Murphy Oil Corporation · NYSE:MUR
Murphy Oil — Q3 2024 Earnings Presentation
43 slides from Murphy Oil's earnings presentation, Nov 7, 2024
Slide 1: Third Quarter 2024 Earnings Conference Call & Webcast
2024 THIRD QUARTER EARNINGS CONFERENCE CALL & WEBCAST NOVEMBER 7, 2024 ROGER W. JENKINS CHIEF EXECUTIVE OFFICER www.murphyoilcorp.com NYSE: MUR 1
Slide 2: Cautionary Statement
Cautionary Statement Cautionary Note to US Investors – The United States Securities and Exchange Commission (SEC) requires oil and natural gas companies, in their filings with the SEC, to disclose proved reserves that a company has demonstrated by actual production or conclusive formation tests to b
Slide 3: Advancing Strategic Priorities
Advancing Strategic Priorities DELEVER EXECUTE EXPLORE RETURN • Reduced debt by $50 MM in • Produced 185 MBOEPD in 3Q 2024 • Spud Hai Su Vang-1X exploration Progressed Murphy 3.0 of YTD 20241 well in 3Q 2024, the first of two • Completed offshore workovers as Vietnam exploration wells Capital Alloca
Slide 4: Delivering Shareholder Returns Within Capital Allocation Framework
Delivering Shareholder Returns Within Capital Allocation Framework1 Adjusted Free Cash Murphy 3.0 – Flow Formula Murphy 2.0 – Long-term debt Murphy 1.0 – ≤ $1.3 BN Long-term debt Long-term debt of $1.3 BN – $1.8 BN Cash Flow From Operations > $1.8 BN Minimum of 50% of Before WC Change ~75% of adjust
Slide 5: Generating High Revenue From Oil Production
Production, Pricing and Revenue Generating High Revenue From Oil Production 3Q 2024 Production 3Q 2024 Revenue by Area by Area Onshore Canada Eagle Ford Shale $77 MM Eagle Ford Shale $174 MM 32,300 BOEPD 11% 18% 25% Onshore Canada 42% 77,100 BOEPD 185 $711 MM MBOEPD 41% Offshore 75,200 BOEPD 65% Off
Slide 6: 3Q 2024 Financial Results
Financial Results Generating Income to Support Corporate Priorities 3Q 2024 Financial Results Net Income Attributable to Murphy 3Q 2024 ($MM Except Per Share) • Net income $139 MM; adjusted net income $111 MM Income (loss) $139 • EBITDA $378 MM; adjusted EBITDA $397 MM $/Diluted share $0.93 3Q 2024
Slide 7: Balance Sheet Results
Balance Sheet Results Strengthened Balance Sheet Positioned to Withstand Commodity Price Cycles Enhancing Financial Position Through Capital Markets Transactions in 4Q 2024 • Issued $600 MM of 6.000% Senior Notes due 2032 • Tendered $521 MM of long-term debt • $259 MM of 5.875% Senior Notes due 2027
Slide 8: Acting to Support All Stakeholders
Ongoing Commitment to Sustainability Goals Acting to Support All Stakeholders CONTINUED POSITIVELY IMPACTING OUR STRONG ENVIRONMENTAL STEWARDSHIP PEOPLE AND COMMUNITIES GOVERNANCE OVERSIGHT ADVANCING OUR CLIMATE GOALS Well-defined CONSISTENTLY BOARD AND MANAGERIAL GHG OUTPERFORMING OVERSIGHT US Bure
Slide 9: Operations Update
OPERATIONS UPDATE www.murphyoilcorp.com NYSE: MUR 9
Slide 10: Eagle Ford Shale Update
Eagle Ford Shale Update Enhancing Portfolio Through Strong Execution Eagle Ford Shale Acreage 3Q 2024 32 MBOEPD, 72% Oil, 86% Liquids • 5 operated wells online in Tilden • 3 new wells and 2 refracs KARNES • 3 gross non-operated wells online in Karnes TILDEN • 9 gross non-operated wells online in Til
Slide 11: Tupper Montney Update
Tupper Montney Update Consistent Well Outperformance While Managing Price Risk 3Q 2024 429 MMCFD Net, 100% Natural Gas Tupper Montney Acreage • 2024 well delivery program completed in 2Q 2024 4Q 2024 Plan TUPPER WEST • Initiate drilling for 2025 completion Mitigated AECO Exposure • Achieved realized
Slide 12: Offshore Update
Offshore Update Focusing on Executing Highly-Accretive Development Projects Total Offshore 3Q 2024 75 MBOEPD, 81% Oil Highly-Accretive Development and Tieback Projects Gulf of Mexico 3Q 2024 67 MBOEPD, 79% Oil Field Drilling Completions Online • Operated Mormont #3 (Green Canyon 478) well online Kha
Slide 13: Lac Da Vang Field Development Project Update
Lac Da Vang Field Development Project Update Cuu Long Basin, Vietnam Cuu Long Basin Lac Da Vang Field Development Overview BLOCK 15-01/05 LAC DA TRANG NORTH WEST SU TU VANG • Murphy 40% (Op), PetroVietnam Exploration LAC DA TRANG Production 35%, SK Earthon 25% WEST • 100 MMBOE estimated gross recove
Slide 14: Exploration Update
EXPLORATION UPDATE www.murphyoilcorp.com NYSE: MUR 14
Slide 15: Gulf of Mexico Exploration Update
Exploration Update Gulf of Mexico Sebastian #1 (Mississippi Canyon 387) Gulf of Mexico Exploration Area • Murphy 26.8% (Op) Ocotillo • Non-commercial hydrocarbons present, well Silver Dollar plugged and abandoned Silver Dollar West Medusa Delta House Powerball Dalmatian S. • $12 MM of dry hole cost
Slide 16: Cuu Long Basin, Vietnam Asset Overview
Exploration Update Cuu Long Basin, Vietnam Cuu Long Basin Asset Overview BLOCK 15-01/05 LAC DA TRANG SU TU VANG • Murphy 40% (Op), PetroVietnam Exploration NORTH WEST Production 35%, SK Earthon 25% LAC DA TRANG WEST • $30 MM total net well cost LAC DA VANG LAC DA TRANG Block 15-2/17 DISCOVERY • Spud
Slide 17: Tano Basin, Côte d'Ivoire Asset Overview
Development and Exploration Update Tano Basin, Côte d’Ivoire Asset Overview Tano Basin • ~1.5 MM gross acres, equivalent to 256 Gulf of Mexico blocks CÔTE D’IVOIRE GHANA CI-102 • Seismic reprocessing ongoing; final data expected 4Q 2024 Baleine CI-531 Diverse Opportunities Adjacent to Oil Discoverie
Slide 18: Looking Ahead
LOOKING AHEAD www.murphyoilcorp.com NYSE: MUR 18
Slide 19: 2024 Capital and Production Plan
2024 Capital and Production Plan Prioritizing Capital To Maximize Production and Adjusted Free Cash Flow1 FY 2024E CAPEX 4Q 2024 Guidance By Area • 181.5 – 189.5 MBOEPD production, 94 MBOPD or 3% 51% oil, 56% liquids volumes 12% • Includes the following: 38% 13% • 1.5 MBOEPD of planned onshore downt
Slide 20: Disciplined Strategy Leads to Long-Term Value With Current Assets
Disciplined Strategy Leads to Long-Term Value With Current Assets DELEVER EXECUTE EXPLORE RETURN NEAR-TERM LONG-TERM • Reducing debt to reach $1.0 BN debt target in mid-20251 with no debt • Realizing average annual production of 210-220 MBOEPD with maturities until Dec 2027 > 50% average oil weighti
Slide 21: Progressing On 2024 Goals
Progressing On 2024 Goals Delivering shareholder returns through capital allocation framework Enhancing financial position through capital markets Exceeding production guidance across onshore assets Executing Gulf of Mexico well program Advancing Vietnam development and exploration Expanding portfol
Slide 22: Third Quarter Earnings Conference Call & Webcast
2024 THIRD QUARTER EARNINGS CONFERENCE CALL & WEBCAST NOVEMBER 7, 2024 ROGER W. JENKINS CHIEF EXECUTIVE OFFICER www.murphyoilcorp.com NYSE: MUR 22
Slide 23: Appendix
Appendix 1 Non-GAAP Definitions and Reconciliations 2 Glossary of Abbreviations 3 4Q 2024 Guidance 4 2024 North America Onshore Plan 5 Current Fixed Price Contracts 6 Supplemental Information 7 Acreage Maps www.murphyoilcorp.com NYSE: MUR 23
Slide 24: Non-GAAP Financial Measure Definitions and Reconciliations
Non-GAAP Financial Measure Definitions and Reconciliations The following list of Non-GAAP financial measure definitions and related reconciliations is intended to satisfy the requirements of Regulation G of the Securities Exchange Act of 1934, as amended. This information is historical in nature. Mu
Slide 25: Non-GAAP Reconciliation: Adjusted Earnings
Non-GAAP Reconciliation ADJUSTED EARNINGS Murphy defines Adjusted Earnings as net income attributable to Murphy1 adjusted to exclude discontinued operations and certain other items that affect comparability between periods. Adjusted Earnings is used by management to evaluate the company’s operationa
Slide 26: Non-GAAP Reconciliation: EBITDA and EBITDAX
Non-GAAP Reconciliation EBITDA and EBITDAX Murphy defines EBITDA as net income (loss) attributable to Murphy1 before interest, taxes, depreciation, depletion and amortization (DD&A). Murphy defines EBITDAX as net income (loss) attributable to Murphy before interest, taxes, DD&A and exploration expen
Slide 27: Non-GAAP Reconciliation: Adjusted EBITDA
Non-GAAP Reconciliation ADJUSTED EBITDA Murphy defines Adjusted EBITDA as net income (loss) attributable to Murphy1 before interest, taxes, depreciation, depletion and amortization (DD&A), impairment expense, discontinued operations, foreign exchange gains and losses, mark-to-market gains and losses
Slide 28: Non-GAAP Reconciliation: Adjusted EBITDAX
Non-GAAP Reconciliation ADJUSTED EBITDAX Murphy defines Adjusted EBITDAX as net income (loss) attributable to Murphy1 before interest, taxes, depreciation, depletion and amortization (DD&A), exploration expense, impairment expense, discontinued operations, foreign exchange gains and losses, mark-to-
Slide 29: Glossary of Abbreviations
Glossary of Abbreviations AECO: Alberta Energy Company, the Canadian EBITDAX: Income from continuing operations MCF: Thousands of cubic feet benchmark price for natural gas before taxes, depreciation, depletion and amortization, net interest expense, and MCFD: Thousands cubic feet per day BBL: Barre
Slide 30: 4Q 2024 Guidance
4Q 2024 Guidance Oil NGLs Gas Total Producing Asset (BOPD) (BOPD) (MCFD) (BOEPD) US – Eagle Ford Shale 24,200 4,800 27,300 33,600 – Gulf of Mexico excluding NCI1 59,900 4,900 60,500 74,900 Canada – Tupper Montney 400 – 388,800 65,200 – Kaybob Duvernay 2,400 600 9,400 4,600 – Offshore 7,000 – – 7,000
Slide 31: 2024 North America Onshore Plan
2024 North America Onshore Plan Balancing Investments for Free Cash Flow Generation 98 MBOEPD Forecast for FY 2024 FY 2024E Wells Online 30 • 25% oil volumes, 30% liquids volumes 25 Eagle Ford Shale 20 • 20 operated wells online 15 • 15 Catarina wells 10 • 5 Tilden wells 5 • 20 gross non-operated we
Slide 32: Current Fixed Price Contracts
Current Fixed Price Contracts AECO Price Risk Mitigation – Tupper Montney, Canada Volumes Price Commodity Type (MMCF/D) (MCF) Start Date End Date Natural Gas Fixed Price Forward Sales at AECO1 162 C$2.39 10/1/2024 12/31/2024 Natural Gas Fixed Price Forward Sales at AECO1 40 C$2.75 1/1/2025 12/31/202
Slide 33: Maintaining Proved Reserves and Reserve Life
2023 Proved Reserves Maintaining Proved Reserves and Reserve Life • Total proved reserves 724 MMBOE at YE 2023 vs 697 MMBOE at YE 2022 2023 Proved Reserves By Area • Achieved 139% total reserve replacement • Added ~13 MMBOE of proved reserves for Lac Da Vang field in Vietnam 22% • Maintained proved
Slide 34: North America Onshore Locations
North America Onshore Locations More Than 50 Years of Robust Inventory with Low Breakeven Rates Diversified, Low Breakeven Portfolio Eagle Ford Shale and Kaybob Duvernay • Multi-basin portfolio provides optionality in > 25 years of inventory < $50 / BBL all price environments ~ 55 years of total inv
Slide 35: Offshore Development Opportunities
Offshore Development Opportunities Multi-Year Inventory of High-Return Projects Diversified, Low Breakeven Opportunities in Offshore Portfolio • Multi-year inventory of identified offshore projects in current portfolio • Maintaining annual offshore production of 90 – 100 MBOEPD with average annual C
Slide 36: North America Onshore Well Locations
North America Onshore Well Locations Tupper Montney Well Locations Inter-Well Gross Remaining Area Net Acres Spacing (ft) Locations Eagle Ford Shale Operated Well Locations Tupper Montney 118,235 984 - 1,323 976 Inter-Well Gross Remaining Area Net Acres Reservoir Spacing (ft) Locations Lower EFS 300
Slide 37: Eagle Ford Shale Peer Acreage
Eagle Ford Shale Peer Acreage Acreage as of November 5, 2024 www.murphyoilcorp.com NYSE: MUR 37
Slide 38: Kaybob Duvernay Peer Acreage
Kaybob Duvernay Peer Acreage Murphy Paramount Whitecap Veren Chevron Kiwetinohk PCC Cenovus GMT Hitic Halo Cygnet Duvernay Energy Open Crown Other Leased Battery Facility 6 Miles Acreage as of November 5, 2024 www.murphyoilcorp.com NYSE: MUR 38
Slide 39: Tupper Montney Peer Acreage
Tupper Montney Peer Acreage Advantage Montney ARC Montney Birchcliff Montney Ovintiv Montney Peyto Montney Shell Montney Tourmaline Montney Other Competitors Open Crown Murphy TCPL Pipeline Murphy Pipeline Battery Facility 0 Miles 10 Acreage as of November 5, 2024 www.murphyoilcorp.com NYSE: MUR 39
Slide 40: Gulf of Mexico Murphy Blocks
Gulf of Mexico Murphy Blocks PRODUCING ASSETS Gulf of Mexico Exploration Area Asset Operator Murphy WI1 Ocotillo Cascade Murphy 80% Chinook Murphy 86% Silver Dollar Clipper Murphy 80% Silver Dollar West Dalmatian Murphy 56% Medusa Delta House Powerball Dalmatian S. Front Runner Murphy 50% Habanero S
Slide 41: Sergipe-Alagoas Basin, Brazil Asset Overview
Exploration Update Sergipe-Alagoas Basin, Brazil Sergipe-Alagoas Basin Asset Overview • ExxonMobil 50% (Op), Enauta Energia S.A. 30%, Murphy 20% BRAZIL • Hold WI in 9 blocks, spanning >1.6 MM gross acres • >2.8 BN BOE discovered in basin • >1.2 BN BOE in deepwater since 2007 351 • Evaluating next st
Slide 42: Potiguar Basin, Brazil Asset Overview
Exploration Update Potiguar Basin, Brazil Asset Overview Potiguar Basin • Murphy 100% (Op) Murphy WI Block Other Block • Hold WI in 3 blocks, spanning ~775 M Discovered Field gross acres Kilometers • Proven oil basin in proximity to Pitu 0 50 oil discovery Petrobras Extending the Play Into the Deepw
Slide 43: Third Quarter Earnings Conference Call & Webcast
2024 THIRD QUARTER EARNINGS CONFERENCE CALL & WEBCAST NOVEMBER 7, 2024 ROGER W. JENKINS CHIEF EXECUTIVE OFFICER www.murphyoilcorp.com NYSE: MUR 43