Murphy Oil faces crisis with good liquidity, no near-term maturities

By Devika Patel

Knoxville, Tenn., May 7 – Murphy Oil Corp. has good liquidity to see it through the current industry downturn and its nearest debt maturity, about $260 million, isn’t due until June 2022.

As of March 31, Murphy Oil had approximately $1.8 billion of liquidity, comprised of $1.4 billion undrawn under the $1.6 billion senior unsecured credit facility and approximately $408 million of cash and cash equivalents.

“The company continues to maintain strong liquidity,” executive vice president and chief financial officer David R. Looney said on the company’s first quarter ended March 31 earnings conference call on Thursday.

“Further, our first debt maturity isn’t until June 2022 and is only approximately $260 million, providing us with flexibility to appropriately manage the company through this commodity price cycle,” Looney said.

The company has reduced costs and spending to manage through this low-oil-price environment.

“We recognize that in price cycles such as these, that liquidity and financial strength is important and we made the tough decisions by reducing spending and costs across all fronts in order to maximize our future cash flows,” president and chief executive officer Roger W. Jenkins said on the call.

Adjusted EBITDA was $287 million for the quarter.

At the end of first quarter 2020, Murphy had $2.8 billion in outstanding long-term, fixed-rate notes and $170 million drawn under its $1.6 billion senior unsecured credit facility.

The notes had a weighted average maturity of 7.5 years and a weighted average coupon of 5.8%.

The oil and gas exploration and production company is based in El Dorado, Ark.

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