Energy In-depth: Murphy Oil Full Year Earnings Slip Despite Healthy Q4

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MURPHY OIL FULL YEAR EARNINGS SLIP DESPITE HEALTHY Q4
Murphy Oil Corp. reported net income of $375.2 million in the fourth quarter – a healthy jump from $75.4 million in the previous year’s final quarter – but full-year earnings still sank in part due to falling oil prices in the last half of 2014.

“The recent collapse in commodity prices is a concern for our business and our industry,” said Murphy Oil CEO Roger Jenkins. “We expect to lower capital expenditures by some 33% from 2014 levels, including a 46% reduction in the Eagle Ford Shale, as we look ahead to 2015. Our goal is to reduce capital expenditures as much as possible to commitment only levels, protect our balance sheet and evaluate opportunities that emerge over the coming year.”

For the full year, El Dorado-based Murphy Oil posted net income of $905.6 million, down from $1.124 billion in 2013.

Other fourth quarter and full year highlights included:

• The close on the sale of 20% of the firm’s Malaysia business on December 18, 2014. It sold another 10% of its Malaysian oil and gas assets on Jan. 29.
• Set a new quarterly production record of 258,868 barrels of oil equivalent per day (boepd).
• Set a new annual production record of 225,973 boepd up 10% from 2013.
• Repurchased $375 million of company common stock, authorized an additional $500 million share repurchase and increased the regular dividend by 12% to $1.40 per share in August.
• Completed the sale of the U.K. retail gasoline business and initiated decommissioning of the Milford Haven refinery process units.

“We continued to make progress in portfolio optimization in 2014,” Jenkins said. “I am pleased to reach closure on the first phase of the sell-down of our Malaysia assets. This sale marks the value of our long-term Malaysian business and our strong relationship with our new partner, Pertamina, as well as PETRONAS. We continue to grow and replace production with contributions from the Eagle Ford Shale, and new fields in the Gulf of Mexico and Malaysia.”

ARKANSAS DELEGATION SUPPORTS SENATE PASSAGE OF KEYSTONE XL
A Senate bill that would support the Keystone XL pipeline project must be signed into law, members of the state’s congressional delegation said Thursday. The Senate voted 62-36 Thursday to approve Senate Bill 1, involving the pipeline project.

Supporters have said it would bring much needed jobs, including construction and steel jobs, throughout the country while opponents have stressed environmental concerns for their opposition. Read what Arkansas Senators and Congressmen had to say on the subject here.

ENTERGY ARKANSAS CONTRIBUTES $857 MILLION TO ARKANSAS ECONOMY
Entergy Arkansas’ total economic impact on the state reaches almost $1 billion, according to a study released by the state’s largest utility.

IHS Economics and Country Risk conducted the study at Entergy Arkansas’ request. Key takeaways from the report included:

• Entergy’s activities contributed $857 million to Arkansas’ Gross State Product during 2013;
• Every $1 Entergy spends with local businesses stimulates an additional $2 of sales in the state; and
• For every 10 Entergy jobs, another 13 are supported in the state. Those jobs are 26% above the national wage average and 62% above the state average.

Read more or access the report at this link.