Quarterly Stockholder Update by Murphy Oil Corporation

Core Insights - Murphy Oil Corporation experienced a pivotal year in 2025, marked by strong exploration momentum and operational execution, achieving significant well performance in both onshore and offshore assets [2][3][8] Financial Performance - In 2025, the company averaged production of 182 thousand barrels of oil equivalent per day (MBOEPD), an increase from 177 MBOEPD in 2024, generating $1.2 billion in cash from continuing operations and approximately $300 million in free cash flow [3][19] - The company returned $286 million to shareholders through dividends and share buybacks, with a lease operating expense per barrel of oil equivalent (LOE/BOE) of $10.89, a 20% reduction from the previous year [3][19] - For the fourth quarter of 2025, production averaged 181 MBOEPD, with realized oil prices at $59.21 per barrel, down $6.97 from the third quarter, while realized natural gas prices increased by 56% to $2.34 per thousand cubic feet (MCF) [10][19] Operational Highlights - The company set records for the longest laterals in its US onshore program and achieved a 7% year-over-year reduction in drilling costs per well [4][5] - In Vietnam, the Hai Su Vang (Golden Sea Lion) appraisal well was successful, indicating potential for significant resource growth, with first oil expected in the fourth quarter of 2026 [7][15] - The Gulf of America saw the completion of the 2025 workover program, and the acquisition of the Pioneer FPSO is expected to enhance the economics of the Chinook 8 development well [6][10] Capital Expenditures and Investments - Capital expenditures for the fourth quarter were $341 million, lower than the guidance of $392 million, with full-year CAPEX at $1.157 billion, aligning with the lower end of the guidance range [13][22] - The company plans to allocate approximately 75% of its 2026 capital budget to development, with a projected CAPEX range of $1.2 billion to $1.3 billion [22] Future Outlook - Production is anticipated to decrease to 171 MBOEPD in 2026, primarily due to lower natural gas volumes at Tupper Montney, but the company expects to generate over 35% more cash flow from this asset compared to 2025 [23] - The company is optimistic about its exploration and appraisal activities, with plans to drill additional appraisal wells in Vietnam and continue exploration in Côte d'Ivoire [24][18]