Murphy Oil Corporation Announces Fourth Quarter and Full Year 2018 Financial and Operating Results, 2019 Capital Investment Program
Increased Proved Reserves by 17% with 166% Organic Reserve Replacement
With the close of the previously announced Gulf of
Highlights for the fourth quarter include:
- Produced 176 thousand barrels of oil equivalent per day, in line with guidance
-
Closed accretive, deep water, oil-weighted Gulf of
Mexico transaction, which included the addition of over 70 million barrels of oil equivalent of proved reserves -
Realized EBITDA of over
$25 per barrel of oil equivalent sold -
Received credit rating upgrades from Moody’s and
Fitch Ratings -
Closed
$1.6 billion senior unsecured revolving credit facility, with more favorable covenants
Highlights for the full year 2018 include:
- Increased proved reserves by 17 percent to 816 million barrels oil equivalent, with 57 percent liquids-weighting
-
Achieved 166 percent organic reserve replacement with a finding and
development cost of
$10.92 per barrel of oil equivalent - Maintained reserve life index in excess of 10 years
- Produced 171 thousand barrels of oil equivalent per day, a 4 percent increase from prior year
- Increased production in the Kaybob Duvernay to over 8,500 barrels of oil equivalent per day, more than double the prior year
- Registered annualized EBITDA to average capital employed of 21 percent
- Returned 14 percent of operating cash flow to shareholders through long-standing dividend policy
- Preserved balance sheet strength with approximately 37 percent net debt to total capital
FOURTH QUARTER 2018 RESULTS
The company recorded net income, attributable to Murphy, of
Earnings before interest, taxes, depreciation and amortization (EBITDA)
attributable to Murphy, totaled
Production in the fourth quarter averaged 176 thousand barrels of oil equivalent per day (MBOEPD), which was in line with guidance. Details for fourth quarter production can be found in the attached schedules.
FULL YEAR 2018 RESULTS
The company recorded a net income, attributable to Murphy, of
Production for the full year averaged 171 MBOEPD, which was in line with guidance. Details for 2018 production can be found in the attached tables.
“2018 was a really good year for Murphy with our net income at the
highest level in four years. We continued to benefit from our diverse,
growing, oil-weighted portfolio that was able to continuously generate
high cash flow per barrel metrics. We demonstrated again that we are
proven deal-makers by successfully closing on an accretive oil-weighted
transaction that will further enhance our ability to generate cash flow.
Also, we remain committed to rewarding shareholders with cash returns
through our long-standing competitive dividend, while we keep investment
in our assets in line with our cash flows,” stated
FINANCIAL POSITION
As of
YEAR-END 2018 PROVED RESERVES
Murphy’s preliminary year-end 2018 proved reserves were 816 million
barrels of oil equivalent (MMBOE), a 17 percent increase from 698 MMBOE
at year-end 2017. The change in year-over-year reserves is mainly
attributed to the acquisition of Gulf of
2018 Proved Reserves – Preliminary * | |||
Category |
Net Liquid
(MMBBLS) |
Net Gas (BCF) |
Net Equiv. (MMBBLS) |
Proved Developed Producing (PDP) | 257 | 913 | 409 |
Proved Undeveloped (PUD) | 203 | 1,220 | 407 |
Total Proved | 460 | 2,133 | 816 |
* Reserve quantities represent amounts attributable to Murphy and exclude noncontrolling interest |
“Our team did an excellent job adding low-cost, high-value reserves in
2018. We were able to increase our proved reserves by 17 percent and
more importantly increase our oil reserves by 24 percent from 2017. We
continue to replace reserves with finding and development costs tracking
below
REGIONAL OPERATIONS SUMMARY
North American Onshore
The North American onshore business produced over 93 MBOEPD in the fourth quarter.
Tupper Montney – Natural gas production in the quarter averaged over 230 million cubic feet per day (MMCFD), after allowing for over 6 MMCFD impacts related to third-party plant and pipeline restrictions. During the fourth quarter, the company celebrated the asset’s tenth anniversary milestone, producing over 600 billion cubic feet (BCF) gross since inception.
Kaybob Duvernay – During the quarter, the company achieved record production averaging 11 MBOEPD with 59 percent liquids. Murphy has increased production in this play for seven consecutive quarters. As planned, the company brought five operated wells online: a four well pad in Kaybob West and one well in Two Creeks. The four well pad in Kaybob West performed in-line with pre-drill estimates, achieving average initial gross production rates over 30 days (IP30 rate) of over 900 BOEPD per well, with 67 percent liquids. The Two Creeks well, drilled by the previous operator at a less than optimal lateral length of 5,500 feet, was completed and brought online at initial gross production rates of 600 barrels of oil (BOPD) with 87 percent liquids. Over the course of 2018 the company brought 27 wells online, which advanced the appraisal of the play.
“We continue to be pleased with our North American unconventional
business. Our steadfast Tupper Montney asset continues to provide free
cash flow at current prices due to our market diversity and execution.
Success continues in the Kaybob Duvernay, with strong well performance
across the play, and promising early results in the Two Creeks area,
support our plan to retain the vast majority of our acreage. In
Global Offshore
The offshore business produced 83 MBOEPD for the fourth quarter, with 76 percent liquids.
As previously announced in fourth quarter 2018 Murphy closed a Gulf of
Also in the quarter, the Dalmatian subsea pump was installed. Currently, the pump is delivering gross incremental production of over 10,000 BOEPD, an increase of 250 percent from prior quarter production, with 96 percent uptime.
EXPLORATION
Gulf of Mexico Exploration – During the fourth quarter, Murphy
drilled the King Cake exploration well (
Mexico Exploration – During the fourth quarter, Murphy secured
its drilling permit from the Comisión Nacional de Hidrocarburos (“CNH”)
for the
Vietnam Exploration – Murphy expects to spud the LDT-1X well, in
Block 15-01/05 in the
2019 CAPITAL EXPENDITURE AND PRODUCTION GUIDANCE
Murphy is planning 2019 capital expenditures to be in the range of
The table below illustrates the capital allocation by area.
2019 Capital Expenditure Guidance | |||||
Area |
Percent of Total |
||||
U.S. Onshore | 43 | ||||
Canada Onshore | 20 | ||||
North America Offshore | 19 | ||||
SE Asia | 9 | ||||
Exploration | 8 | ||||
Other | 1 |
For 2019, Murphy is allocating
In the
The company is allocating
2019 Operated Onshore Wells Online | |||||||||||||||||||
1Q 2019 | 2Q 2019 | 3Q 2019 | 4Q 2019 | 2019 Total | |||||||||||||||
Eagle Ford Shale | 14 | 31 | 25 | 20 | 90 | ||||||||||||||
Kaybob Duvernay | 4 | 6 | 2 | 0 | 12 | ||||||||||||||
Tupper Montney | 3 | 0 | 5 | 0 | 8 | ||||||||||||||
Placid Montney | 0 | 0 | 0 | 7 | 7 |
Production for
Murphy is allocating approximately
The company is allocating approximately
“Our 2019 capital program supports our strategy of allocating capital to
high margin, oil-weighted assets by investing in our profitable
Detailed guidance for the first quarter and full year 2019 is contained in the following schedule.
CONFERENCE CALL AND WEBCAST SCHEDULED FOR
Murphy will host a conference call to discuss 2018 financial and
operating results as well as provide 2019 guidance on
FINANCIAL DATA
Summary financial data and operating statistics for fourth quarter 2018, 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 and schedules comparing EBITDA and EBITDAX between periods are included with these schedules as well as guidance for the first quarter and full year 2019.
ABOUT
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 or results, are subject to inherent risks and
uncertainties. Factors that could cause one or more of these future
events or results not to occur as implied by any forward-looking
statement include, but are not limited to, increased volatility or
deterioration in the level of crude oil and natural gas prices,
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, natural hazards impacting our operations, 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, and 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
RESERVES REPORTING TO THE SECURITIES AND EXCHANGE COMMISSION
The
NON-GAAP FINANCIAL MEASURES
This news release contains certain non-GAAP financial measures 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 financial measures are broadly used to value and compare companies in the crude oil and natural gas industry, although 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) (Thousands of dollars, except per share amounts) |
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Three Months Ended | Year Ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2018 |
2017 1 |
2018 |
2017 1 |
||||||||||||||
Revenues | |||||||||||||||||
Revenue from sales to customers | $ | 664,717 | 580,455 | 2,586,627 | 2,078,548 | ||||||||||||
(Loss) gain on crude contracts | 27,374 | (40,799 | ) | (41,975 | ) | 9,566 | |||||||||||
Gain on sale of assets and other income | (84 | ) | 1,929 | 25,951 | 137,015 | ||||||||||||
Total revenues | 692,007 | 541,585 | 2,570,603 | 2,225,129 | |||||||||||||
Costs and expenses | |||||||||||||||||
Lease operating expenses | 149,668 | 122,251 | 555,894 | 468,323 | |||||||||||||
Severance and ad valorem taxes | 11,972 | 10,847 | 52,072 | 43,618 | |||||||||||||
Exploration expenses, including undeveloped lease amortization |
34,066 | 45,478 | 103,977 | 122,834 | |||||||||||||
Selling and general expenses | 42,700 | 48,135 | 216,024 | 203,573 | |||||||||||||
Depreciation, depletion and amortization | 261,338 | 242,937 | 971,901 | 957,719 | |||||||||||||
Accretion of asset retirement obligations | 12,518 | 10,953 | 44,559 | 42,590 | |||||||||||||
Impairment of assets | 20,000 | - | 20,000 | - | |||||||||||||
Redetermination expense | - | 15,000 | 11,332 | 15,000 | |||||||||||||
Other expense (benefit) | 9,903 | 19,718 | (34,873 | ) | 30,706 | ||||||||||||
Total costs and expenses | 542,165 | 515,319 | 1,940,886 | 1,884,363 | |||||||||||||
Operating income from continuing operations | 149,842 | 26,266 | 629,717 | 340,766 | |||||||||||||
Other income (loss) | |||||||||||||||||
Interest and other income (loss) | 3,670 | 19,164 | (15,775 | ) | (87,181 | ) | |||||||||||
Interest expense, net | (47,340 | ) | (43,360 | ) | (181,604 | ) | (181,783 | ) | |||||||||
Total other loss | (43,670 | ) | (24,196 | ) | (197,379 | ) | (268,964 | ) | |||||||||
Income from continuing operations before income taxes | 106,172 | 2,375 | 432,338 | 71,802 | |||||||||||||
Income tax expense (benefit) | (6,471 | ) | 287,136 | 9,330 | 382,738 | ||||||||||||
Income (loss) from continuing operations | 112,643 | (284,761 | ) | 423,008 | (310,936 | ) | |||||||||||
Income (loss) from discontinued operations, net of income taxes |
(872 | ) | (2,030 | ) | (3,522 | ) | (853 | ) | |||||||||
Net income (loss) including noncontrolling interest | 111,771 | (286,791 | ) | 419,486 | (311,789 | ) | |||||||||||
Less: Net income (loss) attributable to noncontrolling interest | 8,392 | - | 8,392 | - | |||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO MURPHY | $ | 103,379 | (286,791 | ) | 411,094 | (311,789 | ) | ||||||||||
INCOME (LOSS) PER COMMON SHARE – BASIC | |||||||||||||||||
Continuing operations | $ | 0.60 | (1.65 | ) | 2.39 | (1.81 | ) | ||||||||||
Discontinued operations | - | (0.01 | ) | (0.01 | ) | - | |||||||||||
Net Income (Loss) | $ | 0.60 | (1.66 | ) | 2.38 | (1.81 | ) | ||||||||||
INCOME (LOSS) PER COMMON SHARE – DILUTED | |||||||||||||||||
Continuing operations | $ | 0.59 | (1.65 | ) | 2.37 | (1.81 | ) | ||||||||||
Discontinued operations | - | (0.01 | ) | (0.01 | ) | - | |||||||||||
Net Income (Loss) | $ | 0.59 | (1.66 | ) | 2.36 | (1.81 | ) | ||||||||||
Cash dividends per Common share | 0.25 | 0.25 | 1.00 | 1.00 | |||||||||||||
Average Common shares outstanding (thousands) | |||||||||||||||||
Basic | 173,055 | 172,573 | 172,974 | 172,524 | |||||||||||||
Diluted | 174,312 | 172,573 | 174,209 | 172,524 | |||||||||||||
1 Reclassified to conform to current presentation. |
MURPHY OIL CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (Thousands of dollars) |
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Three Months Ended | Year Ended | |||||||||||||||||
December 31, | December 31, | |||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||
Operating Activities | ||||||||||||||||||
Net income (loss) including noncontrolling interest | $ | 111,771 | (286,791 | ) | 419,486 | (311,789 | ) | |||||||||||
Adjustments to reconcile net income (loss) to net cash provided by continuing operations activities: |
||||||||||||||||||
Loss (Income) from discontinued operations | 872 | 2,030 | 3,522 | 853 | ||||||||||||||
Depreciation, depletion and amortization | 261,338 | 242,937 | 971,901 | 957,719 | ||||||||||||||
Impairment of assets | 20,000 | – | 20,000 | – | ||||||||||||||
Dry hole costs (credits) | 16,098 | (3,024 | ) | 20,624 | (4,163 | ) | ||||||||||||
Amortization of undeveloped leases | 8,633 | 20,916 | 40,177 | 61,776 | ||||||||||||||
Accretion of asset retirement obligations | 12,518 | 10,953 | 44,559 | 42,590 | ||||||||||||||
Deferred income tax charge (benefit) | (44,925 | ) | 263,987 | (183,680 | ) | 260,420 | ||||||||||||
Pretax (gain) loss from sale of assets | (48 | ) | 3,332 | (54 | ) | (127,434 | ) | |||||||||||
Net (increase) decrease in noncash operating working capital | (167,258 | ) | 135,344 | (169,808 | ) | 136,414 | ||||||||||||
Other operating activities, net | 3,452 | (80,407 | ) | 52,669 | 111,689 | |||||||||||||
Net cash provided by continuing operations activities | 222,451 | 309,277 | 1,219,396 | 1,128,075 | ||||||||||||||
Investing Activities | ||||||||||||||||||
Acquisition of oil properties | (794,623 | ) | – | (794,623 | ) | – | ||||||||||||
Property additions and dry hole costs | (244,449 | ) | (303,250 | ) | (1,102,805 | ) | (1,009,667 | ) | ||||||||||
Proceeds from sales of property, plant and equipment | 255 | 360 | 1,383 | 69,506 | ||||||||||||||
Purchases of investment securities 1 | – | – | – | (212,661 | ) | |||||||||||||
Proceeds from maturity of investment securities 1 | – | – | – | 320,828 | ||||||||||||||
Net cash required by investing activities | (1,038,817 | ) | (302,890 | ) | (1,896,045 | ) | (831,994 | ) | ||||||||||
Financing Activities | ||||||||||||||||||
Increase (decrease) in revolving credit facility | 325,000 | – | 325,000 | – | ||||||||||||||
Borrowings of debt, net of issuance costs | – | (175 | ) | – | 541,597 | |||||||||||||
Repayments of debt | – | – | – | (550,000 | ) | |||||||||||||
Capital lease obligation payments | (2,586 | ) | (2,446 | ) | (9,750 | ) | (17,133 | ) | ||||||||||
Withholding tax on stock-based incentive awards | (1,154 | ) | 35 | (8,076 | ) | (7,116 | ) | |||||||||||
Issue cost of debt facility | (6,366 | ) | – | (6,366 | ) | – | ||||||||||||
Cash dividends paid | (43,264 | ) | (43,144 | ) | (173,044 | ) | (172,565 | ) | ||||||||||
Net cash required by financing activities | 271,630 | (45,730 | ) | 127,764 | (205,217 | ) | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents | (15,623 | ) | 7,124 | (28,730 | ) | 1,327 | ||||||||||||
Net increase (decrease) in cash and cash equivalents | (560,359 | ) | (32,219 | ) | (577,615 | ) | 92,191 | |||||||||||
Cash and cash equivalents at beginning of period | 947,732 | 997,207 | 964,988 | 872,797 | ||||||||||||||
Cash and cash equivalents at end of period | $ | 387,373 | 964,988 | 387,373 | 964,988 | |||||||||||||
1 Investments are Canadian government securities with maturities greater than 90 days at the date of acquisition. |
MURPHY OIL CORPORATION SCHEDULE OF ADJUSTED INCOME (LOSS) (unaudited) (Millions of dollars, except per share amounts) |
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Three Months Ended | Year Ended | |||||||||||||||||
December 31, | December 31, | |||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||
Net income (loss) attributable to Murphy (GAAP) | $ | 103.4 | (286.8 | ) | 411.1 | (311.8 | ) | |||||||||||
Discontinued operations loss (income) | 0.9 | 2.0 | 3.5 | 0.9 | ||||||||||||||
Income from continuing operations | 104.3 | (284.8 | ) | 414.6 | (310.9 | ) | ||||||||||||
Adjustments: | ||||||||||||||||||
Impact of tax reform | (15.7 | ) | 274.3 | (135.7 | ) | 274.3 | ||||||||||||
Mark-to-market (gain) loss on crude oil derivative contracts | (27.6 | ) | 20.0 | (26.8 | ) | (8.9 | ) | |||||||||||
Ecuador arbitration settlement | – | – | (20.5 | ) | – | |||||||||||||
Brunei working interest income | – | – | (16.0 | ) | – | |||||||||||||
Impairment of assets | 15.8 | – | 15.8 | – | ||||||||||||||
Seal insurance proceeds | – | – | (15.2 | ) | – | |||||||||||||
Tax benefits on investments in foreign areas | (14.7 | ) | – | (14.7 | ) | (32.9 | ) | |||||||||||
Foreign exchange losses (gains) | (3.9 | ) | (22.4 | ) | 10.2 | 64.2 | ||||||||||||
Malaysia/ Brunei unitization/ redetermination expense | – | 9.3 | 7.0 | 9.3 | ||||||||||||||
Write-off of previously suspended exploration wells | – | – | 4.5 | – | ||||||||||||||
Mark-to-market (gain) loss on PAI contingent consideration | (3.8 | ) | – | (3.8 | ) | – | ||||||||||||
Deferred tax on undistributed foreign earnings | – | – | – | 65.2 | ||||||||||||||
Gain on sale of assets | – | 2.5 | – | (93.5 | ) | |||||||||||||
Oil Insurance Limited dividends | – | – | – | (2.9 | ) | |||||||||||||
Materials inventory loss | – | 14.1 | – | 14.1 | ||||||||||||||
Total adjustments after taxes | (49.9 | ) | 297.8 | (195.2 | ) | 288.9 | ||||||||||||
Adjusted income (loss) attributable to Murphy | $ | 54.4 | 13.0 | 219.4 | (22.0 | ) | ||||||||||||
Adjusted income (loss) per diluted share | $ | 0.31 | 0.08 | 1.26 | (0.13 | ) | ||||||||||||
Non-GAAP Financial Measures
Presented above is a reconciliation of Net income (loss) to Adjusted
income (loss). Adjusted income (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 income (loss) 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
Amounts shown above as reconciling items between Net income (loss) and Adjusted income (loss) 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.
Three Months Ended | Year Ended | ||||||||||||||||||||||||||||||
December 31, 2018 | December 31, 2018 | ||||||||||||||||||||||||||||||
Pretax | Tax | Net | Pretax | Tax | Net | ||||||||||||||||||||||||||
Exploration & Production: | |||||||||||||||||||||||||||||||
United States | $ | 15.2 | (3.2 | ) | 12.0 | 15.2 | (3.2 | ) | 12.0 | ||||||||||||||||||||||
Canada | – | – | – | (21.0 | ) | 5.8 | (15.2 | ) | |||||||||||||||||||||||
Malaysia | – | – | – | 11.3 | (4.3 | ) | 7.0 | ||||||||||||||||||||||||
Other International | – | (14.7 | ) | (14.7 | ) | (11.5 | ) | (14.7 | ) | (26.2 | ) | ||||||||||||||||||||
Total E&P | 15.2 | (17.9 | ) | (2.7 | ) | (6.0 | ) | (16.4 | ) | (22.4 | ) | ||||||||||||||||||||
Corporate 1: | (40.3 | ) | (6.9 | ) | (47.2 | ) | (51.9 | ) | (120.9 | ) | (172.8 | ) | |||||||||||||||||||
Total adjustments | $ | (25.1 | ) | (24.8 | ) | (49.9 | ) | (57.9 | ) | (137.3 | ) | (195.2 | ) |
1 | In 2018, the Company reported realized and unrealized gains and losses on crude oil contracts in the Corporate segment to reflect how segments are currently evaluated, how resources are allocated and how risk is managed by the Company. The 2017 amounts have been reclassified from the Exploration and Production business for comparable disclosure. |
MURPHY OIL CORPORATION SCHEDULE OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA) (unaudited) (Millions of dollars, except per barrel of oil equivalents sold) |
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Three Months Ended | Year Ended | ||||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||||
Net income (loss) attributable to Murphy (GAAP) | $ | 103.4 | (286.8 | ) | 411.1 | (311.8 | ) | ||||||||||||||
Discontinued operations loss (income) | 0.9 | 2.0 | 3.5 | 0.9 | |||||||||||||||||
Income tax expense (benefit) | (6.5 | ) | 287.1 | 9.3 | 382.7 | ||||||||||||||||
Interest expense, net | 47.3 | 43.4 | 181.6 | 181.8 | |||||||||||||||||
Depreciation, depletion and amortization expense | 256.3 | 242.9 | 966.9 | 957.7 | |||||||||||||||||
Impairment of assets | 20.0 | – | 20.0 | – | |||||||||||||||||
EBITDA attributable to Murphy (Non-GAAP) | $ | 421.4 | 288.6 | 1,592.4 | 1,211.3 | ||||||||||||||||
Accretion of asset retirement obligations | 12.5 | 11.0 | 44.6 | 42.6 | |||||||||||||||||
Mark-to-market (gain) loss on crude oil derivative contracts | (35.0 | ) | 30.8 | (33.9 | ) | (13.7 | ) | ||||||||||||||
Ecuador arbitration settlement | – | – | (26.0 | ) | – | ||||||||||||||||
Seal insurance proceeds | – | – | (21.0 | ) | – | ||||||||||||||||
Brunei working interest income | – | – | (16.0 | ) | – | ||||||||||||||||
Malaysia/ Brunei unitization/ redetermination expense | – | 15.0 | 11.3 | 15.0 | |||||||||||||||||
Foreign exchange losses (gains) | (5.3 | ) | (24.0 | ) | 8.1 | 75.1 | |||||||||||||||
Mark-to-market (gain) loss on PAI contingent consideration | (4.8 | ) | – | (4.8 | ) | – | |||||||||||||||
Write-off of previously suspended exploration wells | – | – | 4.5 | – | |||||||||||||||||
Gain on sale of assets | – | 3.3 | – | (127.4 | ) | ||||||||||||||||
Oil Insurance Limited dividends | – | – | – | (4.4 | ) | ||||||||||||||||
Materials inventory loss | – | 21.0 | – | 21.0 | |||||||||||||||||
Adjusted EBITDA attributable to Murphy (Non-GAAP) | $ | 388.8 | 345.7 | 1,559.2 | 1,219.5 | ||||||||||||||||
Total barrels of oil equivalents sold attributable to Murphy (thousands of barrels) | 16,417.4 | 15,106.4 | 62,330.5 | 59,321.6 | |||||||||||||||||
EBITDA per barrel of oil equivalents sold | $ | 25.67 | 19.10 | 25.55 | 20.42 | ||||||||||||||||
Adjusted EBITDA per barrel of oil equivalents sold | $ | 23.68 | 22.88 | 25.02 | 20.56 | ||||||||||||||||
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
Presented above is EBITDA per barrel of oil equivalent sold and adjusted EBITDA per barrel of oil equivalent sold. Management believes EBITDA per barrel of oil equivalent sold and adjusted EBITDA per barrel of oil equivalent sold are important information because they are used by management to evaluate the Company’s profitability of one barrel of oil equivalent sold in that period. EBITDA per barrel of oil equivalent sold and adjusted EBITDA per barrel of oil equivalent sold are non-GAAP financial metrics.
MURPHY OIL CORPORATION SCHEDULE OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION AND EXPLORATION (EBITDAX) (unaudited) (Millions of dollars, except per barrel of oil equivalents sold) |
|||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||
Net income (loss) attributable to Murphy (GAAP) | $ | 103.4 | (286.8 | ) | 411.1 | (311.8 | ) | ||||||||||
Discontinued operations loss (income) | 0.9 | 2.0 | 3.5 | 0.9 | |||||||||||||
Income tax expense (benefit) | (6.5 | ) | 287.1 | 9.3 | 382.7 | ||||||||||||
Interest expense, net | 47.3 | 43.4 | 181.6 | 181.8 | |||||||||||||
Depreciation, depletion and amortization expense | 256.3 | 242.9 | 966.9 | 957.7 | |||||||||||||
Impairment of assets | 20.0 | – | 20.0 | – | |||||||||||||
EBITDA attributable to Murphy (Non-GAAP) | 421.4 | 288.6 | 1,592.4 | 1,211.3 | |||||||||||||
Exploration expenses | 34.1 | 45.5 | 104.0 | 122.8 | |||||||||||||
EBITDAX attributable to Murphy (Non-GAAP) | $ | 455.5 | 334.1 | 1,696.4 | 1,334.1 | ||||||||||||
Accretion of asset retirement obligations | 12.5 | 11.0 | 44.6 | 42.6 | |||||||||||||
Mark-to-market (gain) loss on crude oil derivative contracts | (35.0 | ) | 30.8 | (33.9 | ) | (13.7 | ) | ||||||||||
Ecuador arbitration settlement | – | – | (26.0 | ) | – | ||||||||||||
Seal insurance proceeds | – | – | (21.0 | ) | – | ||||||||||||
Brunei working interest income | – | – | (16.0 | ) | – | ||||||||||||
Malaysia/ Brunei unitization/ redetermination expense | – | 15.0 | 11.3 | 15.0 | |||||||||||||
Foreign exchange losses (gains) | (5.3 | ) | (24.0 | ) | 8.1 | 75.1 | |||||||||||
Mark-to-market (gain) loss on PAI contingent consideration | (4.8 | ) | – | (4.8 | ) | – | |||||||||||
Gain on sale of assets | – | 3.3 | – | (127.4 | ) | ||||||||||||
Oil Insurance Limited dividends | – | – | – | (4.4 | ) | ||||||||||||
Materials inventory loss | – | 21.0 | – | 21.0 | |||||||||||||
Adjusted EBITDAX attributable to Murphy (Non-GAAP) | $ | 422.9 | 391.2 | 1,658.7 | 1,342.3 | ||||||||||||
Total barrels of oil equivalents sold attributable to Murphy (thousands of barrels) | 16,417.4 | 15,106.4 | 62,330.5 | 59,321.6 | |||||||||||||
EBITDAX per barrel of oil equivalents sold | $ | 27.74 | 22.12 | 27.22 | 22.49 | ||||||||||||
Adjusted EBITDAX per barrel of oil equivalents sold |
$ | 25.76 | 25.90 | 26.61 | 22.63 | ||||||||||||
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
Presented above is EBITDAX per barrel of oil equivalent sold and adjusted EBITDAX per barrel of oil equivalent sold. Management believes EBITDAX per barrel of oil equivalent sold and adjusted EBITDAX per barrel of oil equivalent sold are important information because they are used by management to evaluate the Company’s profitability of one barrel of oil equivalent sold in that period. EBITDAX per barrel of oil equivalent sold and adjusted EBITDAX per barrel of oil equivalent sold are non-GAAP financial metrics.
MURPHY OIL CORPORATION FUNCTIONAL RESULTS OF OPERATIONS (unaudited) (Millions of dollars) |
|||||||||||||||||||||
Three Months Ended |
Three Months Ended |
||||||||||||||||||||
Revenues |
Income (Loss) |
Revenues |
Income (Loss) |
||||||||||||||||||
Exploration and production | |||||||||||||||||||||
United States 1, 4 | $ | 344.0 | 42.6 | 298.0 | 22.4 | ||||||||||||||||
Canada | 104.8 | 4.4 | 97.4 | 9.8 | |||||||||||||||||
Malaysia | 213.6 | 61.1 | 186.8 | 50.3 | |||||||||||||||||
Other | 2.3 | 12.3 | – | (26.6 | ) | ||||||||||||||||
Total exploration and production | 664.7 | 120.4 | 582.2 | 55.9 | |||||||||||||||||
Corporate 1 | 27.3 | (7.7 | ) |
(40.6 |
) | (340.7 | ) | ||||||||||||||
Revenue/income from continuing operations | 692.0 | 112.7 |
541.6 |
(284.8 | ) | ||||||||||||||||
Discontinued operations, net of tax | – | (0.9 | ) | – | (2.0 | ) | |||||||||||||||
Total revenues/net income (loss) | $ | 692.0 | 111.8 |
541.6 |
(286.8 | ) | |||||||||||||||
Year Ended |
Year Ended |
||||||||||||||||||||
Revenues |
Income (Loss) |
Revenues |
Income (Loss) |
||||||||||||||||||
Exploration and production | |||||||||||||||||||||
United States 4 | $ | 1,289.6 | 242.9 | 944.3 | (8.9 | ) | |||||||||||||||
Canada 2 | 438.6 | 51.1 | 485.5 | 112.5 | |||||||||||||||||
Malaysia | 854.2 | 269.5 | 781.1 | 224.2 | |||||||||||||||||
Other | 22.2 | (16.6 | ) | – | (37.5 | ) | |||||||||||||||
Total exploration and production | 2,604.6 | 546.9 | 2,210.9 | 290.3 | |||||||||||||||||
Corporate 3 | (34.0 | ) | (123.9 | ) | 14.2 |
(601.2 |
) | ||||||||||||||
Revenue/income from continuing operations | 2,570.6 | 423.0 | 2,225.1 |
(310.9 |
) | ||||||||||||||||
Discontinued operations, net of tax | – | (3.5 | ) | – | (0.9 | ) | |||||||||||||||
Total revenues/net income (loss) | $ | 2,570.6 | 419.5 | 2,225.1 |
(311.8 |
) |
1 |
In 2018, the Company reported realized and unrealized gains and losses on crude oil contracts in the Corporate segment to reflect how segments are currently evaluated, how resources are allocated and how risk is managed by the Company. The 2017 amounts have been reclassified from the U.S. Exploration and production business to reflect comparable disclosure. Realized and unrealized gains (losses) of $27.4 million and ($40.8) million are included in the Corporate segment for the three month periods ended December, 2018 and 2017, respectively. Realized and unrealized gains (losses) of ($42.0) million and $9.6 million are included in the Corporate segment for the years ended December 31, 2018 and 2017, respectively. Corporate segment loss for the three-month periods ended December 31, 2018 and 2017 included foreign exchange gain of $5.0 million and $23.7 million, respectively. Corporate segment loss for the years ended December 31, 2018 and 2017 included foreign exchange losses of $9.0 million and $97.1 million, respectively. |
|
2 | 2017 revenue includes a pretax gain of $132.4 million ($96.0 million after-tax) related to the sale of the Seal heavy oil asset in Canada. | |
3 | Corporate net loss for the year ended December 31, 2018 included a credit to income tax expense of $135.7 million related to an IRS interpretation of the Tax Cuts and Jobs Act (the Act). Corporate net loss for the year ended December 31, 2017 included a charge of $274.3 million relating to the impact of the Act. | |
4 | In 2018, includes results attributable to a noncontrolling interest in MP GOM LLC, a Gulf of Mexico joint venture (MP GOM). |
MURPHY OIL CORPORATION |
||||||||||||||||||||||
United | ||||||||||||||||||||||
(Millions of dollars) | States 1 | Canada | Malaysia | Other | Total | |||||||||||||||||
Three Months Ended December 31, 2018 | ||||||||||||||||||||||
Oil and gas sales and other revenues | $ | 344.0 | 104.8 | 213.6 | 2.3 | 664.7 | ||||||||||||||||
Lease operating expenses | 67.9 | 31.6 | 49.7 | 0.4 | 149.6 | |||||||||||||||||
Severance and ad valorem taxes | 11.7 | 0.3 |
– |
– | 12.0 | |||||||||||||||||
Depreciation, depletion and amortization | 137.1 | 61.3 | 56.7 | 1.0 | 256.1 | |||||||||||||||||
Accretion of asset retirement obligations | 6.0 | 1.9 | 4.6 | – | 12.5 | |||||||||||||||||
Impairment of assets | 20.0 |
– |
– |
– |
20.0 | |||||||||||||||||
Exploration expenses | ||||||||||||||||||||||
Dry holes | 16.0 | – | 0.1 | – | 16.1 | |||||||||||||||||
Geological and geophysical | 0.6 | – | 1.5 | 2.4 | 4.5 | |||||||||||||||||
Other exploration | 1.1 | 0.3 | – | 3.5 | 4.9 | |||||||||||||||||
17.7 | 0.3 | 1.6 | 5.9 | 25.5 | ||||||||||||||||||
Undeveloped lease amortization | 7.6 | 0.3 | – | 0.7 | 8.6 | |||||||||||||||||
Total exploration expenses | 25.3 | 0.6 | 1.6 | 6.6 | 34.1 | |||||||||||||||||
Selling and general expenses | 10.0 | 6.1 | 2.6 | 5.4 | 24.1 | |||||||||||||||||
Other | 10.8 | 1.7 | (0.2 | ) | 1.2 | 13.5 | ||||||||||||||||
Results of operations before taxes | 55.2 | 1.3 | 98.6 | (12.3 | ) | 142.8 | ||||||||||||||||
Income tax provisions (benefits) | 12.6 | (3.1 | ) | 37.5 | (24.6 | ) | 22.4 | |||||||||||||||
Results of operations (excluding corporate overhead and interest) |
$ | 42.6 | 4.4 | 61.1 | 12.3 | 120.4 | ||||||||||||||||
Three Months Ended December 31, 2017 | ||||||||||||||||||||||
Oil and gas sales and other revenues | $ | 298.0 | 97.4 | 186.8 | – | 582.2 | ||||||||||||||||
Lease operating expenses | 62.8 | 24.3 | 35.2 | – | 122.3 | |||||||||||||||||
Severance and ad valorem taxes | 10.6 | 0.2 | – | – | 10.8 | |||||||||||||||||
Depreciation, depletion and amortization | 144.0 | 48.8 | 44.9 | 1.0 | 238.7 | |||||||||||||||||
Accretion of asset retirement obligations | 4.6 | 2.0 | 4.3 | – | 10.9 | |||||||||||||||||
Redetermination expense | – | – | 15.0 | – | 15.0 | |||||||||||||||||
Exploration expenses | ||||||||||||||||||||||
Dry holes | – | – | (0.1 | ) | (3.0 | ) | (3.1 | ) | ||||||||||||||
Geological and geophysical | 2.1 | – | 1.7 | 11.6 | 15.4 | |||||||||||||||||
Other exploration | 1.1 | 0.2 | – | 10.9 | 12.2 | |||||||||||||||||
3.2 | 0.2 | 1.6 | 19.5 | 24.5 | ||||||||||||||||||
Undeveloped lease amortization | 20.7 | 0.2 | – | – | 20.9 | |||||||||||||||||
Total exploration expenses | 23.9 | 0.4 | 1.6 | 19.5 | 45.4 | |||||||||||||||||
Selling and general expenses | 13.2 | 7.2 | 3.5 | 4.5 | 28.4 | |||||||||||||||||
Other | 18.5 | 1.9 | (0.7 | ) | – | 19.7 | ||||||||||||||||
Results of operations before taxes | 20.4 | 12.6 | 83.0 | (25.0 | ) | 91.0 | ||||||||||||||||
Income tax provisions (benefits) | (2.0 | ) | 2.8 | 32.7 | 1.6 | 35.1 | ||||||||||||||||
Results of operations (excluding corporate overhead and interest) |
$ | 22.4 | 9.8 | 50.3 | (26.6 | ) | 55.9 |
1 | In 2018, the Company reported realized and unrealized gains and losses on crude oil contracts in the Corporate segment to reflect how segments are currently evaluated, how resources are allocated and how risk is managed by the Company. The 2017 amounts have been reclassified from the Exploration and Production business for comparable disclosure. 2018 also includes results attributable to a noncontrolling interest in MP GOM, effective November 30, 2018. |
MURPHY OIL CORPORATION OIL AND GAS OPERATING RESULTS (unaudited) YEAR ENDED DECEMBER 31, 2018 AND 2017 |
||||||||||||||||||||||||||
United | ||||||||||||||||||||||||||
(Millions of dollars) | States 1 | Canada 2 | Malaysia | Other | Total | |||||||||||||||||||||
Year Ended December 31, 2018 | ||||||||||||||||||||||||||
Oil and gas sales and other revenues | $ | 1,289.6 | 438.6 | 854.2 | 22.2 | 2,604.6 | ||||||||||||||||||||
Lease operating expenses | 230.5 | 122.6 | 202.1 | 0.7 | 555.9 | |||||||||||||||||||||
Severance and ad valorem taxes | 50.9 | 1.2 | – | – | 52.1 | |||||||||||||||||||||
Depreciation, depletion and amortization | 519.5 | 232.4 | 198.6 | 3.5 | 954.0 | |||||||||||||||||||||
Accretion of asset retirement obligations | 19.5 | 7.7 | 17.4 | – | 44.6 | |||||||||||||||||||||
Impairment of assets | 20.0 | – | – | – | 20.0 | |||||||||||||||||||||
Redetermination expense | – | – | 11.3 | – | 11.3 | |||||||||||||||||||||
Exploration expenses | ||||||||||||||||||||||||||
Dry holes | 16.0 | – | 0.1 | 4.5 | 20.6 | |||||||||||||||||||||
Geological and geophysical | 7.1 | – | 2.1 | 6.7 | 15.9 | |||||||||||||||||||||
Other exploration | 6.3 | 0.6 | – | 20.4 | 27.3 | |||||||||||||||||||||
29.4 | 0.6 | 2.2 | 31.6 | 63.8 | ||||||||||||||||||||||
Undeveloped lease amortization | 36.8 | 0.8 | – | 2.5 | 40.1 | |||||||||||||||||||||
Total exploration expenses | 66.2 | 1.4 | 2.2 | 34.1 | 103.9 | |||||||||||||||||||||
Selling and general expenses | 49.0 | 26.8 | 10.8 | 23.5 | 110.1 | |||||||||||||||||||||
Other | 23.0 | (19.1 | ) | (1.0 | ) | 2.3 | 5.2 | |||||||||||||||||||
Results of operations before taxes | 311.0 | 65.6 | 412.8 | (41.9 | ) | 747.5 | ||||||||||||||||||||
Income tax provisions (benefits) | 68.1 | 14.5 | 143.3 | (25.3 | ) | 200.6 | ||||||||||||||||||||
Results of operations (excluding corporate overhead and interest) |
$ | 242.9 | 51.1 | 269.5 | (16.6 | ) | 546.9 | |||||||||||||||||||
Year Ended December 31, 2017 | ||||||||||||||||||||||||||
Oil and gas sales and other revenues | $ | 944.3 | 485.5 | 781.1 |
– |
2,210.9 | ||||||||||||||||||||
Lease operating expenses | 198.5 | 101.1 | 168.8 | – | 468.4 | |||||||||||||||||||||
Severance and ad valorem taxes | 42.2 | 1.5 | – | – | 43.7 | |||||||||||||||||||||
Depreciation, depletion and amortization | 546.1 | 185.4 | 204.6 | 3.8 | 939.9 | |||||||||||||||||||||
Accretion of asset retirement obligations | 17.4 | 7.9 | 17.3 | – | 42.6 | |||||||||||||||||||||
Redetermination expense |
– |
– |
15.0 |
– |
15.0 | |||||||||||||||||||||
Exploration expenses | ||||||||||||||||||||||||||
Dry holes | (1.9 | ) | – | 0.7 | (3.0 | ) | (4.2 | ) | ||||||||||||||||||
Geological and geophysical | 3.1 | 0.1 | 1.7 | 17.6 | 22.5 | |||||||||||||||||||||
Other exploration | 6.6 | 0.4 | – | 35.7 | 42.7 | |||||||||||||||||||||
7.8 | 0.5 | 2.4 | 50.3 | 61.0 | ||||||||||||||||||||||
Undeveloped lease amortization | 60.2 | 1.6 | – | – | 61.8 | |||||||||||||||||||||
Total exploration expenses | 68.0 | 2.1 | 2.4 | 50.3 | 122.8 | |||||||||||||||||||||
Selling and general expenses | 61.8 | 28.3 | 14.0 | 19.6 | 123.7 | |||||||||||||||||||||
Other | 20.0 | 2.3 | 8.4 | – | 30.7 | |||||||||||||||||||||
Results of operations before taxes | (9.7 | ) | 156.9 | 350.6 | (73.7 | ) | 424.1 | |||||||||||||||||||
Income tax provisions (benefits) |
(0.8 | ) | 44.4 | 126.4 | (36.2 | ) | 133.8 | |||||||||||||||||||
Results of operations (excluding corporate overhead and interest) |
$ | (8.9 | ) | 112.5 | 224.2 | (37.5 | ) | 290.3 |
1 | In 2018, the Company reported realized and unrealized gains and losses on crude oil contracts in the Corporate segment to reflect how segments are currently evaluated, how resources are allocated and how risk is managed by the Company. The 2017 amounts have been reclassified from the Exploration and Production business for comparable disclosure. 2018 also includes results attributable to a noncontrolling interest in MP GOM, effective November 30, 2018. | |
2 | 2017 revenue includes a pretax gain of $132.4 million related to the sale of Seal heavy oil assets in Canada. |
MURPHY OIL CORPORATION PRODUCTION-RELATED EXPENSES (unaudited) (Dollars per barrel of oil equivalents sold) |
|||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||
United States – Eagle Ford Shale | |||||||||||||||||
Lease operating expense | $ | 10.83 | 6.70 | 8.84 | 7.35 | ||||||||||||
Severance and ad valorem taxes | 3.13 | 2.27 | 3.20 | 2.46 | |||||||||||||
Depreciation, depletion and amortization (DD&A) expense | 24.41 | 25.39 | 24.54 | 25.64 | |||||||||||||
United States – Gulf of Mexico | |||||||||||||||||
Lease operating expense | $ | 9.16 | 22.29 | 11.39 | 13.71 | ||||||||||||
DD&A expense | 15.32 | 17.62 | 16.50 | 20.20 | |||||||||||||
Canada – Onshore | |||||||||||||||||
Lease operating expense | $ | 4.04 | 4.50 | 4.52 | 4.95 | ||||||||||||
Severance and ad valorem taxes | 0.06 | 0.07 | 0.06 | 0.10 | |||||||||||||
DD&A expense | 10.99 | 9.79 | 10.61 | 9.92 | |||||||||||||
Canada – Offshore | |||||||||||||||||
Lease operating expense | $ | 21.85 | 9.08 | 15.21 | 9.61 | ||||||||||||
DD&A expense | 14.45 | 12.93 | 13.68 | 12.95 | |||||||||||||
Malaysia – Sarawak | |||||||||||||||||
Lease operating expense | $ | 8.26 | 4.34 | 8.12 | 5.24 | ||||||||||||
DD&A expense | 8.95 | 8.08 | 8.65 | 8.09 | |||||||||||||
Malaysia – Block K | |||||||||||||||||
Lease operating expense | $ | 14.83 | 14.35 | 16.97 | 14.13 | ||||||||||||
DD&A expense | 17.69 | 14.42 | 15.52 | 14.60 | |||||||||||||
Total oil and gas operations | |||||||||||||||||
Lease operating expense | $ | 8.91 | 8.09 | 8.86 | 7.89 | ||||||||||||
Severance and ad valorem taxes | 0.71 | 0.72 | 0.83 | 0.74 | |||||||||||||
DD&A expense | 15.56 | 15.79 | 15.50 | 15.85 | |||||||||||||
Total oil and gas operations – excluding noncontrolling interest | |||||||||||||||||
Lease operating expense | $ | 8.95 | – | 8.88 | – | ||||||||||||
Severance and ad valorem taxes | 0.71 | – | 0.83 | – | |||||||||||||
DD&A expense | 15.30 | – | 15.23 | – |
MURPHY OIL CORPORATION OTHER FINANCIAL DATA (unaudited) (Millions of dollars) |
|||||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||
Capital expenditures | |||||||||||||||||
Exploration and production 1 | |||||||||||||||||
United States | $ | 934.5 | 130.6 | 1,389.1 | 558.1 | ||||||||||||
Canada | 86.8 | 91.8 | 378.1 | 296.4 | |||||||||||||
Malaysia | 54.8 | 10.7 | 140.6 | 18.4 | |||||||||||||
Other | 12.7 | 33.0 | 51.6 | 88.0 | |||||||||||||
Total | 1,088.8 | 266.1 | 1,959.4 | 960.9 | |||||||||||||
Corporate | 5.5 | 7.9 | 27.9 | 14.8 | |||||||||||||
Total capital expenditures | 1,094.3 | 274.0 | 1,987.3 | 975.7 | |||||||||||||
Charged to exploration expenses 2 | |||||||||||||||||
United States | 17.7 | 3.2 | 29.4 | 7.8 | |||||||||||||
Canada | 0.3 | 0.2 | 0.6 | 0.5 | |||||||||||||
Malaysia | 1.6 | 1.6 | 2.2 | 2.4 | |||||||||||||
Other | 5.9 | 19.5 | 31.6 | 50.3 | |||||||||||||
Total charged to exploration expenses | 25.5 | 24.5 | 63.8 | 61.0 | |||||||||||||
Total capitalized 3 | $ | 1,068.8 | 249.5 | 1,923.5 | 914.7 |
1 | Includes 2018 acquisition capital expenditure related to MP GOM of $794.6 million. | |
2 |
Excludes amortization of undeveloped leases of $8.6 million and $20.9 million for the three months ended December 31, 2018 and 2017, respectively, and $40.2 million and $61.8 million for the year ended December 31, 2018 and 2017, respectively. |
|
3 | Includes noncontrolling interest capital expenditures of $3.0 million. |
MURPHY OIL CORPORATION CONDENSED BALANCE SHEETS (unaudited) (Millions of dollars) |
|||||||||
December 31, 2018 | December 31, 2017 | ||||||||
Assets |
|||||||||
Cash and cash equivalents | $ | 387.4 | 965.0 | ||||||
Other current assets | 492.4 | 406.6 | |||||||
Property, plant and equipment – net | 9,757.6 | 8,220.0 | |||||||
Other long-term assets | 415.2 | 269.3 | |||||||
Total assets | $ | 11,052.6 | 9,860.9 | ||||||
Liabilities and Stockholders' Equity |
|||||||||
Current maturities of long-term debt | $ | 10.6 | 9.9 | ||||||
Other current liabilities | 835.5 | 824.3 | |||||||
Long-term debt 1 | 3,227.1 | 2,906.5 | |||||||
Other long-term liabilities | 1,781.8 | 1,500.0 | |||||||
Total equity 2 | 5,197.6 | 4,620.2 | |||||||
Total liabilities and stockholders' equity | $ | 11,052.6 | 9,860.9 |
1 | Includes a capital lease on production equipment of $125.8 million at December 31, 2018 and $134.0 million at December 31, 2017. | |
2 | 2018 includes noncontrolling interest of $368.3 million. |
MURPHY OIL CORPORATION PRODUCTION SUMMARY (unaudited) |
|||||||||||||
Three Months Ended | Year Ended | ||||||||||||
December 31, | December 31, | ||||||||||||
Barrels per day unless otherwise noted | 2018 | 2017 | 2018 | 2017 | |||||||||
Net crude oil and condensate | |||||||||||||
United States | Onshore | 29,609 | 38,709 | 31,787 | 34,649 | ||||||||
Gulf of Mexico 1 | 32,412 | 12,266 | 18,702 | 11,551 | |||||||||
Canada | Onshore | 7,017 | 3,821 | 5,690 | 3,004 | ||||||||
Offshore | 5,109 | 8,064 | 6,701 | 8,091 | |||||||||
Heavy 2 | – | – | – | 150 | |||||||||
Malaysia | Sarawak | 11,958 | 12,519 | 11,942 | 12,674 | ||||||||
Block K | 15,351 | 17,578 | 16,734 | 20,312 | |||||||||
Brunei | 537 | – | 558 | – | |||||||||
Total net crude oil and condensate | 101,993 | 92,957 | 92,114 | 90,431 | |||||||||
Net natural gas liquids | |||||||||||||
United States | Onshore | 6,049 | 7,038 | 6,578 | 6,867 | ||||||||
Gulf of Mexico 1 | 1,312 | 881 | 1,147 | 947 | |||||||||
Canada | Onshore | 1,273 | 799 | 1,073 | 508 | ||||||||
Malaysia | Sarawak | 1,145 | 465 | 792 | 829 | ||||||||
Total net natural gas liquids | 9,779 | 9,183 | 9,590 | 9,151 | |||||||||
Net natural gas – thousands of cubic feet per day | |||||||||||||
United States | Onshore | 30,356 | 31,956 | 31,832 | 32,629 | ||||||||
Gulf of Mexico 1 | 15,970 | 12,619 | 14,356 | 11,901 | |||||||||
Canada | Onshore | 267,421 | 244,309 | 266,416 | 226,218 | ||||||||
Malaysia | Sarawak | 99,830 | 99,080 | 104,457 | 104,616 | ||||||||
Block K | 3,589 | 9,230 | 5,766 | 8,358 | |||||||||
Total net natural gas - thousands of cubic feet per day | 417,166 | 397,194 | 422,827 | 383,722 | |||||||||
Total net hydrocarbons including NCI 3,4 |
181,300 | 168,339 | 172,175 | 163,536 | |||||||||
Noncontrolling interest | |||||||||||||
Net crude oil and condensate – barrels per day | (4,500 | ) | – | (1,134 | ) | – | |||||||
Net natural gas liquids – barrels per day | (94 | ) | – | (24 | ) | – | |||||||
Net natural gas – thousands of cubic feet per day | (1,705 | ) | – | (430 | ) | – | |||||||
Total noncontrolling interest | (4,878 | ) | – | (1,230 | ) | – | |||||||
Total net hydrocarbons excluding NCI 3,4 | 176,422 | 168,339 | 170,946 | 163,536 |
1 2018 includes net volumes attributable to a noncontrolling interest in MP GOM, a Gulf of Mexico joint venture. |
2 The Company sold the Seal area heavy oil field in January 2017. |
3 Natural gas converted on an energy equivalent basis of 6:1. |
4 NCI – noncontrolling interest in MP GOM, a Gulf of Mexico joint venture. |
MURPHY OIL CORPORATION SALES SUMMARY (unaudited) |
|||||||||||||
Three Months Ended | Year Ended | ||||||||||||
December 31, | December 31, | ||||||||||||
Barrels per day unless otherwise noted | 2018 | 2017 | 2018 | 2017 | |||||||||
Net crude oil and condensate | |||||||||||||
United States | Onshore | 29,609 | 38,709 | 31,787 | 34,649 | ||||||||
Gulf of Mexico 1 | 28,554 | 12,266 | 17,729 | 11,551 | |||||||||
Canada | Onshore | 7,017 | 3,821 | 5,690 | 3,004 | ||||||||
Offshore | 5,954 | 6,673 | 6,884 | 7,525 | |||||||||
Heavy 2 | – | – | – | 150 | |||||||||
Malaysia | Sarawak | 13,354 | 9,795 | 12,401 | 12,454 | ||||||||
Block K | 18,672 | 16,757 | 17,025 | 19,867 | |||||||||
Brunei | 463 | – | 233 | – | |||||||||
Total net crude oil and condensate | 103,623 | 88,021 | 91,749 | 89,200 | |||||||||
Net natural gas liquids | |||||||||||||
United States | Onshore | 6,049 | 7,038 | 6,578 | 6,867 | ||||||||
Gulf of Mexico 1 | 1,312 | 881 | 1,147 | 947 | |||||||||
Canada | Onshore | 1,273 | 799 | 1,073 | 508 | ||||||||
Malaysia | Sarawak | 773 | 1,263 | 786 | 1,048 | ||||||||
Total net natural gas liquids | 9,407 | 9,981 | 9,584 | 9,370 | |||||||||
Net natural gas – thousands of cubic feet per day | |||||||||||||
United States | Onshore | 30,356 | 31,956 | 31,832 | 32,629 | ||||||||
Gulf of Mexico 1 | 15,970 | 12,619 | 14,356 | 11,901 | |||||||||
Canada | Onshore | 267,421 | 244,309 | 266,416 | 226,218 | ||||||||
Malaysia | Sarawak | 99,830 | 99,080 | 104,457 | 104,616 | ||||||||
Block K | 3,589 | 9,230 | 5,766 | 8,358 | |||||||||
Total net natural gas – thousands of cubic feet per day | 417,166 | 397,194 | 422,827 | 383,722 | |||||||||
Total net hydrocarbons including NCI 3,4 | 182,558 | 164,201 | 171,804 | 162,524 | |||||||||
Noncontrolling interest | |||||||||||||
Net crude oil and condensate – barrels per day | (3,729 | ) | – | (940 | ) | – | |||||||
Net natural gas liquids – barrels per day | (94 | ) | – | (24 | ) | – | |||||||
Net natural gas – thousands of cubic feet per day | (1,705 | ) | – | (430 | ) | – | |||||||
Total noncontrolling interest | (4,107 | ) | – | (1,036 | ) | – | |||||||
Total net hydrocarbons excluding NCI 3,4 | 178,451 | 164,201 | 170,769 | 162,524 |
1 2018 includes net volumes attributable to a noncontrolling interest in MP GOM, a Gulf of Mexico joint venture. |
2 The Company sold the Seal area heavy oil field in January 2017. |
3 Natural gas converted on an energy equivalent basis of 6:1. |
4 NCI – noncontrolling interest in MP GOM, a Gulf of Mexico joint venture. |
MURPHY OIL CORPORATION PRICE SUMMARY (unaudited) |
||||||||||||||
Three Months Ended | Year Ended | |||||||||||||
December 31, | December 31, | |||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||
Weighted average Exploration and Production sales prices | ||||||||||||||
Crude oil and condensate – dollars per barrel | ||||||||||||||
United States 1 | Onshore | $ | 63.14 | 55.86 | $ | 67.08 | 50.49 | |||||||
Gulf of Mexico 4 | 54.97 | 54.03 | 62.36 | 49.24 | ||||||||||
Canada 2 | Onshore | 35.80 | 52.91 | 50.87 | 46.68 | |||||||||
Offshore | 61.12 | 60.78 | 68.02 | 53.39 | ||||||||||
Malaysia 3 | Sarawak | 51.99 | 58.76 | 62.38 | 53.26 | |||||||||
Block K | 63.06 | 58.91 | 65.44 | 52.72 | ||||||||||
Brunei | 68.59 | – | 71.48 | – | ||||||||||
Natural gas liquids – dollars per barrel | ||||||||||||||
United States | Onshore | $ | 19.71 | 22.22 | $ | 22.21 | 17.70 | |||||||
Gulf of Mexico 4 | 18.82 | 24.84 | 24.54 | 19.57 | ||||||||||
Canada 2 | Onshore | 30.78 | 29.80 | 37.44 | 25.00 | |||||||||
Malaysia 3 | Sarawak | 65.34 | 51.92 | 69.04 | 51.00 | |||||||||
Natural gas – dollars per thousand cubic feet | ||||||||||||||
United States | Onshore | $ | 3.02 | 2.36 | $ | 2.44 | 2.49 | |||||||
Gulf of Mexico 4 | 3.71 | 2.31 | 2.77 | 2.49 | ||||||||||
Canada 2 | Onshore | 1.81 | 1.90 | 1.52 | 1.97 | |||||||||
Malaysia 3 | Sarawak | 3.99 | 3.64 | 3.78 | 3.55 | |||||||||
Block K | 0.26 | 0.23 | 0.24 | 0.24 |
1 In 2018, the Company reported realized and unrealized gains and losses on crude oil contracts in the Corporate segment to reflect how segments are currently evaluated, how resources are allocated and how risk is managed by the Company. The 2017 amounts have been reclassified from the Exploration and Production business for comparable disclosure. |
2 U.S. dollar equivalent. |
3 Prices are net of payments under the terms of the respective production sharing contracts. |
4 Prices include noncontrolling interest for MP GOM, a U.S. Gulf of Mexico joint venture. |
MURPHY OIL CORPORATION | ||||||||||||||||||
COMMODITY HEDGE POSITIONS (unaudited) | ||||||||||||||||||
AS OF DECEMBER 31, 2018 | ||||||||||||||||||
Volumes | Price | Remaining Period | ||||||||||||||||
Area | Commodity | Type | (MMcf/d) | (CAD/Mcf) | Start Date | End Date | ||||||||||||
Montney | Natural Gas |
Fixed price forward sales at AECO |
59 | C$2.81 | 1/1/2019 | 12/31/2020 | ||||||||||||
Volumes | Price | Remaining Period | ||||||||||||||||
Area | Commodity | Type | (MMcf/d) | (USD/MMBtu) | Start Date | End Date | ||||||||||||
Montney | Natural Gas |
Fixed price forward sales at AECO |
10 | $ 4.19 | 1/1/2019 | 3/31/2019 | ||||||||||||
Montney | Natural Gas |
Fixed price forward sales at AECO |
10 | $ 3.85 | 1/1/2019 | 3/31/2019 | ||||||||||||
Montney | Natural Gas |
Fixed price forward sales at Dawn |
10 | $ 4.20 | 1/1/2019 | 3/31/2019 |
MURPHY OIL CORPORATION | |||||
FIRST QUARTER 2019 GUIDANCE | |||||
Liquids | Gas | ||||
BOPD | MCFD | ||||
Production | |||||
U.S. – Eagle Ford Shale | 34,800 | 28,800 | |||
– Gulf of Mexico including NCI 1 | 65,900 | 25,100 | |||
– Gulf of Mexico excluding NCI | 52,750 | 20,000 | |||
Canada – Tupper Montney | – | 220,000 | |||
– Kaybob Duvernay and Placid Montney | 8,400 | 34,800 | |||
– Offshore | 7,650 | – | |||
Malaysia – Sarawak | 11,900 | 103,700 | |||
– Block K / Brunei | 16,000 | 6,700 | |||
Total net production (BOEPD) - including NCI 1 | 212,000 to 216,000 | ||||
Total net production (BOEPD) - excluding NCI | 198,000 to 202,000 | ||||
Total net sales (BOEPD) - including NCI | 214,000 to 223,000 | ||||
Total net sales (BOEPD) - excluding NCI | 200,000 to 209,000 | ||||
Realized oil prices ($ per barrel): | |||||
Malaysia – Sarawak | $55.00 | ||||
– Block K | $59.00 | ||||
Realized natural gas price ($ per MCF): | |||||
Malaysia – Sarawak | $4.00 | ||||
Exploration expense ($ millions) |
$40 |
||||
1 Includes noncontrolling interest of MP GOM of 13,150 BOPD liquids and 5,100 MCFD gas. | |||||
FULL YEAR 2019 GUIDANCE | |||||
Total net production (BOEPD) - including NCI 2 |
|
215,000 to 223,000 |
|||
Total net production (BOEPD) - excluding NCI |
|
202,000 to 210,000 |
|||
Capital expenditures ($ billions) - excluding NCI 3 | $1.25 to $1.45 | ||||
2 Includes noncontrolling interest of MP GOM of 13,000 BOEPD. | |||||
3 Excludes noncontrolling interest of MP GOM of $48 million. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20190131005209/en/
Source:
Investor Contacts:
Kelly Whitley, kelly_whitley@murphyoilcorp.com,
281-675-9107
Bryan Arciero, bryan_arciero@murphyoilcorp.com,
832-319-5374
Emily McElroy, emily_mcelroy@murphyoilcorp.com,
870-864-6324