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MUFG Oil and Gas Conference – Murphy Oil Corp

Murphy Oil Corp · May 17, 2018 · 40 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 1
    MUFG OIL & GAS CONFERENCE MAY 17, 2018 JOHN B. GARDNER VICE PRESIDENT & TREASURER
  2. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 2
    Agenda 01 MURPHY OVERVIEW 02 PORTFOLIO REVIEW 03 FINANCIAL OVERVIEW 04 LOOKING AHEAD 05 TAKEAWAYS MURPHY OIL CORPORATION www.m urp h yo i lc o rp.c om NYSE: MUR 3
  3. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 3
    MURPHY OVERVIEW MURPHY OIL CORPORATION www.m urp h yo i lc o rp.c om NYSE: MUR 4
  4. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 4
    Murphy At A Glance 2017 Proved Reserves 46% Gas 47% Oil Long Corporate History, IPO 1956 19% US Onshore 37% Canada Onshore Global Offshore & North American Onshore Portfolio 7% 698 Canada Offshore 3% MMBOE Diverse Portfolio…
  5. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 5
    Committed to Returning Cash to Shareholders Dividend + Buyback Payout % of Adj CFO, 2015 2017 Returned 4.3 BN to Shareholders, Since 1961 35% MUR 30% Returned 2.5 BN to Shareholders in Last 10 Years 25% 20% Sustained High…
  6. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 6
    2018 Plan Production 167 170 2018 Production Guidance 167 170 MBOEPD, 170 166 169 60% Liquids 168 167.5 2018 Major Annual CAPEX Spend 1.11 BN 166 MBOEPD 670 MM Onshore 164 164 270 MM Offshore 162 130 MM Exploration 160 FY…
  7. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 7
    1Q 2018 Highlights Achieving High-Margin Returning Cash to Generating Strong Returns & Production from Shareholders & Building Maintaining Healthy Liquidity Diversified Assets Long-Term Portfolio 1Q 18 Total Production 168…
  8. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 8
    1Q 2018 Diversified Portfolio Drives High Cash Margins 1Q 2018 Sales Basis Price Premium Oil Margins Widening to WTI 42% 52% Oil Brent/MCO 85 Natural (Malaysian Crude Oil)* Gas 24% LLS* 80 31% WTI 75 Oil-Indexed Gas 11% 31%…
  9. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 9
    Executing on Our Strategy in 1Q 2018 Returning to Offshore Exploration at Bottom of Cycle Develop DIFFERENTIATED PERSPECTIVES In Gulf of Mexico & Brazil Acreage Acquisitions Underexplored Basins & Plays Drilled First Appraisal Wells at…
  10. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 10
    Our Strategy Drives Profitable Growth Value Adding Production Growth Measured, Oil-Weighted Production Growth 300 Within Cash Flow 200 Plan Returns Over 800 MM to Shareholders MBOEPD with Current Dividend Policy 100 Plan…
  11. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 11
    ONSHORE PORTFOLIO REVIEW MURPHY OIL CORPORATION www.m urp h yo i lc o rp.c om NYSE: MUR 12
  12. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 12
    Low-Cost North American Unconventional Business 2017 Proved Reserves Eagle Ford Shale 47% Gas 44% Oil 125,000 Net Acres, 880 Wells Online* 2,000 Remaining Locations Premium Gulf Coast Pricing 48% 493 52% Eagle Ford Shale MMBOE…
  13. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 13
    Eagle Ford Shale Highlights Operated Well Delivery 45 Wells Online FY 2018 Atascosa 6 Tilden Wells Online 1Q 18 Avg IP30 775 BOEPD Karnes 22 Wells Online 2Q 18 10 Well Pad in Karnes, 10 Wells in Tilden Karnes Catarina & 2 Wells in…
  14. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 14
    Tupper Montney Highlights Top Tier North American Dry Natural Gas Play Henry Hub Dry Natural Gas Break-Even Prices, /MCF 6.00 Operated Well Delivery 5 Wells Online FY 2018 5.00 3 Upper Montney, 2 Middle Montney Avg EUR 18 BCF…
  15. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 15
    Kaybob Duvernay 2018 Well Delivery Plan Operated Well Delivery FY 18 Budget: Drill 17 Wells, Online 23 Wells Contingent: Drill +7 Wells, Online +7 Wells Pad Wells Window Online A 01-12 1 Oil 1Q 2018 B 15-16 2 Oil 1Q 2018 C…
  16. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 16
    Kaybob Duvernay Highlights Increased Kaybob Production 92% from 1Q 2017 to 1Q 2018 Drilling Pacesetter Wells 1Q 18 Drilling Cost per Foot 110 1Q 18 /CLAT 600 Appraisal Wells Update Online 1Q 2018 01-12 Pad (1 Well) Oil, IP30 900 BOEPD,…
  17. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 17
    High Margin, Oil-Weighted Global Offshore Business 2017 Proved Reserves Malaysia Key Value Adding Projects in 44% Gas Execution 55% Oil 12% 20 Year Presence in Region Southeast Asia 205 Brent-Linked Pricing 23% MMBOE Gulf of…
  18. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 18
    Offshore Operations Highlights Malaysia Gulf of Mexico Sabah Operated Kikeh DTU Gas Lift Project 80% Complete, Online 3Q 18 Medusa Subsea Well Workover Complete Kakap Phase 2 Drilling to Start 4Q 18, 155 MBOPD 1Q Clipper Comingled Wells…
  19. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 19
    Global Exploration Strategy New Exploration Team Focusing on: Exploration Focus Areas Target 35% Working Interest No 100% New Entry Blocks Partner with Proven Explorers 30% Full Cycle Return at Mean Risked Volumes F&D < 15 Near…
  20. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 20
    Exploration Update GOM Deepwater Samurai (GC 432) Murphy 50% WI, Operator Spud Appraisal Well 2Q 18, Net Well Cost 30 MM Mean Gross Resource Potential 75 MMBOE, Gross Resource Upside Potential 200 MMBOE GOM Deepwater New Low-Cost…
  21. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 21
    2Q 4Q 18 Exploration Plan GOM King Cake Prospect (AT 23) Mexico Palenque Prospect (Deepwater Block 5) Murphy 31.5% WI, Operator Murphy 30% WI, Operator, Partners PETRONAS, Expected Spud 3Q 18 Ophir & Sierra Oil & Gas Mean Gross…
  22. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 22
    FINANCIAL OVERVIEW MURPHY OIL CORPORATION www.m urp h yo i lc o rp.c om NYSE: MUR 23
  23. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 23
    Murphys Financial Strategy Invest Within Cash Flows Focus on Short Cycle, Lower Risk & High Cash Margin Projects Measured Exploration Program to Supplement a Balance of Near-Term & Long-Term Sustainable Growth Maintain Strong…
  24. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 24
    Financials Historical & 2018 Forecast MM (Unless Otherwise Noted) FY FY Q1 FY 2016A 2017A 2018A 2018 Guidance WTI (/BBL) 43.32 50.95 62.87 HHUB (/MMBTU) 2.48 2.96 3.01 Oil Production (MBOPD) 103 90 89 Gas Production (MMCFD) 378…
  25. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 25
    Manageable Debt Maturities Note Maturity Profile Current Plan for the 2022 & 2024 Debt Maturities 1,200 Maturity Profile* 1.1 BN in Maturing Bonds 1,000 Total Notes Outstanding BN 2.8 4.0%, 500 MM Bond Matures Jun 2, 2022 Weighted…
  26. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 26
    Achieving Positive Rating Actions with Moodys Factors that Could Lead to an Upgrade Moodys 2017YE Grid-Indicated Outcome: Ba3 Murphys ratings could be upgraded should the company demonstrate consistent production growth funded through…
  27. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 27
    Achieving Positive Rating Actions with Fitch Fitch Rating vs. WTI Oil Price Fitch LT Issuer Default Rating Future Developments That May, Individually or Collectively, Lead to Positive Rating Actions: An enhanced long-term…
  28. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 28
    Denotes Non-Investment Grade Per Moodys Credit Metrics vs E&P Peers FY 2017 Denotes Investment Grade Per Moodys Denotes Murphy Oil 2017 Net Debt / Adj EBITDAX 2017 Net Debt / Proved Reserves (/BOE)* 5x 4.6x 9 5x 7.74 8 4x 3.6x…
  29. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 29
    Murphys Trading Performance vs High Yield Peers Current Trading Performance Trading Performance Since January 2018 (YTW) 6.5% 6.0% 5.5% 5.0% Yield 4.5% 4.0% 3.5% 3.0% 1/2 1/9 1/16 1/23 1/30 2/6 2/13 2/20…
  30. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 30
    LOOKING AHEAD MURPHY OIL CORPORATION www.m urp h yo i lc o rp.c om NYSE: MUR 31
  31. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 31
    Turning the Corner Doubling EBITDA by 2022 Value-Adding Production Growth 3.0 300 2.5 250 2.0 200 MBOEPD BN 1.5 150 1.0 100 0.5 50 0.0 0 2015 2016 2017 2022E 2015 2016 2017 2022E Guidance Assumes WTI 52/BBL & HH…
  32. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 32
    Takeaways Executing on the 2018 Plan Achieving High Cash Margins from Diverse, Oil-Weighted Portfolio Delivering Pacesetter Onshore Wells Maintaining Offshore Production with Innovative Projects Implementing New Exploration…
  33. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 33
    APPENDIX MURPHY OIL CORPORATION www.m urp h yo i lc o rp.c om NYSE: MUR 34
  34. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 34
    Non-GAAP Financial Measure Definitions & 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…
  35. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 35
    Guidance 2Q 2018 2Q 2018 2Q 2018 Guidance 2Q Liquids (BOPD) Gas (MCFD) 2Q Production: US Eagle Ford Shale 38,600 31,000 Gulf of Mexico 15,350 12,600 Canada Tupper Montney 233,800 Kaybob Duvernay & Placid Montney 5,500 23,500…
  36. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 36
    2018 Hedging Positions Volumes Area Commodity Type (BOPD) Price (USD/BBL) Start Date End Date United States WTI Fixed Price Derivative Swap 21,000 54.88 4/1/2018 12/31/2018 Volumes Area Commodity Type (MMCFD) Price (MCF) Start…
  37. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 37
    Bloomberg Definitions Net Income/BOE = Net Income (Loss) as Reported / Total Annual Production EBITDA = Loss from Continuing Operations - Interest & Other Income + Income Tax Expense (Benefit) + Interest Expense - Interest Capitalized…
  38. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 38
    Moodys Definitions Leveraged Full-Cycle Ratio Realized price per boe production (reflects basis differentials, transportation and hedging) Minus: Operating costs per boe Minus: Total G&A expense (including capitalized portion) per…
  39. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 39
    Fitch Definitions Debt / EBITDA Total Debt Divided by Annualized EBITDA Debt / Proved Developed (PD) Reserves Total Debt Divided by PD Reserves Debt / Flowing Barrels (Annualized Production) Total Debt Divided by Annualized…
  40. MUFG Oil and Gas Conference – Murphy Oil Corp – slide 40
    NA Onshore Running Room Spacing Inter-Well Spacing Area Net Acres PDP Wells Reservoir Remaining Wells Total Well Count* (Acres) (ft) NA Onshore Total 413,156 1,222 5,176 6,398 Lower EFS 60 40 350 Karnes 10,918 274 Upper EFS 158 80…

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