Murphy eyeing 5% year-over-year production growth by Q4

Feb. 13, 2024

The leaders of Murphy Oil Corp., Houston, plan to steadily grow production over the course of 2024 to finish a little below 200,000 boe/d, about 5% above the 185,000 boe/d produced in fourth-quarter 2023.

Murphy’s fourth-quarter production (excluding non-controlling interests) was in line with its full-year number, which finished 11% above the company’s 2022 output. Onshore production during the quarter was 100,000 boe/d, with the company’s Eagle Ford operations clocking 31,000 boe/d, while assets in the Gulf of Mexico and offshore Canada produced 81,000 boe/d.

For 2024, president and chief executive officer Roger Jenkins and his team are forecasting 180,000-188,000 boe/d, with the year’s first quarter coming in lower (163,000-171,000 boe/d) due to workovers and maintenance projects before production ticks up each ensuing quarter. The in-year ramp in production is also attributed to the company’s practice of a more heavily weighted capital spending program in the year’s first half. 

The company devoted about $1 billion to capital projects in 2023. Speaking after the fourth quarter results, Jenkins said the company this year plans to invest most of its projected $970 million (give or take $50 million) in the following ways:

  • $320 million for Eagle Ford, where the company plans to bring online 15 wells at Catarina projects as well as four in Karnes County and 11 non-operated wells in the Tilden area. Recently drilled wells there, Jenkins and executive vice-president of operations Eric Hambly said, are outperforming expectations thanks partly to design improvements and a new drilling rig.
  • $300 million in the Gulf of Mexico, where it will this quarter bring online a well in the Marmalard that will help grow 2024 production to about 79,000 boe/d.
  • $90 million in the Tupper Montney, where executives are planning to produce about 370 MMcfd of natural gas and add 13 operated wells in the second quarter.
  • $40 million in Kaybob Duvernay, where Murphy will produce about 4,000 boe/d this year and bring online three wells.
  • Another $40 million for development work in Lac Da Vang field offshore Vietnam, which will draw nearly double that amount of capital in 2025 and 2026. Jenkins said his team is targeting first oil there in 2026 and will be developing its fields through 2029.

Asked about balancing growing offshore investments with steadier capex in the Eagle Ford and its productivity gains, Jenkins and Hambly pointed to the need to develop offshore infrastructure more quickly so that it ties into other infrastructure with limited lifespans and can generate higher returns. The Eagle Ford, on the other hand, allows for a more measured pace of development.

“We have it when we need it,” Jenkins said of the Eagle Ford, adding that Murphy has a baseline plan that would let it maintain production until 2050 without acquisitions or exploration additions. “We’re proud to have it and I think it’s going to become more valuable” as mergers and acquisitions activity reduces the number of onshore players in both the Eagle Ford and the Canadian regions where Murphy operates.