Murphy Oil Announces Preliminary Quarterly and Annual Financial Results

Murphy Oil Corporation (NYSE: MUR) announced today that its net income
in the fourth quarter of 2012 was $158.7 ?million ($0.82 ?per diluted
share) compared to a net loss of $113.9 ?million ($0.59 ?per diluted
share) in the fourth quarter of 2011. Net income in the fourth quarter
of 2012 was improved over the same 2011 quarter principally due to lower
impairment expenses and income tax benefits associated with operating
losses in two foreign countries in the current period. The just
completed quarter included total impairment charges of $261.0 million
($239.6 ?million after taxes) associated with both oil production
operations in Republic of the Congo and ethanol production operations in
Hereford, Texas. The Congo impairment related primarily to unsuccessful
drilling operations in the fourth quarter and the removal of proved oil
reserves at year-end 2012 at the Azurite field. The field continues to
produce while we evaluate future options. Operating results in the
fourth quarter of the prior year included an impairment charge for
Azurite of $368.6 ?million. The Hereford ethanol plant was deemed
impaired at year-end 2012 due to an expectation of weak future ethanol
crush spreads. Income tax benefits in the upstream business totaled
$108.3 ?million associated with tax deductions for operating losses in
Republic of the Congo and Suriname. The 2012 fourth quarter included a
loss from discontinued operations of $3.7 million ($0.02 per diluted
share), compared to income from discontinued operations of $4.0 ?million
($0.02 per diluted share) in the 2011 quarter. Income from continuing
operations in the fourth quarter of 2012 was $162.4 ?million ($0.84 per
diluted share), but was a loss of $117.9 ?million ($0.61 per diluted
share) a year ago.

For the year of 2012, net income totaled $970.9 ?million ($4.99 ?per
diluted share) compared to $872.7 ?million ($4.49 ?per diluted share) in
2011. Net income included income from discontinued operations of
$6.8 ?million ($0.04 ?per diluted share) in 2012 and $143.2 ?million
($0.74 ?per diluted share) in 2011. Income from continuing operations for
the years of 2012 and 2011 totaled $964.1 ?million ($4.95 ?per diluted
share) and $729.5 ?million ($3.75 ?per diluted share), respectively.

Fourth quarter 2012 vs. Fourth quarter 2011

Exploration and Production (E&P)

Income for the Company′s E&P continuing operations was $145.0 ?million in
the fourth quarter of 2012 compared to a loss of $144.6 ?million in the
same quarter of 2011. The improvement in earnings in the fourth quarter
2012 compared to the same period in 2011 was primarily attributable to a
larger impairment charge in Republic of the Congo in 2011 and income tax
benefits recognized in 2012 totaling $108.3 ?million associated with
operating losses in Republic of the Congo and Suriname. The 2012 quarter
also benefited from higher crude oil sales volumes and lower exploration
expenses, but these were mostly offset by lower oil and natural gas
sales prices and higher overall extraction and administrative expenses.
The increase in extraction expenses in the current year was attributable
to higher worldwide average crude oil production and higher depreciation
unit rates in Malaysia associated with ongoing capital development
activities.

Exploration expenses totaled $137.2 ?million in the fourth quarter 2012,
down from $185.6 ?million in the 2011 quarter. The decrease was primarily
attributable to lower dry hole costs associated with unsuccessful
exploratory drilling in the 2012 quarter in Canada and Brunei, partially
offset by higher dry hole costs in the current quarter in Republic of
the Congo.

Additionally, the 2012 quarter had lower leasehold amortization expense
in the Kurdistan region of Iraq compared to the prior year.

Worldwide production totaled 211,833 barrels of oil equivalent per day
in the 2012 fourth quarter, an 11% increase from the 190,103 ?barrels of
oil equivalent per day produced in the 2011 quarter. Crude oil,
condensate and gas liquids production was 132,918 barrels per day in the
2012 quarter compared to 108,771 ?barrels per day in 2011. The oil
production increase in the current year was primarily attributable to an
ongoing development drilling program in the Eagle ?Ford Shale area of
South Texas as well as purchase of additional working interests in the
Thunder ?Hawk and Front Runner fields in the Gulf of Mexico during 2012.
Natural gas sales volumes averaged 473 ?million cubic feet per day in
quarter four 2012, down 3% from the 488 ?million cubic feet per day sold
in the prior year′s quarter. The 2012 reduction was primarily
attributable to lower gas volumes produced at the Tupper ?area in Western
Canada due to a planned shut-in of certain wells and virtually no
development drilling in this area in the 2012 quarter because of
continued weak North American natural gas sales prices. Natural gas
production in 2012 in the U.S. was above 2011 levels primarily due to
the development drilling program in the Eagle Ford Shale.

The average sales price for the Company′s crude oil, condensate and gas
liquids was $92.82 per barrel for continuing operations in the 2012
fourth quarter, down from $96.67 per barrel in the 2011 quarter. Natural
gas sales prices in North America averaged $3.34 per thousand cubic feet
(MCF) in the 2012 quarter, down from $3.67 per MCF in the 2011 quarter.
Natural gas sold from fields offshore Sarawak, Malaysia, averaged $6.78
per MCF in the 2012 quarter compared to $7.85 ?per MCF a year ago.

Refining and Marketing (R&M)

The Company′s refining and marketing business generated a quarterly
profit from continuing operations of $38.5 ?million in the fourth quarter
2012 compared to a profit of $61.0 ?million in the same quarter a year
earlier. U.S. R&M continuing operations generated earnings of
$22.0 ?million in the fourth quarter of 2012 compared to earnings of
$50.7 ?million in the 2011 quarter. The earnings reduction for this
business in 2012 was principally the result of an impairment charge of
$39.6 ?million after taxes to reduce the carrying value of the Hereford,
Texas ethanol plant. The Company′s U.S. ethanol plants experienced
weaker operating results in the 2012 quarter compared to the prior year
due to depressed ethanol crush spreads. U.S. retail marketing operations
reflected improved results as margins for this business averaged
14.1 ?cents per gallon in the 2012 quarter compared to 13.0 ?cents per
gallon in the 2011 quarter. Retail operations also benefited from
improved merchandise margins in the current quarter compared to a year
ago. The U.K. R&M operations posted a net profit of $16.5 ?million in the
2012 quarter compared to a profit of $10.3 ?million in 2011, with the
improved results based on better overall unit margins for this business.

Corporate

Corporate activities incurred after-tax costs of $21.1 ?million in the
fourth quarter of 2012, well below the net costs of $34.3 ?million in the
2011 quarter. The 2012 cost reduction was primarily related to favorable
effects from transactions denominated in foreign currencies. The 2012
quarter included an after-tax benefit of $3.5 ?million from foreign
currencies, compared to an after-tax charge of $11.6 ?million in the 2011
quarter. The Company also had lower net interest expense in the 2012
quarter due to capitalizing a larger portion of its financing costs to
oil development projects in the current period. Administrative expenses
were higher in the 2012 quarter compared to a year earlier due to
additional costs for professional services and employee compensation.

Discontinued Operations

The loss from discontinued operations was $3.7 ?million ($0.02 per
diluted share) in the fourth quarter 2012, compared to income of
$4.0 ?million ($0.02 per diluted share) in the 2011 fourth quarter. The
2012 quarterly results included income tax adjustments related to the
Company′s former U.S. oil refineries which were sold in 2011, mostly
offset by profits from U.K. oil and gas production operations. The
quarterly profit a year ago was primarily attributable to results of the
U.K. oil and gas production operations. The sale of these U.K. oil and
gas assets is expected to be completed during the first quarter 2013.

Year 2012 vs. Year 2011

Exploration and Production (E&P)

The Company′s E&P continuing operations earned $905.0 ?million for the
full year 2012 compared to $614.2 ?million in 2011. The improvement in
2012 earnings versus 2011 was primarily attributable to higher oil
production and lower impairment and exploration expenses in 2012, plus
income tax benefits recognized in the current year related to U.S. tax
deductions for losses incurred in Republic of the Congo and Suriname.
The current year also benefited from marginally higher average crude oil
sales prices. The 2011 period included a $13.1 ?million after-tax gain on
sale of gas storage assets in Spain. Unfavorable effects in 2012
included lower North ?American natural gas sales prices and higher
extraction expenses, with the latter caused by increased production
levels and higher overall per-unit depreciation rates.

Total exploration expense was $380.9 ?million in 2012, down from
$489.4 ?million in 2011. Exploration costs were lower in the current year
due to more drilling success in 2012, plus lower geophysical expense in
the Gulf of Mexico, Malaysia, Brunei and the Kurdistan region of Iraq.

Total worldwide production in 2012 was 194,278 barrels of oil equivalent
per day, an 8% increase from 179,388 ?barrel equivalents produced in
2011. Total crude oil, condensate and gas liquids production averaged
112,591 barrels per day in 2012, an increase of 9% compared to the 2011
level of 103,160 ?barrels per day. The increase in the current year was
mostly attributable to higher production in the Eagle Ford Shale area of
South Texas and at the Kikeh field, offshore Sabah, Malaysia. Natural
gas sales volumes increased from 457 ?million cubic feet per day in 2011
to 490 ?million cubic feet per day in 2012. The 7% increase in gas
volumes in the current year was primarily attributable to higher
production in the Tupper area and the Eagle ?Ford Shale. Natural gas
volumes would have increased more in 2012 but for the fact that the
Company voluntarily shut-in certain wells and significantly reduced
development drilling in Western ?Canada due to depressed North American
natural gas sales prices.

The average sales price for crude oil and other liquids for continuing
operations was $95.58 per barrel in 2012 compared to $94.18 ?per barrel
in 2011. North American natural gas was sold at an average price of
$2.65 ?per MCF in 2012, significantly below the 2011 average of $4.08 ?per
MCF. However, natural gas volumes produced offshore Sarawak were sold
for $7.50 per MCF in 2012, up from $7.10 ?per MCF in the prior year.

Refining and Marketing (R&M)

The Company′s refining and marketing continuing operations generated a
profit of $157.6 ?million in the year of 2012 compared to a profit of
$190.3 ?million in 2011. U.S. R&M profits from continuing operations were
$105.4 ?million in 2012 compared to $223.6 ?million in 2011. Operating
results in 2012 for the U.S. R&M business were lower than 2011 due to
weaker retail marketing margins and significantly lower margins for
ethanol production operations. Per gallon margins for U.S. retail
operations averaged 12.9 ?cents in 2012 compared to 15.6 ?cents in 2011.
Ethanol production operating results were adversely affected by both
weaker crush spreads and a $39.6 ?million after-tax asset impairment
charge related to the Hereford, Texas plant. The U.K. R&M business
produced a net profit of $52.2 ?million in 2012 compared to a net loss of
$33.3 ?million in 2011. The improvement in U.K. operating results was
attributable to more than a $2.60 per barrel increase in unit margins in
the current year.

Corporate

Corporate after-tax costs were $98.5 ?million in the year of 2012
compared to costs of $75.0 ?million in 2011. The significant unfavorable
variance in 2012 compared to the prior year was mostly associated with
foreign currency effects. Although after-tax effects from transactions
denominated in foreign currencies were minimal in 2012, the prior year
benefited from an after-tax gain of $20.7 ?million. The 2012 period also
had higher administrative costs compared to 2011, primarily associated
with more employee compensation and professional service expenses in the
later period. However, net interest expense was lower in 2012 than
2011 ?essentially due to higher levels of interest capitalized to oil
development projects in the current year.

Discontinued Operations

Income from discontinued operations was $6.8 ?million in 2012 compared to
$143.2 ?million in 2011. The 2011 results primarily related to income for
two U.S. refineries sold in late 2011, including $113.1 ?million of
operating profits and an $18.7 ?million net gain on disposal. Income from
discontinued operations in both years included operating profits for
U.K. offshore oil and gas assets that are expected to be sold in the
first quarter 2013.

Steven A. Coss?, President and Chief Executive Officer, commented, 'The
just completed 2012 was an important year for our Company. Murphy′s
Board decided to separate our U.S. downstream subsidiary into an
independent public company; the completion of this process is expected
during 2013. The U.S. retail business executed a new contract with
Walmart, which will provide growth opportunities for this company for
the next several years. In the oil and gas business, once again our
reserves replacement significantly exceeded our oil and gas production
volumes. We continued growth in our Eagle Ford Shale operation, where
total production averaged 15,000 net barrels of oil equivalent per day
for 2012, with expected 2013 annual production increasing to 30,000 net
barrel equivalents per day. We added acreage and working interests in
Canada and the Gulf of Mexico, while finalizing sale agreements for our
oil and gas properties in the U.K. that are expected to close in the
first quarter of this year. We also paid a $2.50 per share special
dividend and commenced a stock buyback program near year-end.

'We anticipate total worldwide production volumes of 200,000 ?barrels of
oil equivalent per day in the first quarter of 2013. Sales volumes of
oil and natural gas are projected to average 202,000 ?barrels of oil
equivalent per day during the quarter. At the present time, we expect
income from continuing operations in the first quarter to range between
$0.55 and $0.90 ?per diluted share. The first quarter estimate includes
projected exploration expense of between $70 ?million and $140 ?million,
and a loss from our downstream businesses of approximately $10 ?million.
Results could vary based on the risk factors described below.?

The public is invited to access the Company′s conference call to discuss
fourth quarter 2012 results on Thursday, January 31 at 12:00 p.m. CST
either via the Internet through the Investor Relations section of Murphy
Oil′s Web site at http://www.murphyoilcorp.com/ir
or via the telephone by dialing 1-888-503-8172. The telephone
reservation number for the call is 6962469. Replays of the call
will be available through the same address on Murphy ?Oil′s Web ?site, and
a recording of the call will be available through February 4 by calling
1-888-203-1112 and referencing reservation number 6962469. Audio
downloads will also be available on the Murphy Web site through March 1
and via Thomson StreetEvents for their service subscribers.

This press release contains forward-looking statements as defined in
the Private Securities Litigation Reform Act of 1995. These statements,
which express management′s current views concerning future events or
results, including Murphy′s plans to separate its U.S. downstream
business and to divest its U.K. downstream and U.K. upstream operations,
are subject to inherent risks and uncertainties.Factors that
could cause one or more of these forecasted events not to occur include,
but are not limited to, a failure to obtain necessary regulatory
approvals, a failure to obtain assurances of anticipated tax treatment,
a deterioration in the business or prospects of Murphy or its U.S.
downstream business, adverse developments in Murphy or its U.S.
downstream operation′s markets, adverse developments in the U.S. or
global capital markets, credit markets or economies generally or a
failure to execute a sale of the U.K. downstream or U.K. upstream
operations on acceptable terms or in the timeframe contemplated.Factors
that could cause actual results to differ materially from those
expressed or implied in our forward-looking statements include, but are
not limited to, the volatility and level of crude oil and natural gas
prices, the level and success rate of our exploration programs, our
ability to maintain production rates and replace reserves, customer
demand for our products, adverse foreign exchange movements, political
and regulatory instability, and uncontrollable natural hazards. For
further discussion of risk factors, see Murphy′s 2011 Annual Report on
Form 10-K and the September 30, 2012 Quarterly Report on Form 10-Q on
file with the U.S. Securities and Exchange Commission. Murphy undertakes
no duty to publicly update or revise any forward-looking statements.

Murphy Oil Corporation

Barry Jeffery, 870-864-6501