletion, and amortization expense, gain on sale of assets and accretion of asset retirement obligations used in the computation of adjusted EBITDAX exclude the portion attributable to the non-controlling interest (NCI).

Non-GAAP Financial Measures

Presented above is a reconciliation of Net income (loss) to Earnings before interest, taxes, depreciation and amortization, and exploration expenses (EBITDAX) and adjusted EBITDAX. Management believes EBITDAX and adjusted EBITDAX are important information to provide because they are 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 and adjusted EBITDAX are non-GAAP financial measures and should not be considered a substitute for Net income (loss) or Cash provided by operating activities as determined in accordance with accounting principles generally accepted in the United States of America.

Presented above is adjusted EBITDAX per barrel of oil equivalent sold. Management believes adjusted EBITDAX per barrel of oil equivalent sold is important information because it is used by management to evaluate the Company's profitability of one barrel of oil equivalent sold in that period. Adjusted EBITDAX per barrel of oil equivalent sold is a non-GAAP financial metric.

MURPHY OIL CORPORATION

FUNCTIONAL RESULTS OF OPERATIONS (unaudited)

 

 

Three Months Ended
September 30, 2022

Three Months Ended
September 30, 2021

(Millions of dollars)

Revenues

Income
(Loss)

Revenues

Income
(Loss)

Exploration and production

 

 

 

 

United States 1

$

973.8

481.5

 

$

565.2

 

168.1

 

Canada

 

209.6

41.4

 

 

124.6

 

73.9

 

Other

 

4.8

(5.8

)

 

?

 

(5.2

)

Total exploration and production

 

1,188.2

517.1

 

 

689.8

 

236.8

 

Corporate

 

115.2

57.4

 

 

(59.1

)

(98.8

)

Continuing operations

 

1,303.4

574.5

 

 

630.7

 

138.0

 

Discontinued operations, net of tax

 

?

(0.4

)

 

?

 

(0.7

)

Total including noncontrolling interest

$

1,303.4

574.1

 

$

630.7

 

137.3

 

Net income attributable to Murphy

 

528.4

 

 

108.5

 

 

Nine Months Ended
September 30, 2022

Nine Months Ended
September 30, 2021

(Millions of dollars)

Revenues

Income
(Loss)

Revenues

Income
(Loss)

Exploration and production

 

 

 

 

United States 1

$

2,659.2

 

1,225.9

 

$

1,704.4

 

481.8

 

Canada

 

582.3

 

111.3

 

 

349.2

 

(37.7

)

Other

 

18.5

 

(53.5

)

 

?

 

(22.5

)

Total exploration and production

 

3,260.0

 

1,283.7

 

 

2,053.6

 

421.6

 

Corporate

 

(302.6

)

(363.7

)

 

(493.3

)

(577.6

)

Continuing operations

 

2,957.4

 

920.0

 

 

1,560.3

 

(156.0

)

Discontinued operations, net of tax

 

?

 

(1.9

)

 

?

 

(0.6

)

Total including noncontrolling interest

$

2,957.4

 

918.1

 

$

1,560.3

 

(156.6

)

Net income (loss) attributable to Murphy

 

765.6

 

 

(242.1

)

 

¹ Includes results attributable to a noncontrolling interest in MP Gulf of Mexico, LLC (MP GOM).

MURPHY OIL CORPORATION

OIL AND GAS OPERATING RESULTS (unaudited)

THREE MONTHS ENDED SEPTEMBER 30, 2022, AND 2021

 

(Millions of dollars)

United
States 1

Canada

Other

Total

Three Months Ended September 30, 2022

 

 

 

 

Oil and gas sales and other operating revenues

$

973.8

 

164.1

 

4.8

 

1,142.7

 

Sales of purchased natural gas

 

?

 

45.5

 

?

 

45.5

 

Lease operating expenses

 

158.8

 

39.6

 

0.3

 

198.7

 

Severance and ad valorem taxes

 

14.9

 

0.3

 

?

 

15.2

 

Transportation, gathering and processing

 

38.5

 

16.9

 

?

 

55.4

 

Costs of purchased natural gas

 

?

 

43.7

 

?

 

43.7

 

Depreciation, depletion and amortization

 

169.4

 

40.9

 

0.9

 

211.2

 

Accretion of asset retirement obligations

 

8.8

 

2.4

 

?

 

11.2

 

Exploration expenses

 

 

 

 

Dry holes and previously suspended exploration costs

 

0.2

 

?

 

0.9

 

1.1

 

Geological and geophysical

 

1.1

 

0.1

 

0.4

 

1.6

 

Other exploration

 

1.5

 

?

 

2.6

 

4.1

 

 

 

2.8

 

0.1

 

3.9

 

6.8

 

Undeveloped lease amortization

 

2.0

 

0.1

 

0.6

 

2.7

 

Total exploration expenses

 

4.8

 

0.2

 

4.5

 

9.5

 

Selling and general expenses

 

2.6

 

5.2

 

2.0

 

9.8

 

Other

 

(27.7

)

3.7

 

0.6

 

(23.4

)

Results of operations before taxes

 

603.7

 

56.7

 

(3.5

)

656.9

 

Income tax provisions

 

122.2

 

15.3

 

2.3

 

139.8

 

Results of operations (excluding Corporate segment)

$

481.5

 

41.4

 

(5.8

)

517.1

 

 

 

 

 

 

Three Months Ended September 30, 2021

 

 

 

 

Oil and gas sales and other operating revenues

$

565.2

 

124.6

 

?

 

689.8

 

Lease operating expenses

 

96.7

 

33.4

 

0.1

 

130.2

 

Severance and ad valorem taxes

 

10.8

 

0.8

 

?

 

11.6

 

Transportation, gathering and processing

 

28.4

 

16.2

 

?

 

44.6

 

Depreciation, depletion and amortization

 

147.0

 

39.7

 

0.1

 

186.8

 

Accretion of asset retirement obligations

 

9.3

 

2.9

 

?

 

12.2

 

Exploration expenses

 

 

 

 

Dry holes and previously suspended exploration costs

 

17.3

 

?

 

?

 

17.3

 

Geological and geophysical

 

?

 

?

 

0.3

 

0.3

 

Other exploration

 

1.3

 

0.1

 

0.5

 

1.9

 

 

 

18.6

 

0.1

 

0.8

 

19.5

 

Undeveloped lease amortization

 

3.1

 

0.1

 

1.8

 

5.0

 

Total exploration expenses

 

21.7

 

0.2

 

2.6

 

24.5

 

Selling and general expenses

 

4.2

 

4.0

 

1.2

 

9.4

 

Other

 

39.1

 

(71.7

)

2.0

 

(30.6

)

Results of operations before taxes

 

208.0

 

99.1

 

(6.0

)

301.1

 

Income tax provisions

 

39.9

 

25.2

 

(0.8

)

64.3

 

Results of operations (excluding Corporate segment)

$

168.1

 

73.9

 

(5.2

)

236.8

 

 

¹ Includes results attributable to a noncontrolling interest in MP GOM.

MURPHY OIL CORPORATION

OIL AND GAS OPERATING RESULTS (unaudited)

NINE MONTHS ENDED SEPTEMBER 30, 2022, AND 2021

 

(Millions of dollars)

United

States 1

Canada

Other

Total

Nine Months Ended September 30, 2022

 

 

 

 

Oil and gas sales and other operating revenues

$

2,659.0

 

450.2

 

18.5

 

3,127.7

Sales of purchased natural gas

 

0.2

 

132.1

 

?

 

132.3

Lease operating expenses

 

368.2

 

113.4

 

1.2

 

482.8

Severance and ad valorem taxes

 

46.4

 

1.0

 

?

 

47.4

Transportation, gathering and processing

 

100.0

 

52.2

 

?

 

152.2

Costs of purchased natural gas

 

0.2

 

125.1

 

?

 

125.3

Depreciation, depletion and amortization

 

449.6

 

110.7

 

4.4

 

564.7

Accretion of asset retirement obligations

 

27.3

 

7.3

 

0.1

 

34.7

Exploration expenses

 

 

 

 

Dry holes and previously suspended exploration costs

 

(0.5

)

?

 

35.7

 

35.2

Geological and geophysical

 

3.7

 

0.2

 

1.4

 

5.3

Other exploration

 

5.9

 

0.4

 

14.7

 

21.0

 

 

9.1

 

0.6

 

51.8

 

61.5

Undeveloped lease amortization

 

6.7

 

0.2

 

3.8

 

10.7

Total exploration expenses

 

15.8

 

0.8

 

55.6

 

72.2

Selling and general expenses

 

14.1

 

14.1

 

6.5

 

34.7

Other

 

110.4

 

6.5

 

1.0

 

117.9

Results of operations before taxes

 

1,527.2

 

151.2

 

(50.3

)

1,628.1

Income tax provisions

 

301.3

 

39.9

 

3.2

 

344.4

Results of operations (excluding Corporate segment)

$

1,225.9

 

111.3

 

(53.5

)

1,283.7

 

 

 

 

 

Nine Months Ended September 30, 2021

 

 

 

 

Oil and gas sales and other operating revenues

$

1,704.4

 

349.2

 

?

 

2,053.6

Lease operating expenses

 

303.3

 

100.0

 

0.4

 

403.7

Severance and ad valorem taxes

 

30.6

 

1.6

 

?

 

32.2

Transportation, gathering and processing

 

90.5

 

46.7

 

?

 

137.2

Depreciation, depletion and amortization

 

476.6

 

128.0

 

1.1

 

605.7

Accretion of asset retirement obligations

 

27.5

 

7.4

 

?

 

34.9

Impairment of assets

 

?

 

171.3

 

?

 

171.3

Exploration expenses

 

 

 

 

Dry holes and previously suspended exploration costs

 

17.9

 

?

 

?

 

17.9

Geological and geophysical

 

2.7

 

?

 

1.3

 

4.0

Other exploration

 

4.2

 

0.2

 

9.6

 

14.0

 

 

24.8

 

0.2

 

10.9

 

35.9

Undeveloped lease amortization

 

7.9

 

0.2

 

5.8

 

13.9

Total exploration expenses

 

32.7

 

0.4

 

16.7

 

49.8

Selling and general expenses

 

15.0

 

12.0

 

4.7

 

31.7

Other

 

133.5

 

(67.7

)

(1.2

)

64.6

Results of operations before taxes

 

594.7

 

(50.5

)

(21.7

)

522.5

Income tax provisions (benefits)

 

112.9

 

(12.8

)

0.8

 

100.9

Results of operations (excluding Corporate segment)

$

481.8

 

(37.7

)

(22.5

)

421.6

 

¹ Includes results attributable to a noncontrolling interest in MP GOM.

MURPHY OIL CORPORATION

PRODUCTION-RELATED EXPENSES

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

(Dollars per barrel of oil equivalents sold)

2022

 

2021

 

2022

 

2021

United States ? Eagle Ford Shale

 

 

 

 

 

 

 

Lease operating expense

$

9.31

 

8.85

 

$

10.87

 

8.50

Severance and ad valorem taxes

 

3.97

 

3.00

 

 

4.67

 

2.95

Depreciation, depletion and amortization (DD&A) expense

 

25.57

 

27.01

 

 

25.63

 

28.02

 

 

 

 

 

 

 

 

United States ? Gulf of Mexico

 

 

 

 

 

 

 

Lease operating expense

$

15.92

 

11.13

 

$

12.62

 

10.55

Severance and ad valorem taxes

 

0.06

 

0.08

 

 

0.08

 

0.08

DD&A expense

 

9.82

 

9.16

 

 

9.75

 

9.63

 

 

 

 

 

 

 

 

Canada ? Onshore

 

 

 

 

 

 

 

Lease operating expense

$

5.48

 

5.59

 

$

6.46

 

6.02

Severance and ad valorem taxes

 

0.05

 

0.17

 

 

0.06

 

0.11

DD&A expense

 

5.73

 

6.87

 

 

6.36

 

7.93

 

 

 

 

 

 

 

 

Canada ? Offshore

 

 

 

 

 

 

 

Lease operating expense

$

15.43

 

13.25

 

$

14.19

 

12.72

DD&A expense

 

14.39

 

11.53

 

 

12.72

 

13.08

 

 

 

 

 

 

 

 

Total E&P continuing operations

 

 

 

 

 

 

 

Lease operating expense

$

10.88

 

8.69

 

$

10.22

 

8.74

Severance and ad valorem taxes

 

0.83

 

0.78

 

 

1.00

 

0.70

DD&A expense

 

11.75

 

12.67

 

 

12.15

 

13.33

 

 

 

 

 

 

 

 

Total oil and gas continuing operations ? excluding noncontrolling interest

 

 

 

 

 

 

 

Lease operating expense

$

10.64

 

8.51

 

$

10.07

 

8.53

Severance and ad valorem taxes

 

0.86

 

0.82

 

 

1.05

 

0.74

DD&A expense

 

11.85

 

12.84

 

 

12.29

 

13.51

MURPHY OIL CORPORATION

CAPITAL EXPENDITURES

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

(Millions of dollars)

2022

 

2021

 

2022

 

2021

Exploration and production

 

 

 

 

 

 

 

United States

$

259.5

 

111.4

 

 

$

677.7

 

473.8

Canada

 

25.0

 

(5.2

)

 

 

175.9

 

67.1

Other

 

8.2

 

0.4

 

 

 

50.5

 

15.1

Total

 

292.7

 

106.6

 

 

 

904.1

 

556.0

 

 

 

 

 

 

 

 

Corporate

 

3.4

 

3.9

 

 

 

13.9

 

12.7

Total capital expenditures - continuing operations 1

 

296.1

 

110.5

 

 

 

918.0

 

568.7

 

 

 

 

 

 

 

 

Charged to exploration expenses 2

 

 

 

 

 

 

 

United States

 

2.8

 

18.6

 

 

 

9.1

 

24.8

Canada

 

0.1

 

0.1

 

 

 

0.6

 

0.2

Other

 

3.9

 

0.8

 

 

 

51.8

 

10.9

Total charged to exploration expenses - continuing operations

 

6.8

 

19.5

 

 

 

61.5

 

35.9

 

 

 

 

 

 

 

 

Total capitalized

$

289.3

 

91.0

 

 

$

856.5

 

532.8

 

¹ For the three months ended September 30, 2022, total capital expenditures excluding acquisitions of $79.1 million (2021: $0.4 million) and noncontrolling interest (NCI) of $8.0 million (2021: $7.6 million) is $209.0 million (2021: $102.5 million). For the nine months ended September 30, 2022, total capital expenditures excluding acquisitions of $125.6 million (2021: $22.9 million) and noncontrolling interest (NCI) of $16.6 million (2021: $20.6 million) is $775.8 million (2021: $525.2 million)

 

² For the three and nine months ended September 30, 2022, charges to exploration expense exclude amortization of undeveloped leases of $2.7 million (2021: $5.0 million) and $10.7 million (2021: $13.9 million), respectively.

MURPHY OIL CORPORATION

CONSOLIDATED BALANCE SHEETS

(unaudited)

 

(Millions of dollars)

September 30,
2022

 

December 31,
2021

ASSETS

 

 

 

Current assets

 

 

 

Cash and cash equivalents

$

466.0

 

 

521.2

 

Accounts receivable

 

385.2

 

 

258.2

 

Inventories

 

53.3

 

 

54.2

 

Prepaid expenses

 

39.6

 

 

31.9

 

Assets held for sale

 

7.5

 

 

15.5

 

Total current assets

 

951.6

 

 

880.9

 

Property, plant and equipment, at cost

 

8,249.4

 

 

8,127.9

 

Operating lease assets

 

798.1

 

 

881.4

 

Deferred income taxes

 

196.9

 

 

385.5

 

Deferred charges and other assets

 

33.2

 

 

29.3

 

Total assets

$

10,229.2

 

 

10,304.9

 

LIABILITIES AND EQUITY

 

 

 

Current liabilities

 

 

 

Current maturities of long-term debt, finance lease

$

0.7

 

 

0.7

 

Accounts payable

 

539.6

 

 

623.1

 

Income taxes payable

 

38.7

 

 

20.0

 

Other taxes payable

 

30.9

 

 

20.3

 

Operating lease liabilities

 

166.9

 

 

139.4

 

Other accrued liabilities

 

435.7

 

 

360.9

 

Total current liabilities

 

1,212.5

 

 

1,164.3

 

Long-term debt, including finance lease obligation

 

2,023.0

 

 

2,465.4

 

Asset retirement obligations

 

848.6

 

 

839.8

 

Deferred credits and other liabilities

 

429.2

 

 

570.6

 

Non-current operating lease liabilities

 

648.3

 

 

761.2

 

Deferred income taxes

 

188.0

 

 

182.9

 

Total liabilities

 

5,349.6

 

 

5,984.1

 

Equity

 

 

 

Common Stock, par $1.00

 

195.1

 

 

195.1

 

Capital in excess of par value

 

887.7

 

 

926.7

 

Retained earnings

 

5,895.0

 

 

5,218.7

 

Accumulated other comprehensive loss

 

(653.8

)

 

(527.7

)

Treasury stock

 

(1,615.0

)

 

(1,655.4

)

Murphy Shareholders' Equity

 

4,708.9

 

 

4,157.3

 

Noncontrolling interest

 

170.7

 

 

163.5

 

Total equity

 

4,879.6

 

 

4,320.8

 

Total liabilities and equity

$

10,229.2

 

 

10,304.9

 

MURPHY OIL CORPORATION

PRODUCTION SUMMARY

(unaudited)

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

Barrels per day unless otherwise noted

2022

 

2021

 

2022

 

2021

Net crude oil and condensate

 

 

 

 

 

 

 

United States

Onshore

28,522

 

 

26,193

 

 

25,082

 

 

26,552

 

 

Gulf of Mexico 1

68,315

 

 

53,011

 

 

62,380

 

 

61,905

 

Canada

Onshore

3,891

 

 

4,963

 

 

4,228

 

 

5,598

 

 

Offshore

2,171

 

 

3,779

 

 

2,869

 

 

4,016

 

Other

 

487

 

 

299

 

 

716

 

 

243

 

Total net crude oil and condensate - continuing operations

103,386

 

 

88,245

 

 

95,275

 

 

98,314

 

Net natural gas liquids

 

 

 

 

 

 

 

 

United States

Onshore

5,782

 

 

5,847

 

 

5,268

 

 

5,043

 

 

Gulf of Mexico 1

4,780

 

 

3,459

 

 

4,411

 

 

4,296

 

Canada

Onshore

986

 

 

1,085

 

 

942

 

 

1,159

 

Total net natural gas liquids - continuing operations

11,548

 

 

10,391

 

 

10,621

 

 

10,498

 

Net natural gas ? thousands of cubic feet per day

 

 

 

 

 

 

 

United States

Onshore

30,054

 

 

31,478

 

 

29,032

 

 

27,750

 

 

Gulf of Mexico 1

65,319

 

 

46,339

 

 

61,727

 

 

63,557

 

Canada

Onshore

392,483

 

 

309,709

 

 

313,422

 

 

277,077

 

Total net natural gas - continuing operations

487,856

 

 

387,526

 

 

404,181

 

 

368,384

 

Total net hydrocarbons - continuing operations including NCI 2,3

196,243

 

 

163,224

 

 

173,260

 

 

170,209

 

Noncontrolling interest

 

 

 

 

 

 

 

 

Net crude oil and condensate ? barrels per day

(7,125

)

 

(7,546

)

 

(7,735

)

 

(8,834

)

Net natural gas liquids ? barrels per day

(264

)

 

(243

)

 

(290

)

 

(322

)

Net natural gas ? thousands of cubic feet per day 2

(2,202

)

 

(2,331

)

 

(2,628

)

 

(3,498

)

Total noncontrolling interest

(7,756

)

 

(8,178

)

 

(8,463

)

 

(9,739

)

Total net hydrocarbons - continuing operations excluding NCI 2,3

188,487

 

 

155,046

 

 

164,797

 

 

160,470

 

 

¹ Includes net volumes attributable to a noncontrolling interest in MP GOM.

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

³ NCI ? noncontrolling interest in MP GOM.

MURPHY OIL CORPORATION

WEIGHTED AVERAGE PRICE SUMMARY

(unaudited)

 

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2022

 

2021

 

2022

 

2021

Crude oil and condensate ? dollars per barrel

 

 

 

 

 

 

 

 

United States

Onshore

$

94.33

 

69.30

 

$

99.92

 

$

64.16

 

Gulf of Mexico 1

 

92.96

 

68.93

 

 

99.04

 

 

64.44

Canada 2

Onshore

 

82.25

 

63.76

 

 

92.31

 

 

58.70

 

Offshore

 

111.76

 

72.64

 

 

112.93

 

 

68.93

Other

 

 

117.18

 

?

 

 

92.91

 

 

?

Natural gas liquids ? dollars per barrel

 

 

 

 

 

 

 

 

United States

Onshore

 

34.33

 

30.37

 

 

36.83

 

 

24.29

 

Gulf of Mexico 1

 

36.56

 

34.71

 

 

39.99

 

 

27.17

Canada 2

Onshore

 

54.40

 

45.12

 

 

57.53

 

 

37.05

Natural gas ? dollars per thousand cubic feet

 

 

 

 

 

 

 

 

United States

Onshore

 

7.62

 

3.85

 

 

6.49

 

 

3.23

 

Gulf of Mexico 1

 

8.68

 

4.09

 

 

7.23

 

 

3.28

Canada 2

Onshore

 

2.75

 

2.47

 

 

2.70

 

 

2.33

 

¹ Prices include the effect of noncontrolling interest in MP GOM.

² U.S. dollar equivalent.

MURPHY OIL CORPORATION

FIXED PRICE FORWARD SALES AND COMMODITY HEDGE POSITIONS (unaudited)

AS OF NOVEMBER 1, 2022

 

 

 

 

 

 

 

Volumes

(MMcf/d)

 

Price/Mcf

 

Remaining Period

Area

 

Commodity

 

Type 1

 

 

 

Start Date

 

End Date

Canada

 

Natural Gas

 

Fixed price forward sales

 

247

 

C$2.34

 

10/1/2022

 

10/31/2022

Canada

 

Natural Gas

 

Fixed price forward sales

 

266

 

C$2.36

 

11/1/2022

 

12/31/2022

Canada

 

Natural Gas

 

Fixed price forward sales

 

269

 

C$2.36

 

1/1/2023

 

3/31/2023

Canada

 

Natural Gas

 

Fixed price forward sales

 

250

 

C$2.35

 

4/1/2023

 

12/31/2023

Canada

 

Natural Gas

 

Fixed price forward sales

 

162

 

C$2.39

 

1/1/2024

 

12/31/2024

Canada

 

Natural Gas

 

Fixed price forward sales

 

45

 

US$2.05

 

10/1/2022

 

12/31/2022

Canada

 

Natural Gas

 

Fixed price forward sales

 

25

 

US$1.98

 

1/1/2023

 

10/31/2024

Canada

 

Natural Gas

 

Fixed price forward sales

 

15

 

US$1.98

 

11/1/2024

 

12/31/2024

¹ Fixed price forward sale contracts are accounted for as normal sales and purchases for accounting purposes.

 

 

Commodity

 

Type

 

Volumes
(Bbl/d)

 

Price
(USD/Bbl)

 

Remaining Period

Area

 

 

 

 

 

Start Date

 

End Date

United States

 

WTI²

 

Fixed price derivative swap

 

20,000

 

$44.88

 

10/1/2022

 

12/31/2022

 

 

 

 

 

 

Volumes
(Bbl/d)

 

Average
Put
(USD/Bbl)

 

Average
Call
(USD/Bbl)

 

Remaining Period

Area

 

Commodity

 

Type

 

 

 

 

Start Date

 

End Date

United States

 

WTI²

 

Derivative collars

 

25,000

 

$63.24

 

$75.20

 

10/1/2022

 

12/31/2022

² West Texas Intermediate

MURPHY OIL CORPORATION

FOURTH QUARTER 2022 GUIDANCE

 

 

Oil
BOPD

 

NGLs
BOPD

 

Gas
MCFD

 

Total
BOEPD

Production ? net

 

 

 

 

 

 

 

U.S. ? Eagle Ford Shale

23,500

 

5,100

 

27,800

 

33,200

? Gulf of Mexico excluding NCI

68,000

 

5,600

 

70,500

 

85,400

Canada ? Tupper Montney

?

 

?

 

296,100

 

49,400

? Kaybob Duvernay and Placid Montney

3,500

 

700

 

12,600

 

6,300

? Offshore

2,500

 

?

 

?

 

2,500

Other

700

 

?

 

?

 

700

 

 

 

 

 

 

 

 

Total net production (BOEPD) - excluding NCI 1

173,500 to 181,500

 

 

 

 

 

 

 

 

Exploration expense ($ millions)

$37

 

 

 

 

 

 

 

 

FULL YEAR 2022 GUIDANCE

Total net production (BOEPD) - excluding NCI 2

164,000 to 172,000

Capital expenditures ? excluding NCI ($ millions) 3

$975 to $1,025

 

 

¹ Excludes noncontrolling interest of MP GOM of 7,300 BOPD of oil, 400 BOPD of NGLs, and 2,600 MCFD gas.

² Excludes noncontrolling interest of MP GOM of 7,600 BOPD of oil, 300 BOPD of NGLs, and 2,700 MCFD gas.

³ Excludes acquisitions of approximately $127 million and CAPEX for noncontrolling interest of MP GOM of $31 million.

 


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