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EL DORADO, Ark. -- Murphy Oil Corp. announced that its wholly-owned subsidiary, Murphy Oil USA Inc., has entered into an agreement with Wal-Mart Stores Inc. and subsidiaries to purchase parcels of property that the company currently leases from Wal-Mart for its Murphy USA retail gasoline stations.
Claiborne P. Deming, Murphy Oil's president and chief executive officer, said, "The purchase of these parcels reflects our commitment to sustaining the longevity of these very productive assets. We look forward to continuing our association with Wal-Mart as we expand our station base in the future, while adhering to our strategy of offering high-quality, competitively priced gasoline to our customers."
Under the agreement terms, the conveyance of the parcels will occur in multiple phases over the next year. Expansion of the Murphy USA program will continue with additional opportunities to purchase new site locations. Murphy USA's retail presence currently covers 21 states, primarily in the Southeast and upper Midwest.
In conjunction with this agreement, the company plans to close up to 47 locations and incur after-tax impairment and restoration costs of approximately $18 million in the second quarter of 2007, which was not included in previously issued earnings guidance.
Capital expenditures for the company are expected to increase by up to approximately $315 million during the 2007-2008 period, according to the announcement.