EL DORADO, Ark. —
Murphy Oil is splitting in two in order to better focus on the separate tasks of exploration and production, and the sale of gasoline and other goods through its retail locations.
Murphy Oil will continue to explore for and produce oil in the U.S., Canada and Malaysia. The company will continue its exploration program and offshore development projects, while also growing its North America onshore businesses.
Murphy USA will become a separate company focused on selling fuels. Murphy USA operates retail gasoline stations in 23 states. Murphy USA will also operate seven fuel distribution terminals and ethanol production facilities in North Dakota and Texas.
Murphy is extending a trend in the U.S. oil industry. ConocoPhillips and Marathon Oil Corp. have executed similar splits in recent years.
Exploring for oil is a high-risk business that can also offer high rewards when companies succeed in finding oil and oil prices rise.
Refining oil into fuels and selling them does not usually carry the same risks or rewards. Murphy's only refinery, located in the United Kingdom, will stay with Murphy Oil company, but the company is still trying to sell it so it can focus exclusively on exploration and production.
Shares of Murphy Oil Corp., based in El Dorado, Ark., rose $4.25, or 7.2 percent, to $63.25 in morning trading after trading as high as $63.42 earlier in the session. They are near their 52-week high of $65.60 set in late February. They traded as low as $43.29 in late June.
Murphy announced a special dividend of $2.50 for a total of $500 million and a stock buyback program covering $1 billion in common shares. The dividend will be paid on Dec. 3 to shareholders of record as of Nov. 16 and is in addition to the company's previously announced dividend of 31.25 cents.
State News
Murphy to split off its retail division
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