MURPHY OIL CORP

Summary

Murphy Oil Corporation is a global oil and gas exploration and production company, with both onshore and offshore operations and properties. As used in this report, the terms Murphy, Murphy Oil, we, our, its and Company may refer to Murphy Oil Corporation or any one or more of its consolidated subsidiaries.

The Company was originally incorporated in Louisiana in 1950 as Murphy Corporation. It was reincorporated in Delaware in 1964, at which time it adopted the name Murphy Oil Corporation. In 2013, the U.S. downstream business was separated from Murphy Oil Corporation’s oil and gas exploration and production business. For reporting purposes, Murphy’s exploration and production activities are subdivided into three geographic segments, including the United States, Canada and all other countries. Additionally, the Corporate segment includes interest income, interest expense, foreign exchange effects, corporate risk management activities and administrative costs not allocated to the exploration and production segments. The Company’s corporate headquarters are located in Houston, Texas.

As part of the Company’s underlying operations, the Company is continually monitoring its greenhouse gas (GHG) emissions and impact on the environment as well as other social and environmental aspects of its business. See Sustainability on page 10.

In addition to the following information about each business activity, data about Murphy’s operations, properties and business segments, including revenues by class of products and financial information by geographic area, are provided on pages 32 through 45, 74 through 76, 77 through 78, 98 through 100, and 103 through 118 of this Form 10-K report.

Interested parties may obtain the Company’s public disclosures filed with the Securities and Exchange Commission (SEC), including Form 10-K, Form 10-Q, Form 8-K and other documents, by accessing the Investor Relations section of Murphy Oil Corporation’s Website at www.murphyoilcorp.com.

Exploration and Production

The Company produces crude oil, natural gas and natural gas liquids primarily in the U.S. and Canada and explores for crude oil, natural gas and natural gas liquids in targeted areas worldwide.

During 2023, Murphy’s principal exploration and production activities were conducted in the United States by wholly-owned Murphy Exploration & Production Company – USA (Murphy Expro USA) and its subsidiaries, in Canada by wholly-owned Murphy Oil Company Ltd. and its subsidiaries and in Australia, Brazil, Brunei, Côte d’Ivoire, Mexico and Vietnam by wholly-owned Murphy Exploration & Production Company – International (Murphy Expro International) and its subsidiaries. Murphy’s operations and production in 2023 were in the United States, Canada and Brunei.

Unless otherwise indicated, all references to the Company’s offshore U.S. and total oil, natural gas liquids and natural gas production and sales volumes and proved reserves include a noncontrolling interest in MP Gulf of Mexico, LLC (MP GOM; see further details below).

Murphy’s worldwide 2023 production on a barrel of oil equivalent basis (six thousand cubic feet of natural gas equals one barrel of oil) was 192,640 barrels of oil equivalent per day, an increase of 10.0% compared to 2022.

For further details on business execution, see“Management’s Discussion and Analysis of Financial Condition and Results of Operations” starting on page 32. For further details on 2023 production and sales volume see pages 35 to 36.

United States

In the United States, Murphy produces crude oil, natural gas liquids and natural gas primarily from fields in the Gulf of Mexico and in the Eagle Ford Shale area of South Texas. The Company produced 108,084 barrels of crude oil and natural gas liquids per day and approximately 96 MMCF of natural gas per day in the U.S. in 2023. These amounts represented 94.0% of the Company’s total worldwide oil and natural gas liquids and 20.6% of worldwide natural gas production volumes.

Offshore

The Company holds rights to approximately 600 thousand gross acres in the Gulf of Mexico. During 2023, approximately 73% of total U.S. hydrocarbon production was produced at fields in the Gulf of Mexico, of which approximately 90% was derived from ten fields, including St. Malo, Samurai, Khaleesi, Mormont, Cascade and Chinook, Kodiak, Lucius, Neidermeyer, Marmalard and Front Runner. Total average daily production in the Gulf of Mexico in 2023 was 79,397 barrels of crude oil and natural gas liquids and 70 MMCF of natural gas. At December 31, 2023, Murphy had total proved reserves for Gulf of Mexico fields of 132.3 million barrels of oil and natural gas liquids and 100.7 billion cubic feet of natural gas.

Onshore

The Company holds rights to approximately 133 thousand gross acres in South Texas in the Eagle Ford Shale unconventional oil and natural gas play. During 2023, approximately 27% of total U.S. hydrocarbon production was produced in the Eagle Ford Shale. Total 2023 production in the Eagle Ford Shale area was 28,641 barrels of oil and liquids per day and 25.7 MMCF per day of natural gas. At December 31, 2023, the Company’s proved reserves for the U.S. Onshore business totaled 130 million barrels of liquids and 192.4 billion cubic feet of natural gas.

Canada

In Canada, the Company holds working interests in Tupper Montney (100% owned), Kaybob Duvernay (operated) and two non-operated offshore assets – the Hibernia and Terra Nova fields, located offshore Newfoundland in the Jeanne d’Arc Basin. During 2023 the Company sold a portion of its working interest in Kaybob Duvernay and our entire 30% non-operated working interest in Placid Montney.

Onshore

Murphy has approximately 139 thousand gross acres of Tupper Montney mineral rights located in northeast British Columbia. In addition, the Company holds a 70% operated working interest in Kaybob Duvernay lands in Alberta. The Company has approximately 165 thousand gross acres of Kaybob Duvernay mineral rights. Daily production in 2023 in Onshore Canada averaged 3,618 barrels of liquids and 370 MMCF of natural gas, which included production from our divested Placid Montney of 274 barrels of liquids and 3 MMCF of natural gas. Total Onshore Canada proved liquids and natural gas reserves at December 31, 2023, were approximately 16.4 million barrels and 2.2 trillion cubic feet, respectively.

Offshore

The Company holds a non-operated interest in approximately 133 thousand gross acres offshore Canada. Murphy has a 6.5% working interest in Hibernia Main, a 4.3% working interest in Hibernia South Extension and an 18% working interest in Terra Nova.

Oil production in 2023 was 2,780 barrels of oil per day for Hibernia.

In 2023, the Terra Nova asset life extension project was completed and production restarted at the end of November. Production is expected to ramp up over the coming months. Total oil production in 2023 was 240 barrels of oil per day for Terra Nova.

Total proved reserves for offshore Canada at December 31, 2023 were approximately 22.3 million barrels of liquids and 14.8 billion cubic feet of natural gas.

Brazil

The Company holds a 20% non-operated working interest in nine blocks in the offshore regions of the Sergipe-Alagoas Basin (SEAL) in Brazil (SEAL-M-351, SEAL-M-428, SEAL-M-430, SEAL-M-501, SEAL-M-503, SEAM-M-505, SEAL-M-573, SEAL-M-575 and SEAL-M-637).

Murphy has a 100% working interest in three blocks in the Potiguar Basin (POT-M-857, POT-M-863 and POT-M-865).

Murphy’s total acreage position in Brazil as of December 31, 2023 is approximately 2.5 million gross acres, offsetting several major discoveries. There are no well commitments.

Brunei

The Company has a working interest of 8.051% in Block CA-1 as of December 31, 2023.

Oil production in 2023 was 250 barrels of oil per day for Brunei.

Total proved reserves for our Jagus East discovery in Block CA-1 at December 31, 2023 were approximately 0.3 million barrels of liquids and 188 million cubic feet of natural gas. Block CA-1 covers 2 thousand gross acres.

Mexico

Murphy holds a 40% working interest and is the operator of Block 5 in the deepwater Salina Basin. The block covers approximately 623 thousand gross acres, with water depths ranging from 2,300 to 3,500 feet (700 to 1,100 meters). The license contract is currently in the first additional exploration period, which expires in May 2025 and has no outstanding commitments. In 2022, an exploration well was drilled and did not find commercial hydrocarbons.

Vietnam

The Company holds an interest in 7.3 million gross acres, consisting of a 65% working interest in blocks 144 and 145; and a 40% interest in Block 15-1/05 and Block 15-2/17. The Company is operator of each of the three Production Sharing Contracts (PSCs).

Block 15-1/05 contains the Lac Da Vang (LDV) discovered field in the Cuu Long Basin where the Declaration of Commerciality was made in January 2019, and the field Outline Development Plan was approved by Petrovietnam in August 2019. The Lac Da Trang (LDT) 1X exploration well, the last remaining commitment of the PSC, was completed in April 2019. In 2023, the Company received government approval of the field development plan and the Board of Directors of the Company (the Board) sanctioned the project. The Company anticipates drilling an exploration well in 2024.

In Block 15-2/17, the Company completed its seismic study program, which included 3D seismic reprocessing. In 2024 the Company anticipates drilling an exploration commitment well.

In blocks 144 and 145, the Company acquired 2D seismic in 2013 and undertook seabed surveys in 2015 and 2016. The Company will be seeking an extension to complete the remaining seismic commitment.

Total proved reserves for Vietnam at December 31, 2023 were approximately 12.1 million barrels of liquids and 2.8 billion cubic feet of natural gas.

Côte d’Ivoire

During the second quarter of 2023, Murphy signed PSCs as operator in five deepwater blocks in the Tano Basin offshore Côte d’Ivoire in Africa. The five blocks have a total area of 1.5 million gross acres, with Murphy initially holding a 90% working interest in four blocks and 85% working interest in the fifth block. Société Nationale d’Opérations Pétrolières de la Côte d’Ivoire holds the remaining working interest for each block.

Commitments for the initial exploration periods across the five blocks consist of seismic reprocessing. Block CI-103 includes the Paon discovery, appraised with multiple wells by a previous operator. The PSC for this block also includes a commitment to submit a field development plan for this discovery by the end of 2025.

Proved Reserves

Total proved reserves for crude oil, natural gas liquids and natural gas as of December 31, 2023 are presented in the following table.

1 Includes proved developed reserves of 12.8 MMBOE, consisting of 11.7 million barrels of oil (MMBBL) oil, 0.5 MMBBL NGLs and 3.8 BCF natural gas, attributable to the noncontrolling interest in MP GOM.

2 Includes proved undeveloped reserves of 2.7 MMBOE, consisting of 2.3 MMBBL oil, 0.1 MMBBL NGLs and 1.5 BCF natural gas, attributable to the noncontrolling interest in MP GOM.

3 Includes proved reserves of 15.5 MMBOE, consisting of 14.0 MMBBL oil, 0.6 MMBBL NGLs and 5.3 BCF natural gas, attributable to the noncontrolling interest in MP GOM.

4 Includes proved natural gas reserves to be consumed in operations as fuel of 71.3 BCF, 41.9 BCF and 2.8 BCF for the U.S. Canada and Other, respectively, with 1.2 BCF attributable to the noncontrolling interest in MP GOM.

Murphy Oil’s 2023 total proved reserves and proved undeveloped reserves are reconciled from 2022 as presented in the table below:

1 For purposes of these computations, natural gas sales volumes are converted to equivalent barrels of oil using a ratio of six thousand cubic feet (MCF) of natural gas to one barrel of oil.

2 Includes 15.5 MMBOE and 2.7 MMBOE for total proved and proved undeveloped reserves, respectively, attributable to the noncontrolling interest in MP GOM.

During 2023, Murphy’s total proved reserves increased by 24.1 million barrels of oil equivalent (MMBOE). The increase in reserves principally relates to extensions of 86.4 MMBOE in Onshore Canada, 11.7 MMBOE in the Eagle Ford Shale, 12.6 MMBOE in Vietnam, 1.1 MMBOE in the Gulf of Mexico, and 0.9 MMBOE in Offshore Canada. These revisions were offset by production of 70.4 MMBOE in 2023, performance and price related reductions of 11.4 MMBOE in the Eagle Ford Shale and 1.9 MMBOE in the Gulf of Mexico, and disposition of 5.2 MMBOE in Onshore Canada.

Murphy’s total proved undeveloped reserves at December 31, 2023 increased 34.6 MMBOE from a year earlier. The proved undeveloped reserves reported in the table as extensions and discoveries during 2023 were predominantly attributable to four areas: the U.S. Gulf of Mexico, the Eagle Ford Shale in South Texas, Tupper Montney in Onshore Canada and Offshore Vietnam. The U.S. and Canadian assets had active development work ongoing during the year, while the Tupper Montney had increased capital allocations and the Lac Da Vang development project in Vietnam was sanctioned. The majority of proved undeveloped reserves associated with revisions of previous estimates was the result of performance adjustments in Tupper Montney and the Eagle Ford Shale and negative price revisions in the U.S. Onshore and U.S. Offshore fields, and were substantially offset by positive price revisions in Tupper Montney from decreased royalty rates and decelerated royalty incentive payouts arising from lower commodity prices. The majority of the proved undeveloped reserves migration to the proved developed category are attributable to drilling in Tupper Montney, the Gulf of Mexico, and the Eagle Ford Shale and the completion of the Terra Nova field life extension project in Offshore Canada. Other proved undeveloped increases resulted from sanctioned development plans for the Longclaw field in the Gulf of Mexico and Lac Da Vang field in Vietnam.

The Company spent approximately $704 million in 2023 to convert proved undeveloped reserves to proved developed reserves. In the next three years, the Company expects to spend a range of approximately $450 million to $700 million per year to move current undeveloped proved reserves to the developed category. The anticipated level of spending in 2024 primarily includes drilling and development in the Gulf of Mexico, Eagle Ford Shale, Tupper Montney and Vietnam areas.

At December 31, 2023, proved reserves are included for several development projects, including oil developments in the Eagle Ford Shale in South Texas, deepwater Gulf of Mexico, Kaybob Duvernay in Onshore Canada and Lac Da Vang in Vietnam; as well as natural gas developments in Tupper Montney in Onshore Canada. Total proved undeveloped reserves associated with various development projects at December 31, 2023 were approximately 314.0 MMBOE, which represents 42% of the Company’s total proved reserves.

Certain development projects have proved undeveloped reserves that will take more than five years to bring to production. The Company currently operates deepwater fields in the Gulf of Mexico that have two undeveloped locations that exceed this five-year window. Total reserves associated with the two locations amount to less than 1% of the Company’s total proved reserves at year-end 2023. The development of certain reserves extends beyond five years due to limited well slot availability, thus making it necessary to wait for depletion of other wells prior to initiating further development of these locations or behind-pipe completions with significant capital costs that categorize them as undeveloped.

Murphy Oil’s Reserves Processes and Policies

All estimates of reserves are made in compliance with SEC Rule 4-10 of Regulation S-X, which states that “proved oil and gas reserves are those quantities of oil and gas which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible —from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations.” Proved reserves estimates will generally be revised only as additional geologic or engineering data become available or as economic conditions change. Moreover, estimates of proved reserves may be revised as a result of future operations, effects of regulation by governmental agencies or geopolitical or economic risks. Therefore, the proved reserves included in this report are estimates only and should not be construed as being exact quantities, and if recovered, could be more or less than the estimated amounts.

Murphy has established both internal and external controls for estimating proved reserves that follow the guidelines set forth by the SEC for oil and gas reporting. Crude oil and condensate, natural gas liquids (NGL) and natural gas reserve estimates are developed or reviewed by Qualified Reserves Estimators (“QREs”). QREs are technical professionals embedded within the asset teams. QRE qualification generally requires a minimum of five years of practical experience in petroleum engineering or petroleum production geology, with at least three years of such experience being in the estimation and evaluation of reserves, and either a bachelors or advanced degree in petroleum engineering, geology or other discipline of engineering or physical science from a college or university of recognized stature, or the equivalent thereof from an appropriate government authority or professional organization. Larger business units of the Company also employ Regional Reserves Coordinators who coordinate and provide oversight of the reserve submissions to senior management and the Corporate Reserves group. Murphy provides annual training to all Company reserves estimators to ensure SEC requirements associated with reserves estimation and Form 10-K reporting are fulfilled.

Proved reserves are consolidated and reported through the Corporate Reserves group. Murphy’s General Manager Corporate Reserves (Reserves General Manager) leads the Corporate Reserves group that also includes Corporate Reserve engineers and support staff, all of which are independent of the Company’s oil and gas operational management and technical personnel. The Reserves General Manager joined Murphy in 2020 and has more than 32 years of industry experience. He has a Bachelor of Science in Mechanical Engineering and is also a licensed Professional Engineer in the State of Texas. The Reserves General Manager reports to the Executive Vice President and Chief Financial Officer and makes annual presentations to the Board about the Company’s reserves. The Reserves Manager and the Corporate Reserve engineers review and discuss reserves estimates directly with the Company’s technical staff in order to make every effort to ensure compliance with the rules and regulations of the SEC.

The Reserves General Manager coordinates and oversees the third-party audits which are performed annually. In 2023, third party audits were conducted for proved reserves covering 96.6% of total proved reserves. All audits conducted during this period were within the established +/- 10.0% tolerance.

Ryder Scott Company (“Ryder Scott”) performed audits for certain reserve estimates of Murphy’s U.S. fields as of December 31, 2023. The Ryder Scott summary report is filed as an exhibit to this Annual Report on Form 10-K. The team lead for Ryder Scott has over 21 years of industry experience, joining Ryder Scott over 18 years ago. He is a registered Professional Engineer in the State of Texas.

McDaniel & Associates (“McDaniel”) performed audits for certain reserve estimates of our Canadian fields as of December 31, 2023. The McDaniel summary report is filed as an exhibit to this Annual Report on Form 10-K. The two technical advisors for McDaniel both have over 17 years of experience in the estimation and evaluation of reserves with McDaniel. Both are registered Professional Engineers with the Association of Professional Engineers and Geoscientists of Alberta.

Gaffney, Cline & Associates Pte Ltd (“GaffneyCline”) performed audits for certain reserve estimates of our Vietnam fields as of December 31, 2023. The GaffneyCline summary report is filed as an exhibit to this Annual Report on Form 10-K. The team lead for GaffneyCline has over 40 years of industry experience, joining GaffneyCline over 19 years ago.

To ensure accuracy and security of reported reserves, the proved reserves estimates are coordinated in industry-standard software with access controls for approved users. In addition, Murphy complies with internal controls concerning the various business processes related to reserves.

More information regarding Murphy’s estimated quantities of proved reserves of crude oil, natural gas liquids and natural gas for the last three years are presented by geographic area on pages 105 through 112 of this Form 10-K report. Murphy currently has no oil and natural gas reserves from non-traditional sources. Murphy has not filed and is not required to file any estimates of its total proved oil or natural gas reserves on a recurring basis with any federal or foreign governmental regulatory authority or agency other than the SEC. Annually, Murphy reports gross reserves of properties operated in the United States to the U.S. Department of Energy; such reserves are derived from the same data from which estimated proved reserves of such properties are determined.

Crude oil, condensate and natural gas liquids production and sales, and natural gas sales by geographic area with weighted average sales prices for each of the three years ended December 31, 2023 are shown on page 34 of this Form 10-K report.

Production expenses for the last three years in U.S. dollars per equivalent barrel are discussed beginning on page 38 of this Form 10-K report.

Supplemental disclosures relating to oil and natural gas producing activities are reported on pages 103 through 118 of this Form 10-K report.

Acreage and Well Count

At December 31, 2023, Murphy held leases, concessions, contracts or permits on developed and undeveloped acreage as shown by geographic area in the following table. Gross acres are those in which all or part of the working interest is owned by Murphy. Net acres are the portions of the gross acres attributable to Murphy’s interest.

Certain acreage held by the Company will expire in the next three years.

Scheduled expirations in 2024 include 4,521 thousand net acres in Vietnam, 52 thousand net acres in in the Gulf of Mexico and 6 thousand net acres in Onshore Canada. Murphy has applied for and anticipates receiving lease extensions in Vietnam.

Acreage currently scheduled to expire in 2025 include 249 thousand net acres in Mexico, 75 thousand net acres in Brazil, 6 thousand net acres in the Gulf of Mexico and 1 thousand net acres in Onshore Canada.

Scheduled expirations in 2026 include 27 thousand net acres in the Gulf of Mexico and 6 thousand net acres in Offshore Canada.

As used in the three tables that follow, “gross” wells are the total wells in which all or part of the working interest is owned by Murphy, and “net” wells are the total of the Company’s fractional working interests in gross wells expressed as the equivalent number of wholly-owned wells. An “exploratory” well is drilled to find and produce crude oil or natural gas in an unproved area and includes delineation wells which target a new reservoir in a field known to be productive or to extend a known reservoir beyond the proved area. A “development” well is drilled within the proved area of an oil or natural gas reservoir that is known to be productive.

The following table shows the number of oil and natural gas wells producing or capable of producing at December 31, 2023.

Murphy’s net wells drilled and completed in the last three years are shown in the following table.

Murphy’s drilling wells in progress at December 31, 2023 are shown in the following table. The year-end well count includes wells awaiting various completion operations.