Discontinued Operations

6 Months Ended

Jun. 30, 2014

Discontinued Operations And Disposal Groups [Abstract]

Discontinued Operations

Note D – Discontinued Operations

The Company has previously announced its intention to sell its U.K. refining and marketing operations. The Company has accounted for this U.K. downstream business as discontinued operations for all periods presented, including a reclassification of 2013 operating results and cash flows for this business to discontinued operations. The U.K. downstream operations were previously reported as a separate segment within the Company’s former refining and marketing business. On July 31, 2014, Murphy signed an agreement to sell the Milford Haven, Wales, refinery and terminal assets. Pending regulatory approval and subject to other material conditions, this transaction is scheduled to be completed by October 31, 2014. Additionally, a separate transaction for sale of the U.K. retail marketing business is at an advanced stage.

On August 30, 2013, Murphy Oil Corporation (the “Company”) distributed 100% of the outstanding common stock of Murphy USA Inc. (“MUSA”) to its shareholders in a generally tax-free spin-off for U.S. federal income tax purposes. Prior to the separation, MUSA held all of the Company’s U.S. downstream operations, including retail gasoline stations and other marketing assets, plus two ethanol production facilities. The shares of MUSA common stock are traded on the New York Stock Exchange under the ticker symbol “MUSA.” The Company has no continuing involvement with MUSA operations. Accordingly, the operating results and the cash flows for these former U.S. downstream operations have been reported as discontinued operations in the 2013 consolidated financial statements. The U.S. downstream operations were previously reported as a separate segment within the Company’s former refining and marketing business.

The Company also sold its oil and gas assets in the United Kingdom during 2013. After-tax gains on sale of the assets were $68.8 million in the three months ended June 30, 2013 and $216.2 million in the six months ended June 30, 2013. The Company has accounted for these U.K. upstream operations as discontinued operations in its consolidated financial statements for all periods presented.

The results of operations associated with these discontinued operations for the three-month and six-month periods ended June 30, 2014 and 2013 were as follows:

	Three Months					Six Months
	Ended June 30,					Ended June 30,
(Thousands of dollars)	2014			2013		2014			2013
Revenues	$	811,134			5,964,045		2,243,520			11,479,583
Income before income taxes, including pretax gain on disposals of $55,640 and $130,568 during the three-month and six-month periods in 2013	$	(16,938	)		184,418		(34,233	)		317,339
Income tax expense (benefit)		(3,682	)		41,663		(6,944	)		(3,332	)
Income (loss) from discontinued operations	$	(13,256	)		142,755		(27,289	)		320,671

The following table presents the carrying value of the major categories of assets and liabilities of U.K. refining and marketing operations reflected as held for sale on the Company’s consolidated balance sheets at June 30, 2014 and December 31, 2013:

	June 30,		December 31,
(Millions of dollars)	2014		2013
Current assets
Cash	$	242,438		301,302
Accounts receivable		165,972		302,059
Inventories		126,656		254,240
Other		82,128		86,131
Total current assets held for sale	$	617,194		943,732
Non-current assets
Property, plant and equipment, net	$	279,555		360,347
Other		22,596		21,057
Total non-current assets held for sale	$	302,151		381,404
Current liabilities
Accounts payable	$	255,470		637,432
Other		465		1,708
Total current liabilities associated with assets held for sale	$	255,935		639,140
Non-current liabilities
Deferred income taxes payable	$	75,896		68,096
Deferred credits and other liabilities		18,031		27,448
Total non-current liabilities associated with assets held for sale	$	93,927		95,544