Murphy Oil Corp. is selling off some of its conventional oil and gas properties in western Canada to free up some cash for projects in growth areas outside of North America. The properties for sale have total proved reserves of about 40 MMboe and currently produce 20 Mboe/d.

The announcement was light on details, but the El Dorado, AR-based producer holds an interest in more than two million acres in western Canada. Although it did not detail what it would sell, Murphy plans to keep its Hybernia and Terra Nova properties off of Canada’s East Cost. The company also plans to retain its 5% stake in Syncrude Canada Ltd., which is the world’s largest producer of oil from oil sands.

“Now is the right time to monetize our investment in many of our assets in western Canada in order to position the Company to access opportunities in higher growth areas,” said CEO Claiborne P. Deming. “This sale will bolster our balance sheet strength so that we can reallocate capital to further enhance the company’s financial returns.” In a statement, Murphy said it had retained advisers and said that it expects to complete a sale by mid-2004.

Murphy spokeswoman Mindy West said the properties for sale have garnered attention, especially by Canadian-based royalty trusts. Following the sale, she said the company most likely would use the proceeds to invest in “higher growth areas,” including Malaysia, where it is a large lease holder. Earlier this year, Murphy announced a significant discovery in Malaysia, which could contain 100-300 million bbl.

In November, Murphy dropped its third quarter earnings profit $4.4 million because of costs from an unsuccessful natural gas well in Alberta. The gas prospect lowered Murphy’s third quarter net income by 5 cents/share.

Last year, Murphy’s principal exploration and production activities were conducted in the United States, Ecuador, Malaysia, western Canada and offshore eastern Canada, the North Sea and the Atlantic Margin. Its crude oil and natural gas liquids production, in 2002, was in the United States, Canada, the United Kingdom and Ecuador, and its natural gas was produced and sold in the United States, Canada and the United Kingdom.

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