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Murphy Oil (MUR) Sells Assets, Uses Proceeds in New Business
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Murphy Oil Corporation (MUR - Free Report) announced that its subsidiary closed the previously announced divestment of certain non-core operated Kaybob Duvernay assets and all of its non-operated Placid Montney assets in Canada. Murphy received cash proceeds of nearly $104 million (nearly C$141 million). The transaction has an effective date of Mar 31, 2023.
The decision to monetize the non-core assets is justified as this deal brings forward the value of a small, non-core portion of Murphy Oil’s onshore Canadian portfolio and the company has had no intention of investing in these locations for many years.
Murphy Oil intends to utilize the proceeds from non-core asset divestitures in its new business in Côte d’Ivoire and development in Vietnam.
During the second quarter, Murphy signed production-sharing contracts to secure working interests as the operator in five deepwater blocks in the Tano Basin offshore Côte d’Ivoire. These blocks offer tremendous opportunities for exploration and geophysical studies in this area will allow Murphy to have a better knowledge of the reserves in this region.
Last week, Murphy Oil received approval from the Vietnam government to advance a field development plan at the Lac Da Vang oilfield in the southern region.
Therefore, channeling the asset sales proceeds in these two prospects will likely yield positive returns for Murphy Oil.
Mergers & Acquisition In Oil and Energy Space
Oil and Gas companies are divesting non-core assets and making strategic acquisitions to further expand operations and benefit from core operations.
Oil and Gas company Devon Energy (DVN - Free Report) completed its all-stock merger with WPX Energy. This deal will strengthen both its positions in the Delaware and Williston Basins.
Devon Energy also completed the acquisition of RimRock Oil and Gas LP in the Williston Basin in 2022. This acquisition added more than 100 highly economically undrilled locations, positioning Devon’s Williston assets to maintain high-margin production and strong free cash flow for years to come.
TotalEnergies (TTE - Free Report) continues to make strategic acquisitions and agreements with existing operators in high-potential areas and divest assets that are not in sync with its long-term objectives. In the first half of 2023, the company sold assets worth $431 million, the majority of which was a 50% interest in the Marketing & Services subsidiary in Egypt. TotalEnergies’ acquired assets were worth $3,738 million in the first half of 2023.
Price Performance
Murphy Oil’s shares have gained 31.9% in the past six months compared with its industry’s growth of 25%.
The Zacks Consensus Estimate for Texas Pacific Land’s 2023 earnings moved up 6.4% in the past 60 days. TPL reported an average surprise of 1.25% in the trailing four quarters.
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Murphy Oil (MUR) Sells Assets, Uses Proceeds in New Business
Murphy Oil Corporation (MUR - Free Report) announced that its subsidiary closed the previously announced divestment of certain non-core operated Kaybob Duvernay assets and all of its non-operated Placid Montney assets in Canada. Murphy received cash proceeds of nearly $104 million (nearly C$141 million). The transaction has an effective date of Mar 31, 2023.
The decision to monetize the non-core assets is justified as this deal brings forward the value of a small, non-core portion of Murphy Oil’s onshore Canadian portfolio and the company has had no intention of investing in these locations for many years.
Murphy Oil intends to utilize the proceeds from non-core asset divestitures in its new business in Côte d’Ivoire and development in Vietnam.
During the second quarter, Murphy signed production-sharing contracts to secure working interests as the operator in five deepwater blocks in the Tano Basin offshore Côte d’Ivoire. These blocks offer tremendous opportunities for exploration and geophysical studies in this area will allow Murphy to have a better knowledge of the reserves in this region.
Last week, Murphy Oil received approval from the Vietnam government to advance a field development plan at the Lac Da Vang oilfield in the southern region.
Therefore, channeling the asset sales proceeds in these two prospects will likely yield positive returns for Murphy Oil.
Mergers & Acquisition In Oil and Energy Space
Oil and Gas companies are divesting non-core assets and making strategic acquisitions to further expand operations and benefit from core operations.
Oil and Gas company Devon Energy (DVN - Free Report) completed its all-stock merger with WPX Energy. This deal will strengthen both its positions in the Delaware and Williston Basins.
Devon Energy also completed the acquisition of RimRock Oil and Gas LP in the Williston Basin in 2022. This acquisition added more than 100 highly economically undrilled locations, positioning Devon’s Williston assets to maintain high-margin production and strong free cash flow for years to come.
TotalEnergies (TTE - Free Report) continues to make strategic acquisitions and agreements with existing operators in high-potential areas and divest assets that are not in sync with its long-term objectives. In the first half of 2023, the company sold assets worth $431 million, the majority of which was a 50% interest in the Marketing & Services subsidiary in Egypt. TotalEnergies’ acquired assets were worth $3,738 million in the first half of 2023.
Price Performance
Murphy Oil’s shares have gained 31.9% in the past six months compared with its industry’s growth of 25%.
Image Source: Zacks Investment Research
Stock to Consider
Murphy Oil currently has a Zacks Rank #3 (Hold). A better-ranked stock in the same sector is Texas Pacific Land (TPL - Free Report) , currently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Texas Pacific Land’s 2023 earnings moved up 6.4% in the past 60 days. TPL reported an average surprise of 1.25% in the trailing four quarters.