New York-listed Murphy Oil’s chief executive Roger Jenkins said that the farmout showed the value of its “high-margin, long-term assets” in the south-east Asian state.
He said the explorer would look to “re-deploy the proceeds through an individual or combination of strategic and financial initiatives such as increased drilling capital in the Eagle Ford Shale, acquisition opportunities, debt reduction and share repurchases”.
Murphy Oil holds majority stakes in seven production sharing contracts in Malaysia that yielded more than 40% of its total net production last year with output of around 86,00 barrels of oil equivalent per day.
The permits hold 125 million barrels of oil and 406 billion cubic feet of gas in proved reserves.
The company had been known to be marketing the assets, and during the summer rumours emerged of Japan’s Mitsubishi submitting a non-binding bid of $2.5 billion and of Indian duo ONGC Videsh (OVL) and Oil India offering a joint bid of $1.5 billion, according to Reuters reports.
Murphy Oil said it expected the sale two close in two phases in the fourth quarter of the year and the first quarter of next year, subject to approvals, with an effective date of 1 January 2014.