Due to the ongoing weakness in the crude oil and natural gas markets following the COVID-19 outbreak, Murphy Oil Corp. announced an additional reduction in its 2020 CAPEX, lowering its planned spend to $780 million, a 46% decrease from its original 2020 capital plan. The company had previously announced a 2020 CAPEX drop to $950 million last month.
Part of these savings will come from significant salary reductions for company executives. Murphy Oil said the annual salary for its President and CEO will be reduced by 35%, while remaining executives will receive salary reductions of as much as 30%, with the average drop for those executives being around 22%. Cash retainers for all directors will be lowered by 35%, with the Chairman of Murphy’s Board of Directors reducing his cash retainer by 70%.
“Murphy recognizes the reality of the current situation in the commodity markets, and we believe the reduction in dividends, capital expenditures, salaries and retainers are prudent steps to sustain the company for a long time,” said Claiborne P. Deming, Murphy’s Board Chairman. “We will continue to review our dividend and other items throughout the course of the year and make further adjustments if warranted.”