Murphy said Hai Su Vang is one of multiple exploration prospects that it has identified in the basin. The company plans more evaluation and drilling. (Source: Shutterstock)
Murphy Oil Corp.’s oil discovery in Vietnam “should force a reset with investors,” KeyBanc Capital Markets analysts Tim Rezvan and Jonathan Mardini said in a note.
Murphy said Jan. 7 the find came from the Hai Su Vang-1X exploration well in Block 15-2/17 in the Cuu Long Basin, 40 miles offshore Vietnam. The well, drilled to total depth of 13,124 ft in 149 ft of water, found 370 ft of net oil pay from two reservoirs.
The discovery may lead to a reset in expectations for peak production in 2028 and adjustments to facility procurement plants, Rezvan and Mardini said.
“We view this release as an important reminder to investors of Murphy's exploration prowess, following weak share price performance in 2024,” the analysts said in reference to when Murphy fell 29% versus a 3% decline for the S&P Oil & Gas Exploration & Production Index.
Murphy said Hai Su Vang is one of multiple exploration prospects that it has identified in the basin. The company plans more evaluation and drilling.
Murphy’s subsidiary, Murphy Cuu Long Tay Oil Co., Ltd., is the operator of the block with 40% working interest. PetroVietnam Exploration Production Corp. Ltd. holds 35% and SK Earthon Co. Ltd. holds the remaining 25%.
The analysts reiterated their overweight rating on Murphy shares, which traded at $32.44 at 12:12 p.m. CT Jan. 8, up $0.81 on the day. After reaching $49.14 in April, they fell as low as $27.75 in December.
“Today's release reflects a high-class problem for Murphy—looking into potential facility adjustments to support a larger potential resource,” Rezvan and Mardini wrote.
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