Business Context and Reporting Period
Company: Murphy Oil Corporation
Filing Type: Form 10-K (Annual Report)
Period Ended: December 31, 1996
Business Overview: A worldwide oil and gas exploration and production company with refining and marketing operations in the U.S. and U.K., and pipeline/trading operations in Canada. Operations are classified into "Exploration and Production" and "Refining, Marketing, and Transportation."
Key Financial Metrics
Note: Specific revenue, profit, cash flow, margin, debt, and liquidity figures are not provided in the text of this filing. The document explicitly incorporates these financial statements and selected data by reference to the 1996 Annual Report to Security Holders (Exhibit 13), specifically pages 22 through 48.
- Market Value: Approximately $1,555,503,000 (aggregate market value of voting stock held by non-affiliates as of February 28, 1997).
- Shares Outstanding: 44,873,752 shares of Common Stock (as of February 28, 1997).
- Employees: 1,339 full-time employees (as of December 31, 1996).
Material Changes and Operational Highlights
- Spin-off: On December 31, 1996, the Company completed a spin-off of its wholly owned farm, timber, and real estate subsidiary, Deltic Farm & Timber Co., Inc. (reincorporated as Deltic Timber Corporation).
- Merger Withdrawal: On November 6, 1996, Murphy announced a Memorandum of Understanding to merge its U.K. refining and marketing interests with Elf Oil U.K. and Gulf Oil (Great Britain). On March 13, 1997, the Company elected to withdraw from these merger negotiations.
- Drilling Activity (1996): Drilled 19.5 net exploratory wells (9.0 dry) and 78.0 net development wells (2.6 dry).
- Refining Capacity: Total crude capacity of 167,400 barrels per stream day across facilities in Wales, Louisiana, and Wisconsin.
Outlook, Risks, and Contingencies
Management Commentary & Outlook: Detailed outlook information is incorporated by reference to page 28 of the 1996 Annual Report. The Company notes that operations are affected by worldwide political developments, including OPEC actions, price fixing, and production rate determinations.
Risks:
- Political & Regulatory: Risks include government intervention in oil markets, tax changes, environmental regulations, and currency fluctuations.
- Competition: Intense competition from companies with greater resources and competition from other energy industries.
- Legal Proceedings: MOUSA is a defendant in two governmental environmental actions seeking monetary sanctions of $100,000 or more; however, these are not considered material to the Company's financial condition. Other legal proceedings are considered routine.
Investor Verification Checklist
- Verify specific revenue, net income, and cash flow figures in the 1996 Annual Report to Security Holders (Exhibit 13), as they are not listed in this 10-K text.
- Review the impact of the withdrawn U.K. merger negotiations on future strategic plans.
- Assess the financial implications of the Deltic Timber Corporation spin-off completed at year-end.
- Monitor the status of the two environmental governmental actions involving MOUSA, despite current non-material classification.
- Confirm current oil and gas reserve estimates and production costs referenced in pages 44-49 of the 1996 Annual Report.