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Item 9A. Controls and Procedures

2024-02-23 compared with 2023-02-27 · 496 added, 596 removed, 1888 unchanged (37% of the section changed)

CONTROLS AND PROCEDURES

Under the direction of its principal executive officer and principal financial officer, controls and procedures have been established by Murphy to ensure that material information relating to the Company and its consolidated subsidiaries is made known to the officers who certify the Company’s financial reports and to other members of senior management and the Board of Directors.

Based on their evaluation, with the participation of the Company’s management, as of December 31, 2023, the principal executive officer and principal financial officer of Murphy Oil Corporation have concluded that the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) were effective to ensure that the information required to be disclosed by Murphy Oil Corporation in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms.

5 unchanged sentences

OTHER INFORMATION

During the three months ended December 31, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

4 unchanged sentences

Stockholders may also obtain, free of charge, a copy of the Code of Ethical Conduct for Executive Management by writing to the Corporate Secretary at 9805 Katy Fwy, Suite G-200, Houston, TX 77024.

Any future amendments to or waivers of the Company’s Code of Ethical Conduct for Executive Management will be posted on the Company’s Website.

Any future amendments to or waivers of the Code of Ethical Conduct for Executive Management will be posted on the Company’s Website.

EXECUTIVE COMPENSATION

Information required by this item is incorporated by reference to Murphy’s definitive Proxy Statement for the Annual Meeting of Stockholders on May 10, 2023 under the captions “Compensation Discussion and Analysis” and “How Are We Compensated” and in various compensation schedules.

Information required by this item is incorporated by reference to Murphy’s definitive Proxy Statement for the Annual Meeting of Stockholders on May 8, 2024 under the captions “Compensation Discussion and Analysis” and “How We Are Compensated” and in various compensation schedules.

As required by U.S federal securities laws, the Company revised its incentive-based compensation recoupment (clawback) policy providing for the recovery of erroneously awarded incentive-based compensation received by current or former executive officers.

We have filed our written recoupment policy as Exhibit 10.29 to this Form 10-K report and as of December 31, 2023, there have been no accounting restatements requiring compensation recoupment.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

22 unchanged sentences

Note D – Property, Plant and Equipment

Note E – Assets Held for Sale and Discontinued Operations

Note F – Inventories

Note G – Financing Arrangements and Debt

Note H– Asset Retirement Obligations

Note I – Income Taxes

Note J – Incentive Plans

Note K – Employee and Retiree Benefit Plans

Note L – Financial Instruments and Risk Management

Note M – Earnings per Share

Note N – Other Financial Information

Note O – Accumulated Other Comprehensive Loss

Note P – Assets and Liabilities Measured at Fair Value

Note Q – Commitments

Note R – Environmental and Other Contingencies

Note S – Common Stock Issued and Outstanding

Note T – Business Segments

Note U – Leases

Note V – Restructuring Charges

Note E – Inventories

Note F – Financing Arrangements and Debt

Note G – Asset Retirement Obligations

Note H – Income Taxes

Note I – Incentive Plans

Note J – Employee and Retiree Benefit Plans

Note K – Financial Instruments and Risk Management

Note L – Earnings per Share

Note M – Other Financial Information

Note N – Accumulated Other Comprehensive Loss

Note O – Assets and Liabilities Measured at Fair Value

Note P – Commitments

Note Q – Environmental and Other Contingencies

Note R – Common Stock Issued and Outstanding

Note S – Business Segments

Note T – Leases

Supplemental Oil and Natural Gas Information (unaudited)

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and MP Gulf of Mexico, LLC

Exhibit 2.1 to Form 10-K for the year ended December 31, 2018

Exhibit 2.1 to Form 10-K filed February 27, 2019

2.4 Share Sale and Purchase Agreement between Canam Offshore Limited and PTTEP HK Offshore Limited for the sale and purchase of the entire issued share capital of Murphy Sarawak Oil Co., Ltd.

2 unchanged sentences

3.1 Certificate of Incorporation of Murphy Oil Corporation, as amended effective May 11, 2005

Exhibit 3.1 to Form 10-K for the year ended December 31, 2010

Exhibit 3.1 to Form 10-K filed February 28, 2011

3.2 By-Laws of Murphy Oil Corporation, as amended effective August 5, 2020

1 unchanged sentence

4.1 Indenture dated as of May 4, 1999 between Murphy Oil Corporation and SunTrust Bank, Nashville, N.A., as trustee

Exhibit 4.2 to Form 10-K for the year ended December 31, 2004

Exhibit 4.2 to Form 10-K filed March 16, 2005

4.2 Supplemental Indenture dated as of May 4, 1999 between Murphy Oil Corporation and SunTrust Bank, Nashville, N.A., as trustee, relating to 7.05% Notes due 2029

Exhibit 4.2 to Form 10-K for the year ended December 31, 2004

Exhibit 4.2 to Form 10-K filed March 16, 2005

4.3 Indenture dated as of May 18, 2012 between Murphy Oil Corporation and U.S.

1 unchanged sentence

Exhibit 4.1 to Form 8-K filed May 18, 2012

4.4 First Supplemental Indenture dated as of May 18, 2012, between Murphy Oil Corporation and U.S.

Bank National Association, as trustee, relating to 4.00% Notes due 2022

Exhibit 4.2 to Form 8-K filed May 18, 2012

4.4 Second Supplemental Indenture dated as of November 30, 2012, between Murphy Oil Corporation and U.S.

Bank National Association, as trustee, relating to 5.125% N otes due 2042

Bank National Association, as trustee, relating to 5.125% Notes due 2042

Exhibit 4.1 to Form 8-K filed November 30, 2012

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4.8 Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934

Exhibit 4.9 to Form 10-K filed on February 27, 2020

4.10 Sixth Supplemental Indenture dated as of March 5, 2021, between Murphy O i l Corporation and U.S.

Exhibit 4.9 to Form 10-K filed February 27, 2020

4.9 Sixth Supplemental Indenture dated as of March 5, 2021, between Murphy Oil Corporation and U.S.

Bank National Association, as trustee, and Wells Fargo Bank, National Association as series trustee, relating to 6.375% Notes due 2028

Exhibit 4.2 to Form 8-K files March 5, 2021

Exhibit 4.2 to Form 8-K filed March 5, 2021

10.1 New Credit Agreement dated as of November 17, 2022 among Murphy Oil Corporation, Murphy Exploration & Production Company – International, and Murphy Oil Company Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent and the lenders party thereto

Exhibit 10.1 to Form 10-K filed February 27, 2023

10.2 Murphy Oil Corporation Annual Incentive Plan

Exhibit 10.3 to Form 10-K filed on February 25, 2022

Exhibit 10.3 to Form 10-K filed February 25, 2022

10.3 Murphy Oil Corporation 2012 Long-Term Incentive Plan

1 unchanged sentence

10.4 Amendment to the Murphy Oil Corporation 2012 Long-Term Incentive Plan

Exhibit 10.8 to Form 10-K filed on February 27, 2020

Exhibit 10.8 to Form 10-K filed February 27, 2020

10.5 Form of employee stock option (2012 Long-Term Incentive Plan)

Exhibit 99.1 to Form 10-K for the year ended December 31, 2013

Exhibit 99.1 to Form 10-K filed February 28, 2014

10.6 Form of stock appreciation right (2012 Long-Term Incentive Plan)

3 unchanged sentences

10.8 Amendment to the Murphy Oil Corporation 2018 Long-Term Incentive Plan

Exhibit 10.15 to Form 10-K filed on February 27, 2020

Exhibit 10.15 to Form 10-K filed February 27, 2020

10.9 Form of employee performance-based restricted stock unit – stock settled grant agreement (2018 Long-Term Incentive Plan)

Exhibit 10.14 to Form 10-K for the year ended December 31, 2018

Exhibit 10.14 to Form 10-K filed February 27, 2019

10.10 Form of employee performance-based restricted stock unit – stock settled grant agreement (2018 Long-Term Incentive Plan)

Exhibit 10.17 to Form 10-K filed on February 27, 2020

Exhibit 10.17 to Form 10-K filed February 27, 2020

10.11 Form of employee time-based restricted stock unit – stock settled 3-year grant agreement (2018 Long-Term Incentive Plan)

Exhibit 10.15 to Form 10-K for the year ended December 31, 2018

Exhibit 10.15 to Form 10-K filed February 27, 2019

10.12 Form of employee time-based restricted stock unit – stock settled 5-year grant agreement (2018 Long-Term Incentive Plan)

Exhibit 10.16 to Form 10-K for the year ended December 31, 2018

Exhibit 10.16 to Form 10-K filed February 27, 2019

10.13 Murphy Oil Corporation 2020 Long-Term Incentive Plan

1 unchanged sentence

10.14 Form of employee performance-based restricted stock unit – stock settled grant agreement (2020 LTI Plan)

Exhibit 10.21 to Form 10-K filed on February 26, 2021

Exhibit 10.21 to Form 10-K filed February 26, 2021

10.15 Form of employee time-based restricted stock unit – stock settled 3-year grant agreement (2020 LTI Plan)

Exhibit 10.22 to Form 10-K filed on February 26, 2021

Exhibit 10.22 to Form 10-K filed February 26, 2021

10.16 Form of employee time-based restricted stock unit – stock settled 5-year grant agreement (2020 LTI Plan)

Exhibit 10.23 to Form 10-K filed on February 26, 2021

Exhibit 10.23 to Form 10-K filed February 26, 2021

10.17 Form of employee time-based restricted stock unit – cash settled 3-year grant agreement (2020 LTI Plan)

Exhibit 10.24 to Form 10-K filed on February 26, 2021

Exhibit 10.24 to Form 10-K filed February 26, 2021

10.18 Form of employee time-based restricted stock unit – cash settled 5-year grant agreement (2020 LTI Plan)

Exhibit 10.25 to Form 10-K filed on February 26, 2021

Exhibit 10.25 to Form 10-K filed February 26, 2021

10.19 Murphy Oil Corporation 2018 Stock Plan for Non-Employee Directors

3 unchanged sentences

10.21 Second Amendment to the 2018 Stock Plan for Non-Employee Directors

Exhibit 10.24 to Form 10-K filed on February 27, 2020

Exhibit 10.24 to Form 10-K filed February 27, 2020

10.22 Form of non-employee director restricted stock unit award – stock settled grant agreement (2018 NED Plan)

Exhibit 10.20 to Form 10-K for the year ended December 31, 2018

Exhibit 10.20 to Form 10-K filed February 27, 2019

10.23 Form of non-employee director restricted stock unit award – stock settled grant agreement (2018 NED Plan)

Exhibit 10.26 to Form 10-K filed February 27, 2020

10.24 Murphy Oil Corporation 2021 Stock Plan for Non-Employee Directors

1 unchanged sentence

10.25 Form of non-employee director restricted stock unit award – stock settled grant agreement (2021 NED Plan)

Exhibit 10.27 to Form 10-Q filed on August 5, 2021

Exhibit 10.27 to Form 10-Q filed August 5, 2021

10.26 Murphy Oil Corporation Non-Qualified Deferred Compensation Plan for Non-Employee Directors

Exhibit 10.6 to Form 10-K for the year ended December 31, 2015

Exhibit 10.6 to Form 10-K filed February 26, 2016

10.27 Trademark License Agreement dated as of August 30, 2013, between Murphy Oil Corporation and Murphy USA Inc.

Exhibit 10.4 to Form 8-K filed September 5, 2013

10.27 Form of non-employee director restricted stock unit award – stock settled grant agreement (2018 NED Plan)

Exhibit 10.26 to Form 10-K filed on February 27, 2020

10.28 First Amendment to the New Credit Agreement dated as of December 16, 2022 among Murphy Oil Corporation, Murphy Exploration & Production Company – International and Murphy Oil Company Ltd., as borrowers, JPMorgan Chase Bank, N.A., as administrative agent and the lenders party thereto

Exhibit 10.28 to Form 10-K filed February 27, 2023

M urphy Oil Corporation Comp ensation Recoupment Policy

Form of employee performance-based restricted stock unit (2020 LTI Plan)

Form of employee time-based restricted stock unit – A (2020 LTI Plan)

Form of employee time-based restricted stock unit – B (2020 LTI Plan)

Form of employee time-based restricted stock unit – C (2020 LTI Plan)

Form of employee time-based restricted stock unit – D (2020 LTI Plan)

*21.1 Subsidiaries of Murphy Oil Corporation

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*23.3 Consent of McDaniel & Associates Consultants Ltd.

Consent of Gaffney, Cline & As sociates Pte .

*31.1 Certification required by Rule 13a-14(a) pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

2 unchanged sentences

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

*99.1 Ryder Scott reserves audit report for Eagle Ford Shale and Gulf of Mexico

*99.1 Ryder Scott reserves audit report for U.S.

Onshore and Gulf of Mexico

*99.2 Ryder Scott reserves audit report for MP GOM JV

*99.3 McDaniel independent audit report for Canada Onshore and Offshore proved crude oil and natural gas reserves

*99.3 McDaniel independent audit report for Canada Onshore proved crude oil and natural gas reserves

Gaffney, Cline independent audit report for Vietnam proved crude oil and natural gas reserves

101.INS Inline XBRL Instance Document

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February 23, 2024

Jenkins, President

Jenkins, Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on February 23, 2024 by the following persons on behalf of the registrant and in the capacities indicated.

5 unchanged sentences

MADISON MURPHY

Jenkins, President and

Chief Executive Officer and Director

(Principal Executive Officer) R.

(Principal Executive Officer)

Madison Murphy, Director

JAY COLLINS /s/ JEFFREY W.

Jay Collins, Director Jeffrey W.

Nolan, Director

/s/ STEVEN A.

COSSE /s/ ROBERT N.

Cossé, Director Robert N.

Ryan, Jr., Director

/s/ LAWRENCE R.

DICKERSON /s/ NEAL E.

Dickerson, Director Neal E.

Schmale, Director

DICKERSON /s/ JEFFREY W.

Dickerson, Director Jeffrey W.

Nolan, Director

/s/ MICHELLE A.

EARLEY /s/ LAURA A.

Earley, Director Laura A.

Sugg, Director

EARLEY /s/ ROBERT N.

Earley, Director Robert N.

Ryan, Jr., Director

/s/ ELISABETH W.

KELLER /s/ THOMAS J.

Keller, Director Thomas J.

KELLER /s/ LAURA A.

Keller, Director Laura A.

Sugg, Director

/s/ THOMAS J.

MIRELES /s/ PAUL D.

Mireles, Executive Vice President

and Chief Financial Officer

(Principal Financial Officer)

(Principal Financial Officer) Paul D.

Vice President and Controller

46 unchanged sentences

Capitalized costs of producing oil and gas properties, along with equipment and facilities that support production, are amortized to expense by the units-of-production method.

The Company’s internal petroleum reserve engineers estimate proved oil and gas reserves and the Company engages third-party petroleum reserve specialists to perform an independent assessment.

For the year ended

December 31, 2022, the Company recorded depreciation, depletion, and amortization expense of $776.8 million.

The Company’s internal petroleum reserve engineers estimate proved oil and gas reserves and the Company engages third-party petroleum reserve specialists to perform an

independent assessment.

For the year ended December 31, 2023, the Company recorded depreciation, depletion, and amortization expense of $861.6 million.

We identified the assessment of the estimated oil and gas reserves used in the depletion of producing oil and gas properties as a critical audit matter.

46 unchanged sentences

343,992 391,152

Inventories Note F

Inventories Note E

54,454 54,513

Prepaid expenses 36,674 34,697

Assets held for sale Note E

Total current assets 752,194 972,325

1 unchanged sentence

8,225,197 8,228,016

Operating lease assets Note U

946,406 881,389

Deferred income taxes Note I

Operating lease assets Note T

745,185 946,406

Deferred income taxes Note H

Deferred charges and other assets 43,686 44,316

9 unchanged sentences

Total current liabilities 846,545 1,257,834

Long-term debt, including finance lease obligation Note G

Long-term debt, including finance lease obligation Note F

1,328,352 1,822,452

Asset retirement obligations Note H

Asset retirement obligations Note G

904,051 817,268

Deferred credits and other liabilities 309,605 304,948

Non-current operating lease liabilities Note U

Non-current operating lease liabilities Note T

551,845 742,654

Deferred income taxes Note I

Deferred income taxes Note H

276,646 214,903

5 unchanged sentences

Retained earnings 6,546,079 6,055,498

Accumulated other comprehensive loss Note O

Accumulated other comprehensive loss Note N

( 521,117 ) ( 534,686 )

12 unchanged sentences

Total revenue from sales to customers 3,448,854 4,220,140 2,801,215

(Loss) Gain on derivative instruments ( 320,410 ) ( 525,850 ) 202,661

(Loss) on derivative instruments – ( 320,410 ) ( 525,850 )

Gain on sale of assets and other income 11,293 32,932 23,916

7 unchanged sentences

Selling and general expenses 117,306 131,121 121,950

Restructuring expenses — — 49,994

Depreciation, depletion and amortization 861,602 776,817 795,105

3 unchanged sentences

Total costs and expenses 2,418,118 2,345,952 2,017,846

Operating income (loss) from continuing operations 1,586,710 281,435 ( 1,362,309 )

Operating income from continuing operations 1,042,029 1,586,710 281,435

Other income (loss)

Other income (expense) 14,310 ( 16,771 ) ( 17,303 )

Other (loss) income ( 8,587 ) 14,310 ( 16,771 )

Interest expense, net ( 112,373 ) ( 150,759 ) ( 221,773 )

Total other loss ( 120,960 ) ( 136,449 ) ( 238,544 )

Income (Loss) from continuing operations before income taxes 1,450,261 42,891 ( 1,549,035 )

Income tax expense (benefit) 309,464 ( 5,862 ) ( 293,741 )

Income (Loss) from continuing operations 1,140,797 48,753 ( 1,255,294 )

Income from continuing operations before income taxes 921,069 1,450,261 42,891

Income tax expense 195,921 309,464 ( 5,862 )

Income from continuing operations 725,148 1,140,797 48,753

Loss from discontinued operations, net of income taxes ( 1,467 ) ( 2,078 ) ( 1,225 )

Net income (loss) including noncontrolling interest 1,138,719 47,528 ( 1,262,445 )

Net income (loss) attributable to noncontrolling interest 173,672 121,192 ( 113,668 )

Net income including noncontrolling interest 723,681 1,138,719 47,528

Net income attributable to noncontrolling interest 62,122 173,672 121,192

NET INCOME (LOSS) ATTRIBUTABLE TO MURPHY $ 661,559 $ 965,047 $ ( 73,664 )

15 unchanged sentences

Years Ended December 31 (Thousands of dollars) 2023 2022 2021

Net income (loss) including noncontrolling interest $ 1,138,719 $ 47,528 $ ( 1,262,445 )

Net income including noncontrolling interest

$ 723,681 $ 1,138,719 $ 47,528

Other comprehensive income (loss), net of tax

Net (loss) gain from foreign currency translation ( 106,335 ) 12,116 29,241

Net gain (loss) from foreign currency translation

36,598 ( 106,335 ) 12,116

Retirement and postretirement benefit plans ( 23,029 ) 99,360 59,816

Deferred loss on interest rate hedges reclassified to interest expense – – 1,690

Other comprehensive (loss) income ( 6,975 ) 73,622 ( 27,172 )

Comprehensive income (loss) including noncontrolling interest 1,131,744 121,150 ( 1,289,617 )

Comprehensive income (loss) attributable to noncontrolling interest 173,672 121,192 ( 113,668 )

Other comprehensive income (loss)

13,569 ( 6,975 ) 73,622

Comprehensive income including noncontrolling interest

737,250 1,131,744 121,150

Comprehensive income attributable to noncontrolling interest

62,122 173,672 121,192

COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO MURPHY $ 675,128 $ 958,072 $ ( 42 )

4 unchanged sentences

Operating Activities

Net income (loss) including noncontrolling interest $ 1,138,719 $ 47,528 $ ( 1,262,445 )

Adjustments to reconcile net income (loss) to net cash provided by continuing operations activities

Net income including noncontrolling interest $ 723,681 $ 1,138,719 $ 47,528

Adjustments to reconcile net income to net cash provided by continuing operations activities

Depreciation, depletion and amortization 861,602 776,817 795,105

Deferred income tax expense (benefit) 179,823 286,079 ( 4,146 )

Mark to market (gain) loss on derivative instruments ( 214,788 ) 112,113 69,310

Mark to market loss (gain) on contingent consideration 78,285 63,147 ( 13,783 )

Long-term non-cash compensation 89,246 63,382 46,558

Unsuccessful exploration well costs and previously suspended exploration costs 169,795 82,085 17,339

Contingent consideration payment

( 139,574 ) – –

Long-term non-cash compensation 61,953 89,246 63,382

Accretion of asset retirement obligations 46,059 46,243 46,613

Amortization of undeveloped leases 10,925 13,300 18,925

Mark to market loss on contingent consideration 7,113 78,285 63,147

Mark to market (gain) loss on derivative instruments – ( 214,788 ) 112,113

Loss from discontinued operations 1,467 2,078 1,225

1 unchanged sentence

Impairment of assets – – 196,296

Noncash restructuring expense — — 17,565

Other operating activities, net ( 74,716 ) ( 34,193 ) ( 53,821 )

6 unchanged sentences

( 35,578 ) ( 128,538 ) ( 20,244 )

Property additions for King's Quay FPS — ( 17,734 ) ( 112,961 )

Proceeds from sales of property, plant and equipment 102,913 4,528 270,503

Property additions for King's Quay FPS – – ( 17,734 )

Net cash required by investing activities ( 998,680 ) ( 1,109,471 ) ( 417,710 )

Financing Activities

Retirement of debt ( 647,707 ) ( 876,358 ) ( 12,225 )

Repayment of revolving credit facility ( 400,000 ) ( 365,000 ) ( 250,000 )

Borrowings on revolving credit facility 600,000 400,000 165,000

Distributions to noncontrolling interest ( 183,038 ) ( 137,517 ) ( 43,673 )

Cash dividends paid ( 128,219 ) ( 77,204 ) ( 95,989 )

Repayment of revolving credit facility ( 600,000 ) ( 400,000 ) ( 365,000 )

Retirement of debt ( 498,175 ) ( 647,707 ) ( 876,358 )

Early redemption of debt cost – ( 8,295 ) ( 39,335 )

Repurchase of common stock ( 150,022 ) – –

Contingent consideration paid ( 60,243 ) ( 81,742 ) –

Cash dividends paid ( 170,978 ) ( 128,219 ) ( 77,204 )

Distributions to noncontrolling interest ( 29,382 ) ( 183,038 ) ( 137,517 )

Withholding tax on stock-based incentive awards ( 14,276 ) ( 17,631 ) ( 5,209 )

Issue costs of debt facility ( 14,353 ) — —

Early redemption of debt cost ( 8,295 ) ( 39,335 ) —

Capital lease obligation payments ( 636 ) ( 803 ) ( 695 )

Finance lease obligation payments ( 622 ) ( 636 ) ( 803 )

Debt issuance, net of cost – – 541,913

Net cash (required) provided by financing activities ( 1,081,621 ) ( 794,513 ) 39,711

Cash Flows from Discontinued Operations

Operating activities ( 14,500 ) — —

Issue costs of debt facility ( 20 ) ( 14,353 ) –

Net cash required by financing activities

( 923,718 ) ( 1,081,621 ) ( 794,513 )

Net cash required by discontinued operations

Cash from discontinued operations 2

– ( 14,500 ) –

Effect of exchange rate changes on cash and cash equivalents ( 1,246 ) ( 3,873 ) 638

Net (decrease) increase in cash and cash equivalents

( 174,889 ) ( 29,221 ) 210,578

Cash and cash equivalents at beginning of period 491,963 521,184 310,606

1 unchanged sentence

1 Certain prior-period amounts have been reclassified to conform to the current period presentation.

2 Cash previously classified as held-for-sale

See Notes to Consolidated Financial Statements, page 70.

3 unchanged sentences

Cumulative Preferred Stock – par $ 100 , authorized 400,000 shares, none issued

Common Stock – par $ 1.00 , authorized 450,000,000 shares at December 31, 2022, 2021 and 2020, issued 195,100,628 at December 31, 2022, 2021 and 2020

Balance at beginning of year 195,101 195,101 195,089

Exercise of stock options — — 12

Balance at end of year 195,101 195,101 195,101

Common Stock – par $ 1.00 , authorized 450,000,000 shares at December 31, 2023, 2022 and 2021, issued 195,100,628 shares at December 31, 2023, 2022 and 2021

Balance at beginning and end of year 195,101 195,101 195,101

Capital in Excess of Par Value

Balance at beginning of year 893,578 926,698 941,692

Stock-based compensation 25,242 25,429 26,052

Share-based compensation 29,386 25,242 25,429

Restricted stock transactions and other 1

Exercise of stock options, including income tax benefits ( 13,193 ) ( 1,674 ) ( 156 )

( 42,667 ) ( 58,362 ) ( 40,423 )

Balance at end of year 880,297 893,578 926,698

2 unchanged sentences

Net income (loss) for the year attributable to Murphy 661,559 965,047 ( 73,664 )

Cash dividends ( 128,219 ) ( 77,204 ) ( 95,989 )

Cash dividends paid ( 170,978 ) ( 128,219 ) ( 77,204 )

Balance at end of year 6,546,079 6,055,498 5,218,670

8 unchanged sentences

Balance at beginning of year ( 1,614,717 ) ( 1,655,447 ) ( 1,690,661 )

Purchase of treasury shares ( 151,241 ) – –

Awarded restricted stock, net of forfeitures 28,392 40,730 35,214

Exercise of stock options 8,433 1,326 —

Balance at end of year – 39,633,309 of Common Stock in 2022, 40,637,578 shares of Common Stock in 2021 and 41,502,003 shares of Common Stock in 2020

Balance at end of year – 42,351,986 shares of common stock in 2023, 39,633,309 shares of common stock in 2022 and 40,637,578 shares of common stock in 2021

( 1,737,566 ) ( 1,614,717 ) ( 1,655,447 )

2 unchanged sentences

Balance at beginning of year 154,119 163,485 179,810

Net income (loss) attributable to noncontrolling interest 173,672 121,192 ( 113,668 )

Net income attributable to noncontrolling interest

62,122 173,672 121,192

Distributions to noncontrolling interest owners ( 29,382 ) ( 183,038 ) ( 137,517 )

1 unchanged sentence

Total Equity $ 5,549,653 $ 5,148,893 $ 4,320,796

1 Prior-period amounts have been aggregated to conform to the current period presentation.

See Notes to Consolidated Financial Statements, page 70.

3 unchanged sentences

Note A – Significant Accounting Polices

NATURE OF BUSINESS – Murphy Oil Corporation is an international oil and natural gas company that conducts its business through various operating subsidiaries.

The Company primarily produces oil and natural gas in the United States and Canada and conducts oil and natural gas exploration activities worldwide.

The Company sold its Malaysian assets in 2019 and they are reported as discontinued operations.

In connection with the LLOG Exploration Offshore L.L.C.

and LLOG Bluewater Holdings, L.L.C., (LLOG) acquisition, we hold a 0.5 % interest in two variable interest entities (VIEs), Delta House Oil and Gas Lateral LLC and Delta House Floating Production System (FPS) LLC (collectively Delta House).

These VIEs have not been consolidated because we are not considered the primary beneficiary.

These non-consolidated VIEs are not material to our financial position or results of operations.

As of December 31, 2022, our maximum exposure to loss was $ 3.2 million (excluding operational impacts), which represents our net investment in Delta House.

We have not provided any financial support to Delta House other than amounts previously required by our membership interest.

PRINCIPLES OF CONSOLIDATION – The consolidated financial statements include the accounts of Murphy Oil Corporation and all majority-owned subsidiaries.

NATURE OF BUSINESS – Murphy Oil Corporation is an international oil and gas company that conducts its business through various operating subsidiaries.

The Company primarily produces oil and natural gas in the United States and Canada and conducts oil and gas exploration activities worldwide.

BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION – The consolidated financial statements include the accounts of the Company and are presented in conformity with GAAP.

The consolidated financial statements include the accounts of Murphy Oil Corporation and all majority-owned subsidiaries.

Undivided interests in oil and natural gas joint ventures are consolidated on a proportionate basis.

Investments in affiliates in which the Company owns from 20 % to 50 % are accounted for by the equity method.

Beginning in the fourth quarter of 2018, Murphy reports 100 % of the sales volume, revenues, costs, assets and liabilities including the 20 % noncontrolling interest (NCI), of MP GOM in accordance with accounting for noncontrolling interest as prescribed by ASC 810-10-45.

Beginning in the fourth quarter of 2018, Murphy reports 100 % of the sales volume, revenues, costs, assets and liabilities including the 20 % noncontrolling interest in MP GOM in accordance with accounting for noncontrolling interest as prescribed by Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 810-10-45, “Consolidations”.

Other investments are generally carried at cost.

Intercompany accounts and transactions are eliminated.

USE OF ESTIMATES – Preparing the financial statements of the Company in accordance with U.S.

generally accepted accounting principles (GAAP) requires management to make a number of estimates and assumptions that affect the reporting of amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities.

USE OF ESTIMATES – Preparing the financial statements of the Company in accordance with GAAP requires management to make a number of estimates and assumptions that affect the reporting of amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities.

Actual results may differ from the estimates.

18 unchanged sentences

The fair value of investment securities is determined by available market prices.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note A – Significant Accounting Policies (Continued)

ACCOUNTS RECEIVABLE – At December 31, 2023 and 2022, the Company’s accounts receivable primarily consisted of amounts owed to the Company by customers for sales of crude oil and natural gas and operating costs related to joint venture partners working interest share.

2 unchanged sentences

The Company reviews this allowance for adequacy at least quarterly and bases its assessment on a combination of current information about its customers, joint venture partners and historical write-off experience.

Any trade accounts receivable balances written off are charged against the allowance for doubtful accounts.

Any trade accounts receivable balances written off are

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note A – Significant Accounting Policies (Continued)

charged against the allowance for doubtful accounts.

The Company has not experienced any significant credit-related losses in the past three years.

19 unchanged sentences

If an impairment occurs, the carrying value of the impaired asset is reduced to fair value.

There were no impairments recognized in 2022.

In 2021, the Company recognized pretax noncash impairment charges of $ 196.3 million to reduce the carrying values at select properties.

In 2021, the Company recorded an impairment charge of $ 171.3 million for Terra Nova due to the status, including agreements with the partners, of operating and production plans and a $ 25.0 million impairment charge for assets reported as Assets held for sale in the Consolidated Balance Sheets.

See also Note D for further discussion of impairment charges.

There were no impairments recognized in 2023 and 2022.

The Company records a liability for asset retirement obligations (ARO) equal to the fair value of the estimated cost to retire an asset.

6 unchanged sentences

Any difference between costs incurred upon settlement of an ARO and the recorded liability is recognized as a gain or loss in the Company’s earnings.

See Note H for further discussion.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note A – Significant Accounting Policies (Continued)

See Note G for further discussion.

Depreciation and depletion of producing oil and natural gas properties are recorded based on units of production.

4 unchanged sentences

Capitalized interest is amortized over the useful life of the asset in the same manner as other development costs.

LEASES - At inception, contracts are assessed for the presence of a lease according to criteria laid out by ASC 842.

If a lease is present, further criteria is assessed to determine if the lease should be classified as an operating or finance lease.

Operating leases are presented on the Consolidated Balance Sheet as “Operating lease assets” with the corresponding lease liabilities presented in “Operating lease liabilities” and “Non-current operating lease liabilities”.

Finance lease assets (related to Brunei) are presented on the Consolidated Balance Sheet within “Property, plant and equipment” with the corresponding liabilities presented in “Current maturities of long-term debt, finance lease” and “Long-term debt, including finance lease obligation”.

LEASES – At inception, contracts are assessed for the presence of a lease according to criteria laid out by ASC 842, “Leases”.

If a lease is present, further criteria is assessed to determine if the lease should be classified as an

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note A – Significant Accounting Policies (Continued)

operating or finance lease.

Operating leases are presented on the Consolidated Balance Sheets as “Operating lease assets” with the corresponding lease liabilities presented in “Operating lease liabilities” and “Non-current operating lease liabilities”.

Finance lease assets (related to Brunei) are presented on the Consolidated Balance Sheets within “Property, plant and equipment”, with the corresponding liabilities presented in “Current maturities of long-term debt, finance lease” and “Long-term debt, including finance lease obligation”.

Generally, lease liabilities are recognized at commencement and based on the present value of the future minimum lease payments to be made over the lease term.

1 unchanged sentence

Where implicit lease rates are not determinable, the minimum lease payments are discounted using the Company’s collateralized incremental borrowing rates.

Operating leases are expensed according to their nature and recognized in LOE, Selling and general expenses or capitalized in the Consolidated Financial Statements.

Operating leases are expensed according to their nature and recognized in “Lease operating expenses”, “Selling and general expenses” or capitalized in the Consolidated Financial Statements.

Finance leases are depreciated with the relevant expenses recognized in “Depreciation, depletion and amortization” and “Interest expense, net” on the Consolidated Statement of Operations.

21 unchanged sentences

Upon entering into a derivative contract, the Company may designate the derivative as either a fair value hedge or a cash flow hedge or decide that the contract is not a hedge for accounting purposes, and thenceforth, recognize changes in the fair value of the contract in earnings.

Sale and purchase contracts in the normal course of business are not designated as hedges for accounting purposes.

The Company documents the relationship between the derivative instrument designated as a hedge and the hedged items as well as its objective for risk management and strategy for the use of the hedging instrument to manage the risk.

21 unchanged sentences

Differences between estimated and actual vested amounts are accounted for as an adjustment to expense, when known.

Cash-Settled Awards – The Company accounts for stock appreciation rights (SARs), cash-settled restricted stock units (CRSU) and phantom stock units as liability awards.

Expense associated with these awards is recognized over the vesting period based on the latest available estimate of the fair value of the awards, which is generally determined using a Black-Scholes method for SAR, a Monte Carlo method for performance-based CRSU, and the period-end price of the Company’s common stock for time-based CRSU and phantom units.

When SARs are exercised and when CRSU and phantom units settle, the Company adjusts previously recorded expense to the final amounts paid out in cash for these awards.

Cash-Settled Awards – The Company accounts for stock appreciation rights (SARs) and cash-settled restricted time-based stock units (CRSUs) as liability awards.

Expense associated with these awards is recognized over the vesting period based on the latest available estimate of the fair value of the awards, which is generally determined using a Black-Scholes method for SARs and the period-end price of the Company’s common stock for time-based CRSUs.

When SARs are exercised and when CRSUs settle, the Company adjusts previously recorded expense to the final amounts paid out in cash for these awards.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

9 unchanged sentences

Accounting Principles Adopted

Compensation-Retirement Benefits-Defined Benefit Plans-General.

In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2018-14 which modifies the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans.

For public companies, the amendments in this ASU are effective for fiscal years ending after December 15, 2020, with early adoption permitted and is to be applied on a retrospective basis to all periods presented.

The Company adopted the standard in the fourth quarter of 2020 and it did not have a material impact on its consolidated financial statements.

Financial Instruments – Credit Losses.

In June 2016, the FASB issued ASU 2016-13 which replaces the impairment model for most financial assets, including trade receivables, from the incurred loss methodology to a forward-looking expected loss model that will result in earlier recognition of credit losses.

The amendments in this ASU are effective for fiscal years beginning after December 15, 2019, with early adoption permitted and is to be applied on a modified retrospective basis.

The Company adopted this accounting standard in the first quarter of 2020 and it did not have a material impact on its consolidated financial statements.

Fair Value Measurement.

In August 2018, the FASB issued ASU 2018-13 which modifies disclosure requirements related to fair value measurement.

The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.

Implementation on a prospective or retrospective basis varies by specific disclosure requirement.

Early adoption is permitted.

The standard also allows for early adoption of any removed or modified disclosures upon issuance of this ASU while delaying adoption of the additional disclosures until their effective date.

The Company adopted this accounting standard in the first quarter of 2020 and it did not have a material impact on its consolidated financial statements.

Income Taxes .

In December 2019, the FASB issued ASU 2019-12, which removes certain exceptions for investments, intraperiod allocations and interim calculations and adds guidance to reduce complexity in accounting for income taxes.

The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020.

Implementation on a prospective or retrospective basis varies by specific topics within the ASU.

The Company adopted this guidance in the first quarter of 2021 and it did not have a material impact on its consolidated financial statements.

Recent Accounting Pronouncements

None affecting the Company.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Recent Accounting Pronouncements

Income Tax Disclosures.

In December 2023 the FASB issued Accounting Standards Update (ASU) 2023-09 Income Taxes (Topic 740):

Improvements to Income Tax Disclosures .

The standard becomes effective for annual periods beginning after December 15, 2024.

The update requires financial statements to include consistent categories and greater disaggregation of information in the rate reconciliation, as well as income taxes paid disaggregated by jurisdiction.

Murphy is currently evaluating the impact of adopting this standard.

Reportable Segment Disclosures.

In November 2023 the FASB issued ASU 2023-07 Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures .

The standard becomes effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The standard requires additional disclosures about operating segments, including segment expense information provided to the chief operating decision maker, and extends certain disclosure requirements to interim periods.

The standard does not affect our determination of significant segments.

Murphy is currently evaluating the impact of adopting this standard.

Note C – Revenue from Contracts with Customers

5 unchanged sentences

For operated oil and natural gas production where the non-operated working interest owner does not take-in-kind its proportionate interest in the produced commodity, the Company acts as an agent for the working interest owner and recognizes revenue only for its own share of the commingled production.

The exception to this is the reporting of the noncontrolling interest in MP GOM as prescribed by U.S.

The exception to this is the reporting of the noncontrolling interest in MP GOM as prescribed by GAAP.

- In the United States, the Company primarily produces oil and natural gas from fields in the Eagle Ford Shale area of South Texas and in the Gulf of Mexico.

3 unchanged sentences

For the offshore business in Canada, contracts are based on index prices and revenue is recognized at the time of vessel load based on the volumes on the bill of lading and point of custody transfer.

Disaggregation of Revenue

The Company reviews performance based on two key geographical segments and between onshore and offshore sources of revenue within these geographies.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

1 unchanged sentence

Note C – Revenue from Contracts with Customers (Continued)

For the years ended December 31, 2022, 2021 and 2020 the Company recognized $ 4,220.1 million, $ 2,801.2 million and $ 1,751.7 million, respectively, from contracts with customers for the sales of oil, natural gas liquids and natural gas.

Disaggregation of Revenue

The Company reviews performance based on two key geographical segments and between onshore and offshore sources of revenue within these geographies.

The Company’s revenues and other income for each of the three year presented were as follows.

Years Ended December 31,

50 unchanged sentences

The underlying reason for entering a fixed price contract is generally unrelated to anticipated future prices or other observable data and serves a particular purpose in the Company’s long-term strategy.

As of December 31, 2022, the Company had the following sales contracts in place which are expected to generate revenue from sales to customers for a period of 12 months or more starting at the inception of the contract:

Current Long-Term Contracts Outstanding at December 31, 2022

As of December 31, 2023, the Company had the following sales contracts in place which are expected to generate revenue from sales to customers for a period over 12 months starting at the inception of the contract:

Long-Term Contracts Outstanding at December 31, 2023

Location Commodity End Date Description Approximate Volumes

Natural Gas and NGL Q1 2030 Deliveries from dedicated acreage in Eagle Ford As produced

Natural Gas and NGL Q2 2023 Deliveries from dedicated acreage in Eagle Ford As produced

Canada Natural Gas Q4 2025 Contracts to sell natural gas at USD index pricing 25 MMCFD

Canada Natural Gas Q4 2023 Contracts to sell natural gas at CAD fixed prices 38 MMCFD

Canada Natural Gas Q4 2024 Contracts to sell natural gas at USD index pricing 31 MMCFD

Canada Natural Gas Q4 2024 Contracts to sell natural gas at CAD fixed prices 100 MMCFD

Canada Natural Gas Q4 2024 Contracts to sell natural gas at CAD fixed prices 34 MMCFD

Canada Natural Gas Q4 2024 Contracts to sell natural gas at CAD fixed pricing 124 MMCFD

Canada Natural Gas Q4 2024 Contracts to sell natural gas at USD fixed pricing 25 MMCFD

Canada Natural Gas Q4 2024 Contracts to sell natural gas at CAD index pricing 28 MMCFD

Canada Natural Gas Q4 2026 Contracts to sell natural gas at USD index pricing 49 MMCFD

Canada NGL Q3 2023 Contracts to sell natural gas liquids at CAD pricing 952 BOEPD

Canada Natural Gas Q4 2027 Contracts to sell natural gas at USD index pricing 30 MMCFD

Canada Natural Gas Q4 2028 Contracts to sell natural gas at USD index pricing 10 MMCFD

Fixed price contracts are accounted for as normal sales and purchases for accounting purposes.

12 unchanged sentences

2 Includes $ 15,356 in 2023 and $ 18,319 in 2022 related to administrative assets and support equipment.

On September 15, 2023, the Company completed the previously announced divestment of certain non-core operated Kaybob Duvernay assets and all of our non-operated Placid Montney assets, located in Alberta, Canada for net cash proceeds of C$ 139.0 million.

No gain or loss was recorded related to this transaction, and the effective date of the transaction was March 1, 2023.

During the third quarter of 2022, the Company completed the disposition of its 62.5 % operated working interest of the Thunder Hawk field for a purchase price of $ 20.0 million less closing adjustments of $ 23.1 million, resulting in a total net payment to the buyer of $ 3.1 million.

3 unchanged sentences

No gain or loss was recorded related to this sale.

In 2021, the Company sold its interest in the King’s Quay FPS to ArcLight Capital Partners, LLC (ArcLight) for proceeds of $ 267.7 million, which reimburses the Company for previously incurred capital expenditures.

In August 2022, the Company acquired an additional working interest of 3.37 % in the Lucius field for a purchase price of $ 78.5 million, net of closing adjustments.

In June 2022, the Company acquired an additional working interest of 11.0 % in the Kodiak field for a purchase price of $ 50.0 million, net of closing adjustments.

In 2021, the Company recorded an impairment charge of $ 171.3 million for Terra Nova due to the status, including agreements with the partners, of operating and production plans.

Subsequently, the Company acquired an additional 7.525 % working interest at Terra Nova following a commercial agreement to sanction an asset life extension project.

The Company also recorded an impairment charge of $ 25.0 million for assets reported as Assets held for sale in the Consolidated Balance Sheet.

The following table reflects the recognized before tax impairments for the three years ended December 31, 2022.

The following table reflects the recognized before tax impairments for each of the three years presented.

(Thousands of dollars) 2023 2022 2021

3 unchanged sentences

$ – $ – $ 196,296

$ — $ 196,296 $ 1,206,284

Exploratory Wells

Under FASB guidance, exploratory well costs should continue to be capitalized when the well has found a sufficient quantity of reserves to justify its completion as a producing well, and the company is making sufficient progress assessing the reserves and the economic and operating viability of the project.

At December 31, 2023, 2022 and 2021, the Company had total capitalized drilling costs pending the determination of proved reserves of $ 49.1 million, $ 171.9 million and $ 179.5 million, respectively.

The following table reflects the net changes in capitalized exploratory well costs for each of the three years presented.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

1 unchanged sentence

Note D – Property, Plant and Equipment (Continued)

At December 31, 2022, 2021 and 2020, the Company had total capitalized drilling costs pending the determination of proved reserves of $ 171.9 million, $ 179.5 million and $ 181.6 million, respectively.

The following table reflects the net changes in capitalized exploratory well costs during the three-year period ended December 31, 2022.

( Thousands of dollars )

2 unchanged sentences

Additions pending the determination of proved reserves 48 33,440 16,725

Reclassifications to proved properties based on the determination of proved reserves ( 82,185 ) – –

– ( 7,915 ) –

1 unchanged sentence

Ending balance at December 31 $ 49,118 $ 171,860 $ 179,481

The capitalized well costs charged to expense during 2022 represent expenditures related to the Cutthroat-1 exploration well in block SEAL-M-428 in the Sergipe-Alagoas Basin offshore Brazil and Hoffe Park #1 (Mississippi Canyon 122) in the Gulf of Mexico.

The following table provides an aging of capitalized exploratory well costs based on the date the drilling was completed for each individual well and the number of projects for which exploratory well costs has been capitalized.

Reclassifications to proved properties of $ 82.2 million, for the year ended December 31, 2023, are primarily related to LDV-4X in Vietnam.

Capitalized well costs charged to dry hole expense of $ 40.6 million are related to the Cholula-1EXP well in offshore Mexico, and Oso #1 (Atwater Valley 138), and Chinook #7 (Walker Ridge 425) exploration wells in the Gulf of Mexico.

The preceding table excludes well costs of $ 129.2 million incurred and expensed directly to dry hole during the year ended December 31, 2023, related to the Chinook #7 (Walker Ridge 425) and Oso #1 (Atwater Valley 138) explorations well in the Gulf of Mexico.

The projects are aged based on the last well drilled in the project.

9 unchanged sentences

$ 49,118 4 4 $ 171,860 9 8 $ 179,481 14 8

Of the $ 156.3 million of exploratory well costs capitalized more than one year at December 31, 2022, $ 96.3 million is in Vietnam, $ 37.1 million is in the U.S., $ 15.5 million is in Mexico, $ 4.7 million is in Canada and $ 2.7 million is in Brunei.

Of the $ 49.1 million of exploratory well costs capitalized more than one year at December 31, 2023, $ 26.5 million is in the U.S., $ 15.1 million is in Vietnam, $ 4.8 million is in Canada and $ 2.7 million is in Brunei.

In all geographical areas, either further appraisal or development drilling is planned and/or development studies/plans are in various stages of completion.

Note E – Assets Held for Sale and Discontinued Operations

In September 2022, the Company sold its share of Brunei Block CA-2 to Petronas Carigali Brunei Ltd (see Note D for additional information).

Additionally, in December 2022, the Company’s former headquarters office building in El Dorado, Arkansas was sold.

There were no remaining assets held for sale on the Consolidated Balance Sheet as of December 31, 2022.

As of December 31, 2021, assets held for sale included the carrying value of the net property, plant and equipment of Brunei Block CA-2 and the Company’s former headquarters office building in El Dorado, Arkansas.

The following table presents the carrying value of the major categories of assets and liabilities that are reflected as held for sale on the Company’s Consolidated Balance Sheets at December 31, 2022 and 2021.

( Thousands of dollars )

Current assets

Property, plant and equipment, net $ — $ 15,453

Total current assets associated with assets held for sale $ — $ 15,453

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note E - Assets Held for Sale and Discontinued Operations (Continued)

The Company has accounted for its former Malaysian exploration and production operations and its former U.K.

refining and marketing operations as discontinued operations for all periods presented.

The results of operations associated with discontinued operations are presented in the following table.

( Thousands of dollars )

2022 2021 2020

Revenues $ — $ 795 $ 4,090

Costs and expenses

Other costs and expenses 2,078 2,020 11,241

Loss from discontinued operations $ ( 2,078 ) $ ( 1,225 ) $ ( 7,151 )

Note F – Inventories

Inventories consisted of the following at December 31, 2022 and 2021:

Note E – Inventories

Inventories consisted of the following for the respective periods presented:

( Thousands of dollars )

2 unchanged sentences

Inventories $ 54,454 $ 54,513

Note G – Financing Arrangements and Debt

Long-term debt consisted of the following as of December 31, 2022 and 2021:

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note F – Financing Arrangements and Debt

Long-term debt for the respective periods presented consisted of the following:

(Thousands of dollars) 2023 2022

2 unchanged sentences

$ – $ 248,675

5.75 % notes, due August 2025

248,675 548,675

5.875 % notes, due December 2027

14 unchanged sentences

1 Coupon rate may fluctuate 25 basis points if rating is periodically downgraded or upgraded by S&P and Moody’s.

The amount of long-term debt repayable over each of the next five years and thereafter are as follows:

nil in 2023, nil in 2024, $ 248.7 million in 2025, nil in 2026, $ 543.2 million in 2027 and $ 1.04 billion thereafter.

The Company also has a shelf registration statement on file with the U.S.

Securities and Exchange Commission that permits the offer and sale of debt and/or equity securities through October 15, 2024.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note G - Financing Arrangements and Debt (Continued)

In November 2022, the Company entered into a $ 800 million revolving credit facility (RCF) and the previous revolving credit facility has been terminated effective November 2022.

The RCF is a senior unsecured guaranteed facility which expires on November 17, 2027, unless the outstanding principal amount of the Company’s 5.75 %, 2025 (2025 Notes) as at February 15, 2025 exceeds $ 50.0 million, in which case, the RCF will expire on that date.

The amounts of long-term debt repayable over each of the next five years and thereafter are as follows:

nil in 2024, nil in 2025, nil in 2026, $ 443.2 million in 2027, $ 372.2 million in 2028 and $ 519.5 million thereafter.

The Company also has a shelf registration statement on file with the SEC that permits the offer and sale of debt and/or equity securities through October 15, 2024.

In November 2022, the Company entered into a $ 800 million revolving credit facility, and the previous revolving credit facility has been terminated effective November 2022.

The RCF is a senior unsecured guaranteed facility which expires on November 17, 2027.

On the date the Company achieves certain credit ratings (Investment Grade Ratings Date), certain covenants will be modified as set forth in the RCF.

2 unchanged sentences

Borrowings under the RCF bear interest at rates based on either the “Alternate Base Rate”, the “Adjusted Term Secured Overnight Financing Rate (SOFR) Rate”, or the “Adjusted Daily Simple SOFR Rate”, respectively, plus the “Applicable Rate”.

The “Alternate Base Rate” of interest is the highest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus ½ of 1% and (c) the Adjusted Term SOFR Rate for a one month Interest Period as published two U.S.

The “Alternate Base Rate” of interest is the highest of (a) the Prime Rate in effect on such day, (b) the New York Federal Reserve Bank (NYFRB) Rate in effect on such day plus ½ of 1% and (c) the Adjusted Term SOFR Rate for a one month Interest Period as published two U.S.

Government Securities Business Days prior to such day (or if such day is not a U.S.

8 unchanged sentences

At December 31, 2023, the Company was in compliance with all covenants related to the RCF.

In November 2022, the Company redeemed $ 200.0 million aggregate principal amount of its 5.750 % senior notes due 2025 (2025 Notes).

In November 2023, the Company tendered a total of $ 249.5 million of its 2027 Notes, 2028 Notes and 2029 Notes, retiring $ 250 million in aggregate principal.

The cost of debt extinguishment of $ 1.3 million is included in “Interest expense, net” on the Consolidated Statement of Operations for the year ended December 31, 2023.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note F - Financing Arrangements and Debt (Continued)

There were no additional cash costs related to the November 2023 debt extinguishment on the 2027 Notes, 2028 Notes and 2029 Notes for the year ended December 31, 2023.

In September 2023, the Company redeemed the remaining $ 248.7 million principal outstanding of its 2025 Notes.

The non-cash costs of debt extinguishment of $ 0.9 million is included in “Interest expense, net” on the Consolidated Statement of Operations for the year ended December 31, 2023.

In November 2022, the Company redeemed $ 200.0 million aggregate principal amount of its 2025 Notes.

The cost of debt extinguishment of $ 3.9 is included in “Interest expense, net” on the Consolidated Statement of Operations for the year ended December 31, 2022.

2 unchanged sentences

There were no additional cash costs related to the September and October 2022 debt extinguishment on the 2042 Notes for the year ended December 31, 2022.

In August 2022, the Company redeemed the remaining $ 42.4 million of its 6.875 % senior notes due in 2024 (2024 Notes) and tendered $ 100.0 million and $ 98.1 million aggregate principal amount of its 2025 Notes and 6.375 % senior notes due 2028 (2028 Notes), respectively.

The total cost of the debt extinguishment of $ 4.0 million is included in “Interest expense, net” on the Consolidated Statement of Operations for the year ended December 31, 2022.

3 unchanged sentences

The cash costs of $ 3.4 million are shown as a financing activity on the Consolidated Statement of Cash Flows for the year ended December 31, 2022.

In March 2021, the Company issued $ 550.0 million of new notes that bear interest at a rate of 6.375 % and mature on July 15, 2028.

The Company incurred transaction costs of $ 8.1 million on the issuance of these new notes and the Company will pay interest semi-annually on January 15 and July 15 of each year.

The proceeds of the $ 550.0 million notes, along with cash on hand, were used to redeem and cancel $ 259.3 million of the Company’s 4.00 % notes due June 2022 and $ 317.1 million of the Company’s 4.95 % notes due December 2022 (originally issued as 3.70 % notes due 2022;

collectively the 2022 Notes).

The cost of the debt extinguishment of $ 36.9 million is included in “Interest expense, net” on the Consolidated Statement of Operations for the year

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note G - Financing Arrangements and Debt (Continued)

ended December 31, 2021.

The cash costs of $ 34.2 million are shown as a financing activity on the Consolidated Statement of Cash Flows for the year ended December 31, 2021.

In August 2021, the Company redeemed $ 150.0 million aggregate principal amount of its 2024 Notes.

The cost of the debt extinguishment of $ 3.5 million is included in Interest expense, net” on the Consolidated Statement of Operations for the year ended December 31, 2021.

The cash costs of $ 2.6 million are shown as a financing activity on the Consolidated Statement of Cash Flows for the year ended December 31, 2021.

In December 2021, the Company redeemed an additional $ 150.0 million aggregate principal amount of the 2024 Notes.

The cost of the debt extinguishment of $ 3.4 million is included in “Interest expense, net” on the Consolidated Statement of Operations for the year ended December 31, 2021.

The cash costs of $ 2.6 million are shown as a financing activity on the Consolidated Statement of Cash Flows for the year ended December 31, 2021.

Note H – Asset Retirement Obligations

The asset retirement obligations liabilities (ARO) recognized by the Company at December 31, 2022 and 2021 are related to the estimated costs to dismantle and abandon its producing oil and natural gas properties and related equipment.

A reconciliation of the beginning and ending aggregate carrying amount of the ARO for 2022 and 2021 is shown in the following table.

Note G – Asset Retirement Obligations

The asset retirement obligations liabilities recognized by the Company are related to the estimated costs to dismantle and abandon its producing oil and natural gas properties and related equipment.

A reconciliation of the beginning and ending aggregate carrying amount of the ARO for the respective periods presented is shown in the following table.

(Thousands of dollars) 2023 2022

4 unchanged sentences

Liabilities settled ( 95,637 ) ( 64,255 )

Liabilities associated with assets held for sale — 263

Changes due to translation of foreign currencies 3,004 ( 10,448 )

Balance at end of year 914,763 911,653

Current portion of liability at end of year ¹ ( 94,385 ) ( 132,117 )

Noncurrent portion of liability at end of year $ 817,268 $ 839,776

Current portion of liability ¹ ( 10,712 ) ( 94,385 )

Noncurrent portion of liability $ 904,051 $ 817,268

1 Included in “Other accrued liabilities” on the Consolidated Balance Sheets.

2 unchanged sentences

prices for oil field services, technological changes, governmental requirements and other factors.

Note I – Income Taxes

The components of income (loss) from continuing operations before income taxes for each of the three years presented and income tax expense (benefit) attributable thereto were as follows.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note I – Income Taxes (Continued)

Note H – Income Taxes

The components of income (loss) from continuing operations before income taxes for each of the three years presented and income tax expense (benefit) attributable thereto were as follows.

( Thousands of dollars )

14 unchanged sentences

The following table reconciles income taxes based on the U.S.

statutory tax rate to the Company’s income tax expense.

statutory tax rate to the Company’s income tax expense for each of the three years presented.

( Thousands of dollars )

12 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note I – Income Taxes (Continued)

An analysis of the Company’s deferred tax assets and deferred tax liabilities at December 31, 2022 and 2021 showing the tax effects of significant temporary differences follows.

Note H – Income Taxes (Continued)

An analysis of the Company’s deferred tax assets and deferred tax liabilities for the respective periods presented showing the tax effects of significant temporary differences follows.

( Thousands of dollars )

19 unchanged sentences

Subsequent reductions of the valuation allowance are expected to be reported as reductions of tax expense assuming no offsetting change in the deferred tax asset.

The Company has an U.S.

net operating loss of $ 2.1 billion at year-end 2022 with a corresponding deferred tax asset of $ 442.7 million.

The Company has a U.S.

net operating loss carryforward of $ 1.7 billion at year-end 2023 with a corresponding deferred tax asset of $ 357.5 million.

The Company believes the U.S.

7 unchanged sentences

If this threshold is met, the tax benefit is then measured and recognized at the largest amount that is greater than 50% likely of being realized upon ultimate settlement.

Liabilities associated with uncertain income tax positions are included in “Deferred credits and other liabilities” in the Consolidated Balance Sheets.

Liabilities associated with uncertain income tax positions are included in “Other taxes payable” and “Deferred credits and other liabilities” in the Consolidated Balance Sheets for current and long-term portions, respectively.

A reconciliation of the beginning and ending amount of the consolidated liability for unrecognized income tax benefits during the three years presented is shown in the following table.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note I – Income Taxes (Continued)

Note H – Income Taxes (Continued)

( Thousands of dollars )

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Additions for tax positions related to prior year 2,456 948 –

Settlements with taxing authorities — — ( 2,748 )

Balance at December 31 $ 6,384 $ 3,928 $ 2,903

2 unchanged sentences

The Company also had other recorded liabilities of $ 0.3 million as of December 31, 2023, 2022 and 2021, respectively, for interest and penalties associated with uncertain tax positions.

Income tax expense for the years ended December 31, 2022, 2021 and 2020 included net benefits for interest and penalties of nil , nil and $ 0.1 million, respectively, associated with uncertain tax positions.

In 2023, the Company currently expects to add between $ 0.1 million and $ 1.0 million to the provision for uncertain tax positions.

Although existing liabilities could be reduced by settlement with taxing authorities or lapse due to statute of limitations, the Company believes that the changes in its unrecognized tax benefits due to these events will not have a material impact on the Consolidated Statement of Operations during 2023.

There were no interest or penalties associated with uncertain tax positions included in income tax expense for any period presented.

In 2024, the Company currently does not expect to add to the provision for uncertain tax positions.

Although existing liabilities could be reduced by settlement with taxing authorities or due to statute of limitations closing, the Company believes that the changes in its unrecognized tax benefits due to these events will not have a material impact on the Consolidated Statement of Operations during 2024.

The Company’s tax returns in multiple jurisdictions are subject to audit by taxing authorities.

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The Company has retained certain possible liabilities and rights to income tax receivables relating to Malaysia for the years prior to 2019.

The Company believes current recorded liabilities are adequate.

Coronavirus Aid, Relief, and Economic Security Act

In the fourth quarter of 2020, under the provisions of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, the Company received a refund of its remaining outstanding AMT credit balance of approximately $ 18.5 million.

Note J – Incentive Plans

Note I – Incentive Plans

Murphy utilizes cash-based and/or share-based incentive awards to supplement normal salaries as compensation for executive management and certain employees.

For share-based awards that qualify for equity accounting, costs are recognized as an expense in the Consolidated Statements of Operations, using a grant date fair value-based measurement method, over the periods that the awards vest.

For share-based awards that settle in cash that are required to be accounted for under liability accounting rules, costs are recognized as expense using a fair value-based measurement method over the vesting period, but expense is adjusted as necessary through the date the award value is finally determined.

For cash-settled equity awards that are required to be accounted for under liability accounting rules, costs are recognized as expense using a fair value-based measurement method over the vesting period, but expense is adjusted as necessary through the date the award value is finally determined.

Total expense for liability awards is ultimately adjusted to the final intrinsic value for the award.

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The 2020 Long-Term Plan expires in 2030.

A total of 5 million shares are issuable during the

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note J – Incentive Plans (Continued)

life of the 2020 Long-Term Plan.

A total of 5 million shares are issuable during the life of the 2020 Long-Term Plan.

Shares issued pursuant to awards granted under this Plan may be shares that are authorized and unissued or shares that were reacquired by the Company, including shares purchased in the open market.

2 unchanged sentences

The Stock Plan for Non-Employee Directors (2021 NED Plan) permits the issuance of restricted stock, restricted stock units and stock options or a combination thereof to the Company’s Non-Employee Directors.

The Company currently has outstanding incentive awards issued to Directors under the 2021 NED Plan and the 2018 Stock Plan for Non-Employee Directors (2018 NED Plan).

The Company generally expects to issue treasury shares to satisfy future stock option exercises and vesting of restricted stock and restricted stock units.

Amounts recognized in the financial statements with respect to share-based plans are shown in the following table:

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note I – Incentive Plans (Continued)

Company currently has outstanding incentive awards issued to Directors under the 2021 NED Plan and the 2018 Stock Plan for Non-Employee Directors (2018 NED Plan).

The Company generally expects to issue treasury shares to satisfy vesting of restricted stock and restricted stock units.

Amounts recognized in the financial statements with respect to share-based plans for each of the three years presented are shown in the following table.

( Thousands of dollars )

3 unchanged sentences

As of December 31, 2023, there were $ 47.4 million in compensation costs, to be expensed over approximately the next three years , related to unvested share-based compensation arrangements granted by the Company.

Employees receive net shares, after applicable withholding obligations, upon each stock option exercise and restricted stock award.

Total income tax benefits realized from tax deductions related to stock option exercises under share-based payment arrangements were immaterial for the years ended December 31, 2022, 2021 and 2020.

Employees receive net shares, after applicable withholding obligations, upon each stock option exercise and restricted stock unit vest.

Equity-Settled Awards

PERFORMANCE-BASED RESTRICTED STOCK UNITS – Performance-based restricted stock units (PSUs) to be settled in Common shares were granted in 2021 and 2022 under the 2020 Long-Term Plan and 2020 under the 2018 Long-Term Plan.

PERFORMANCE-BASED RESTRICTED STOCK UNITS – PSUs to be settled in common shares were granted in 2020 under the 2018 Long-Term Plan, and in 2021, 2022 and 2023 under the 2020 Long-Term Plan.

Each grant will vest if the Company achieves specific performance objectives at the end of the designated performance period.

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If performance goals are not met, PSUs will not vest, but the recognized compensation cost associated with the stock award would not be reversed.

For PSUs, the performance conditions are based on the Company’s total shareholder return ( 80 % weighting), compared to an industry peer group of companies, and the EBITDA divided by Average Capital Employed (ACE) metric ( 20 % weighting) for PSU awards, over the performance period.

For PSUs, the performance conditions are based on the Company’s total shareholder return ( 80 % weighting), compared to an industry peer group of companies, and the EBITDA divided by Average Capital Employed metric ( 20 % weighting) for PSU awards, over the performance period.

During the performance period, PSUs are subject to transfer restrictions and are subject to forfeiture if a grantee terminates for reasons other than retirement, disability or death.

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The assumptions used in the valuation of the performance awards granted in 2023, 2022 and 2021 are presented in the following table.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note J – Incentive Plans (Continued)

2023 2022 2021

6 unchanged sentences

Stock beta 1.034

1.195 - 1.200

Expected life 3.0 years 3.0 years 3.0 years

TIME-BASED RESTRICTED STOCK UNITS – Time-based RSUs have been granted to the Company’s Non-Employee Directors (NED) under the 2018 NED Plan and 2021 NED Plan and to certain employees under the 2012 Long-Term Plan, 2018 Long-Term Plan and 2020 Long-Term Plan.

The fair value of the time-based restricted stock units awarded in 2022, 2021 and 2020 are presented in the following table.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note I – Incentive Plans (Continued)

TIME-BASED RESTRICTED STOCK UNITS – Time-based RSUs have been granted to the Company’s Non-Employee Directors (NED) under the 2018 NED Plan and 2021 NED Plan, and to certain employees under the 2020 Long-Term Plan.

The fair value of the time-based restricted stock units awarded for each of the last three years are presented in the following table.

Type of Plan Valuation Methodology 2023 2022 2021

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1 Under the 2021 NED Plan, RSUs granted in 2023 are scheduled to vest in February 2024.

2 The RSUs granted under the 2012 Plan will vest on the fifth anniversary of the date of grant.

2 The RSUs granted under the 2018 and 2020 Long-Term Plan generally vest on the third anniversary of the date of grant.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note J – Incentive Plans (Continued)

Note I – Incentive Plans (Continued)

Changes in stock options outstanding during the last three years are presented in the following table.

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Outstanding at December 31, 2020

Outstanding at Exercised ( 47,000 ) 17.57

Outstanding at Forfeited ( 825,010 ) 54.85

2,048,400 40.14

( 170,000 ) 17.57

( 558,900 ) 52.61

Outstanding at December 31, 2021 1,319,500 37.77

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Exercisable at December 31, 2023 – –

Additional information about stock options outstanding at December 31, 2022 is shown below.

Options Outstanding Options Exercisable

Exercisable Price No.

in Years Aggregate

28.51 13,000 1.1 $ 188,565 13,000 1.1 $ 188,565

The total intrinsic value of options exercised during 2023 was $ 0.16 million.

2 unchanged sentences

Cash-Settled Awards

The Company has granted phantom stock-based incentive awards to be settled in cash to certain employees in the form of SARs, Performance-based restricted stock units (CPSUs), CRSUs and Phantom units.

The Company has granted phantom stock-based incentive awards to be settled in cash to certain employees in the form of SARs and CRSUs.

SAR awards have terms similar to stock options.

CPSU terms are similar to other performance-based restricted stock awards.

CRSUs generally settle on the third anniversary of the date of grant.

Phantom units generally settle three to five years from date of grant.

Each award granted is settled, net of applicable income tax withholdings, in cash rather than with common shares.

3 unchanged sentences

Compensation expense of $ 30.9 million, $ 42.9 million and $ 29.0 million was recorded in 2023, 2022 and 2021, respectively, for these plans.

Note K – Employee and Retiree Benefit Plans

Note J – Employee and Retiree Benefit Plans

PENSION AND OTHER POSTRETIREMENT PLANS – The Company has defined benefit pension plans that are principally noncontributory and cover most full-time employees.

3 unchanged sentences

tax qualified plans meet the funding requirements of federal laws and regulations.

Contributions to foreign plans are based on local laws and

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

tax regulations.

Contributions to foreign plans are based on local laws and tax regulations.

The Company also sponsors other postretirement benefits such as health care and life insurance benefit plans, which are not funded, that cover most retired U.S.

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employees under the Company’s retirement plan after the date of their separation from Murphy.

GAAP requires the Company to recognize the overfunded or underfunded status of its defined benefit plans as an asset or liability in its consolidated balance sheet and to recognize changes in that funded status between periods through “Accumulated other comprehensive loss.”

In 2020, the Company announced that it was closing its headquarters office in El Dorado, Arkansas, its office in Calgary, Alberta, and consolidating all worldwide staff activities to its existing office location in Houston, Texas.

As a result of this decision and the subsequent restructuring activities, a pension remeasurement was triggered and the Company incurred pension curtailment and special termination benefit charges as a result of the associated reduction in force in 2020.

The tables that follow provide a reconciliation of the changes in the plans’ benefit obligations and fair value of assets for the years ended December 31, 2022 and 2021 and a statement of the funded status as of December 31, 2022 and 2021.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note J – Employee and Retiree Benefit Plans (Continued)

GAAP requires the Company to recognize the overfunded or underfunded status of its defined benefit plans as an asset or liability in its Consolidated Balance Sheets and to recognize changes in that funded status between periods through “Accumulated other comprehensive loss”.

The tables that follow provide a reconciliation of the changes in the plans’ benefit obligations, fair value of assets and funded status for the respective periods presented.

Benefits Other

27 unchanged sentences

Fund Status and net plan liability recognized at December 31 $ ( 221,342 ) $ ( 212,129 ) $ ( 63,808 ) $ ( 67,679 )

1 At December 31, 2023, the Company recognized an increase to its domestic plan benefit obligation related to a plan amendment.

The amendment provides a permanent increase to benefits for retirees and beneficiaries who commenced payments prior to 2020.

In 2023, the increase to the pension benefits obligation is primarily due to the decrease in the interest rate assumption.

At December 31, 2023, amounts included in “Accumulated other comprehensive loss” (AOCL) in the Consolidated Balance Sheets, before reduction for associated deferred income taxes, which have not been

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

At December 31, 2022, amounts included in “Accumulated other comprehensive loss” (AOCL) in the Consolidated Balance Sheets, before reduction for associated deferred income taxes, which have not been recognized in net periodic benefit expense are shown in the following table.

Note J – Employee and Retiree Benefit Plans (Continued)

recognized in net periodic benefit expense are shown in the following table.

( Thousands of dollars )

13 unchanged sentences

Unfunded other postretirement plans 63,808 67,679 63,808 67,679 – –

The table that follows provides the components of net periodic benefit expense for each of the three years ended December 31, 2022.

The table that follows provides the components of net periodic benefit expense for each of the three years presented.

Pension Benefits Other

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Amortization of prior service cost (credit) 620 ( 684 ) 591 ( 532 ) ( 532 ) –

Amortization of transitional (asset) liability 231 — — ( 587 ) — —

Recognized actuarial (gain) loss 9,776 16,098 20,565 ( 3,512 ) ( 615 ) ( 29 )

Net periodic benefit expense 18,239 9,578 24,917 ( 308 ) 2,032 3,337

Termination benefits expense — — 8,434 — — —

Curtailment expense 219 – – – – –

1 unchanged sentence

The preceding tables in this note include the following amounts related to foreign benefit plans.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

Benefits Other

7 unchanged sentences

The following table provides the weighted-average assumptions used in the measurement of the Company’s benefit obligations at December 31, 2023 and 2022 and net periodic benefit expense for 2023 and 2022.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note J – Employee and Retiree Benefit Plans (Continued)

Benefit Obligations Net Periodic Benefit Expense

6 unchanged sentences

2023 2022 2023 2022 2023 2022 2023 2022

Discount rate 5.30 % 2.54 % 5.41 % 2.86 % 3.13 % 2.24 % 2.86 % 2.51 %

Discount rate on obligation, interest cost and service cost

5.03 % 5.30 % 5.15 % 5.41 % 5.27 % 3.13 % 5.41 % 2.86 %

Rate of compensation increase 3.52 % 3.50 % – – 3.52 % 3.00 % – –

20 unchanged sentences

During 2024, the Company currently expects to make contributions of $ 35.8 million to its domestic defined benefit pension plans, $ 2.2 million to its foreign defined benefit pension plans and $ 4.4 million to its domestic postretirement benefits plan.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

PLAN INVESTMENTS – Murphy Oil Corporation maintains an Investment Policy Statement (Statement) that establishes investment standards related to its funded domestic qualified retirement plan.

Our investment strategy is to maximize long-term returns at an acceptable level of risk through broad diversification of plan assets in a variety of asset classes.

Asset classes and target allocations are determined by our investment committee and include equities, fixed income and other investments, including hedge funds, real estate and cash equivalent securities.

Investment managers are prohibited from investing in equity or fixed income securities issues by the Company.

Asset classes and target allocations are determined by our investment committee and includes equities, fixed income and other investments, including hedge funds, real estate and cash equivalent securities.

Investment managers are prohibited from investing in equity or fixed income securities issued by the Company.

The majority of plan assets are highly liquid, providing flexibility for benefit payment requirements.

1 unchanged sentence

Asset allocations are rebalanced on a periodic basis throughout the year to bring assets to within an acceptable range of target levels.

The weighted average asset allocation for the Company’s funded pension benefit plans at December 31, 2022 and 2021 are presented in the following table.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note J – Employee and Retiree Benefit Plans (Continued)

The weighted average asset allocation for the Company’s funded pension benefit plans at the respective balance sheet dates are shown in the following table.

Equity securities 62.6 % 65.7 %

5 unchanged sentences

The 7.4 % expected return was comprised of the weighted average expected future equity securities return of 8.4 % and a fixed income securities return of 4.7 %.

There is also an average expected investment expense of 0.6 %.

An average expected investment expense of 0.8 % is included in this calculation.

Over the last 10 years, the return on funded retirement plan assets has averaged 3.0 %.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

At December 31, 2023, the fair value measurements of retirement plan assets within the fair value hierarchy are included in the table that follows.

15 unchanged sentences

fixed income 132,608 56,381 76,227 –

International commingled trust fund — — — —

Emerging market mutual fund — — — —

Cash and equivalents 10,412 10,412 — –

10 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

Note J – Employee and Retiree Benefit Plans (Continued)

At December 31, 2022, the fair value measurements of retirement plan assets within the fair value hierarchy are included in the table that follows.

25 unchanged sentences

Total $ 450,944 $ 273,447 $ 144,763 $ 32,734

The definition of levels within the fair value hierarchy in the tables above is included in Note P .

The definition of levels within the fair value hierarchy in the tables above is included in Note O .

For domestic plans, U.S.

core, small/midcap, international, emerging market equity securities and U.S.

treasury securities are quoted prices in active markets.

treasury securities are valued based on quoted prices in active markets.

For commercial paper securities, the prices received generally utilize observable inputs in the pricing methodologies.

9 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note K – Employee and Retiree Benefit Plans (Continued)

Note J – Employee and Retiree Benefit Plans (Continued)

The effects of fair value measurements using significant unobservable inputs on changes in Level 3 plan assets are outlined below:

9 unchanged sentences

Relating to assets held at the reporting date 711

Purchases, sales and settlements ( 11,731 )

Relating to assets sold during the period ( 8,991 )

Total at December 31, 2023 $ 24,454

3 unchanged sentences

Amounts charged to expense for the Company’s match to these plans were $ 8.5 million in 2023, $ 6.0 million in 2022 and $ 5.4 million in 2021.

Note L – Financial Instruments and Risk Management

Note K – Financial Instruments and Risk Management

DERIVATIVE INSTRUMENTS – Murphy uses derivative instruments, such as swaps and zero-cost commodity price collar contracts, to manage certain risks related to commodity prices, foreign currency exchange rates and interest rates.

1 unchanged sentence

The Company does not hold any derivatives for speculative purposes, and it does not use derivatives with leveraged or complex features.

Derivative instruments are traded with creditworthy major financial institutions or over national exchanges such as the New York Mercantile Exchange (NYMEX).

Derivative instruments are traded with creditworthy major financial institutions or over national exchanges such as the New York Mercantile Exchange.

The Company has a risk management control system to monitor commodity price risks and any derivatives obtained to manage a portion of such risks.

6 unchanged sentences

Under the collar contracts, which also matured monthly, the Company purchased a put option and sold a call option with no net premiums paid to or received from counterparties.

Upon maturity, collar contracts required payments by the Company if the NYMEX average closing price is above the ceiling price or payments to the Company if the NYMEX average closing price is below the floor price.

At December 31, 2022, the Company does no t have any outstanding crude oil derivative contracts.

At December 31, 2021, the Company had 20,000 barrels per day in NYMEX West Texas Intermediate (WTI) swap contracts at a price per barrel of $ 44.88 and 25,000 barrels per day in NYMEX WTI collar contracts with an average ceiling price per barrel of $ 75.20 and an average floor price per barrel of $ 63.24 , both maturing ratably during 2022.

Upon maturity, collar contracts required payments by the Company if the NYMEX average closing price was above the ceiling price or payments to the Company if the NYMEX average closing price was below the floor price.

At December 31, 2023 and December 31, 2022, the Company did no t have any outstanding crude oil derivative contracts.

At December 31, 2021, the Company had 20,000 barrels per day in NYMEX WTI swap contracts at a price per barrel of $ 44.88 and 25,000 barrels per day in NYMEX WTI collar contracts with an average ceiling price per barrel of $ 75.20 and an average floor price per barrel of $ 63.24 , both maturing ratably during 2022.

MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – Continued

Note L – Financial Instruments and Risk Management (Continued)

Note K – Financial Instruments and Risk Management (Continued)

Foreign Currency Exchange Risks

1 unchanged sentence

The Company had no foreign currency exchange short-term derivative instruments outstanding as of December 31, 2023 and 2022.

At December 31, 2022 and 2021, the fair value of derivative instruments not designated as hedging instruments are presented in the following table.

What changed 10-K

Item 9A. Controls and Procedures