Q1 2024 Murphy Oil Corp Earnings Call

May 2, 2024

Operator: Good morning, ladies and gentlemen, and welcome to the first quarter 2020 earnings conference call and webcast. If at any time during this call you need assistance, please press star zero for the operator. I would like to turn the conference over to Kelly Whitley, Vice President of Investor Relations and Communications. Please go ahead.

Good morning, ladies and gentlemen, and welcome to the first quarter 'twenty 'twenty four earnings conference call and webcast. If at any time. During this call you need assistance. Please press star zero for any operator, I'd now like to turn the conference over to Kelly Whitley, Vice President of Investor Relations.

Kelly L. Whitley: And communications. Please go ahead.

Kelly L. Whitley: Thank you, Jonah. Good morning, everyone, and thank you for joining us on our first-quarter earnings call today. Joining us today are Roger Jenkins, Chief Executive Officer, along with Eric Hambly, President and Chief Operating Officer, and Tom Mireles, Executive Vice President and Chief Financial Officer. Please refer to the informational slides we've placed on the Investor Relations section of our website as you follow along with our webcast today. Throughout today's call, production numbers, reserves, and financial amounts are adjusted to exclude noncontrolling interests in the Gulf of Mexico. Slide 2.

Kelly L. Whitley: Thank you Joanna.

Kelly L. Whitley: Everyone and thank you for joining us on our first quarter earnings call today, joining us as Roger Jenkins, Chief Executive Officer, along with Eric Hambly, President and Chief operating Officer, and Tom Morale is executive Vice President and Chief Financial Officer. Please refer to the informational slides we have placed on the Investor Relations section of our website as you follow them.

Kelly L. Whitley: Along with our webcast today throughout today's call production numbers.

Kelly L. Whitley: <unk> M financial amounts are adjusted to exclude Noncontrolling interest in the Gulf of Mexico.

Kelly L. Whitley: Please keep in mind that some of the comments made during this call will be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. As such, no assurances can be given that these events will occur or that the projections will be attained. A variety of factors exist that may cause actual results to differ. For a further discussion of risk factors, see Murphy's 2023 Annual Report on Form 10-K, on file with the SEC. Murphy takes no duty to publicly update or revise any forward-looking statements. I will now turn the call over to Roger.

Kelly L. Whitley: Slide two please keep in mind that some of the comments made during this call will be considered forward looking statements as defined in the private Securities Litigation Reform Act of 1995 as such no assurances can be given that these events will occur or that the projections will be attained a variety of factors exist that may cause actual.

Kelly L. Whitley: Results to differ for further discussion of risk factors see Murphy's 2023 annual report on Form 10-K on file with the SEC Murphy takes no duty to publicly update or revise any forward looking statements I will now turn the call over to Roger.

Roger W. Jenkins: Thank you, Kelly. Good morning, everyone, and thanks for listening to our call today. As we turn to slide three, I'd like to reiterate our corporate priorities of deliver, execute, explore, and return. We remain firmly on track for achieving our $300 million debt reduction goal in 2024, leading to $1 billion of total long-term bond debt outstanding at year-end. In the first quarter of 24, we exceeded production guidance in the Eagleford Shale and Tupper Montany with total production of 170,000 barrels of equivalents per day at the high end of our guidance range. Murphy's Gulf of Mexico Workover Program is ongoing. In addition, I'm pleased to report that the Moremont No.

Roger W. Jenkins: Thank you Kelly and good morning, everyone and thanks for listening to our call today.

Roger W. Jenkins: 2 The Subsea Well is back online in the first quarter after equipment repair. We'll continue to progress our well delivery program. And in the second quarter, we will have a new well at Khaleesi and 23 new operated wells all coming online, and Exploration, where our operating partner is currently drilling the Ocotillo Exploration Well in the Gulf of Mexico, and we will move to the Orange Exploration Well immediately following. In the first quarter, Murphy was awarded six deepwater blocks from the Gulf of Mexico Federal Lease Sale 261.

Roger W. Jenkins: Turning to slide three I'd like to reiterate our corporate priorities of Delever execute explore and return.

Roger W. Jenkins: Firmly on track for achieving our 300 million dollar debt reduction goal in 2024, leading to 1 billion of total long term bond debt outstanding at year end 'twenty four.

Roger W. Jenkins: The first quarter 'twenty four we exceeded production guidance in the Eagle Ford shale in Tupper Montney with total production of 170000 barrels of equivalents per day at the high end of our guidance range Murphy's Gulf of Mexico work over program is ongoing. In addition, I'm pleased to report that the more month number two subsea wells back on line in the first quarter after.

Roger W. Jenkins: Repair, we're continuing to progress our well delivery program.

Roger W. Jenkins: And then the second quarter, we will have a new well at Khaleesi and 23, new operated wells all to come online.

Roger W. Jenkins: In exploration, where our operating partners currently drilling No-code kilo exploration wells in the Gulf of Mexico, and we will move to the Orange exploration well immediately following.

Roger W. Jenkins: In the first quarter Murphy was awarded six deepwater blocks from the Gulf of Mexico Federal lease sale 261, we're also progressing our exploration plans in Vietnam as well.

Roger W. Jenkins: We're also progressing our expiration plans in Vietnam as we've contracted a rig to spud our exploration program at the beginning of the third quarter. We're pleased to continue our hallmark of consistent returns to our shareholders through buybacks and a long-standing dividend. We repurchased $50 million of stock in the first quarter at an average price of $39.25 a share. Additionally, as announced in January, we increased our quarterly dividend to $1.20 per share annualized, and our board maintained this level in April, which is back to the 2016 annual level.

Roger W. Jenkins: We're also progressing our exploration plans in Vietnam as we've contracted a rig to spud our exploration program at the beginning of the third quarter. We're pleased to continue our hallmark of consistent returns to our shareholders through buybacks and a long-standing dividend. We repurchased $50 million of stock in the first quarter at an average price of $39.25 a share. Additionally, as announced in January, we increased our quarterly dividend to $1.20 per share annualized, and our board maintained this level in April, which is back to the 2016 annual level.

Roger W. Jenkins: Tracked at a rig to spud our exploration program in the beginning of the third quarter.

Roger W. Jenkins: We're pleased to continue our hallmark of consistent returns to our shareholders through buybacks and launch lending dividend, we've repurchased $50 million of stock in the first quarter at an average price of $39.25 a share. Additionally, as announced in January we increased our quarterly dividend to <unk> 30 per share.

Roger W. Jenkins: 120, I'm, sorry, $1.20 per share annualized and our board maintained this level in April which is back to a 2016 annual level.

Roger W. Jenkins: Our cap allocation focus has been primarily focused on debt reduction since 2020. Between August, 2020 and August, 2022, excuse me, we reduced total debt by $730 million. Since announcing the framework in August 22, we've consistently executed a combination of debt reduction, share repurchases, and dividend increases. And since the full year 2020, we've reduced debt by $1.7 billion. We purchased a total of $200 million in stock, or 4.7 million shares at an average price of $42.68 a share, and raised our quarterly dividend by 140%, and the first quarter of 2024 specifically, which generates efficient adjusted cashflow to allow us to purchase $50 million of stock and capitalize on the stock price dislocation to oil prices.

Roger W. Jenkins: Our capital allocation focus has been primarily.

Roger W. Jenkins: Focused on debt reduction since 'twenty 'twenty between August 2020 in August 2022.

Roger W. Jenkins: Excuse me, we reduced total debt by $730 million since announcing the framework in August of 'twenty. Two we've consistently executed combination of debt reduction share repurchases and dividend increases.

Roger W. Jenkins: And since total year 2020, we've reduced debt by $1 $7 billion, we purchased a total of $200 million of stock of $4 7 million shares at an average price of $42.68 a share and raised our quarterly dividend 140%.

Roger W. Jenkins: In the first quarter 2024, specifically, we generate sufficient adjusted cash flow to allow us to purchase 50 million of stock and capitalize on stock price dislocation to oil prices for.

Roger W. Jenkins: For 2024, we're solidly on track to achieve our $300 million debt reduction goal and reach Murphy 3.0 of our capital allocation framework, especially with the current oil price. Looking forward to reaching this next step and further increasing shareholder returns to 50% of adjusted pre-cash flow later this year. Slide five.

Roger W. Jenkins: For 'twenty 'twenty four we solidly on track to achieve our 300 million dollar debt reduction go and rich Murphy three point over our capital allocation framework, especially with current oil price prices.

Roger W. Jenkins: Looking forward to reaching this next step in further increasing shareholder returns to 50% of adjusted free cash flow later this year.

Roger W. Jenkins: Slide five.

Roger W. Jenkins: Murphy produced at the high end of guidance at 170,000 barrels equivalent in the first quarter of 24, with 89,000 barrels of oil per day. We achieved a slight premium to WTI as we realized $78 per barrel. And our realized NGL price was $23 a barrel, and natural gas was $2.12 per thousand cubic feet. Overall, we generated $746 million of revenue in a quarter, excluding our non-controlling interest. I will now turn the call over to our Executive Vice President and Chief Financial Officer, Tom Morales, for an update on our financial results.

Thomas J. Mireles: Murphy produced at the high end of guidance at 170,000 barrels equivalent in the first quarter of 24, with 89,000 barrels of oil per day. We achieved a slight premium to WTI as we realized $78 per barrel. And our realized NGL price was $23 a barrel, and natural gas was $2.12 per thousand cubic feet. Overall, we generated $746 million in revenue in a quarter, excluding our non-controlling entities. I will now turn the call over to our Executive Vice President and Chief Financial Officer, Tom Morales, for an update on our financial results.

Roger W. Jenkins: Murphy produced at the high end of guidance at 170000 barrels equivalent in the first quarter of 'twenty four with 89000 barrels of oil per day, we achieved a slight premium to Debbie T is we realized $78 per barrel and our realized NGL price was $23 a barrel and Nat gas was $2 12 per thousand cubic feet.

Roger W. Jenkins: Overall, we generated 746 million of revenue in the quarter, excluding our Noncontrolling interest I will now turn the call over to our executive Vice President and Chief Financial Officer, Tom morale is for an update on our financial results Tom.

Thomas J. Mireles: Thank you, Roger. And good morning, everyone.

Tom morale: Thank you Roger and good morning, everyone.

Thomas J. Mireles: Slide five. In the first quarter, Murphy reported $90 million of net income, or 59 cents per diluted share, and $131 million of adjusted net income, or $0.85 per diluted share. We achieved $405 million of adjusted EBITDA due to a combination of strong production and realized prices, with $264 million of accrued CapEx excluding non-controlling interest. Overall, as Roger mentioned previously, we had an outstanding quarter in returns to shareholders as we repurchased $50 million of stock, paid a higher dividend, and increased our cash balance.

Thomas J. Mireles: Slide five. In the first quarter, Murphy reported $90 million of net income, or $0.59 per diluted share, and $131 million of adjusted net income, or $0.85 per diluted share. We achieved $405 million of adjusted EBITDA due to a combination of strong production and realized prices, with $264 million of accrued CapEx excluding non-controlling interest. Overall, as Roger mentioned previously, we had an outstanding quarter in returns to shareholders as we repurchased $50 million of stock, paid a higher dividend, and increased our cash balance. In total, we returned over 60% of our free cash flow, all while supporting a front-end loaded CapEx plan with approximately 60% of spending in the first half of 2024. Slide six.

Tom morale: Slide five.

Tom: In the first quarter Murphy reported $90 million of net income or <unk> 59 cents per diluted share.

Tom: $131 million of adjusted net income or <unk> 85 cents per diluted share.

Tom: We achieved $205 million of adjusted EBITDA due to a combination of strong production and realized prices with $264 million of accrued capex, excluding noncontrolling interest.

Tom: Overall as Roger mentioned previously we had an outstanding quarter and returns to shareholders as we repurchased $50 million of stock paid a higher dividend and increased our cash balance in.

Thomas J. Mireles: In total, we returned over 60% of our free cash flow, all while supporting a front-end loaded CapEx plan with approximately 60% of spending in the first half of 2024. Slide six. Murphy maintained strong liquidity in the first quarter with $1.1 billion as of March 31st, including more than $300 million in cash and equivalents. I'm pleased that during the quarter, we received positive outlooks from both Moody's and Fitch, revised from stable outlooks previously, with the corporate ratings affirmed at BA2 and BB+.

Tom: In total we returned over 60% of our free cash flow all while supporting our front end loaded Capex plan with approximately 60% of spending in the first half of 2024.

Tom: Slide six.

Thomas J. Mireles: Murphy maintained strong liquidity in the first quarter with $1.1 billion as of March 31st, including more than $300 million in cash and equivalents. I'm pleased that during the quarter, we received positive outlooks from both Moody's and Fitch, revised from stable outlooks previously, with the corporate ratings affirmed at BA2 and BB+. At quarter end, we had $1.3 billion of senior notes outstanding with a long-dated weighted average maturity of nearly eight years. We remain on track for further debt reduction this year, and I look forward to reaching Murphy 3.0 with total debt of $1 billion before year end. Slide seven.

Tom: Murphy maintain strong liquidity in the first quarter with $1 $1 billion as of March 31, including more than $300 million in cash and equivalents.

Tom: I'm pleased that during the quarter, we received positive outlooks from both Moody's and Fitch revised from stable outlooks previously with.

Tom: With the corporate ratings affirmed at B E two and double B plus.

Thomas J. Mireles: At quarter end, we had $1.3 billion of senior notes outstanding with a long-dated weighted average maturity of nearly eight years. We remain on track for further debt reduction this year, and I look forward to reaching Murphy 3.0 with total debt of $1 billion before year end. Slide seven.

Tom: At quarter end, we had $1 $3 billion of senior notes outstanding with a long dated weighted average maturity of nearly eight years.

Tom: We remain on track for further debt reduction this year and I look forward to reaching Mercury 3.0, with total debt of $1 billion before year end.

Tom: Slide seven.

Thomas J. Mireles: At Murphy, we seek to continually minimize our impact on the environment, whether that's using natural gas rather than diesel to fuel our onshore operations or utilizing recycled water for our well completion. We also support the communities in which we work, like the city of Uvalde in South Texas or here in Houston. Because of this service, we have been presented with awards, such as the United States President's Volunteer Service Award from the Houston Food Bank, and I look forward to Murphy developing further initiatives to enhance our positive impact. With that, I will turn it over to Eric Hamley, our president and chief operating officer, to discuss our operational updates. Thank you, Tom.

Thomas J. Mireles: At Murphy, we seek to continually minimize our impact on the environment, whether that's using natural gas rather than diesel to fuel our onshore operations or utilizing recycled water for our well completion. We also support the communities in which we work, like the city of Uvalde in South Texas or here in Houston. Because of this service, we have been presented with awards, such as the United States President's Volunteer Service Award from the Houston Food Bank, and I look forward to Murphy developing further initiatives to enhance our positive impact. With that, I will turn it over to Eric Hambly, our President and Chief Operating Officer, to discuss our operational updates. Thank you, Tom.

Tom: At Murphy, we seek to continuously minimize our impact on the environment, whether that's using natural gas rather than diesel to fuel our onshore operations are utilizing recycled water for well completions.

Tom: We also support the communities in which we work like the city of your body in South, Texas or here in Houston.

Tom: Because of this service we have been presented with awards such as the United States President Volunteer Service Award from the Houston Food Bank and I look forward to Murphy developing further initiatives to enhance our positive impact.

Tom: With that I will turn it over to Eric Hambly, our President and Chief operating officer to discuss our operational updates. Thank you Tom Slide 10, our Eagle Ford Shale wells performed above expectations in the first quarter, achieving total production of 29000 barrels of oil equivalent per day with 86% liquids volumes are operating partner brought online.

Eric M. Hambly: Thank you, Tom. Slide 10. Our Eagleford shale wells performed above expectations in the first quarter, achieving total production of 29,000 barrels of oil equivalent per day with 86% liquids volume. Our operating partner brought four Tilden wells online during the quarter, while Murphy progressed our 20-well operated drilling program for the year as planned. We are on track to bring seven operated Caterina wells online in the second quarter, plus an additional four non-operated Tilden wells.

Eric M. Hambly: <unk> four Tilden wells during the quarter, while Murphy progressed, our 'twenty well operated drilling program for the year as planned we are on track to bring seven operated Catarina wells online in the second quarter plus an additional four non operated Tilden wells.

Eric M. Hambly: Slide 11. In Tupper-Montney, Murphy produced 348 million cubic feet of gas per day and progressed our 2024 well delivery program with 13 wells that are either now producing or will be online in the near term. This will complete our plans for the year.

Eric M. Hambly: In Tupper-Montney, Murphy produced 348 million cubic feet of gas per day and progressed our 2024 well delivery program with 13 wells that are either now producing or will be online in the near term. This will complete our plans for the year. We are excited to announce that Murphy has joined the Rockies LNG partnership, which may create future LNG opportunities for our Tupper-Montney acreage as projects in the area near completion. This partnership is comprised of Western Canadian natural gas producers, driving LNG export optionality, and we are eager to be a part of it. Murphy maintains a strong price diversification strategy to mitigate ACO price exposure.

Eric M. Hambly: Slide 11, and the Tupper Montney Murphy produced 348 million cubic feet per day and progressed, our 2024, well delivery program with 13 wells that are either now producing ore will be online in the near term. This will complete our plans for the year. We are excited to announce that Murphy has joined the rock.

Eric M. Hambly: We are excited to announce that Murphy has joined the Rockies LNG partnership, which may create future LNG opportunities for our Tupper-Montney acreage as projects in the area near completion. This partnership is comprised of Western Canadian natural gas producers, driving LNG export optionality, and we are eager to be a part of it. Murphy maintains a strong price diversification strategy, mitigating against ACO price exposure.

Eric M. Hambly: <unk> LNG partnership, which may create future LNG opportunities for our Tupper montney acreage as projects in the area of near completion. This partnership is comprised of Western Canadian natural gas producers driving LNG export Optionality and we are eager to be a part of it.

Eric M. Hambly: Murphy maintains a strong price diversification strategy mitigating against eco price exposure for the first quarter, we sold approximately half of our natural gas volumes at the Chicago Dawn Marlin Emerson, Henry hub, and Ventura price points Slide 12.

Eric M. Hambly: For the first quarter, we sold approximately half of our natural gas volumes at the Chicago, Don, Malin, Emerson, Henry Hub, and Ventura price points. Slide 12. Our K-Bop Dubonnet asset produced 4,000 barrels of oil equivalent per day with 68% liquids in the first quarter of 2024. We progressed our development program for the year and have three operated wells coming online in the second quarter as planned. Slide 13.

Eric M. Hambly: R K, Bob Duvernay asset produced 4000 barrels of oil equivalent per day with 68% liquids in the first quarter of 2024, we progressed our development program for the year and have three operated wells coming online in the second quarter as planned slide 13.

Eric M. Hambly: Our Gulf of Mexico assets produce 73,000 barrels of oil equivalent per day with 82% oil volumes. This production was impacted by approximately 13,000 barrels of oil equivalent per day of planned downtime events during the quarter. Murphy is advancing our development program for the year, and we look forward to bringing online the sizable Calusi No. 4 well in the second quarter, as we found approximately 200 feet of net pay when drilling. We're also progressing the drilling of a new well at our Mormont Field, which is scheduled to come online in the third quarter.

Eric M. Hambly: Our Gulf of Mexico assets produce 73,000 barrels of oil equivalent per day with 82% oil volumes. This production was impacted by approximately 13,000 barrels of oil equivalent per day of planned downtime events during the quarter. Murphy is advancing our development program for the year, and we look forward to bringing online the sizable Calisee Number Four well in the second quarter, as we found approximately 200 feet of net pay when drilling. We're also progressing the drilling of a new well at our Mormont field, which is scheduled to come online in the third quarter.

Eric M. Hambly: Our Gulf of Mexico assets produced 73000 barrels of oil equivalent per day with 82% oil volumes. This production was impacted by approximately 13000 barrels of oil equivalent per day of planned downtime events during the quarter.

Eric M. Hambly: Murphy is advancing our development program for the year and we look forward to bringing online the sizeable khaleesi number four well in the second quarter as we found approximately 200 feet of net pay when drilling. We're also progressing the drilling a new well at our normal field, which is scheduled to come online in the third quarter. Additionally, our operating partners brought online as well.

Eric M. Hambly: Additionally, our operating partner brought online wells at the St. Malo and Lucius Fields during the quarter. In offshore Canada, we produced 6,000 barrels of oil equivalent per day in the first quarter, according to plan. During the first quarter, we completed the zone changes on the Marmalard No. 1 and No. 2 wells as planned, as well as the subsea equipment repair at Mormont No. 2.

Eric M. Hambly: Additionally, our operating partner brought online wells at the St. Molo and Lucius Fields during the quarter. In offshore Canada, we produced 6,000 barrels of oil equivalent per day in the first quarter, according to plan. During the first quarter, we completed the zone changes on the Marmalard No. 1 and No. 2 wells as planned, as well as the subsea equipment repair at Mormont No. 2.

Eric M. Hambly: Or is it the St Malo and Lucius field during the quarter.

Eric M. Hambly: In offshore Canada, we produced 6000 barrels oil equivalent per day in the first quarter. According to plan.

Eric M. Hambly: Slide 14 during the first quarter, we completed the zone changes on the normal hard number one and number two wells as planned as well as the subsea equipment repair at more month number two Murphy also initiated work on the niedermeyer number one well workover with the plan now updated to drilling a sidetrack, well, which will delay the online date to the third.

Eric M. Hambly: Murphy also initiated work on the Niedermeyer No. 1 well workover, with the plan now updated to drilling a sidetrack well, which will delay the online date to the third quarter of 2024. Our workover expenses, which are included in our lease operating expenses, total $50 million for the first quarter, with $65 million forecast for the second quarter.

Eric M. Hambly: For 2024.

Eric M. Hambly: Our workover expenses, which are included in our lease operating expenses totaled $50 million for the first quarter was $65 million forecast for the second quarter. This figure includes the cost of the niedermeyer sidetrack well.

Eric M. Hambly: Additional work is planned later this year at the Dalmatian No. 2 well for the subsurface safety valve repair, as well as the non-operated Kodiak No. 3 well, stimulation, and zone addition, slide 15.

Eric M. Hambly: Additional work is planned later this year at the Dalmatian number two well for the subsurface safety valve repair as well as the non operated Kodiak number three well stimulation and zoned additions.

Eric M. Hambly: Slide 15 in Vietnam, we have been progressing our plans for our locked the volatile fuel development project, including advancing awarded major contracts. This year. We look forward to begin drilling development wells in 2025 and remain on schedule for achieving first oil in late 2026 slide 17 and.

Eric M. Hambly: In Vietnam, we have been progressing our plans for our Lock-de-Vong field development project, including advancing the award of major contracts this year. We look forward to beginning drilling our development wells in 2025 and remaining on schedule for achieving first oil in late 2026. Slide 17.

Eric M. Hambly: In Vietnam, we have been progressing our plans for our Loc De Vang field development project, including advancing a ward of major contracts this year. We look forward to beginning drilling our development wells in 2025 and remaining on schedule for achieving first oil in late 2026. Slide 17.

Eric M. Hambly: In the Gulf of Mexico, we're excited to begin our 2024 exploration program. Our operating partner is currently drilling the Ocotillo Exploration Well. Immediately following this well, the rig will shift to drill the nearby Orange Exploration Well. These two Miocene prospects are located near existing infrastructure and could be brought online quickly if either is a discovery. Also, in the first quarter, we expanded our portfolio and were awarded six deepwater blocks from the Gulf of Mexico Federal Lease Sale 261. Slide 18.

Eric M. Hambly: In the Gulf of Mexico, We're excited to begin our 2024 exploration program. Our operating partner is currently drilling the <unk> exploration well immediately following this well the rig will shift to drill the nearby Orange exploration well.

Eric M. Hambly: These two Miocene prospects are located near existing infrastructure and can be brought online quickly if either as a discovery.

Eric M. Hambly: Also in the first quarter, we expanded our portfolio and were awarded six deepwater blocks from the Gulf of Mexico Federal lease sale 261 slide 18.

Eric M. Hambly: We're continuing preparations for our Vietnam exploration program later this year and are excited to have contracted a rig which is currently drilling in the country. Murphy will first drill the Hai Su Vong exploration well in block 15217 in the third quarter and target a mean to upward gross resource potential of 170 to 430 million barrels of oil equivalent. The rig will then move to drill the Locke the Hong exploration well in block 15105, targeting a mean to upward gross resource potential of 65 to 135 million barrels of oil equivalent. We look forward to seeing the results of these wells as they provide the potential to create a more sizable business in Vietnam. Slide 19.

Eric M. Hambly: And preparations for our Vietnam exploration program later this year and are excited to have contracted a rig which is currently drilling in country Murphy will first but the HIFU vong exploration well in block 15, $2 17 in the third quarter and target a mean to upward gross resource potential of 170 to 430 million barrels of oil.

Eric M. Hambly: The rig will then move to drill the locked the Hong exploration well in block 15, 105 targeting a mean to upward gross resource potential of 65 to 135 million barrels of oil equivalent we look forward to seeing the results of these wells as they provide the potential to create a more sizable business in Vietnam.

Eric M. Hambly: Our seismic reprocessing work continues to progress for our acreage in Cote d'Ivoire, and we are pleased at the multiple opportunities available across exploration plate types. Importantly, E&I recently announced positive results from its Moraine 1 exploration well on the Callao Discovery nearby. Murphy is excited at this news, and I note that our Block CI-502 in particular is very near this discovery. In general, our Cote d'Ivoire acreage position is now bookended by two significant E&I discoveries. We will continue to progress our analysis of the data as it comes in, with the final seismic data due by year end 2024. And with that, I will turn it back to Roger.

Eric M. Hambly: Our seismic reprocessing work continues to progress for our acreage in Cote d'I, and we are pleased at the multiple opportunities available across exploration play types. Importantly, E&I recently announced positive results from its Moraine 1 exploration well on the Kalao discovery nearby. Murphy is excited at this news, and I note that our block CI 502, in particular, is very near this discovery. In general, our Cote of Wa acreage position is now bookended by two significant E&I discoveries. We will continue to progress our analysis of the data as it comes in, with the final seismic data due by year end 2024. And with that, I will turn it back to Roger.

Eric M. Hambly: 19, our seismic reprocessing work continues to progress for our acreage and could it work and we are pleased at the multiple opportunities available across exploration play types Importantly, Eni recently announced positive results from its marine one exploration well on the Carlyle discovery nearby Murphy as excited at this news.

Eric M. Hambly: And I note that our block Ci five year or two in particular is very near this discovery.

Eric M. Hambly: In general our quote of our acreage position is now bookended by two significant Eni discoveries, we will continue to progress our analysis of the data as it comes in with a final seismic data do by year end 2024, and with that I will turn it back to Roger.

Roger W. Jenkins: Thank you, Eric. On slide 21, for second quarter 24, we forecast total production of 176,000 to 184,000 equivalents per day with 93,000 barrels of oil during that period. This range is impacted by 2,000 barrels of oil equivalent today of offshore non-op unplanned maintenance, primarily related to a third party downstream facility. 1,250 barrels of oil equivalent per day of Eagleford Shale downtime as we have offset frack impact, and a significant downtime of 11,700 barrels of oil equivalent per day at Tupper Montany for plant maintenance that's ongoing.

Roger W. Jenkins: Thank you Eric on Slide 21 for second quarter 'twenty four we forecast total production of 176000 to 184000 equivalents per day with 93000 barrels of old during that period.

Roger W. Jenkins: This range is impacted by 2000 barrels of oil equivalent a day of offshore non op unplanned maintenance primarily related to a third party downstream facility.

Roger W. Jenkins: 250 barrels equivalent per day of Eagle Ford shale downtime as we have offset frac impacts.

Roger W. Jenkins: And a significant downtime of 11700 barrels equivalent per day at Tupper Montney for plant maintenance that's ongoing.

Roger W. Jenkins: Murphy plans to spend approximately $325 million of accrued CAPEX in the second quarter. For the full year 24, we're maintaining a production guidance of 180 to 188,000 equivalents per day with 52% or 95,000 barrels a day of oil. This guidance is supported by stronger own-well performance and better results at non-operated offshore fields. We're also maintaining our CapEx range at $920 million to $1.02 billion, excluding NCI. These ranges will support us in achieving our 2024 debt reduction goal of $300 million, thereby allowing us to reach Murphy 3.0 and enhance our shareholder returns. On slide 22.

Roger W. Jenkins: Murphy plans to spend approximately $325 million of accrued capex in the second quarter. The full year 'twenty four we're maintaining our production guidance of 180 to 188000 equivalents per day with 52%.

Roger W. Jenkins: Murphy plans to spend approximately $325 million of accrued CapEx in the second quarter. For the full year of 2024, we're maintaining a production guidance of $180,000 to $188,000 equivalents per day with 52%, or 95,000 barrels a day of oil. This guidance is supported by stronger own-well performance and better results at non-operated offshore fields. We're also maintaining our CapEx range at $920 million to $1.02 billion, excluding NCI. These ranges will support us in achieving our 2024 debt reduction goal of $300 million, thereby allowing us to reach Murphy 3.0 and enhance our shareholder returns. On slide 22.

Roger W. Jenkins: Our 95000 barrels a day of oil.

Roger W. Jenkins: This guidance is supported by stronger on well performance and better results at non operated offshore fields. We're also maintaining our capex range not heard 20 million to 1.02 billion. Excluding NCI. These ranges will support us achieving our 2020 for debt reduction goal of $300 million, thereby allowing us to <unk>.

Roger W. Jenkins: Reach Murphy, three porno and enhance our shareholder returns on slide 22.

Roger W. Jenkins: Effective at year-end, our long-term strategy remains unchanged since we first disclosed the refreshed projections following last year's opportunities captured in Vietnam and Cote d'Ivoire to support our new opportunities and long-term oil production growth. We'll continue to support and grow our returns to shareholders during this time. In particular, we'll be executing Murphy 3.0 of our framework after reaching our debt reduction goal this year. Longer term, we plan to reinvest approximately 45 percent of operating cash flow, enabling us to achieve average production of approximately 210,000 to 220,000 equivalents per day and, as always, over 50 percent oil weighting.

Roger W. Jenkins: Effective at year-end, our long-term strategy remains unchanged since we first disclosed the refreshed projections following last year's opportunities captured in Vietnam and Cote d'Avore to support our new opportunities and long-term oil production growth. As we continue to support and grow our returns to shareholders during this time, we'll be executing Murphy 3.0 of our framework after reaching our debt reduction goal this year. Longer term, we plan to reinvest approximately 45% of operating cash flow, enabling us to achieve average production of approximately 210 to 220,000 barrels per day and, as always, over 50% oil weighting.

Roger W. Jenkins: Effective at year end, our long term strategy remains unchanged since we first disclosed the refresh projections following last year's opportunities captured in Vietnam in Cote d'ivoire to support our new opportunities and long term oil production growth.

Roger W. Jenkins: Who continue to support and grow our returns to shareholders. During this time in particular will be executing mercury three point over our framework after reaching our debt reduction goal. This year longer term, we plan to reinvest approximately 45% of operating cash flow, enabling us to achieve average production of approximately 210 to 220000 closings.

Roger W. Jenkins: Per day, and as always over 50% oil weighting.

Roger W. Jenkins: Murphy will continue generating ample free cash flow to allocate towards further shareholder returns, accretive investments, as well as supporting exploration success. Additionally, as part of this plan, Murphy remains committed to achieving metrics that are consistent with the investment grade rating. And I'm pleased with the rating agency outlook improvements achieved this spring that Tom just spoke of. On slide 23, I'm glad to have a solid first quarter behind us as we continue to execute our plans for the remainder of the year.

Roger W. Jenkins: Murphy will continue generating ample free cash flow to allocate towards further shareholder returns accretive investments as well as supporting exploration success. Additionally, as part of this plan, we remain committed to achieving metrics that are consistent with investment grade rating.

Roger W. Jenkins: And I'm pleased with the rating agency outlook improvements achieved this spring that Tom just spoke of. On slide 23, I'm glad to have a solid first quarter behind us as we continue to execute our plans for the remainder of the year. A long history of consistently returning to shareholders will expand as we reach Murphy 3.0 later this year. We're already ahead of the game with share repurchase in the first quarter. I view our 24 debt reduction goal as a given.

Roger W. Jenkins: And I am pleased with the rating agency outlook improvements achieved this spring that Tom just spoke up.

Speaker Change: On slide 23, and glad to have a solid first quarter behind us as we continue to execute our plans for the remainder of the year, our long history of consistently returning to shareholders will expand as we reached Murphy III Porno later this year. We're already ahead of the game with share repurchase in the first quarter.

Roger W. Jenkins: A long history of consistently returning to shareholders will expand as we reach Murphy 3.0 later this year. We're already ahead of the game with share repurchase in the first quarter. I view our 24 debt reduction goal as a given.

Roger W. Jenkins: Of your 'twenty for debt reduction goal as a given and I look forward to buying back more stock to enhance shareholder value. Additionally have exploration upside with drilling two wells in the Gulf of Mexico, and two wells in Vietnam, our future is bright, especially reconsider a long runway of Gulf of Mexico projects as well as significant future locations.

Roger W. Jenkins: I look forward to buying back more stock to enhance shareholder value. Additionally, we have exploration upside with drilling two wells in the Gulf of Mexico and two wells in Vietnam. Our future is bright, especially considering our long runway of Gulf of Mexico projects as well as significant future locations across our North American onshore business and our exploration upside. As we approach the annual meeting season, we often benchmark our peer group on 2023 10K data. When doing so, we find that Murphy is rated one or two in many categories.

Roger W. Jenkins: <unk>, our north American onshore business and our exploration upside.

Roger W. Jenkins: As we approach annual meeting season, we often benchmark or peer group on 2023 10-K data when doing so we found that Murphy is rated one or two in many categories. A few of those free cash flow per production.

Roger W. Jenkins: A few of those are free cash flow per production, debt-adjusted share growth, production per debt-adjusted share growth, lowest reinvestment rates, debt reduction, total debt, debt due 24 to 26, debt to EBITDA, total cash return for shareholder change year over year, and lastly, G&A for EBITDA. Solid company, solid plan, diverse portfolio, exploration upside, locations sustainable, and a long history of shareholder returns. That's Murphy Oil Corporation. As always, I want to thank our outstanding employees for the consistent effort and determination to help us reach all of our goals. With that, that's the end of our prepared remarks today, and we look forward to your questions.

Roger W. Jenkins: A few of those are free cash flow per production, debt-adjusted share growth, production per debt-adjusted share growth, lowest reinvestment rates, debt reduction, total debt, debt due 24 to 26, debt to EBITDA, total cash return for shareholder change year over year, and lastly, G&A for EBITDA. Solid company, solid plan, diverse portfolio, exploration upside, locations sustainable, and a long history of shareholder returns. That's Murphy Oil Corporation. As always, I want to thank our outstanding employees for their consistent effort and determination to help us reach all of our goals. With that, that's the end of our prepared remarks today, and we look forward to your questions.

Roger W. Jenkins: The purple.

Roger W. Jenkins: Per debt adjusted share growth production per debt adjusted share growth lowest reinvestment rates debt reduction total debt that do 24 to 26 at debt to EBITDA total cash return per shareholder change year over year, and lastly, G&A per EBITDAX.

Roger W. Jenkins: Solid company.

Roger W. Jenkins: <unk> plan.

Roger W. Jenkins: <unk> portfolio exploration upside locations sustainable the long history of shareholder returns that's Murphy oil Corporation.

Speaker Change: As always I want to thank our outstanding employees for their consistent effort and determination to help us reach all of our goals with that that's the end of our prepared remarks today and we look forward to our questions.

Roger W. Jenkins: Okay.

Operator: Ladies and gentlemen, if you have a question, please press star, then followed by the number 1 on your touchtone phone. You will hear a prompt that your hand has been raised, and if you wish to decline from the polling process, please press star followed by the number 2. If you are using a speakerphone, please leave the handset before pressing any key. Your first question comes from the line of Neal Dingmann from Charles Securities. Your line is open.

Operator: Ladies and gentlemen, if you have a question, please press star, then followed by the number 1 on your touchtone phone. You will hear a prompt that your hand has been raised, and if you wish to decline from the polling process, please press star followed by the number 2. If you are using a speakerphone, please leave the handset before pressing any key. Your first question comes from the line of Neil Dingman from Tras Securities. Your line is open.

Speaker Change: Ladies ladies ladies and gentlemen, if you have a question. Please press Star then followed by the one on your Touchtone phone, you'll hear a prompt Johannesburg waste and if you wish to decline from the polling process.

Speaker Change: Press Star followed by the number two you are using a speaker phone. Please lift the handset before pressing keys.

Roger W. Jenkins: Your first question comes from the line of Neal Dingmann Suntrust Securities. Your line is open.

Neal David Dingmann: Good morning, Roger. My first question is just on shareholder return. You just sort of hit on this, Roger, but I just want to go over it. Specifically, could you or Tom remind me what bonds, if any, you were able to repay early? And then, more importantly, once you get under that billion or to Murphy 3.0, besides just stepping up the shareholder return, could we see more expiration work? Or what else can we see? Because obviously, your debt at that time will be well under $50 million. So I'm just wondering, besides stepping up the shareholder return, is there something else we would see with that incremental free cash flow?

Neal David Dingmann: Good morning, good morning.

Neal David Dingmann: Good morning, Roger.

Neal David Dingmann: My first question just on shareholder return you just sort of hit on this slide but I just want to go over specifically could you or Tom remind me what bonds, if any youre able to repay it early and then more I guess more importantly, once you get under that $1 billion or to Murphy three point, though.

Neal David Dingmann: Besides just stepping up the shareholder return could be see more exploration work or what else can we see because obviously your debt at that time will be well under control. So I'm just wondering besides stepping up the shareholder return is there something else, we would see what that incremental free cash flow.

Roger W. Jenkins: Thank you for that question, Neil. It's a big key part of our strategy. I'm going to give you the big, high-level picture and let Tom talk about the specific bonds. We need to think about this framework as a yearly matter. We easily can forecast, as you and all of your peers are, that we'll easily get rid of this $300 million of debt. But there are nuances to calling the debt at different opportunities. We also have an internal target in our plans of how much stock we can buy.

Roger W. Jenkins: Thank you for that question, Neil. It's a big key part of our strategy. I'm gonna give you the big, high-level picture and let Tom talk about the specific bonds. We need to think about this framework as a yearly matter. We easily can forecast, as you and all of your peers are, that we'll easily get rid of this $300 million of debt. But there are nuances to calling the debt at different opportunities. We also have an internal target in our plans of how much stock we can buy. Nobody wants to buy back stock more than me. And we see the debt as a given.

Speaker Change: Thank you for that question Neil is a big key part of our strategy and we'll give you a big high level picture and let Tom talk about this specific bonds, we need to think about this framework as a yearly matter.

Thomas J. Mireles: So we're already ahead of the game on the stock. We have an eyeball on how much stock we wanna buy. And I would see that going along if the debt goes into the third quarter, that's still something we'll be able to do as we go along the way, if you understand me on that. So our strategies, as far as long-term, we wanna keep our plans. We keep our low growth plans. We do not see changes to that plan at any time, as I just reiterated.

Tom: We easily can forecast as you and all of your peers are that will easily get rid of this $300 million of debt. There is nuances to calling the debt at different opportunities. We also have an internal target and our plans of how much stock we can buy nobody wants to buy back stock more than me and we see the debt is a given so we're already there.

Roger W. Jenkins: Nobody wants to buy back stock more than me, and we see the debt as a given. So we're already ahead of the game on the stock. We have an eyeball at how much stock we want to buy. And I would see that going along if the debt goes into the end of the third quarter.

Tom: Head of the game on the stock we have an eyeball to how much stock we want to buy and I would see that going along if the debt goes into the into the third quarter.

Thomas J. Mireles: That's still something we'll be able to do as we go along the way, if you follow me on that. So our strategies will do it. As far as the long term, we want to keep our plans. We keep our low growth plans. We do not see changes to that plan at any time, as I just reiterated, and we want to continue to buy into this stock while it's undervalued. And as you know, by yourself and many of your peers, we'd be ranked number one, and cash flow through 26 available to our market cap. And that's going to make us have a really big advantage. And we're not really into changing that right now, so I'll let Tom talk about specific notes. All right.

Neal David Dingmann: That's still something we will be able to do as we go along the way. If you follow me on that so our strategy as far as long term, we want to keep our plans, we keep our low growth plans.

Neal David Dingmann: We do not see changes to that plan at any time that I, just reiterated and we want to continue to buyback the stock while it's undervalued and as you know by yourself and many of your peers would be ranked number one in cash flow through 'twenty six available to our market cap and that's going to make us have a really big advantage and we are not really in the change in that.

Thomas J. Mireles: And we want to continue to buy back this stock while it's undervalued. And as you know, by yourself and many of your peers, we'll be ranked number one in cash flow through 26 available to our market cap. And that's gonna make us have a really big advantage, and we're not really into changing that right now. So I'll let Tom talk about specific notes.

Neal David Dingmann: Right now so I'll, let Tom talk about the specific notes.

Thomas J. Mireles: All right, thanks, Roger. Yeah, Neal, you know, we have a little over $300 million to go to reach Murphy 3.0. And we've got more, plenty available in our 2027 notes. Those are callable today, and the balance is around $440 million in 2027 notes. And then our 2028 notes will be callable in July of this year. Now, you asked about, you know, once we get to Murphy 3.0, and we go into this, you know, 50% to shareholders, 50% to the balance sheet, the way we kind of think about that. As you know, Murphy 2.0 was about more of a defensive move, making sure we got our balance sheet in a robust shape. Murphy 3.0 gives us a chance to be positioned for more of an offensive move, you know, whether it's dry powder or, you know, more opportunities to return to shareholders, either through buybacks or even dividends.

Thomas J. Mireles: All right, thanks, Roger. Yeah, Neal, you know, we have a little over $300 million to go to reach Murphy 3.0. And we've got more, plenty available in our 2027 notes. Those are callable today, and the balance is around $440 million in 2027 notes. And then our 2028 notes will be callable in July of this year. Now, you asked about, you know, once we get to Murphy 3.0, and we go into this, you know, 50% to shareholders, 50% to the balance sheet, the way we kind of think about that. As you know, Murphy 2.0 was about more of a defensive move, making sure we got our balance sheet in a robust shape. Murphy 3.0 gives us a chance to be positioned for more of an offensive move. You know, whether it's dry powder or, you know, more opportunities to return to shareholders, either through buybacks or even dividends.

Tom: Alright, Thanks, Roger Yes, Neal, we got a little over $300 million to go to reach Mercury three.

Neal David Dingmann: And.

Tom: We've got more plenty available in our 2027 notes those are callable today.

Tom: And the balance is around $440 million of.

Tom: 27 notes.

Tom: And then our 2028 notes will be callable.

Tom: In July of this year.

Tom: Now you asked about once we get to Mercury 3.0.

Neal David Dingmann: We go into this 50% to shareholders, 50% to the balance sheet.

Neal David Dingmann: The way.

Neal David Dingmann: We kind of think about that as you know.

Neal David Dingmann: <unk> 2.0 was about it.

Neal David Dingmann: More of a defensive move making sure we've got our balance sheet.

Neal David Dingmann: Our robust shape.

Neal David Dingmann: <unk> three point, so it gives us a chance to.

Neal David Dingmann: Be positioned for more of an offensive move.

Neal David Dingmann: Whether it's dry powder or.

Neal David Dingmann: More opportunities to return to shareholders, either through buybacks or even dividends.

Thomas J. Mireles: Take some. And then that completely answers the question.

Speaker Change: Thanks, Tom.

Neal David Dingmann: Thanks, Tom. And then, go ahead. That completely answers it. And just secondly, Roger, maybe a high valuation, just continue. It's hard not to notice, you know, that you all trade below some other companies that have materially less production. I'm just wondering your opinion.

Speaker Change: Okay, Kubota answers that and then just secondly.

Neal David Dingmann: And then just secondly, Roger, maybe a high valuation. Just continue. It's hard not to notice, you know, that you all trade below some other companies that have materially less production. I'm just one of your opinions.

Speaker Change: Roger maybe a high level of evaluation.

Speaker Change: It continued its hard not to notice.

Speaker Change: That you all trade below some other companies that have materially less production I'm just wanted your opinion.

Neal David Dingmann: You know, do you think the market is just still not appreciating the stable offshore production of y'all? I mean, I look at your inventory, I look at the production, especially not just the onshore but the offshore development activity, and continue to be sort of surprised by the discount. I just would love to hear your opinion on why this discount, you know, that I can't piece together.

Speaker Change: Do you think the market is just still not appreciating the stable offshore production of you all I mean I look at.

Speaker Change: Your inventory I look at the production, especially not just the onshore but offshore development activity and continue to be sort of surprised just the discount I'd just love to hear your opinion.

Speaker Change: Why this discount that I can't I can't piece together.

Roger W. Jenkins: Thanks for that question, Neil. I really love that question. This is my twelfth year doing this, and it used to make me really upset about those matters.

Speaker Change: Okay. Thanks for that question, Neil really love that question.

Speaker Change: This is Matt 12th year doing this they used to make me real upset about those matters, but today, we're just looking to buy back stock and that we're going to buy back stock until we do better we have our balance sheet in order to do so just rattled off and a long list of positives about our company is solid can't be you can't have those attributes about running a good solid company.

Roger W. Jenkins: But today, we're just looking to buy back stock, and we're going to buy back stock until we do better. We have our balance sheet in order to do so. I just rattled off a long list of positives about our company as solid. Can't have those attributes about running a good, solid company. I believe it must be because the market cap of our company would be similar to all shale, and all shale doesn't have a workover. All shales are perfectly organized according to the drilling game plan.

Speaker Change: I believe it must be the market cap of our company would be similar to all shale and oil shale doesn't have a workover. All shales are perfectly organized drilling game plan. If we were all shale I could tell you exactly the production by quarter, it's almost better to have the same product Capex every quarter.

Roger W. Jenkins: If we were all shale, I could tell you exactly the production by quarter. It's almost better to have the same capex every quarter. But if you look at the free cash flow and the uniqueness of our company and the deals that we've done and the M&A and all the opportunities we have, it's because we're in the oil business; we're in different aspects of the business. And we now have ourselves in a situation where growth has slowed, buying back stock is in fashion, but we're gonna have the best balance sheet and buy back stock and be patient And then we'll go with the valuation from there. It makes sense. Well said. Thank you, Roger.

Speaker Change: But if you look at the free cash flow and the uniqueness of our company and the deals that we've done in the M&A and all the opportunities. We have is because we are in the oil business. We're in different aspects of the business and we now have ourself in a situation where growth has slowed.

Speaker Change: Buying back stock is in Vogue, but we're going to have the best balance sheet and buying stock and be patient and get into doing that especially in 'twenty five and that will go with evaluation from there.

Speaker Change: It makes sense well said thank you Roger.

Speaker Change: Okay.

Speaker Change: Yeah.

Operator: Your next question comes from the line of Leo Mariani from Rod MGM. Your line is open.

Speaker Change: Your next question comes from the line of Leo Mariani from Rod M. Kim Your line is open.

Speaker Change: Sure.

Leo Paul Mariani: I wanted to touch base on the Gulf of Mexico production here real quick. I heard some of these numbers right.

Leo Paul Mariani: I wanted to touch base on the Gulf of Mexico production here real quick.

Leo Paul Mariani: Behind some of these numbers right I think you guys said you had 13000 barrels a day equivalents of downtime in the first quarter 2000 equivalents downtime in the second quarter. So that's a plus 11000 barrel a day improvement in <unk>, but just kind of looking at guidance it looks like youre guiding up around.

Leo Paul Mariani: I think you guys said you had 13,000 barrels a day of equivalence of downtime in the first quarter, 2,000 barrels a day of equivalence of downtime in the second quarter. So I guess that's a plus 11,000 barrels a day improvement in 2Q. But just kind of looking at guidance, it looks like you're guiding up around 4,000 barrels a day. Just wanted to get a sense of the deltas, that just kind of natural declines there in the Gulf.

Speaker Change: <unk> 4000 barrels a day. So just wanted to get a sense of the Delta is that just kind of natural declines there in the Gulf.

Roger W. Jenkins: I'll let Eric handle that for you, Leo, and thank you for that question.

Speaker Change: I'll, let Eric handle that for you Leo and thank you for that question, Yes, Leo Thanks very much.

Eric M. Hambly: Yeah, Leo, thanks very much. We have quite a bit going on with our Gulf of Mexico program this year. We've noted that we have a number of high-rate wells that are not currently producing, in particular the Niedermeyer well that we're doing a workover on, which has now become a sidetrack. That's a high-rate well, about 4,000 barrels a day. Those should come online early in the third quarter.

Eric M. Hambly: I have quite a bit going on with our Gulf of Mexico program. This year. We've noted that we have a number of high rate wells that are not currently producing in particular, the niedermeyer well that we're doing a workover, which has now become a sidetrack at a high rate well about 4000 barrels a day that should come online early in the third quarter and then in the middle of the year, we have work going on at <unk>.

Eric M. Hambly: And then in the middle of the year, we have work going on at our non-op Kodiak and our operated Dalmatian to increase production there. So if you think about those just wells that have historically been producers for us that are coming online toward the middle of the year, you'll see a ramp. Along with that, we have our Colisee Mormont program that'll add volumes that will help offset declines. So as you march through the year, Gulf of Mexico production will increase.

Eric M. Hambly: Non op Kodiak and our operated Dalmatian to increase production. There. So if you think about those just wells that have historically been producers for us that are coming online towards the middle of the year Youll see a ramp along with that we have are khaleesi more mod program that will add volumes that will help offset declines so as you March through the year.

Eric M. Hambly: And production in the Gulf of Mexico in the first quarter was around 73,000 barrels a day and ought to be up 9, 10, 11,000 barrels a day by the end of the year, the end of the last quarter, ought to be something like that increase, so offsetting the decline with new production and restoring wells to production that have been offline temporarily.

Eric M. Hambly: Gulf of Mexico production will increase.

Eric M. Hambly: And <unk>.

Eric M. Hambly: Production in Gulf of Mexico in the first quarter was around 73000 barrels a day and ought to be up 910, 11000 barrels a day by the end of the year and the last quarter ought to be something like that increase so offsetting decline with new production and restoring wells to production that have been offline temporarily.

Leo Paul Mariani: Okay, that was very helpful in terms of the explanation, and I wanted to also have just kind of a similar line of questioning around the Eagle Ford. It looks like that production ticks down a little bit in the second quarter. You guys cited some maintenance that's ongoing, but could you maybe just kind of discuss how the Eagle Ford production trajectory should play out as we roll into 3Q and 4Q?

Speaker Change: Okay that was very helpful in terms of the explanation.

Eric M. Hambly: I wanted to also have they just kind of a similar line of questioning around the Eagle Ford It looks like that production ticks down a little bit in the second quarter. You guys cited some maintenance thats ongoing but could you maybe just kind of discuss how the Eagle Ford production trajectory should play out as we roll into <unk> in 2014.

Eric M. Hambly: Yep. As you noted, we do have a little bit of downtime in the second quarter. That's primarily offset by the frack impact because we have an active completion program going in the second quarter. That program continues into the third quarter. The bulk of our operated wells, which generate most of the new production in Eagleford, come online in the third quarter. So you ought to see production peak in Eagleford in the third quarter and be relatively similar in the fourth quarter. For the full year, we're predicting 30,000 barrels a day for Eagleford.

Speaker Change: Yes, as you noted we do have a little bit of downtime in the second quarter, that's primarily offset frac impact because we have an active completion program going in the second quarter that program continues into the third quarter. The bulk of our operated wells, which generate most of the new production in Eagle Ford come online in the third quarter. So you ought to see production peak in Eagle Ford in the third.

Eric M. Hambly: Quarter and be relatively similar in the fourth quarter.

Eric M. Hambly: Okay for the full year, we're predicting a 30000 barrels a day for the Eagle Ford.

Eric M. Hambly: Okay, that's helpful. I appreciate it. Thanks. Thank you, Leo.

Speaker Change: Okay. That's helpful. I appreciate it thanks.

Operator: Thank you, Leo. I appreciate it.

Speaker Change: Thank you Leo I appreciate it.

Operator: Your next question comes from the line of Team Rezvan from KeyBank Capital Markets.

Eric M. Hambly: Your next question comes from the line of Tim <unk> from Keybanc capital markets. Your line is open.

Timothy A. Rezvan: Good night, folks. See you tomorrow. Good night, folks.

Operator: Good night, folks. See you tomorrow. Good night, folks.

Eric M. Hambly: Good morning, Tim Good morning.

Timothy A. Rezvan: Thanks for taking my question. I was hoping to dig in a little more and follow up on the last question about the Gulf of Mexico.

Tim: Hi, Roger.

Tim: Thanks for taking my question I was hoping to dig in a little more on a follow up on the last question on the Gulf of Mexico.

Eric M. Hambly: You know, the Niedermeyer, obviously a prolific well, 4,000 a day. You said the workover activity became a sidetrack. I was wondering if you could give a little more context on kind of what changed and, you know, if you expect that back at full capacity in early 3Q.

Timothy A. Rezvan: You know, the Niedermeyer, obviously a prolific well, 4,000 a day. You said the workover activity became a sidetrack. I was wondering if you could give a little more context on kind of what changed and, you know, if you expect that back at full capacity in early 3Q.

Tim: They need a myer, obviously prolific wells 4000 a day.

Tim: You said the Workover activity became a sidetrack I was wondering if you could give more context on kind of what changed in.

Tim: If you expect that back yet at full capacity in early <unk>.

Eric M. Hambly: Eric will handle that for you. It's just an oil field there, Tim, this morning. Yeah, so what happened with that well?

Tim: Eric handle that for you.

Eric M. Hambly: Oil field there Tim this morning, yes, so what happened with that well is the workover that we had planned when we got on the well we expected that the problem was of a packer that was leaking we confirmed in the early stages of our Workover that that was indeed the problem as we progress with the work too.

Eric M. Hambly: Yeah, so what happened with that well was the workover that we had planned when we got on the well. We expected that the problem was a packer that was leaking. We confirmed in the early stages of our workover that that was indeed the problem.

Eric M. Hambly: As we progressed with the work to pull the packer and tubing, we were trying to isolate the lower completion from the upper completion, so basically, the productive connection with the reservoir from the tubular goods in the top part of the well. And we were having difficulty isolating the lower completion and decided that the best path forward to have the best success going forward that well was instead of continuing on that path of continuing to fight to get isolation of the lower completion, we would sidetrack the well, which would give us an opportunity to have a completely new well with a very short offset from the existing location.

Eric M. Hambly: Pull a packer and tubing, we were trying to isolate the lower completion from the upper completion, so basically the that productive.

Eric M. Hambly: Connection with the reservoir from the tubular goods in the top part of the well and we were.

Eric M. Hambly: Having difficulty isolating the lower completion and decided that the best path forward to have the best success going forward that well was instead of continue on that path of continuing to fight to get isolation of the lower completion that we would sidetrack, the well, which would give us an opportunity to have a.

Eric M. Hambly: Completely new.

Eric M. Hambly: Completed well.

Eric M. Hambly: With a very short offset from the existing location, we have sidetracked that well, we like what we've seen so far we're going to move forward with the completion that should be a brand new fresh completion with chaz.

Eric M. Hambly: We have sidetracked that well. We like what we've seen so far. We're going to move forward with a completion that should be a brand new fresh completion, which has the best mechanical outcome and should provide the best production rate opportunity. So it should produce in line or better than the well that we're leaving behind.

Eric M. Hambly: The best mechanical outcome and should provide the best production rate opportunity. So it should produce in line or better than the well that we're leaving behind.

Roger W. Jenkins: Okay. And one note on that, Tim. One note on that, Tim.

Eric M. Hambly: Okay.

Eric M. Hambly: Tim one note on that Tim It's 4000 net these wells all these wells we have make 16 to 18000 barrels a day growth. These are big wells, we happen to own 37% of this month. So it makes way more than for a day.

Roger W. Jenkins: It's 4,000 net. These wells, all these wells we have, make 16 to 18,000 barrels a day gross. These are big wells. We happen to own 30-something percent of this one, so it makes way more than four barrels a day. Yeah.

Timothy A. Rezvan: Yeah, sure. Yeah, I get that. Okay, that's all I had. Thank you.

Speaker Change: Sure Yeah, I get that okay. That's all I had thank you.

Speaker Change: Thank you Tim.

Operator: Again, if you have a question at this time, please press star followed by the number one on your touchtone phone. You will hear a prompt that your hand has been raised. And if you wish to decline from the polling process, please press star then followed by the number two. Your next question comes from the line of Charles Meade from Johnson Rice. Your line is open.

Speaker Change: Again, if you have a question at this time. Please press star followed by the one on your Touchtone phone you will hear a prom date. Your hand has been raised and if you wish to decline from the polling process. Please press Star then followed by the number too.

Speaker Change: Your next question comes from the line of Charles Meade from Johnson Rice. Your line is open.

Charles Arthur Meade: Good morning, Charles. Good morning. Good morning, Roger.

Charles Arthur Meade: Good morning, Joe Good morning, Roger T to you and the rest of the MRF team there.

Charles Arthur Meade: To you and the rest of the MRF team there, my first question is on 2Q-CAPEX. The 325 guide is, you can call it 60 million higher than what I was looking for and I think what some other people were looking for. It looks like, as you've already laid out, that the big driver of that is really the U.S. and U.S. Onshore. I guess I should say North America on the short drilling completion page.

Charles Arthur Meade: My first question is on <unk> Capex.

Charles Arthur Meade: <unk> 25.

Charles Arthur Meade: It is as you call it $60 million higher than what I was looking for and I think what some other people who are looking for.

Charles Arthur Meade: It looks like what you've already laid out that the big driver of that is really the U S.

Charles Arthur Meade: U S onshore completion pace drilling completion, or I guess, I should say North America onshore drilling completion pace, but but also that you know there are a lot of work going on in the Gulf of Mexico are those the two big pieces or are there other drivers that are contributing to that.

Charles Arthur Meade: But also, you know, there's a lot of work going on in the Gulf of Mexico. Are those the two big pieces, or are there other drivers that are contributing to that? What looks like high capex.

Speaker Change: Well it looks like high Capex to queue. Thanks for that question, Charles I'm going to just frame a little bit let Eric get into the detail. So we said all along over 60% of our Capex in the first year and we're still within a percent of that is just timing of various matters timing actually bureau faster completing faster in the onshore business and we have non op matters.

Roger W. Jenkins: Thanks for that question, Charles. I'm going to just frame a little bit, and let Eric get into the details. So we've said all along that we were 60% of our CapEx in the first year, and we're still within a percent of that. This is timing of various matters. Timing, actually, we've drilled faster and completed faster in the onshore business, and we have non-up matters timing on the other.

Roger W. Jenkins: And I'll let Eric get into the details after that. So we feel that we're still in line. Everything's in line for our debt. Everything's in line for buyback stock. We just moved a few percent of the CapEx to the left. That's really no more than that. Eric will give you details on that.

Speaker Change: Timing on the other and I'll, let Eric get into the detail after that so we feel that we're still.

Charles Arthur Meade: <unk> in line everything is in line for our debt Everything's in line and buy back stock. We just moved a few percent of the Capex to the left that's really no more than that and Eric can give you the detail of that.

Eric M. Hambly: Yeah, thanks, Roger. As you noted, most of the change is driven by the timing of our onshore North America drilling completion program. That's over $30 million of the change. So that's shifting from later in the year into the second quarter. And then offshore, about $15 million of equipment, subsea equipment related to our Calise-Mormont program.

Eric M. Hambly: Yes, Thanks Roger.

Eric M. Hambly: As you noted most of the change is driven by the timing of our onshore North America drilling completion program Thats over $30 million of the change. So that's shifting from later in the year into the second quarter, and then offshore about $15 million of equipment subsea equipment related to our caliche more month program.

Eric M. Hambly: We moved some spending that we expected in the fourth quarter up into the second quarter as we pivoted during the time we had our Mormont number two subsea equipment issue. And then some seismic spend moved from the first quarter to the second quarter. You know that we had lower capex than our original guide in the first quarter. So some of the spending we thought would happen for non-DNC related activities, including seismic, and our Lac du Ventre development spending moved from the first quarter of 24 into the second quarter of 24. And that's another $11 million or so. So that describes most of the changes in the movement of capex, really, as Roger pointed out. We're just phasing out spending, and not overall spending is changing.

Eric M. Hambly: We move some spending that we expected in the fourth quarter up into the second quarter as we pivoted. During the time, we had are more month number two subsea equipment issue.

Eric M. Hambly: Then some seismic spend move from the first quarter. The second quarter, you know that we have lower capex than our original guide in the first quarter. So some of the spending we thought would happen.

Charles Arthur Meade: For non D&C related activities, including seismic.

Charles Arthur Meade: And our locked volume development spending moved from the first quarter of 'twenty four into the second quarter of 'twenty, four and Thats, another $11 million or so so better ascribe most of the changes in the movement of Capex really as Roger pointed out.

Charles Arthur Meade: We're just phasing of spending and not overall spending is changing.

Charles Arthur Meade: Got it. That is a helpful detail. And then, Eric, I want to go back to a comment that you made about this.

Speaker Change: Got it that is helpful detail and then.

Speaker Change: And then Eric I wanted to go back to a comment that you made about this up it seemed like you were pretty positive on this khaleesi <unk> number to a development well I think it is and I think you are believer heard you mention that there are over 200 feet of pay and I was wondering if you could give us two two aspects of context and anything else you want to add to it first.

Eric M. Hambly: It seemed like you were pretty positive about this Calise No. 2 development. Well, I think it is. And I think you – believe I heard you mention that there are over 200 feet of pay. And I was wondering if you could give us two aspects of context and anything else you want to add.

Charles Arthur Meade: It seemed like you were pretty positive about this Calise No. 2 development. Well, I think it is. And I think you – believe I heard you mention that there are over 200 feet of pay. And I was wondering if you could give us two aspects of context and anything else you want to add.

Charles Arthur Meade: First, how does that 200 feet or whatever you saw in this most recent one compare to the initial well there? And then the second piece is, is that all in one zone, or is that across a few different zones? And so we're going to have a – I guess what I'm getting at is, is this going to be a monster one-zone completion, or is this the more typical 60 feet in three different zones?

Charles Arthur Meade: How does that how does that 200 feet or whatever you saw in this in this most recent well how does that compare to the to the you know.

Eric M. Hambly: The initial well there and then the second piece is is that all in one zone or is that is that across a few different zones and so you know we're going to have about I guess, what I'm getting to is this is this going to be a monster one zone completion or is this the more typical you have.

Charles Arthur Meade: 60 feet in three different zones kind of thing.

Eric M. Hambly: Yeah, thanks for that. I appreciate the opportunity to talk about it.

Speaker Change: Thanks for that I appreciate the opportunity to talk about it.

Eric M. Hambly: This particular well, the Calise 4 well, was targeting a reservoir that was not in our initial development of the field. As we developed the field, we identified some additional opportunities. This particular one is targeting a shallower reservoir in an updip position. And so we penetrated this reservoir as we were going to deeper zones, which were the target of our main field development. This is sort of an additional set of volumes that we were able to develop after the initial development program, and we're excited about it. It is in only one zone.

Charles Arthur Meade: This particular, well the <unk> four well was targeting a reservoir that was not in our initial development of the field as we develop the field we identified some additional opportunities.

Charles Arthur Meade: This particular, one is targeting a shallower reservoir and an uptick position and we so we penetrated this reservoir as we were going to deeper zones, which where the target of our main field development. This is sort of an additional set of volumes that we were able to develop after the initial development program and we're excited about it.

Eric M. Hambly: It's a very nice looking reservoir with high reservoir quality and should produce very well for us here as it comes online soon. So if you think about our overall Calise-Mormont-Samurai development, we had an initial set of wells that we've talked about how they'll do production-wise. In the development, we have Calise, and the two Mormont wells that we're doing this year are similar. They're targeting zones that were not contemplated in the initial development. They're additional volumes, which will allow us to extend the plateau of our total Calise-Mormont-Samurai development. So from that perspective, we're really excited. This development's been tremendous for us, with very fast payout already happening. And additional volumes going forward with plateau production out into 2025-2026.

Charles Arthur Meade: As in one zone. It is a very nice looking reservoir with high reservoir quality.

Charles Arthur Meade: Got it. That's great detail. Thank you. Thanks, Charles. I appreciate it.

Charles Arthur Meade: Should produce very well for us here.

Charles Arthur Meade: As it comes online.

Charles Arthur Meade: Thanks. Thanks, Charles. I appreciate it.

Charles Arthur Meade: Soon so if you think about our overall can we see more months' samurai development. We had an initial set of wells, which we've talked about how they'll do production wise in the development, we have khaleesi and the two more months wells that we're doing this year are similar they're targeting zones that were not contemplated in our initial development their additional volumes, which will allow us to extend the <unk>.

Roger W. Jenkins: There are no further questions from our phone lines. I would now like to turn the call over to Roger Jenkins for any closing remarks. Thank you.

Charles Arthur Meade: <unk> of our total colussy more months' samurai development. So from that perspective, we're really excited this development has been tremendous for us with very fast payout already happened and additional volumes going forward with plateau production out into 2025 2026.

Charles Arthur Meade: Got it. That's great detail. Thank you. Thanks, Charles. I appreciate it.

Speaker Change: Got it that's great detail. Thank you.

Speaker Change: Thanks, Thanks, Charles I appreciate it.

Operator: There are no further questions from our phone lines. I would now like to turn the call over to Roger Jenkins for any closing remarks. Thank you.

Speaker Change: There are no further questions from our phone lines I would now like to turn the call over to Roger Jenkins for any closing remarks.

Roger W. Jenkins: Appreciate everyone dialing in today. Had some good dialogue there with our business. We're very, very pleased with our business. Looking forward to the rest of the year and beyond. Appreciate all the attendance today, and we'll be seeing you soon. Check in with our IR team if you have any further questions. Thank y'all.

Roger W. Jenkins: I appreciate everyone dialing in today had some good dialogue there with our business are very very pleased with our business looking forward the rest of the year and beyond I. Appreciate all the attendance today and we will be seeing you soon checking with our IR team. If you have any further questions. Thank you all.

Operator: This concludes today's conference call; you may now disconnect.

Speaker Change: This concludes today's conference call you may now disconnect.

Roger W. Jenkins: Yes.

Roger W. Jenkins: Okay.

Roger W. Jenkins: No.

Roger W. Jenkins: Yeah.

Roger W. Jenkins: Okay.

Roger W. Jenkins: Yes.

Roger W. Jenkins: Okay.

Roger W. Jenkins: No.

Roger W. Jenkins: Yes.

Roger W. Jenkins: Sure.

Roger W. Jenkins: No.

Q1 2024 Murphy Oil Corp Earnings Call

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