Murphy Exits Malaysia

Murphy Oil Corporation March 21 said it will be exiting Malaysia after fully divesting its stake in its two primary Malaysian subsidiaries, Murphy Sabah Oil and Murphy Sarawak Oil, to Thai state-owned PTTEP for $2.13bn.

PTTEP will also pay Murphy a $100mn bonus payment contingent upon certain future exploratory drilling results prior to October 2020. The transaction has an effective economic valuation date of January 1, 2019, with the closing expected to occur by the end of the second quarter 2019. Closing of the transaction is subject to customary conditions precedent including, among other things, necessary regulatory approvals, Murphy said.

The company plans to continue its current oil-weighted strategy in both the Eagle Ford Shale and the Gulf of Mexico, while maintaining its focused exploration plan, it said.

“After 20 years of successful operations in Malaysia, I am pleased to announce this all-cash transaction benefiting our shareholders by fully monetizing our proved and probable reserves. The tactical repositioning of Murphy allows us to simplify our business and focus on our core assets in the Western Hemisphere,” commented Murphy CEO Roger W. Jenkins.

Murphy had proven reserves of 816mn barrels of oil equivalent in 2018, of which 129mn boe were from Malaysia. Of the 129mn boe of proved reserves, 70mn boe are characterised as proved undeveloped. The proved reserves are comprised of 468bn ft³ of natural gas and 51mn barrels of liquids, the company said.