The oil industry may have softened its public image with the Murphy Oil Co.'s $50 million commitment to provide college scholarships for students in its hometown of El Dorado, Ark.
The scholarship program, called the El Dorado Promise, provides over the next 20 years a full scholarship for El Dorado High School graduates who attend the district for all 13 years and up to 65% paid tuition for students who attend grades nine through 12. El Dorado is a city of approximately 20,500 in a state with the second-lowest percentage of college graduates in the U.S., according to the Associated Press.
Publicity generated over the donation should be welcome news to an industry battered by claims of environmental irresponsibility and criticism for profiting from high gas prices. The Associated Press reported that when Murphy Oil -- an IndustryWeek 50 Best Manufacturer for 2006 -- announced the program on Jan. 22 at an El Dorado High School assembly, some students screamed and applauded while others wept.
"This is a huge day," said El Dorado schools Superintendent Bob Watson when the initiative was announced. "As of today, El Dorado High School graduates will have an unprecedented opportunity to continue their education. For some students, this is life changing. Students who have worked hard but would not have been able to attend college because of financial limitations now have the means to do so."
Murphy Oil President and CEO Claiborne Deming indicated that the program could provide an economic development boost for El Dorado.
"We are committed to making El Dorado a great place to live and work, and we created the Promise to further invest in El Dorado's greatest resource, our children," he said.
Murphy Oil Co.At A GlanceMurphy Oil Co.El Dorado, Ark.Primary Industry: Petroleum and Coal ProductsNumber of employees: 2,8922005 In ReviewRevenue: $11.877 billionProfit Margin: 7.13%Sales Turnover: 1.86Inventory Turnover: 28.76Revenue Growth: 42.07%Return On Assets: 15.51%Return On Equity: 31.95%
Meanwhile, Murphy Oil has made progress with its continuing exploration efforts with the discovery of a deepwater natural gas well off the coast of Sabah, Malaysia, the company announced on Jan. 29. The well, called Rotan #1, reached a depth of 7,024 feet and was drilled in 3,773 feet of water.
This is the first discovery of four exploration wells drilled in the Block H field, according to Deming.
"We have always believed in the potential of deepwater Sabah and have maintained a high and consistent level of exploration activity since 1999," he said. "Success in this new play demonstrates the tremendous opportunity in the area on which to build."
Murphy is the operator and 80% stakeholder of Block H, with Petronas Carigali Sdn. Bhd. holding the remaining 20%.
The company expects retail and refining margins to decline during the fourth quarter of 2006 from the previous quarter, resulting in downstream income of $20 million, according to an earnings guidance report.
The company expects total earnings to be between 40 cents and 45 cents per share. Oil production for the quarter is estimated at 93,000 barrels per day.
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