![Murphy Oil to Divest Non-core Canadian Assets for $112 Million](/sites/default/files/styles/hart_news_article_image_640/public/image/2023/08/murphy-oil-divest-non-core-canadian-assets-112-million.jpg?itok=HYE-8FVB)
In this photo, an oil drilling rig can be seen. 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. (Source: Shutterstock.com)
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.
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