Murphy Oil
Murphy Oil's Eagle Ford Shale operations expand into eight counties in South Texas. The company entered the unconventional resources arena later than many of its competitors, but came in at a great time to capitalize on the Eagle Ford Shale. The company quickly assembled more than 200,000 acres and now expects resource potential on its properties will reach almost 900 million barrels of oil equivalent. The company will be operating in the Eagle Ford for many years to come as it develops its Tilden, Catarina, Nueces, and Tilden 2 projects across South Texas Murphy Oil Corporation (NYSE: MUR) is a closely held integrated company that has expanded into unconventional resources over the past few years.. The company headquarters is in El Dorado, AR. The company’s reserves are located across the world, but expected growth is being driven by the Eagle Ford Shale and the Montney Shale in Canada. The company was founded in Louisiana with a majority timber and banking interest, but that changed with the discovery of the Caddo Field in Louisiana. The company later moved to Arkansas.
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Murphy Oil Eagle Ford Shale Quarterly Commentary
January 2016
The Eagle Ford Shale outperformed company expectations for 2015, with highlights including:
Q4 production averaged over 57,000 boepd with 27 operated wells brought online.
Full-year 2015 production averaged over 61,200 boepd with 136 operated wells brought online.
Eagle Ford Shale had a fourth quarter operating expense of just under $8.50 per BOE. And we expect this to be a reasonable run rate going forward.
For 2016, Murphy is planning 2016 capital expenditures for operations to be $825.0 million with approximately 41 percent will be allocated toward the Eagle Ford Shale. This $340 million will be rargetted primarily for drilling and completions in the Eagle Ford. The company also announced plans to drill a second Austin Chalk well in the first quarter of 2016.
When discussing cost-cutting measure, President and CEO, Roger W. Jenkins said "We have a lot of flexibility in the Eagle Ford. And we can go down $100 million there if we want to. And that's the beauty of these plays is you can slow it down. More difficult in offshore."
October 2015
Murphy's third quarter production for 2015 averaged over 63,000 boepd with 33 new wells brought online. The company achieved higher than projected third quarter Eagle Ford Shale production due to continued efficiency improvements, lower base declines and increased Estimated Ultimate Recoveries (EURs) per wellassociated with enhanced drilling and completion techniques. The full-year outlook for 2015 is now expected to average over 61,000 boepd, an increase from near 57,000 boepd from 2014 annual production with over a 45 percent capital reduction in 2015.
July 2015
In the Eagle Ford Shale, second quarter 2015 production, which was comprised of 90% liquids, averaged near 60,800 barrels of oil equivalent per day (boepd) net. As planned, we continue to operate four drilling rigs and two completion spreads and we expect to stay near this level of activity for the rest of the year. We brought 36 new wells on line in the second quarter and have brought 58% of our total estimated wells for the year online in the first half. Production in the third quarter of 2015 is estimated to average over 59,000 boepd with the 2015 full year outlook now expected to average near 59,000 boepd, slightly ahead of annual production for 2014.
April 2015
In the Eagle Ford Shale (EFS), first quarter 2015 production, which was comprised of 90% liquids, averaged near 64,200 barrels of oil equivalent per day (boepd) net, essentially flat to the fourth quarter 2014. As planned, we have reduced our rig count in EFS to four rigs during the first quarter and we expect to stay at this level for the rest of the year. We brought 45 new wells on line in the first quarter and are currently using two completion spreads, with plans to reduce to one spread in the second quarter, to manage our well inventory. Production in the second quarter of 2015 is estimated to average 59,000 boepd with the 2015 outlook flat year-on-year to 2014 at approximately 57,000 boepd based on the previously disclosed 46% reduction in capital spending this year. Our EFS resource continues to grow with proved and net recoverable resource near 750 million barrels of oil equivalent (mmboe) at the end of 2014.
April 30, 2014
Murphy's first quarter production in the Eagle Ford Shale averaged 49,634 net boe/d, which was up from 41,904 net boe/d in the fourth quarter. The company brought 44 wells on line and recovered from weather issues experienced in the fourth quarter of 2013. In the first quarter, eight drilling rigs were running and three wells were completed across the play. Murphy is implementing 40 acre downspacing on a go forward basis in its main Karnes and Tilden development areas and has good running room across the Eagle Ford with over 1,750 prosective drilling locations.
January 30, 2013
Murphy Oil surpassed 25,000 boe/d at the end of 2012 and annualized production averaged 15,000 boe/d. Murphy has 10 rigs and 3 frack crews working around the clock. The company has drilled 216 wells to date and has brought 163 to production. Total time spent to drill and case wells is averaging 11-13 days across the play. Roger Jenkins, COO stated "There's many places to unload the trucks, many depots, many options. We're doing very well with our crude. Murphy's land situation is not a condensate one. For black oil, 41, 42 degree API, we've been getting a $13 positive margin to WTI there for some time. And people want our crude in that area and we're doing very well with the marketing quality of crude because we have very little condensate in our business."
The company will continue to push downspacing to 80-acres across all three areas operated in the Eagle Ford. Testing down to as little as 40-acres per well might take place late in 2013. Watch for test results from the company's first Pearsall Shale well near the end of the first quarter of 2013. Two horizontal Pearsall wells are planned in Atascosa County in the first half of the year.
Pad drilling is expect to push operational costs down.
May 3, 2012
Murphy currently has 14 rigs contracted in North America, 10 in the Eagle Ford and 4 in Canada waiting on spring break-up. Three of these rigs will be back to work at Seal, and the other rig will float between the Montney, South Alberta, and their new oil play in the Muskwa.
In the Eagle Ford Shale, Murphy now has 10 rigs running and are looking to add 2 more by year end. They are operating 2 dedicated frac spreads and are looking to add a third crew shortly. The company has stepped up the pace here based on strong results and redeployment of capital from dry gas areas, and now expect to drill 43 more wells budgeted and complete an additional 34. To date, Murphy has drilled 87 wells in the play and have 18 awaiting completion. Current net production today is 11,800 barrels of oil equivalent. With their revised outlook, they should average approximately 15,000 barrels of oil equivalent to date net for the year. They have lots to do in the Eagle Ford with over 2,000 oilier locations yet to drill.
January 25, 2011
Extraction expenses rose in 2011 due to well workover expenses at the Kikeh field and higher production at onshore fields in the Eagle Ford Shale area in the U.S. and the Montney area of Western Canada..... Activity in our North American resource plays ramped up as we accelerated oil developments in the Eagle Ford Shale of South Texas and the Seal heavy oil project in northern Alberta.
Murphy exited the year near 9,000 barrels of oil per day net as we ramped up our rig count from 3 to 6 over the year. We now have 7 rigs running, and we'll add 2 more by early March and average 8 for the year. To date, we have drilled 56 wells, with 9 awaiting fracs. Well results continue to be encouraging and are trending better than our planned type curve for the play. Costs are falling with improved service contract terms as well as improved efficiencies in drilling and completion operations. Further improvements in cost are expected as gas rigs and equipment stand down across industry this year.
A total of $3 billion will be spent largely on development projects in 2012. $1 billion is slated for the U.S., primarily in the Eagle Ford Shale; a further $700 million in Canada, of which $200 million is for Seal heavy oil development; and $300 million is budgeted for Montney. Total Eagle Ford spend will range $1-1.2 billion per year.
November 2, 2011
Production expenses rose in 2011 due to an ongoing well workover program at the Kikeh field and higher production at onshore fields in the Eagle Ford Shale area in the U.S. and the Montney area of Western Canada.
Activities on the Company's North American resource acreage will be further expanded in coming months with the addition of two rigs in the Eagle Ford Shale oil window.
July 27, 2011
“…Our Eagle Ford Shale presence and production volumes continue to grow. We had a record production day of 7,200 barrels of oil equivalent in this area in July and we added over 20,000 acres in the heart of the play in the second quarter. We are proud to partner with Walmart U.S. to offer a 10-cent per gallon discount opportunity to retail customers at the majority of our gasoline stations beginning in July and continuing through September 30...…”
May 4, 2011
“…In the Eagle Ford Shale, we are stepping up activity with 4 rigs working now and plan to get to 7 rigs by year end. Last December, we sanctioned a project in the Karnes area of the play. 2 of the 4 rigs are active there. To date, we have drilled 24 wells, with 15 producing and 9 awaiting fracs. Well results continue to be very encouraging and are trending better than our tight curve for wells in the play.
We have a dedicated frac crew, which completed 6 wells in the first quarter and will continue to knock off 3 to 5 wells a month going forward. The region has been hampered by takeaway capacity, and we expect this to improve as infrastructure projects move forward into next year..…”
Source: murphyoilcorp.com