By P.R. Venkat
Midsize U.S. energy firm Murphy Oil Corp. has begun an over US$2
billion sale of its Malaysian oil and gas assets, people with
knowledge of the deal said,
The deal would make Murphy the latest U.S. oil company to shed
overseas assets in an effort to refocus on business back home.
Murphy Oil is seeking to sell as much as 30% of its stake in its
Malaysian assets, these people said.
The sale process is at an early stage, the people said, adding
that the company is currently seeking bidders. The first round of
bids are due in June, one of the people said, adding that the
company hopes to wrap up the deal by the end of the year.
Murphy Oil didn't respond to requests for comment.
Many U.S. oil firms are under pressure from investors to shed
overseas assets, especially as the shale-gas boom at home has made
domestic operations more lucrative.
In February, U.S.- based Anadarko Petroleum Corp. sold its
minority interest in two offshore fields in northeastern China's
Bohai Bay to China's Brightoil Petroleum (Holdings) Ltd. for
US$1.08 billion. New York-based Hess Corp. agreed to sell its
Indonesian business for US$1.3 billion to Indonesia's PT Pertamina
and Thailand's PTT Exploration & Production PCL in December.
And Houston-based Newfield Exploration Co. sold its Malaysian
business to SapuraKencana Petroleum Bhd. for US$898 million in
October. Apache Corp. and Devon Energy Corp. have also shed foreign
assets.
The potential for developing North America's vast shale-gas
fields has caused globally diversified oil-and-gas companies to
rethink their overseas strategies. Huge discoveries in Louisiana,
Texas, North Dakota and Pennsylvania have made the U.S. an
attractive investment target. The Obama administration also cleared
the way for broader natural-gas exports recently, when it approved
a $10 billion facility at the Gulf Coast.
Murphy entered Malaysia in 1999 and has majority interests in
seven separate production-sharing contracts. Oil-and-gas production
in Malaysia and off the country's coastline accounts for more than
40% of Murphy Oil's output. So far this year, the company has
sanctioned a floating liquefied natural gas project offshore with
local partner Petroliam Nasional Bhd., or Petronas, Malaysia's
state-controlled energy company. It also started pumping oil and
gas from four wells in the Siakap North-Petai fields, the company
said earlier this month.
With Murphy now looking closer to home, it will focus on its
Eagle Ford Shale operations in southern Texas as well as offshore
exploration in the Gulf of Mexico. In March, Murphy Oil was the
high bidder on 16 new blocks in the central Gulf of Mexico, where
it is actively exploring. And last month, the company started
natural gas production from a well at its Dalmatian field in the
Gulf. A second oil-pumping well there is expected to come online by
the end of June.
Apart from Malaysia, the company also has operations in Vietnam,
where it has three assets, including two deep water blocks and one
shallow water block. In Indonesia, the company has interest in four
gas exploration assets, while in Brunei, Murphy Oil has entered
into two production sharing agreements. It has made five
discoveries--two oil and three gas.
Lynn Cook contributed to this article.
Write to P.R. Venkat at venkat.pr@wsj.com
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