Murphy Oil posts disappointing Q2 as costs rise, cuts 2014 output guidance

|About: Murphy Oil Corporation (MUR)|By:, SA News Editor

Murphy Oil's (NYSE:MUR) Q2 earnings from continuing operations fell 45% Y/Y and missed Wall Street estimates, as costs surged.

MUR cites higher exploration expenses, higher extraction costs in Malaysia associated with several new field start-ups, lower realized oil and natural gas sales prices for Sarawak production, unfavorable effects in the U.S. from commodity contracts, and higher financing costs.

Q2 production averaged 210,191 boe/day, below company guidance of 217K, primarily due to the global offshore business in Malaysia with lower oil and gas volumes related to a well operational delay on Kikeh and continued unplanned downtime at a third party methanol plant that processes Kikeh associated gas.

Lowers FY 2014 production guidance to 220K-225K boe/day from 225K-230K, primarily reflecting reductions at two properties and revisions for further production risks.