MUR - Earnings call transcript Q1 2021

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Operator

Good morning, ladies and gentlemen, and welcome to the Murphy Oil Corporation First Quarter 2021 Earnings Conference Call. [Operator Instructions]. And I like to turn the conference over to Kelly Whitley, Vice President, Investor Relations and Communications. Please go ahead.

Kelly Whitley

Good morning, operator, and thank you, everyone, for joining us on our first quarter earnings call today.

Operations; Jenkins, Executive Chief Financial Vice Hambly, Vice Roger with Officer; Officer; is Senior Executive Looney, Mireles, David President President, us President Technical Executive and along Eric Vice Joining President, Tom Services. and and Chief the to placed we've of slides Relations along with on you website as informational follow Investor our section refer Please the our webcast today. in numbers, reserves adjusted noncontrolling interest are and to Mexico. amounts production the financial call, of today's Throughout Gulf exclude X. Slide made Reform during mind forward-looking that some XXXX. comments be in of Please call keep considered this our statements the in will Private Act defined as Securities Litigation of

results such, that differ. given the be that variety assurances be or will actual occur A attained. will that to As projections exist no of these can factors events cause may

see forward-looking discussion to XXXX now I XX-K Murphy of on Form the Factors, any file duty turn takes call no to further revise report statements. Risk on or Roger annual with Jenkins. SEC. over will the update Murphy's publicly For

Roger Jenkins

you, Thank everyone. Good Kelly. morning,

to an our to Murphy project and large offshore peers of Canada. completion have deepwater line the execute start and our illustrates Mexico average Gulf in and than portion characteristics, our and Murphy's of Shale, ability operations onshore X. of assets oil. sanction and which time why drilling Ford X Eagle Further, with successful deep business, team unique onshore provides our have Murphy X-year assets leverage and faster from expertise. a Oil roots abilities. that we Gulf Turning like exhibit from abilities the first to projects with Mexico Eagle I'd leading to and sources: revenue. onshore unique Ford enables primarily Canada capabilities Unconventional Shale produces to complementary Slide which shared

our augments exploration execution potential Our leading portfolio. capability high offshore

our generate returning to quartile long high XXXX. the peers assets achieve to be believe flow, through cash which They end at and levels one toward by the the the Board our of success. management been of emissions to Throughout multiple directors delevering top team low all our term intensity, cash carbon founding personal oil-weighted has our we our compared business decade the continue are as have X. directed of and and ownership family. in Murphy shareholders industry's in which dividend. will Our Also, of our highest long-term interest peers, maintain our our of this, we ownership to of compared and company's On Slide levels all supported company

year and Murphy in this a progress that execute X% of total due of utilizing has company the these of notes, on explore. from senior share monetization new revolver and first in XXXX. year-end quarter, repay significant senior fully total XXXX to proceeds are delever, issuing notes million Our to and floating take production our $XXX debt debt with transactions. X Overall, of were we system our and of achieved Quay made out delevering our reduction or priorities derisking King's our the since

by an debt $XXX reduction for current debt total Our a additional XX% reducing the year. goal in maintaining prices million are of strip XXXX this

operated execution ahead remained Our online under of wells schedule levels with business onshore projects of while brought budget, schedule. remains performance on as ability our topnotch our and nonoperated high and offshore

Shale Texas. Ford experiencing in storm X% from the guidance X% guidance beat by impacts Our this while above assets, were in production despite particular, quarter oil our Eagle winter

the our we the Brazil, Basin nonoperated the later our this analysts X quarter, Silverback high our oil details attention and investors upcoming of ExxonMobil. Lastly, Significantly, approximately with priorities I'm Sergipe-Alagoas Murphy in production. an simple XXX,XXX liquids barrels of beat exploration excited barrels production getting wells. produced X excited recently Cutthroat as barrels XX,XXX XX,XXX per guidance with Chevron per to these to day. by potential of and the We're XX% we turn for equivalent On the day will X, continue Gulf was advancing spud discuss to well drilling per with of was year, unique today. The in our average program. well which Slide Mexico day,

slightly spent amount the benchmark, before cadence, Commodity in of barrel, Lucius rebounded but with shown plan Quay the million XXXX our million total accrued for haven't acquisition averaging the the our oil interest $XX of to As our significantly first weighted Murphy. spending an prices $XXX X.X realizations quarterly X/X net we we working the and WTI includes nonoperated quarter well quarter pandemic. CapEx $XX which capital with field. year. in totaled since in above per King’s This Overall, additional first excludes seen

Our Mr. natural feet. per $X.XX And will turn I averaged give our gas Looney, Financial Officer, David over realization thousand call Chief now a financial the update. prices to cubic to

David Looney

X. Thank morning, you, Slide On good and Roger, everyone.

$X.XX recorded and or such on million loss per of reported share. we loss million or several items, $XXX of net $X.XX $XX mark-to-market net oil loss million for tax net net adjusted adjusted noncash share. crude adjusting a after $XXX quarter, the a per Terra one-off income charge Nova impairment For income a million noncash on $XXX we After as diluted diluted derivatives,

current operations December during Nova, quarter recorded the impairment of there this operating off of charge have the to due since plans. Terra XXXX. status line been Regarding We

asset quarter. of $XXX to a proceeds including adjusted stakeholders quarter plan. a cash operations accounting $XXX production However, Murphy, we the million for from other property sales partners for support noncontrolling achieved interest. million, of for the long-term of positive flow evaluate $XXX Cash and million that After additions totaled the options million, and could from continue $XXX

flow price production for through the front, continues XXXX. protect future Slide all Montney additional in of to way contracts hedging Murphy X. the its cash the On sales fixed a portion Tupper with forward

sorry, the annual XXXX spent was Eagle CapEx first with in total. of the our XX% XX% mentioned, $XXX nearly Approximately weighted total XX% heavily Canada, -- respectively onshore Shale towards for quarter, million million Mexico first the for XX% our in we're CapEx Roger for remainder $XXX to Canada, Overall, is spent the accrued maintaining of $XXX the total cadence million of year CapEx Gulf plan or while offshore CapEx continue As annual I'm and year. respectively. planned will down of in plan CapEx the were stair-step XXXX. the to of the Ford quarter This and of

of XXX,XXX full However, XXX,XXX guidance the we are barrels to for our equivalent day range per tightening production year. to oil

second range quarter XXX,XXX the a forecasting of of day. XXX,XXX barrels we're of For per to oil equivalent XXXX, production

Slide XX,XXX day per production oil at of for X. oil forecast barrels Importantly, our is second the quarter.

occurring during the had Murphy first significant -- quarter. flow events in As the cash several mentioned, first Roger

we've on So Slide the ins to simplify tried and outs X.

$XXX of as our from to Quay monetizing during $XX Quay system. in revolving $XXX operations, million addition cash facility was King’s We CapEx, off million quarter. these funds use the from credit In floating outstanding covering we received our the production regular the well to King’s incurred on nearly million funds that pay as CapEx

account early first quarter, and of issued This notes, At million available the XXXX into million we X% I'll of deficit, total mentioned. we prices, notes commodity cost a for additional as other of net for had full and from equivalents we raising redemption repaid ended debt, notes cash a off an cash new which those and cash million also debt reduction of hand. it year take account was have turn of to Once $XX $XXX was million. to of of or total million $XXX later the and used the $XXX had Roger senior We up this covered senior current end repurchase on amounts, With At related over $XXX with to XX% that, for of notes. Roger. proceeds the $XX you XXXX. back million million pay of $XXX the $XXX of approximately goal year a to million an payoff dividends

Roger Jenkins

X, you, North efficiencies. David. line about to our I'll first to well continues now onshore be Thank drilling coming of execution quarter wells Slide operated business. ahead in on Murphy schedule onshore enhancements enhance completion the to moving in with due and our American talking

came operated Ford Eagle and the gross Tupper operated X the ahead Montney to XX nonoperated the in Shale Shale wells track Ford nonoperated the end in at wells Additionally, XX schedule. of online next wells remain Eagle on and XX bring remaining wells X Overall, we quarters. quarter, of online

Slide from power reduced Tupper production third-party have using Our by gas drilling drilling approximately actions across plant, America of and Tupper environmental previous processing our XX, per in North bringing where from and equivalent primarily completion emissions we cost of On Ford saved utilized day across our We barrels water consume power quarter, of onshore. midpoint quarter teams hydro from in water, diesel barrels Further, company's is clean-burning programs, which for costs. disposal have in worked which our saving for with our Eagle February equivalent winter of impact $X per natural X,XXX XX gas hard of reduced, XX,XXX Murphy recycled reduce completions guidance $X.X barrel of to gas electrification XX% million natural the more the as nearly secured not storm. activities, such plant the exceeded Montney day the despite only recycled XXX,XXX the completions online than Shale wells while the million in emissions but instead supply. completion impact Montney

well X meaningful equivalent work from Murphy million that is with down proud cost our day. bottom completion $X.X of the Our reaching has per line. previous wells, approximately results, from I'm well of barrels the costs reduced first team XXXX, average on impact In significantly done X,XXX in has our equivalents stronger XX% 'XX, Along our per dropped well quarter to best oil stand-alone per the of quarter online $X.X wells, it now and X,XXX period. IPXX IP the rate having first averaged million per years. with of day company's well during barrels our costs with

they to Karnes pleased acreage results count well in quarter work we and our Chalk we're Austin County, in derisk strong the location for to first potential Chalk the achieved the future. our in the see Austin create As

with Murphy cubic per wells curve Our continue quarter as Chalk per an day Tier feet and on million the Montney. day, X produced barrels Slide line average online planned. our brought the Tier X X,XXX equivalent Tupper rate X in type X in IP wells and Tupper XXX our in the wells have perform curve. first Austin XX, type recent achieved outperformed of Tier and to

well Our Drilling well $X.X quarter asset $X.X million the reduction compared with are in on completion million this and royalties. an total XXXX. of impacted by as first as quarter as to improve for to continue Average mechanical XX% approximately production in costs now a since as was in issue approximate higher XXXX. the X well costs well 'XX

project advance to at the planned. Looking as is at Samurai-X drilling hole Malo Mexico continue first scheduled. our The The drilled to well projects projects wells oil and as the first progressing XX. well Slide of drilling in remains St. in first Murphy's the on in achieve is track half Gulf on X been Samurai of have all as of currently The major part nonoperated top Khaleesi/Mormont, project the Gulf as waterflood XXXX. sections campaign.

well by well drilled being The X-well On first of line, on the currently Quay, producer final total is the XX. and King’s in the operator. now Slide campaign is

is construction operator project. to As job an for Gulf the quarter schedule we 'XX. kept is of system prospect currently Samurai that the executing to projects. the 'XX. half for industry-leading this to pandemic. XXXX. our monetization Gulf is We're production FPS commenced quarter. Mexico and be with the the quarter integral the Silverback is Murphy's Mexico, It despite of an the of first are the with away which of Slide being exceptional planned in in partnered pleased significant Chevron drilling the Exploration, team the Quay in complete oil sail Mexico Gulf We're receiving of first in XX. field installed piece doing from the now of this the in Moorings as previously second excited the King’s for global track Khaleesi/Mormont, floating third in arrival, advancing announced, closed of in remains first on of this Construction

with nonoperated plan Again, to view on currently shareholders continues an to executing of X play-opening attractive resource $X.X averaging XX,XXX access trend consistency provides illustrating net a to to quarterly is working debt further barrel exploration XX% for a our reduce billion. offshore When and XXXX large by have highlighting Basin focused 'XX, market Slide potential Our and position million and interest more XX $XX best while Murphy blocks us barrels. shareholders. based optionality. half spud to to as This Sergipe-Alagoas our focused $XX by level Slide funding we our $X billion An risk with X opportunity nonoperated and barrels Further, highlight provides partners we our After remain our is On partners. in exploration dividend in company. do the on balancing cash a and, We of with the on Murphy priorities. Slide Today, leads is far operator, total maintaining and than adjacent held barrels us, cash success, for billion a what a we debt for By of net our we potential well potential further opportunities reduce we increased XX, WTI production A&D per that equivalent On our XX% annually, weighting long-range shareholders. company a position to of fourth basis. to CapEx of portfolio exploration XXX on and its significant we're is of maintaining the average production $XXX of reduction quarter cost spend while asset Brazil debt second at to the along Brazil what billion to earnings to progress debt to forecast oil our in program unchanged. plan X% 'XX, which levels, Murphy, averaging presented the generation. oil average resource million as significant returning to per the our of ExxonMobil XX. plan towards approximately option the will price million. of previously CAGR through equivalent flow course, have with enables Murphy Cutthroat approximately conditions XX and behind day. development, is remains

executing and strong production exploring. our ahead a in beyond, current on we volumes, With priorities capital be first first the we're and prices target and on repurchases per safely, billion all Murphy debt reductions to we level. remain beyond of focused the particular, oil of of moving reduction in an committed to delevering, this above by of $XX for resulting forward on we offshore as later XXXX, XXXX. year with XX% strip ahead As conservative additional million $XXX the look remainder further our for we operating of barrel maintaining debt project year, continue $X.X 'XX. potential half By that in total spending, the of major is projects for to

efficiencies Our all and to tremendous with environmental schedule, done onshore drilling wells and and completions of intensity team cut have impacts. bringing minimal ahead a finding ways job improving while emissions our cost online operate

for done I'm the foundation have strong and remainder costs future of this Thank and a cases, Murphy with ahead look the and in Lastly, this of accomplishments. in this operator our want plan quarter safely the budget and our thank business with over partners set wells Brazil forward to to year's to I'll within your the you. and questions. the this impacts. year to Gulf campaign. drill according environmental outstanding reduce the our and it all some drilling up, employees Wrapping campaigns looking work year all pleased for turn we work We've and for That's exploration the to I to job with doing executing schedule. morning, of of and hard I forward the

Operator

Instructions]. [Operator from will And question Scotiabank. your Paul at be Cheng first

Paul Cheng

questions. quick I have several

successful talking Chalk, inventory what -- First, hope, how about? opportunity we as may may that can big the at rough looking is on idea What Austin the is a be that be that there? you you us of set kind you give if

Roger Jenkins

Paul. Okay,

provide best for morning. that this I color have Head of to Hambly, our Operation you think to Eric it's

Eric Hambly

a Thanks, Paul. great question. It's

excited the really potential we the results year. our program. of brought Chalk wells saw We Chalk are Austin very solid Austin about We from X this online

for of performance our reassessing next over the a quarters expectations future determine and we'll Austin With be wells plan from tiering Chalk. we'll wells, the those few and

generation is it. about strong follow allows focus and it excited very areas flow delevering, we're the of mentioned. from our as to So cash us And Roger really these

Paul Cheng

Any say, have what of you of, number share? that a, idea inventory? you maybe can do prospect kind say, Eric,

Eric Hambly

of about we out We have pursue numerous next over have X Austin Chalk our tiers going position from performance XXX to our likely Eagle expected And Tier broken Tier wells or decade that and the Ford our so into we're wells. X. between

overall bit Tier between So tiering we're of going Chalk the our those distribution to premature now of be update that reevaluating wells future locations our co-development and It's position. Chalk Austin right into X, a terms in Tier our incorporating for X. Ford Austin Eagle assessment strategy to of

Paul Cheng

years. current I is plan average $XXX that expected remain like think next debt? for that -- saying X the million. program stronger to that you're and looks going the any XXXX just form that about least and wondered excess for stick that going actually shape at XXXX or or for cash it, price than that to strong in unchanged I Commodity Is maybe X everyone it to you're is or down be And any CapEx to pay could change just quite your

Roger Jenkins

for Thank on long-range question Paul, and that you, our we're this plan. higher Paul, with prices. sticking plans oil Actually,

focus, our program. We with this have nice very further our Happy that, just have execution. Paul, stay our those my are call as as And where have list levels. of positioned in delevering after we a we with going very outlined oil that statement to after I on or outstanding our production well and we'll the opportunities We're debt feel main morning.

the And continue be go prices change so. to So faster and with to up, if delever will glad we to oil no plans that. do

Paul Cheng

the Or looking start you debt get alternative before reach target consider long-term before of the you there, will of you that And may cash? that on that at? Is the $X that to you use basis need mentioned target you billion.

Roger Jenkins

That's that question Thanks a or good on Paul. targets. our question, call debt for

kind flow Just to you level EBITDAX. so that active which debt thinking been that do review that to $XX be. cash space get years. in toward continually to on A&D with of Paul, debt comfortable time is us When world, that X.X something billion are we're billion place level about company to that's happens good could our of allow that. we would billion down any Paul, place a very advantageous make And That that multiple billion balance you And review outstanding that that having level just sheet. opportunities alternatives. get $X.X happens perspective, magical a with it $X debt I to from be an that There that EBIDAX through to would the be in so $X accretive still $X.X a are that other we that and similar And at time, debt an the a execute very our that start frame. is we've think that of though, to From flow to way to team. the perspective, in range, would is cash

Operator

Jordan Next question Truist from at will be Levy Securities.

Jordan Levy

by I out but all your assets. start Gulf relates your in of to as the environment, it kind getting mainly to thoughts Mexico, Roger, want of in competitive the offshore

on all seen seen possibly wanted see that if or a to change creating you in if have your getting new opportunities with you there. get given entrants more that old the rise interested prices change I some Specifically, names either and what at thoughts you've

Roger Jenkins

business. Thank you that our of for much so Gulf Mexico on question

like mind ones international town nicely We discussion Gulf flow, paid That's more positioned more course, few X uniqueness there. those the We're, few point we with very significant to ago, just from years us. is people or a changing off to we uniquely we've ago. done all change. deals see other for to deal goal have went hear late, Paul in I here of than delever. a in we to The swap I'd that rumor, deal deal about out to are as We through that wanting our more and Gulf, aware seen to have of about -- happy keep of opportunities. in with minutes

opportunities flow, were our goals, where we we if something delevering be so buy in to we to is are environment maintain we accretive goal still to that could to And is on which today. cash Our believe the the those fourth operator largest enthused We like to and and We're that the Gulf exist. talk. We by in happy the happy of that street. be about rumors Mexico. like

Jordan Levy

exploration whether ends just helpful. And is quickly, around That's success, how just question another regards about million the in it in you if level, And to really CapEx and specifically, you're capital plays be that how up the Brazil context being the second about my $XXX then think an something out or that accelerated? thinking in in exploration it that's region. flexing allocation of

Roger Jenkins

onshore well feel we that what of opportunities a time offshore and that good drop major on us our on our widely one forecasting allow quite flow seeing into business our in discovery a are If a the fund that delineation in that Slide forward, is -- our our have fund share going we the our of could on from not I our based then have come and our Thank today can when you in along success, the drops mind offshore we significant CapEx delevering with see assets we and we our come that, which in allocation flexibility, our off project that success other on is to goals. exploring we appreciate post again, in capital emphasize have we'll of known. successes hurt it year. the capital business. question more delevered offshore exploration business believe feel key. for we especially the are a success, key XX. We'll positioned execution it today. our here that delevering and, and gets of in we're than And outstanding the some hopefully that to our this And have that. this execution and exploration, and cash of We in of as course, And we keep wells hemisphere likely, tails off, of flows is cash we're greatly bit outlined would part this major that

So about time. comfortable very feel I that this at

Operator

at be Evercore question ISI. Stephen Richardson Next will from

Stephen Richardson

wondering a mineral -- legacy was talk are in bit brine thought number I of corporation land -- was areas significant if years. Arkansas. looking I I for about little tracking Considering is companies those about if you've been still emerging in for indeed looks has the of lithium Arkansas, Roger, wondering like wondering any if or things, at we've corporation's in couple you exploiting one a that business, the could that Murphy rights the of in which contemplated pretty growth and over next role it will have resources the

Roger Jenkins

Steve, in of do income yes, today from home would us unique royalty is in for in We would brine. Union do have about royalty uniqueness. I'd What point acres Arkansas, of like you, to we corporation. be Murphy something question you founding County, about to lands our position. the place have our family Thank out That a XX,XXX that the

big for closely situation, are we're Steve. knowledge extraction region, brine you not are lithium. covering that that believe, have know, extraction working to a or -- And There's as company, project of add in but a today We we project, I particular monitoring that that. that there's we monitoring the that large-scale are experiencing about the by long-term

Stephen Richardson

taking business longer-term attractive, potentially and put to from not really Obviously, Roger, think, for minerals think beyond? royalty there in you do this but perspective is horse, And a role more before the cart that is a but you do Murphy the participation? direct participating a Great.

Roger Jenkins

most focus companies if item. And of We, would review our at it today, around as naturally don't that transition, rather in that to I'd Steve, role opportunities and information leave particular usual, different you that around just us part would mind. being have like allow more energy

Operator

question Nicholson Gail be at Stephens. from Next will

Gail Nicholson

expenses for Operating quarter. year? were during think mildly all And Was weather-related? remainder should the LOEs we about elevated of how the that

Roger Jenkins

is Murphy out in Our to our overall particular asking is it are the year. of very We you question LOE, going Eric well. to us today our OpEx quarter, answer Murphy to rest emphasize today. Hambly economic, question operations, the our Montney this have offshore year total What were I expenses be do over I'd for of here, worked Gail. say Gulf, pretty Head the occasional the for overall $X.XX quarter in the I'll was the an have course, be discuss that that total standard which for X. turn of Eric. company. would which, workover the LOE I'd Tupper would And like Thank where see throughout the in and below as operating $X.XX range, I'll you, very we

Eric Hambly

Thanks, Roger.

slightly workover Field, quarter offshore results first were at by a the influenced expenses. Malo The St. our which elevated operating

some If operating you And look than lower it for about mentioned, at then a Eagle just specifically, be we at Roger $X the our the expenses. $X business, full $XX, barrel OpEx Montney, assets less year equivalent Ford bit -- example, a be $X.XX. our will If about look full basis. year, as probably Tupper a over will on for we expect

quarters. over it stabilize from seen multiple you've kind So should us what to of

Gail Nicholson

results to Karnes that's type X turning that of And Great. Ford how wells thinking in current and what's X causing the about to when now? efficiency that I see keep appreciate can in you curve, Tier you're are Tier Ford. driver the flat the to then at gains that Eagle the outperformance? color. the strength volumes you Eagle Ford The about look that that the you outperforming continue And Eagle CapEx region, talk

Eric Hambly

great Yes, question. a that's

of X X in brought our We they above their those to be expected were for that to because them, happy X very outperformance X in expectations proximity first their forecast. we guide control to a that the known we our significantly the Tier They're to We primary performance, on results. have. have So we reason them, X. performance quarter. higher had performance. actually wells see was that Tier offset The expected to well of exceeding performance. just historical have we've program had well expected Chalk and of X to offset the online we briefly less of Austin X Tier location wells and Tier X

it locations, we encouraged we time our of might evaluating does a are and but have It's tiered that but of up view those bit excited data, So how different we're very early future just by a open now. results.

In you question? terms part of our I'm sorry. -- repeat your last can of the

Gail Nicholson

strength efficiency just achieve. results continued Of Ford you're to flat keep gains the needed just and the CapEx about you've looking how Eagle you course. Can the talk volumes what And to of now? thinking Eagle Ford that is about at

Eric Hambly

of this course, talked question will, every update forecast. and we before, about Yes. We've year, our

Ford many to day. targeting over per accomplish expect the at BOE is per way frame in about XX,XXX are around Ford years I And Eagle flat CapEx $XXX Eagle of million to net production we that year that. maintain total We somewhere would the

Gail Nicholson

any Great. we potential then update can Vietnam? on on And get

Roger Jenkins

places of closing spending mentioned our process delevering the very assets we on of that Vietnam and and capital Thank to And And place that optionality are We're evaluating post capital lower XX. our have It to acreage. we're very our that you, prefer a and in about assets is very, the highlighted that but to there. allocated additional own just risk our I capital in pleased with exploration a represents value inexpensive to large timing, opportunities of delevering question allocated unique Vietnam. it that now. for have our of there create and nature excited focus, Gail, part way allows of portfolio late about have that Slide and for we reasons exploration be not very on it I

Operator

at from be KeyBanc. will Leo question Next Mariani

Leo Mariani

profile return Just program. on a question of the kind onshore of the drilling

Eagle some an look IRR year. those I say, start Ford how to wanted compare, nicely mean, ranging the or let's to of have you versus on When returns Montney X.XX and Chalk at X.XX, with AECO wells the get wells certainly like want guys looks prices been basis it, the here? those you to kind performing from a look Just are on $XX to are it the USD wells however your so of Tupper sense, at USD wells do oil $XX

Roger Jenkins

Go price. by detail assets out that Leo. going to Thank Eric. our and have you for ahead, there, question that have all that I'm we on broken Eric area

Eric Hambly

a our and range. rates forward, Tupper that's return in Ford return Yes, and in Eagle for the year have rates to plan sort here of are XX% that Montney wells The in, oil question. XX% Okay. of of the current our we expectation to at investing in XX% have that of sort are this going great XXX%, prices, wells

So we Eagle a of locations expected bit see a Tupper is very tighter of the rates range within investments, Eagle range Ford bit of best are than of little our our better the Ford Tupper. a return broader. but returns The

plan. really of in excited So and how our excited we that's great a would to both of forward, We're frame tons invest keep about executing position think we're and that. optionality them with have kind I to going of

Leo Mariani

on the this prices do expected than with saw first an later the Eagle Okay. you there's potential higher think, Ford, from think obviously come more acceleration in you here year? And higher quarter. Or year? non-op Do I oil just some you in activity, non-op that's for the think

Roger Jenkins

I today question. that is for delever Leo, capital you, thank check. in to and -- believe up us emphasis been expenditures for an keep It's

I Murphy. names think folks to to onshore with, and Ford indication are companies working be increasing are then which all peers. our partners no big CapEx Eagle will see that the the would Shale Quite common very players, known, quite nor common there. And American we we're of our successful those North it

partners again, better and our is delevering executing and We're which better, our operations, the our our case executing as to executing. leading our be of delevering well. to believe on is goals, we goal So

Leo Mariani

at Okay. interest made Lucius. Gulf in guys the acquisition looking this And just Obviously, working you Mexico here. of

think said in the whole was day barrels incremental quarter. the that not sure online quarter. actually X,XXX a you for I'm it first was I about guys

potential expectation Mexico, Is a dry that kind And of get just to like it's total the of of wanted also see the there cost just is what well? sense then of the partial And quarter there we when if Silverback be type the kind impact would Gulf of if in was any an to unsuccessful? day. might hole X,XXX on as a I that barrels a estimate result? of So a on X.X-month

Roger Jenkins

to Leo. the you handle the going I'm after in take Eric onshore, Please, Silverback that, I'll and have question Eric. have

Eric Hambly

first from X beginning February, XXXX, so started contributed production the production. quarter it for we in Lucius, of of The months recognizing Okay.

barrels over Our day, to a X,XXX per the year little estimate Murphy. is for net

Roger Jenkins

by in Leo. to to purchased that the of excited right our our well that's And of On we is working those time, is our on like LLOG. call well And that our or be again, Silverback, about to way interest opportunities million $XX Leo, post We're cost significant now time. in range from I'd for The that share derisk at to XX% And well. time. at slightly or would really thank million result emphasize have probably question. the past near well, executed a the August well probably acreage this Chevron. portfolio -- for in you we call for is $XX to us be past for type able probably that of be if ongoing it our well will

Operator

Research. your And be from Josh next Instructions]. question will Silverstein [Operator Wolfe at

Joshua Silverstein

Eagle Ford volumes. a question the Just on

this first than what coming you level better XQ. be have half the in volume got XX,XXX day you support XX,XXX that's the barrel in about that And of only Can first expected, You you talk this non-op and the up start coming of to above which [indiscernible]? you ahead when X and we're the wells a day quarter, level, in just activities would guys are a discover you barrel a the the mentioned guys because of rolling volumes year online operated just kind But volume how half. good still in then that second how into year.

Roger Jenkins

into you this Eric the that frame Yes, Thank for question. have get and details. Josh. I'll

our free our as how overall allow company goal onshore maximum working cash well flatter to production of fields achieve is to there. of -- -- That again, -- make the emphasis, increase. overall we're is an with Our oil to profile onshore price to to our be oil perspective flow

and the have wells our overall, going very want what rest frame future. been toward you're in But you year. we Eric to trajectory and have less right, I'll And have for do. But the excited about our goal we of We positive execution. forward our the here our execution is there

Eric Hambly

Okay. Thanks, Roger.

Eagle first from our BOE the day. already year We in program of are quarters. quarter, production and second a nonoperated Ford to BOE not per third The per are XX,XXX XX,XXX that in expect full online we come nearly wells come in have and online day quarter forecasting that the second

quarter. as you end Our in second program, highlighted, operated the will

to continues to So have brought year cash in this with our flow supporting our be from performance, online happy forecasted that line generation. Ford That's to XX%. we new strong Eagle we're this significantly to decline wells our decline will and of well course, base program and see prior our our due year

Roger Jenkins

goal, on of color add original XX,XXX that, our that the further would to is XX,XXX ahead well we're there. plans very very, doing say Josh, our above and I and

Joshua Silverstein

are I though. wanted Correct. is in to Yes. just like the the volumes decline will that understand you half back -- I just -- expectation guys certainly your

Roger Jenkins

Yes, that's true. you're Josh, right.

Joshua Silverstein

the XX,XXX on is towards your... average goal based the Hence or year less full for

Roger Jenkins

Yes. Sure.

on Just production And been base has team the our other team, clarify operational our that. wanted outstanding. also, to kudos to

just today. engineering well, Josh. positives drilling this question year in but production, as so that on several and So you execution, several, for Thank far not completion,

Joshua Silverstein

Sure.

Just follow-up. and volume here question a quick then one other

wanted XQ, of you Gulf there big baking into So guidance I Mexico, storm XQ guys in just just here, to are year. how last the that know this was a year, see -- wanted

Roger Jenkins

Yes.

Let me turn to that part here.

than guidance with a hurricanes decades feel a X,XXX or about and fourth equivalent the X,XXX and over we downtime we this more of per think and this. and that's where of storm Again, average year on includes we're on per day and on the a we the third an we I like that We estimate something downtime we're is process storm know, almost business, part downtime and And here, As our day dealing in good storm Josh. now and estimate X,XXX that. our it's barrel very the And have I'm production our working equivalent slightly ahead the matter. about of way of like in to barrels quarter. that now quarter storm and Josh, based way game lot of from assume you part of are situation, are. for data detail, And our execution happy estimate,

Joshua Silverstein

the program to maturity the happens far this the on year at $XXX of out see goes, you early course later had some cash first Great. as year? waiting quarter. the building yourself the just or to guys end decisions? guys see Are And balance cash sheet cash XXXX just Do of exploration then the you take the throughout make what to of building undrawn as revolver you million with

Roger Jenkins

you, ahead question go David for let I'll that with Josh.

David Looney

question. Yes, the for Josh, thanks

a couple is debt down clearly additional remainder to intention mentioned we've pay here, year. of As the times the it our of our plan, for

extent the towards the towards in amount So all can maximizing trying books on look are advantage any with up our to books us would end fortunate could attractive does in the that we're the build of of to we do see repay at priced, bonds bonds year out you several time our think over of we call in the where the take several to debt conjunction on probably I cetera. that, features course, taking have we et that have issuances very cash of that of We're And do next year. likelihood, the -- additional of debt. the quarters, end something terms

a analysis. So year. different and of we're probably lot towards the at looking things that's into But the what of go that discussion end

Operator

And from be Choudhary question Goldman at your will next Umang Sachs.

Umang Choudhary

differentiator key on you a looks is Exploration be like which update Any for could Brazil, can significant Murphy. company? the for opportunity provide a

Roger Jenkins

long I'd as this our our Brazil out you that Yes. Brazil. that our Thank excited a to We're key which outlined this mentioned part we about year. place point for of area. well lot the happy a my been very we in overall has has in for of the like a strategy. to today, business. very exploration time and question that worked of have script, that we've view And outboard have in which this time for success as size first I on drill of well,

same We strategy. also the nicely along type is Potiguar overall have exploration as moving in which of Basin, well the

of year. going half So the should the second Brazil get

in there X to position, We've a acreage we're large large, a happy our gauged in our with barrels. proud billion basis there and With to it. participate them really that going long-term opportunity ExxonMobil very with and XXX first about the prospect partner, large million on at forward be

a and it for us, this So opportunity large excited we're about morning.

Umang Choudhary

thoughts wanted as seeing pricing. inflation, what markets? And we're get given commodity Are signs I any your service a to around follow-up, just of in the Great. you seeing

Roger Jenkins

close let all joined him our for the services company. procurement of time, the I'm Mireles out he -- our going and heads first to Tom this you us that has other morning. today and with in

Thomas Mireles

cost the do on our top program. We potential question. any certainly stay on try for impacts to Umang, pressure of Thanks,

right Board priority delivering approved our value our of to when budget committed we're and volumes our is shareholders they year. that now the Our last

a fortunately, in So we're through our good position sourcing. strategic

current Our that to to to XXXX, we're When at some be our XXXX seeing we'll in program program. increases we the returns ahead we is really deliver exposed look able not attractive feel continue costs. to

just as cost improve, coming in through we earlier, services, key execution. gains So see while some efficiency increase we highlighted our cost -- continue potential also to in through Eric efficiency

also deliver We we can benefit. to be providers our mutual able with to like that work

on XXXX But our positioned, -- is we're top from of kind seeing currently of. currently, activity that stay well what that in shielded market. So so it's the we're something that we

Operator

turn our the There remarks. any Roger no are to back Jenkins lines. further call would to like for closing phone questions I from over And

Roger Jenkins

and thank a in of call. dialing at the it. be for our so And that we've here, We we'll done quarter Appreciate and work everyone, all you proud you today. much. good Thanks, had seeing next

Operator

thank this lines. do ask we at for Thank today. attending. and time, disconnect again, for conclude Once your indeed you, please sir. this Ladies does conference that your you And gentlemen, call you

Murphy Oil (MUR) 7 May 212021 Q1 Earnings call transcript