Murphy Oil Corporation is closing its legacy headquarters in El Dorado in response to declining crude oil prices.
The company is establishing its new corporate headquarters at its existing office in Houston, Texas. In addition, the company is closing its office in Calgary, Alberta, Canada.
All of Murphy Oil’s worldwide staff activities will be run from the Houston office. There were 80 employees at the El Dorado office and 110 employees at the Calgary office; it is currently unclear what the status of these jobs are.
“Over the past several months, we have taken several actions to significantly reduce costs, including cutting this year’s capital expenditures by approximately 50 percent, or $700 million, lowering the company’s dividend by 50 percent, or $76.5 million on an annualized basis, and lowering executive officers’ salaries on average 22 percent, with the chief executive officer’s reduced by 35 percent. We realize, reluctantly, that we need to consolidate our offices to capture additional cost savings to remain competitive in this unprecedented industry environment. We simply do not have a choice and came to this decision only after exhausting all other cost saving measures,” Claiborne P. Deming, board chairman for Murphy Oil Co., said in a statement
“The El Dorado office closure is particularly painful and difficult, because the company was founded here by C. H. Murphy, Jr. and has been an integral and important part of the community for many years.”
During the first quarter of 2020, Murphy Oil suffered a net loss of $416 million, which amounts to a $2.71 per share loss. The adjusted net loss for the quarter is $46 million.
To offset its losses, Murphy Oil has targeted $30 to $40 million in operating expenses as well as an addition $50 million in cash expenses for 2020. It has also lowered its planned capital expenditures to $740 million.
Murphy Oil’s roots in El Dorado stretch back to 1904 when Charles Haywood Murphy Sr. arrived in the town to settle an uncle’s estate, which Murphy expanded to 13 country banks. He sold the majority of the banks and invested in timberlands and a sawmill three years later, as well as purchasing land tracts.
From the 1920s through the 1940s, the Murphy family purchased land and began participating in oil field discoveries. In 1950, Murphy Corporation was incorporated in Louisiana and the company went public in 1956 and was listed on the New York Stock Exchange in 1961.
Murphy Oil partnered with Walmart to build Murphy USA stations, starting in 1996. Murphy USA was spun off in 2013 as Murphy Oil repositioned itself as an independent exploration and production company.
In a news release, Murphy Oil committed to continue funding the El Dorado Promise. This program, founded in 2007, pays the college tuition – up to the highest amount charged by an Arkansas public university – for every El Dorado Public School District student that decides to attend college.
Image courtesy of Polk Stanley Wilcox Architects