Murphy Oil has entered into an agreement to operate the Gharb Deep Offshore deepwater block in Morocco, holding a 75% working interest, with Morocco's ONHYM holding the remaining 25%. The block covers over 4 million acres. The initial three-year exploration phase does not include any firm well commitments, offering attractive entry costs and competitive terms, which aligns with Murphy's strategy of developing a diverse exploration portfolio.

Fourth Quarter Exploration and Appraisal Results

During the fourth quarter, Murphy spudded four exploration and appraisal wells. The Hai Su Vang-2X (Golden Sea Lion) well in Vietnam encountered 429 feet of net oil pay across two reservoirs, described as "exceptional." Subsequent drill stem tests indicated a combined flow rate of approximately 12,000 barrels per day from the primary reservoir. An appraisal campaign is planned, with the Hakuryu 14 rig moving to the Hai Su Vang-3X and Hai Su Vang-4X appraisal wells this year.

The Civette-1X well in Cote d'Ivoire was a dry hole, but Murphy remains optimistic and plans to proceed with two other exploration wells in the country, Caracal and Bubale. In the US Gulf of Mexico, the Cello-1 and Banjo-1 wells hit 30 feet and 50 feet of net pay, respectively, and will be tied back to the Murphy-operated Delta House floating production system.

Development and Other Operational Updates

Murphy began development drilling at the Lac Da Vang (Golden Camel) project in Vietnam earlier than anticipated and installed the platform jacket, keeping the project on track for first oil by the end of 2026. The company was also named the high bidder for 14 blocks in a December US Gulf lease sale.

Financial and Production Outlook

In the fourth quarter, Murphy produced 181,400 barrels of oil equivalent per day, with profits of $11.9 million. For 2026, the company expects production to be between 167,000 and 175,000 boepd, a decrease attributed to lower volumes at the Tupper Montney play in Canada. Capital expenditures are projected to be $1.2 billion to $1.3 billion, with significant portions allocated to the US Gulf ($330 million) and Eagle Ford shale ($285 million). Drilling plans include 30 wells in the Eagle Ford and 12 across Canada's Kaybob Duvernay and Tupper Montney plays. The purchase of the BW Pioneer FPSO vessel is expected to enhance the economics of the planned Chinook-8 development well, scheduled for late 2026.