A Murphy Oil Corp. subsidiary has signed an agreement to divest a “non-core portion” of its operated Kaybob Duvernay assets and all of its non-operated Placid Montney assets to a private company, the company said in its Aug. 3 earnings report.
Under the purchase and sale agreement, the buyer will pay Murphy CA$150 million (US$112.3 million) at closing in an all-cash transaction, subject to customary closing adjustments and conditions.
The transaction has a March 1, 2023, effective date, with closing anticipated to occur in the third quarter of 2023.
The divested assets include the Saxon and Simonette areas of the Kaybob Duvernay, where Murphy holds a 70% working interest as operator, as well as Murphy’s 30% working interest in the Placid Montney assets operated by Athabasca Oil Corp. Also included are batteries, pipelines and the assumption of related processing and marketing contracts.
The combined assets currently produce approximately 1,700 boe/d net, 39% oil. Net proved reserves were 5.3 MMboe as of Dec. 31, 2022.
The transaction also included 138 net drilling locations across 42,000 net acres in Kaybob Duvernay and 26,000 net acres in Placid Montney.
After the transaction closes, Murphy will have approximately 488 gross drilling locations with an average 75% oil weighting remaining in the Kaybob Duvernay. Murphy’s remaining assets are operated with a 70% working interest.
Murphy will have no remaining position in the Placid Montney.
“This transaction brings forward the value of a small, non-core portion of our onshore Canadian portfolio, as we were not planning to develop these locations for many years. I look forward to progressing our capital allocation framework goals in Murphy 2.0 with the proceeds from this divestiture, and continuing to reward our supportive, long-term shareholders in the upcoming quarters,” said Roger W. Jenkins, president and CEO of Murphy.
Recommended Reading
SLB to Acquire Majority Stake in Aker Carbon Capture
2024-03-31 - SLB and Aker Carbon Capture plan to combine their technology portfolios, expertise and operations platforms to bring carbon capture technologies to market faster and more economically, SLB said in a news release.
No Silver Bullet: Chevron, Shell on Lower-carbon Risks, Collaboration
2024-04-26 - Helping to scale lower-carbon technologies, while meeting today’s energy needs and bringing profits, comes with risks. Policy and collaboration can help, Chevron and Shell executives say.
1PointFive, AT&T Enter Carbon Removal Pact
2024-03-13 - 1PointFive said it is also participating in AT&T’s Connected Climate Initiative to collaborate on carbon removal solutions like direct air capture.
NZT Power, NEP Pick Contractors for Teesside-based Decarbonization Projects
2024-03-15 - About $5.1 billion in work will go to the contractors once projects reach FID, which is expected in September.
Exclusive: What’s Needed to ‘Get Things Moving’ with CCS
2024-03-05 - CCS momentum is brewing, says Katja Akentieva, vice president of New Energy Solutions for the Western Hemisphere at TGS. Now it's time to capitalize on that momentum in this Hart Energy LIVE Exclusive with Jordan Blum.