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Property, Plant and Equipment | 12 Months Ended
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Dec. 31, 2020
Property, Plant and Equipment [Abstract] |
Property, Plant and Equipment | Note G – Property, Plant, and Equipment
| December 31, 2020 |  | December 31, 2019 |
(Thousands of dollars) | Cost |  | Net |  | Cost |  | Net |
Exploration and production ¹ | $ | 19,583,682 |  |  | 8,232,191 |  | 2 | 19,096,323 |  |  | 9,875,727 |  | 2
Corporate and other | 140,661 |  |  | 36,847 |  |  | 207,066 |  |  | 94,016 |  |
Property, plant and equipment | $ | 19,724,343 |  |  | 8,269,038 |  |  | 19,303,389 |  |  | 9,969,743 |  |
¹ Includes unproved mineral rights as follows: | $ | 649,704 |  |  | 530,194 |  |  | 508,526 |  |  | 121,163 |  |
2 Includes $22,940 in 2020 and $24,698 in 2019 related to administrative assets and support equipment. Divestments In July 2019, the Company completed a divestiture of its two subsidiaries conducting Malaysian operations, Murphy Sabah Oil Co., Ltd. and Murphy Sarawak Oil Co., Ltd., in a transaction with PTT Exploration and Production Public Company Limited (PTTEP) which was effective January 1, 2019. Total cash consideration received upon closing was $2.0 billion. A gain on sale of $985.4 million was recorded as part of discontinued operations on the Consolidated Statement of Operations in 2019. Murphy was entitled to receive a $100.0 million bonus payment contingent upon certain future exploratory drilling results prior to October 2020, however the results were not achieved. Acquisitions In June 2019, the Company announced the completion of a transaction with LLOG Exploration Offshore L.L.C. and LLOG Bluewater Holdings, L.L.C., (LLOG) which was effective January 1, 2019. Through this transaction, Murphy acquired strategic deepwater Gulf of Mexico assets which added approximately 67 MMBOE of proven reserves at May 31, 2019. Under the terms of the transaction, Murphy paid cash consideration of $1,236.2 million and has an obligation to pay additional contingent consideration of up to $200 million in the event that certain revenue thresholds are exceeded between 2019 and 2022; and $50.0 million following first oil from certain development projects. The revenue threshold was not exceeded for 2019 or 2020. In 2018, a wholly owned subsidiary, Murphy Exploration & Production Company - USA, entered into a definitive agreement with Petrobras America Inc. (PAI), a subsidiary of Petrobras. The transaction was comprised of all of the Gulf of Mexico producing assets from Murphy and PAI with Murphy overseeing the operations. Both companies contributed all their current producing Gulf of Mexico assets to MP Gulf of Mexico, LLC, a subsidiary of Murphy, which following closing of the transaction is owned 80% by Murphy and 20% by PAI. The transaction excluded Murphy’s exploration blocks. However, PAI’s blocks that hold deep exploration rights were part of the transaction. Murphy paid net cash consideration of $780.7 million, after adjustments provided for in the sale and purchase agreement. Additionally, PAI received a 20% interest in MP GOM and will earn an additional contingent consideration of up to $150.0 million if certain price and production thresholds are exceeded beginning in 2019 through 2025. Also, Murphy agreed to carry $50.0 million of PAI development costs in the St. Malo Field if certain enhanced oil recovery projects are undertaken. As of December 31, 2020, Murphy had funded $29.7 million of the carried interest. Impairments In 2020, declines in future oil and natural gas prices (principally driven by reduced demand in response to the COVID-19 pandemic and increased supply in the first quarter of 2020 from foreign oil producers and - see Risk Factors) led to impairments in certain of the Company’s U.S. Offshore and Other Foreign properties. The Company recorded pretax noncash impairment charges of $1,206.3 million to reduce the carrying values of certain properties to their estimated fair values at the time of impairment. During 2018, declines in future oil and natural gas prices led to impairments in certain of the Company’s producing properties. During 2018, as a result declines in future oil and natural gas prices, the Company recorded pretax noncash impairment charges of $20.0 million to reduce the carrying values of certain Midland properties to their estimated fair values at the time of impairment. The following table reflects the recognized impairments for the three years ended December 31, 2020.
| December 31,
(Thousands of dollars) | 2020 |  | 2019 |  | 2018
U.S. | $ | 1,152,515 |  |  | — |  |  | 20,000 |
Other Foreign | 39,709 |  |  | — |  |  | — |
Corporate | 14,060 |  |  | — |  |  | — |
| $ | 1,206,284 |  |  | — |  |  | 20,000 |
Exploratory Wells Under FASB guidance exploratory well costs should continue to be capitalized when the well has found a sufficient quantity of reserves to justify its completion as a producing well and the Company is making sufficient progress assessing the reserves and the economic and operating viability of the project. At December 31, 2020, 2019 and 2018, the Company had total capitalized drilling costs pending the determination of proved reserves of $181.6 million, $217.3 million and $207.9 million, respectively. The following table reflects the net changes in capitalized exploratory well costs during the three-year period ended December 31, 2020.
(Thousands of dollars) | 2020 |  | 2019 |  | 2018
Beginning balance at January 1 | $ | 217,326 |  |  | 207,855 |  |  | 155,103 |
Additions pending the determination of proved reserves | 3,999 |  |  | 83,712 |  |  | 59,487 |
Reclassifications to proved properties based on the determination of proved reserves | — |  |  | (61,096) |  |  | (2,214) |
Capitalized exploration well costs charged to expense | (39,709) |  |  | (13,145) |  |  | (4,521) |
Ending balance at December 31 | $ | 181,616 |  |  | 217,326 |  |  | 207,855 |
The capitalized well costs charged to expense during 2020 represent a charge for asset impairments (see above). The capitalized well costs charged to expense during 2019 included the CM-1X and the CT-1X wells in Vietnam Block 11-2/11. The wells were originally drilled in 2017. The capitalized well costs charged to expense during 2018 included the Julong East well in Block CA-1, offshore Brunei in which further development of the well has not been sanctioned by the operator and the contract term for development sanctions was reached. This well was originally drilled in 2012. The following table provides an aging of capitalized exploratory well costs based on the date the drilling was completed for each individual well and the number of projects for which exploratory well costs has been capitalized. The projects are aged based on the last well drilled in the project.
| 2020 |  | 2019 |  | 2018
(Thousands of dollars) | Amount |  | No. of Wells |  | No. of Projects |  | Amount |  | No. of Wells |  | No. of Projects |  | Amount |  | No. of Wells |  | No. of Projects
Aging of capitalized well costs: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Zero to one year | $ | — |  |  | — |  | — |  | $ | 63,409 |  |  | 5 |  | 5 |  | $ | 61,096 |  |  | 1 |  | 1
One to two years | 54,220 |  |  | 5 |  | 5 |  | — |  |  | — |  | — |  | 40,523 |  |  | 3 |  | 2
Two to three years | — |  |  | — |  | — |  | 27,396 |  |  | 1 |  | — |  | 5,208 |  |  | 1 |  | 1
Three years or more | 127,396 |  |  | 6 |  | — |  |  | 126,521 |  |  | 5 |  | — |  | 101,028 |  |  | 4 |  | 1
| $ | 181,616 |  |  | 11 |  | 5 |  | $ | 217,326 |  |  | 11 |  | 5 |  | $ | 207,855 |  |  | 9 |  | 5
Of the $181.6 million of exploratory well costs capitalized more than one year at December 31, 2020, $89.7 million is in Vietnam, $45.9 million is in the U.S., $25.6 million is in Brunei, $15.5 million is in Mexico, and $4.8 million is in Canada. In all geographical areas, either further appraisal or development drilling is planned and/or development studies/plans are in various stages of completion.

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- Definition The entire disclosure for long-lived, physical assets used in the normal conduct of business and not intended for resale. Includes, but is not limited to, accounting policies and methodology, roll forwards, depreciation, depletion and amortization expense, including composite depreciation, accumulated depreciation, depletion and amortization expense, useful lives and method used, income statement disclosures, assets held for sale and public utility disclosures. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -URI http://asc.fasb.org/topic&trid=2155823 + Details
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