Murphy to split into separate E&P, retail company

EL DORADO, Ark. -- Murphy Oil is splitting in two in order to better focus on the separate tasks of exploration and production, and the sale of gasoline and other goods through its retail locations.

Shares jumped 8 percent in premarket trading Tuesday.

Murphy will become an independent oil exploration and production company focused on the U.S., Canada and Malaysia. The company will continue its exploration program and offshore development projects, while also growing its North America onshore businesses.

Murphy USA will become a separate company in charge of retail sales. Assets will include seven product distribution terminals and ethanol production facilities in North Dakota and Texas.

The new structure, expected to be finalized next year, will allow each company to focus on different priorities and set financial targets that best fit its own markets and opportunities, the company said.

Murphy announced special dividend of $2.50 for a total of about $500 million and a stock buyback program covering $1 billion in common shares. The dividend will be paid on Dec. 3 to shareholders of record as of Nov. 16 and is in addition to the company's previously announced dividend of 31.25 cents.

There are still plans to sell off downstream operations in the United Kingdom.

Shares of Murphy Oil Corp., based in El Dorado, Ark., rose $4.49 to $63.49 in premarket trading.