Arun Jayaram: Great. Roger, one housekeeping question. It’s a good quarter for you guys. We did note that you tweaked your oil growth year-over-year to 8% from 10%. Is that conservatism? I just want to get some thoughts on what drove that variance?
Roger Jenkins: Well, I’m not going to be unconservative I have my EVP of operations today here with me only beat guidance by 7,000 a day this quarter when you say conservative. I think what’s going on here, it’s kind of we’re doing extremely well, and our guidance is very strong for hurricane season. We are a very big Gulf of Mexico player. We all know that. I would think of that as a positive. We’ve had some operational matters at Dalmatian throughout the year. We’ve also covered that up with some really incredible performance early in the call, Eric, mentioned our strong plateau rates at King’s Key and Eagle Ford doing extremely well. And so we’ve had some issues there, and we’re going to need to get this well online to help that field produce better, if you will, that’s caused a loss.
We put on our onshore wells earlier than planned, and they’re doing extremely well when they come on early and plan you sort of overproduce it then and then they decline toward the end because we’re front-loaded capital company to have more returns for our shareholders with less capital at the end of the year, we’re also being helped by great oil prices today. So that’s what’s going on. We have Terranova basically hardly anything flowing. So it’s hopeful to flow there. We’re doing extremely well this month. Any kind of help on Hurricane season or Dalmatian is a great well that we drilled a year ago. Our team is already executing that well. So I think we can still get back to where we were, but felt that this was the proper guidance today and be sort of a reckoning, if you will, in our production post-hurricane season at our next quarter and the sale of the assets that we’re making today get all that going.
We’re doing extremely well today, incredible high rates at this time. I’m super pleased with Eric’s team on that. And I think it’s just a little conservatism to what we have today, but we have ample ability to cover it up and get back to where we were last quarter. I’m quite pleased how we’re headed.
Arun Jayaram: Great. Thank you, Roger.
Roger Jenkins: Thank you, Ryan. Appreciate it.
Operator: The next question in the queue comes from Charles Meade with Johnson Rice. Please proceed.
Charles Meade: Good morning, Roger to you and the Murphy team there.
Roger Jenkins: Thanks, Charles.
Charles Meade: Roger, there’s been a lot of talk about service costs going up in the offshore. And I think that’s more or less at least the talk is that’s happening worldwide. So I wondered if you can talk a bit about whether you’re seeing that or whether you’ve seen that, the degree to which you’ve seen it so far? And what is — how much service cost increases are contemplated in your current forecast either for the back half of 2023 or 2024. And I’m wondering if perhaps that is one of the big contributors or maybe even the main contributor to you raising the low-end of CapEx guidance for the year?
Roger Jenkins: Eric is a little closer to that. Charles, I’m going to let him walk you through that.
Eric Hambly: Thanks, Charles. Charles, we’re in a pretty good position relative to offshore cost right now. In the first half of this year, we were working a rig in the Gulf of Mexico that was at a rate significantly below market in the $300,000 per day type range. The market is probably in the 450-ish range per day. And we were fortunate enough to lock in rig slots to conduct our planned activity well into 2025 into early 2025. We have locked in rig rates at a little bit below what is kind of current market rate. So you have that going on, which is really helping us not see inflation beyond what we had expected well in 2025. There are some other cost pressures as you can imagine, in the industry casing costs, sometimes they’re moving up and down.
We monitor that pretty carefully. That’s a big thing for us. And other related services to executing our program are pretty minor really look at the rig and the casing costs are driving most of the costs. So relative to a lot of people, we’re feeling really good about our positioning on our cost offshore through 2024. Beyond that, we’ll be exposed to market type of rates. So for our planned activities in 2025 at least the last half of 2025, we’ll have to see how the market is looking on rig rates and kind of be exposed like everybody else with in the industry.
Charles Meade: Got it. That’s helpful detail. Thank you. And then if we could go back to the – OSO well. Roger, when I look at the, I think, your — main resource for that is 150 MBoe and that actually pretty big these days for a single well in the Gulf of Mexico. Can you talk a little bit about what — about the nature of that target or maybe possibly targets in that well? And how risky you see that your risk of success there?
Roger Jenkins: Thanks, Charles. A real good question. Yes, that’s a very large prospect. One of the larger ones being drilled. This is a classic massing play up against salt years ago. Chevron drilled this prospect and never reached the objective to hitting salt prematurely. The seismic has been reprocessed in that area. We feel like we have the prospect now going up against salt with all the major typical massing fields in that area. This has been a bit of an underdrilled area in the Gulf. They’re ample structure here. This is not a lot of infrastructure here as people got back close to platforms to drill, if you will. This is also a very competitive place in the last lease sale. We picked up some leases here under severe competition with Chevron coming in here.