Murphy Oil has closed its previously announced acquisition of deepwater assets in the Gulf of Mexico from LLOG Exploration Offshore and LLOG Bluewater Holdings (LLOG).
In April, Murphy Oil signed a definitive agreement through its wholly owned subsidiary Murphy Exploration & Production Company USA to acquire the oil fields to strengthen its offshore footprint.
Under the deal, Murphy paid a cash consideration totalling $1.227bn following customary closing adjustments. The company funded the transaction through its $1.6bn revolver facility and other sources of liquidity.
The newly acquired assets will be fully owned by Murphy Exploration & Production Company USA and will not be a part of MP Gulf of Mexico’s portfolio.
The deal increases Murphy’s deepwater offshore portfolio by adding 26 Gulf of Mexico blocks. It includes seven producing fields, four development projects and future start-ups.
The company expects that production from these assets will be between 31,000boepd and 33,000boepd in the second half of this year.
Murphy Oil president and CEO Roger Jenkins said: “We are excited to close another accretive Gulf of Mexico transaction as we continue to transform the company.
“After our third-party reserve engineers audited these newly acquired assets, we were able to increase the proved reserve volumes by 13%, to 73Mmboe which further enhances the attractive acquisition metrics.
“Our newly expanded Gulf of Mexico portfolio is consistent with Murphy’s long-term vision of increasing high-margin, oil-weighted production in an area where we have a long history of operational success.”
In March, Murphy Oil signed an agreement to divest its Malaysian portfolio to a subsidiary of PTT Exploration and Production Public Company for $2.13bn. The move was a part of its restructuring strategy to focus and strengthen its presence in the western hemisphere.