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Murphy Oil makes FID on trio of Gulf of Mexico projects



Murphy Oil, the US-based exploration and production company, has taken a final investment decision on a trio of Gulf of Mexico projects. The FID decision for the King’s Quay facility, Khaleesi/Mormont, and Samurai developments was revealed in Murphy Oil’s quarterly report issued this past week.
Murphy Oil makes FID on trio of Gulf of Mexico projects
The FIDs have been made as Murphy Oil seeks to shore up future development and production potential.

The King’s Quay project will see the development of a floating production system (FPS) facility to receive and process up to 80 MBOPD of production and will be anchored by the Khaleesi/Mormont and Samurai developments in the deepwater of the Gulf of Mexico.

The second of these projects to receive FID, the Khaleesi/Mormont Field Development will consist of seven subsea wells, of which four were previously drilled, and infrastructure tie-back to King’s Quay.

The third of these projects to receive FID, the Samurai Field Development will consist of four subsea wells and tie-back to King’s Quay.

Commenting on the FIDs, Roger W. Jenkins, President and Chief Executive Officer of Murphy Oil, said:

“Our planned execution on our new Gulf of Mexico revitalised asset base continues. These projects have outstanding returns offering high-margin production and a free cash flow runway going forward. We and a partner have sanctioned a new midstream asset, King’s Quay, to anchor our two developments. This new FPS asset could be easily monetised, and we are currently evaluating all our options. We forecast first production from the FPS along with our two new fields in mid-2022. Initial production from these assets is expected to exceed 30,000 BOEPD net at first oil.”

That these projects offer an attractive investment proposition, and that the Gulf of Mexico still contains significant profitable production potential is recognised by Mfon Usoro, an analyst at Wood Mackenzie, who said:

“Murphy’s sanction of the trio of projects including the King’s Quay facility, Khaleesi/Mormont and Samurai shows that the Gulf of Mexico still offers attractive investment opportunities. The Gulf of Mexico has evolved since the downturn to shorter cycle projects and a leaner development approach which has led to lower breakevens and higher returns.”

“The FID of the King’s Quay facility is particularly significant because it is one of only three greenfield projects in deepwater Gulf of Mexico that have achieved FID since the downturn. With a new platform set to enter the Gulf of Mexico, it offers up opportunities to commercialise more small-scale subsea tie-backs with higher returns.”

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Murphy Oil makes FID on trio of Gulf of Mexico projects - Time to read 3 min
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