For the first nine months of 2008, net income totaled $1.613 billion, $8.39 per diluted share, compared to $560.4 million, $2.94 per diluted [image-nocss] share, for the same period in 2007.
Reviewing quarterly results by type of business, the company's income contribution from Exploration and production (E&P) operations was $529.9 million in third-quarter 2008 compared to $150.8 million in the same quarter of 2007. The improved earnings in 2008 compared to 2007 were primarily based on higher oil sales prices and volumes.
The company's refining and marketing (R&M) operations generated a quarterly profit of $85.8 million in third-quarter 2008 compared to a quarterly profit of $73.2 million in the 2007 third quarter. North American earnings improved in the 2008 period compared to 2007 primarily due to better margins for U.S. marketing operations.
Murphy Oil's E&P operations earned $1.535 billion in the first nine months of 2008 compared to $388.9 million in the same period of 2007. The primary reasons for the higher earnings in this business in 2008 were higher crude oil and natural gas sales prices and higher crude oil sales volumes.
The company's R&M operations generated a profit of $173.3 million in the first nine months of 2008 compared to a profit of $233.1 million in 2007. The lower 2008 result in North America was due to weaker U.S. refining margins during most of 2008 compared to 2007.
"With the extraordinary turmoil in the financial markets in recent weeks, our history of maintaining a strong balance sheet with low levels of debt is currently serving us well.... Although the lower oil prices seen in recent weeks have curtailed exploration and production earnings, the decline has allowed the refining and marketing business to make a strong contribution to the company's results of operations in the third and early fourth quarters. Following Hurricanes Gustav and Ike, our Gulf of Mexico production has been hampered by delays in repairs to third-party pipelines," said Claiborne P. Deming, president and CEO.
(Click herefor full release.)Also, San Antonio-based Tesoro Corp. has reported third-quarter 2008 net income of $259 million, or $1.86 per share. Net income for third-quarter 2007 was $47 million, or 34 cents per share. For the three quarters ended Sept. 30, 2008, net income was $181 million, or $1.30 per share, versus $606 million, or $4.35 per share a year ago when the company had unusually high refining margins due to significant industry unplanned downtime during the first half of the year.
Operating income also rose due to the significant improvement in commercial and retail marketing margins. Retail and commercial marketing margin was $4.77 per barrel versus $2.65 per barrel a year ago. Retail segment income totaled $34 million due to improved fuel margins along with increased volumes associated with the purchase of the Shell and USA brand retail assets.
Independent refiner and marketer Tesoro, through its subsidiaries, operates seven refineries in the western United States with a combined capacity of approximately 660,000 barrels per day. Tesoro's retail-marketing system includes more than 880 branded retail stations, of which more than 390 are company operated under the Tesoro, Shell, Mirastar and USA Gasoline brands.
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And El Paso, Texas-based Western Refining Inc. has reported third-quarter 2008 net income of $109.2 million, or $1.61 per diluted share. The company's net income was $46.6 million, or 69 cents per diluted share, for the same period in 2007. For the first nine months of 2008, it reported net earnings of $77 million, or $1.14 per diluted share, versus net earnings of $264.1 million, or $3.91 per diluted share, for the first nine months of 2007.
The improvement in operating income in the 2008 third quarter was due to higher refined product margins. The increase in margins was primarily the result of an increase in the amount of lower-cost crude oil processed at the company's refineries during the 2008 quarter. Margins also improved in the quarter as the cost of crude oil declined faster than the prices of finished products.
"We are pleased with our third quarter financial results. Although Hurricanes Gustav and Ike had a positive impact on margins in the quarter, the actions we have taken to improve and enhance our Four Corners and Yorktown refineries contributed significantly to earnings in the quarter and should continue to do so in future quarters," said Paul Foster, Western's president and CEO.
"Despite the ongoing economic uncertainty, refining margins remained strong at our four refineries throughout the month of October," he added. "Our Retail and Wholesale operations also posted strong financial results for the month. Looking at the remainder of the quarter, distillate margins look good as a result of steady demand and continued tight supply. While gasoline demand has declined the last couple of months, we believe the significantly lower prices at the pump today could stimulate demand and improve gasoline margins."
Western Refining is an independent refining and marketing company with a refinery in El Paso, two refineries in the Four Corners region of northern New Mexico and a refinery in Yorktown, Va. Western's asset portfolio also includes refined products terminals in Albuquerque, N.M., and Flagstaff, Ariz., retail stations and convenience stores in Arizona, Colorado and New Mexico, a fleet of crude oil and finished product truck transports and wholesale petroleum products operations in Arizona, California, Colorado, Nevada, New Mexico, Texas and Utah.
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