Murphy earnings decline 10 percent with loss on downstream operations

Allen Baker, PNA contributing writer

Murphy Oil Co. reported net income of $37.1 for the third quarter, down 10 percent from $41.7 million in the 2001 quarter on a loss from its refining and marketing segment. Profits were up substantially from the $14 million posted for the second quarter.

Special items actually contributed $7.9 million to the third-quarter profit number as a favorable tax settlement added $14.7 million to offset some smaller charges.

Refining and marketing operations sank to a loss of $13.8 million for the El Dorado, Ark., company. Murphy had a $19.6 million profit in that area for the third quarter of 2002. The red ink came after a second-quarter loss on downstream operations of $8 million. Refining margins have improved a bit so far in the fourth quarter, the company says.

Exploration and production contributed $48 million, nearly double the upstream earnings of $26.7 million a year earlier. That came from lower expenses, particularly in Malaysia. Crude prices averaged $25.52 per barrel, a 9 percent improvement from the 2001 quarter.

Liquids production rose 9 percent to 70,569 barrels a day with contributions from the Terra Nova field off Newfoundland, which wasn’t operating a year ago. Natural gas volumes declined 2 percent to 288 million cubic feet daily. The gas sold for $2.81 per thousand cubic feet, a slight improvement from $2.75.

Revenues rose 1 percent to $1.15 billion.