Murphy Oil Corporation

Good morning, ladies and gentlemen, and welcome to the Murphy Oil Corporation first quarter 2026 earnings conference call and webcast. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. I would now like to turn the conference over to Atif Riaz, Vice President, Investor Relations and Treasurer. Please go ahead.

Thank you, Rebecca. Good morning and welcome to our first quarter 2026 earnings conference call. Joining me today are Eric Hamley, President and CEO, Tom Morales, Executive Vice President and CFO, and Chris Larino, Senior Vice President Operations. Yesterday, after market closed, we issued our first quarter earnings release, a slide presentation and a stockholder update. These documents can be found on Murphy's website and we will reference them today throughout our call. As a reminder, today's call contains forward looking statements as defined under U.S. securities laws. 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, please refer to our most recent annual report filed with the SEC. Murphy takes no duty to publicly update or revise any forward looking statements except as required by law. Throughout today's call, production numbers, reserves, and financial amounts are adjusted to exclude non-controlling interest in the Gulf of America. I will now turn the call over to Eric for opening remarks.

Thank you, Atif, and thanks to everyone for joining us this morning. I hope you've had a chance to review our stockholder letter, which provides a detailed overview of our first quarter operational and financial performance. Before turning to results, I want to touch on the broader context. ongoing geopolitical developments, particularly in the Middle East, contributed to elevated volatility across energy markets during the quarter. While Murphy does not have direct exposure to the region, these global dynamics influenced realized pricing and reinforced the importance of operating with discipline and a long-term mindset. On today's call, I will briefly discuss this market environment, review our first quarter performance, and provide an update on our exploration and appraisal program. Against the backdrop of significant commodity price volatility, Murphy delivered a strong quarter. Our oil-weighted unhedged portfolio allowed us to fully capture prices as they moved materially higher. We generated cash flow of $429 million and adjusted net income of $47 million, including $67 million of exploration expense related to two unsuccessful wells in Cote d'Ivoire. Cash flow was supported by higher oil prices late in the quarter with realized prices exceeding $90 per barrel in March. It's worth noting that March prices were not representative of the full quarter as prices rose roughly 50% from January to March. Our average realized oil price for the full quarter was $72 per barrel. Given the ongoing commodity price uncertainty, We view flexibility as a competitive advantage and have chosen to remain unhedged at this time. This reflects the strength of our balance sheet and our ability to manage through cycles without relying on market timing or hedging for financial stability. On activity and capital, our approach continues to be driven by market fundamentals and our long-term strategy, not short-term price movements. Accordingly, we are maintaining our capital guidance range of $1.2 billion to $1.3 billion. Externally, as our non-operated partners evaluate how to respond to the current environment, we're seeing a range of approaches emerge. We're engaged with our partners on their plans, and we'll assess the merits of participating in any new activity on a case-by-case basis where it clearly creates shareholder value. Turning to operations, what stands out most this quarter is our execution, and that execution starts with our people. I want to recognize our teams for once again delivering robust, consistent execution across our portfolio. We delivered production above the high end of guidance, operated efficiently, and advanced key projects across the globe in line with schedule and within budget. Our production outperformance was driven roughly evenly by our onshore and offshore operations. Onshore, Eagleford exceeded expectations by nearly 3,000 barrels of oil equivalent per day, supported by strong performance from the 15 new wells brought online during the quarter. Longer laterals and continued innovation in drilling and completions are delivering strong wells efficiently, reinforcing the quality of this asset. Offshore, the Gulf of America also outperform by about 3,000 barrels of oil equivalent per day, driven by high facility uptime and efficient execution of planned maintenance. Turning to exploration and appraisal, we are making meaningful progress across our program. In Quo De Bois, drilling continues at the Buol Exploration Well. We recognize the interest in this well and remain committed to disciplined, transparent communication. We will provide an update once operations are complete and the data have been fully evaluated. In Vietnam, at our Hai Su Bang Golden Sea Lion Field, we are finishing operations on the HSV-3X appraisal well and we'll move next to the HSV 4X well, the final well in the appraisal program. Together, these wells will help define the field's full potential and inform next steps on development. As we have previously communicated, we will provide results and an updated resource range at the conclusion of this appraisal program. To close, this quarter was a real-world test of our strategy. In an environment defined by rapid price movement and elevated uncertainty, our focus remained unchanged. We executed with discipline, exceeded production expectations, and delivered solid financial results while continuing to create long-term shareholder value. Looking ahead, our strong balance sheet positions us effectively across a range of outcomes, providing resilience in a weaker environment and full participation if prices remain strong. With that, we will open the call for your questions.