Murphy Oil Corporation

Good morning, ladies and gentlemen, and welcome to the Murphy Old Corporation fourth quarter 2024 earnings conference call. 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 Ms. Kelly Whitley, Vice President, Investor Relations and Communications. Please go ahead.

Thank you, operator. Good morning, everyone, and thank you for joining us on our fourth quarter earnings call today. With me today are Eric Hambly, President, Chief Executive Officer, Tom Morales, Executive Vice President and Chief Financial Officer, and Chris Larino, Senior Vice President, Operations. Please refer to the informational slides we 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 non-controlling interest in the Gulf of Mexico. 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 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 Eric Hambly.

Thank you, Kelly. Good morning, everyone, and thank you for joining us on our call today. Slide three. Before I get started today, I would like to thank our employees for all their hard work this past year, and I'm looking forward to the exciting things we have ahead at Murphy. As we turn to slide three, I'd like to start with an update on our priorities of delever Execute, Explore, and Return, which we first announced four years ago. Roger, Tom, and I worked closely to develop these priorities with Murphy's board, and I'm pleased to continue our strategy as Murphy's newest president and chief executive officer. We continue to deliver in 2024 with $50 million reduction in senior notes through open market repurchases. Since 2020, we've reduced our total debt by approximately 60%, and reached our lowest net debt in more than a decade at approximately $850 million at year-end 2024. Importantly, Murphy remains committed to achieving our long-term debt goal of $1 billion. In 2024, we produced 177,000 barrels of oil equivalent per day as we brought online 36 operated and 20 gross non-operated onshore wells. and executed our offshore development plans. We also saw the non-operated St. Malo water flood initiate water injection, concluding a significant multi-year project. Overall, across our assets, we maintained our 11-year reserve life with 713 million barrels of oil equivalent approved reserves at year-end 2024. I'm pleased at the exciting news we shared earlier this month that Murphy drilled an oil discovery at the Hai Su Vong 1X exploration well in Vietnam. We'll share further details in a few minutes, but for now, I'll say that our partner group is very excited about the results, and we're preparing to drill an appraisal well in the third quarter of this year. In the near term, we will soon spud the Loc Da Hong 1X exploration well in Vietnam, and our team is also actively preparing to drill two operated exploration wells in the Gulf of Mexico and initiating a three-well exploration program in Cote d'Ivoire later this year. Looking at our fourth priority of return, I'd like to remind everyone that in the third quarter of 2024, we entered Murphy 3.0 of our capital allocation framework, which increased returns to shareholders. Last year, we repurchased $300 million of stock or 8 million shares. Today, we also announced an 8% increase in our quarterly cash dividend with our new annualized rate increasing to $1.30 per share. Slide four. The capital allocation framework remains key to the Murphy team, and we look forward to executing a full year according to the parameters of Murphy 3.0 with a minimum of 50% of adjusted free cash flow allocated to share buybacks. In 2024, we allocated nearly 80% of adjusted free cash flow to share repurchases, and we had $650 million remaining under our share repurchase authorization as of January 28th, 2025. Slide five. In fourth quarter 2024, we produced 175,000 barrels of oil equivalent per day with 85,000 barrels of oil per day. We saw nearly 11,000 barrels of oil equivalent per day of production impacts in the quarter across our operated and non-operated assets, with the largest components being non-operated Gulf of Mexico downtime from a late-season hurricane, lower performance due to a revised Eagleford Shale completion design, a mechanical issue at an offshore well, an offshore rig delay, and a small production impact due to the time required to evaluate and complete additional pay found in the Gulf of Mexico development well. Our assets generated $629 million of revenue in the fourth quarter, with an average realized oil price of $70 per barrel, natural gas liquids price of just over $23 per barrel, and natural gas price of $1.84 per 1,000 cubic feet. I will now turn the call over to our Chief Financial Officer, Tom Morales, to share our financial results, marketing update, and preliminary year-end reserves.