Business Segments

12 Months Ended

Dec. 31, 2019

Murphy’s reportable segments are organized into geographic areas of operations. The Company’s exploration and production activity is subdivided into segments for the United States, Canada and all other countries. Each of these segments derives revenues primarily from the sale of crude oil, condensate, natural gas liquids and/or natural gas. The Company’s management evaluates segment performance based on income (loss) from operations, excluding interest income and interest expense.

The Company has several customers that purchase a significant portion of its oil and natural gas production. During 2019 sales to Chevron represented approximately 25% and Phillips 66 and affiliated companies accounted for 17% of the Company’s total sales revenue. In 2018 and 2017 sales to Phillips 66 and affiliated companies represented approximately 12% and 14%, respectively, of the Company’s total sales revenue. Due to the quantity of active oil and natural gas purchasers in the markets where it produces hydrocarbons, the Company does not foresee any difficulty with selling its hydrocarbon production at fair market prices.

The Company completed the sale of its Malaysian assets in 2019. The U.K. and Malaysian operations have been reported as Discontinued operations for all periods presented in these consolidated financial statements. For all years presented, assets and liabilities associated with U.K. refining and marketing operations were reported as held for sale in the Consolidated Balance Sheets. As of December 31, 2019, the assets and liabilities associated with Brunei as also reported as held for sale in the Consolidated Balance Sheet.

Information about business segments and geographic operations is reported in the following tables. For geographic purposes, revenues are attributed to the country in which the sale occurs. Corporate and other activities, including interest income, other gains and losses (including foreign exchange gains/losses, and realized/unrealized gains/losses on crude oil contracts), interest expense and unallocated overhead, are shown in the tables to reconcile the business segments to consolidated totals. As used in the table on the following page, certain long-lived assets at December 31, exclude investments, noncurrent receivables, deferred tax assets, and other intangible assets.



	Exploration and Production
(Millions of dollars)	United States ¹			Canada		Other		Total E&P		Corporate and Other			Discontinued Operations	Consolidated Total
Year ended December 31, 2019
Segment income (loss) - including NCI ¹	$	518.4		(4.3	)	(53.5	)	460.6		$	(271.8	)	1,064.5	1,253.3
Revenues from external customers	2,367.0			447.0		11.6		2,825.6		3.5			—	2,829.1
Interest and other income (loss)	(13.4		)	(1.5	)	(0.9	)	(15.8	)	(6.7		)	—	(22.5	)
Interest expense, net of capitalization	—			(0.1	)	(0.4	)	(0.5	)	(218.8		)	—	(219.3	)
Income tax expense (benefit)	115.6			(2.9	)	(12.4	)	100.3		(85.6		)	—	14.7
Significant noncash charges (credits)
Depreciation, depletion and amortization	878.7			243.0		3.5		1,125.2		22.6			—	1,147.8
Accretion of asset retirement obligations	34.4			6.1		—		40.5		—			—	40.5
Amortization of undeveloped leases	23.1			1.3		3.6		28.0		—			—	28.0
Deferred and noncurrent income taxes	111.8			14.0		(13.4	)	112.4		(83.9		)	—	28.5
Additions to property, plant, equipment	2,193.3			284.1		69.8		2,547.2		13.6			—	2,560.8
Total assets at year-end	8,043.3			2,303.7		308.6		10,655.6		1,046.2			16.7	11,718.5
Year ended December 31, 2018
Segment income (loss) - including NCI ¹	$	242.9		51.1		(16.6	)	277.4		$	(108.2	)	250.3	419.5
Revenues from external customers	1,332.7			470.5		22.2		1,825.4		(34.0		)	—	1,791.4
Interest and other income (loss)	—			—		—		—		7.8			—	7.8
Interest expense, net of capitalization	—			—		0.2		0.2		(180.6		)	—	(180.4	)
Income tax expense (benefit)	68.1			14.5		(25.3	)	57.3		(183.4		)	—	(126.1	)
Significant noncash charges (credits)
Depreciation, depletion and amortization	519.5			232.4		3.5		755.4		20.2			—	775.6
Accretion of asset retirement obligations	19.5			7.6		—		27.1		—			—	27.1
Amortization of undeveloped leases	36.8			0.8		2.5		40.1		—			—	40.1
Deferred and noncurrent income taxes	68.1			16.5		(25.7	)	58.9		(242.1		)	—	(183.2	)
Additions to property, plant, equipment	1,343.5			373.8		15.9		1,733.2		22.7			138.6	1,894.5
Total assets at year-end	6,342.9			1,711.9		188.1		8,242.9		1,118.5			1,691.2	11,052.6
Year ended December 31, 2017
Segment income (loss)	$	(8.9	)	112.5		(37.5	)	66.1		$	(619.1	)	241.2	(311.8	)
Revenues from external customers	944.3			485.5		—		1,429.8		14.2			—	1,444.0
Interest and other income (loss)	—			—		—		—		(78.3		)	—	(78.3	)
Interest expense, net of capitalization	—			—		—		—		(178.3		)	—	(178.3	)
Income tax expense (benefit)	(0.8		)	44.4		(36.2	)	7.4		262.7			—	270.1
Significant noncash charges (credits)
Depreciation, depletion and amortization	546.1			185.4		3.8		735.3		16.6			—	751.9
Accretion of asset retirement obligations	17.4			7.9		—		25.3		—			—	25.3
Amortization of undeveloped leases	60.2			1.6		—		61.8		—			—	61.8
Deferred and noncurrent income taxes	2.5			55.3		(36.2	)	21.6		242.5			—	264.1
Additions to property, plant, equipment	534.8			267.6		37.6		840.0		14.8			16.0	870.8
Total assets at year-end	5,186.2			1,725.8		154.2		7,066.2		1,101.7			1,693.0	9,860.9

¹2019 and 2018 include results attributable to a noncontrolling interest in MP GOM.



Geographic Information	Certain Long-Lived Assets at December 31
(Millions of dollars)	United States		Canada	Other	Total
2019	$	8,003.9	1,761.2	204.6	9,969.7
2018	6,634.3		1,644.6	153.2	8,432.1
2017	5,050.5		1,635.9	141.3	6,827.7



Geographic Information	Revenues from External Customers for the Year
(Millions of dollars)	United States		Canada	Other	Total
2019	$	2,370.4	447.1	11.6	2,829.1
2018	1,300.3		468.9	22.2	1,791.4
2017	958.3		485.7	—	1,444.0