Murphy Oil Q3 2026 Profit and Lac Da Vang First Oil

Murphy Oil Corporation (MUR) reported a third-quarter 2026 profit compared with a loss a year earlier, while higher investment reduced quarterly free cash flow. The exploration and production company also reached first oil at its Lac Da Vang project in Vietnam and reported additional exploration and appraisal progress in Vietnam and Côte d’Ivoire.

For the three months ended September 30, net income attributable to Murphy was $171.1 million, or $1.17 per diluted share, compared with a net loss of $3.0 million, or $0.02 per share, in the prior-year quarter. Adjusted net income, a non-GAAP measure, increased to $158.4 million, or $1.08 per diluted share, from $58.1 million, or $0.41 per share.

Adjusted EBITDAX rose to $543.9 million from $423.1 million a year earlier. Net cash provided by continuing operations was $540.5 million, up from $339.4 million, while operating cash flow excluding working-capital adjustments increased to $515.0 million from $367.8 million.

Free cash flow declined to $48.2 million from $218.8 million as property additions and dry-hole costs increased to $466.8 million from $149.0 million. Murphy defines free cash flow as cash provided by continuing operations before non-cash working-capital changes, less property additions and dry-hole costs.

Production and operations

Third-quarter production totaled 186,000 barrels of oil equivalent per day, excluding noncontrolling interests. Oil accounted for 45% of output, natural gas liquids for 7% and natural gas for 48%. Eagle Ford Shale production was 44,000 BOEPD, offshore production was 61,000 BOEPD and onshore Canada contributed 82,000 BOEPD.

Murphy realized an average oil price of $89.35 per barrel, excluding hedges and before transportation, gathering and processing costs. Realized prices were $23.08 per barrel for natural gas liquids and $1.84 per thousand cubic feet for natural gas. Lease operating expense averaged $8.20 per BOE.

The company reported $422 million of capital expenditure during the quarter, including approximately $266 million for development, $129 million for exploration and $28 million for appraisal, with figures subject to rounding.

In the Eagle Ford Shale, Murphy brought 14 operated Catarina wells online and said its 2026 well cost per lateral foot was 26% lower year over year. Gulf of America production was 54,000 BOEPD, with liquids representing 87% of output, and the Chinook #8 development well began production with peak gross output of 15,000 BOEPD.

At Tupper Montney in Canada, gross production was 455 million cubic feet per day. Murphy brought eight wells online and realized $1.64 per thousand cubic feet, compared with the $1.12 AECO benchmark cited in the presentation. Offshore Canada produced 7,000 barrels of oil per day, split between Hibernia and Terra Nova.

Vietnam project reaches first oil

Lac Da Vang, also known as Golden Camel, achieved first oil on September 27, less than three years after project sanction. The field contributed only four days of production to the third quarter, and Murphy expects its ongoing ramp-up to lift net production to 3,000 to 5,000 BOEPD in full-year 2027. Net peak production is expected to reach 10,000 to 15,000 BOEPD in 2028 and 2029.

The project has an estimated gross recoverable resource of 100 million BOE. Murphy estimates gross capital expenditure at about $10 per BOE and life-of-field operating costs at $8 to $10 per BOE.

Elsewhere in Vietnam, Murphy announced an oil discovery at Lac Da Trang North-1X in October after the well encountered 131 feet of net oil pay in one reservoir. The company identified the discovery as a potential future tie-back to Lac Da Vang.

Murphy is also reviewing development concepts for the Hai Su Vang discovery following a three-well appraisal campaign. The company estimates post-appraisal recoverable resources at 200 million to 300 million BOE and expects a final investment decision in the fourth quarter of 2027. One of the appraisal wells, Hai Su Vang-4X, was a dry hole, according to the presentation.

In Côte d’Ivoire, the Bubale West-1X appraisal well encountered 88 feet of net oil pay in the Turonian reservoir, as well as additional hydrocarbons in the deeper Albian. Murphy plans to drill two to four appraisal wells over the next 18 to 24 months. The earlier Bubale-1X discovery encountered 100 feet of net oil pay, though the presentation’s 340 million to 850 million BOE range remains a pre-drill gross recoverable resource estimate.

Capital allocation and guidance

Murphy returned $50 million to shareholders through dividends during the quarter and had $550 million remaining under its board-authorized share-repurchase program. Its capital-allocation framework calls for a minimum of 50% of adjusted free cash flow to be allocated to shareholder returns, with up to 50% directed to the balance sheet.

Net debt was $1.13 billion at September 30, up from $1.01 billion at the end of 2025. Total debt was $1.63 billion, while cash and cash equivalents totaled $500.3 million. Murphy reported non-GAAP leverage of 0.9 times and liquidity of $2.5 billion, including $2.0 billion available under its senior unsecured credit facility and $500 million in cash. Its outstanding bonds totaled $1.6 billion, with a weighted-average fixed coupon of 6.3% and weighted-average maturity of 8.4 years.

For the fourth quarter, Murphy expects production of 174,000 to 182,000 BOEPD, excluding noncontrolling interests. The midpoint of its product forecast is 47% oil, 6% natural gas liquids and 47% natural gas. Fourth-quarter capital expenditure is expected to be about $190 million, with exploration expense of $40 million.

Full-year 2026 production is expected to range from 176,000 to 178,000 BOEPD. Murphy projects annual capital expenditure of $1.5 billion to $1.6 billion and exploration expense of $190 million, including $90 million of dry-hole expense.

The outlook remains exposed to oil and natural-gas prices, development costs, operating expenses and exploration results. Murphy also identified geopolitical developments, regulatory approvals, foreign-exchange movements, cybersecurity threats, access to capital and broader economic or trade conditions as risks. The company said the timing and scale of debt reduction and share repurchases will depend on commodity prices, costs and available investment opportunities.