Murphy Oil Q2 Earnings Call Highlights

Murphy Oil’s Bubale discovery offshore Côte d’Ivoire encountered oil in two reservoirs and could become a major growth driver, but appraisal work remains. The first appraisal well is expected to cost about $90 million, with up to five wells possible over the next 18–24 months. The company reduced its Hai Su Vang resource estimate in Vietnam after a dry appraisal well, though it still sees a potential 200–300 million barrels of oil equivalent and is targeting a final investment decision in late 2027. Lac Da Vang remains on schedule for first oil in the fourth quarter. Murphy raised its 2026 capital-spending midpoint to $1.55 billion , including additional investment in Bubale and the Eagle Ford. Second-quarter production averaged 169,000 boe/d, while the company reported $110 million in free cash flow, leverage below 1x and about $2.5 billion of liquidity. Murphy Oil NYSE: MUR highlighted a new discovery offshore Côte d’Ivoire, revised its 2026 capital program upward and outlined plans to accelerate activity in the Eagle Ford during its second-quarter 2026 earnings call. President and CEO Eric Hambly said the company’s most significant development during the quarter was the Bubale discovery, where the discovery well encountered oil in both the Turonian and Cenomanian reservoirs. Murphy entered Côte d’Ivoire with a three-well exploration strategy, and the first two wells were non-commercial, Hambly said. While Bubale has the potential to become a significant growth driver for Murphy, there is still important appraisal work ahead,” Hambly said. The company spudded the Bubale West 1X appraisal well in July, targeting the Turonian reservoir. The well is the first in a potential program of up to five appraisal wells over the next 18 to 24 months. Hambly said the Bubale West 1X well is designed to test reservoir continuity, thickness and quality down dip from the discovery well, while also seeking to establish a deeper oil level. A successful result would provide Murphy with greater confidence that the discovery supports a commercial development, although the total resource range would remain uncertain. Murphy estimates the appraisal well will cost about $90 million, up from its prior $65 million dry-hole cost estimate for the discovery well. Hambly said drilling through a shallow Turonian section was slower than expected, and the company incorporated that learning into its estimate for the appraisal well. If hydrocarbons are encountered, formation evaluation, logging, core and fluid-sampling work could raise the final well cost above $90 million. The company said future appraisal activity will be data-driven. Depending on results from Bubale West 1X, Murphy could pursue a broader appraisal campaign, a limited program or no additional appraisal wells next year. Hambly said Murphy controls the pace of spending because it operates its positions in Côte d’Ivoire and Vietnam. Murphy also addressed results from the Hai Su Vang 4X appraisal well in Vietnam, which was a dry hole. The company reduced its resource estimate after the result, with Hambly saying the well found the targeted interval but encountered low reservoir quality and no net pay. Despite the revision, Murphy continues to view Hai Su Vang as a material opportunity of 200 million to 300 million barrels of oil equivalent, which Hambly described as roughly two to three times the size of the Lac Da Vang project.