Murphy Oil signs four PSCs in Cameroon for potential $202mn offshore exploration programme

US independent oil and gas producer Murphy Oil Corporation (NYSE: MUR) has announced the execution of four production sharing contracts (PSCs) offshore Cameroon. In a November 11 press release, the Houston-based company said it secured operatorship of exploration acreage covering approximately 10,500 square kilometres as the Central African country seeks to reverse declining crude production.

The PSCs cover the Elombo, Etinde Exploration, Ntem and Tilapia blocks. Murphy will initially hold a 100% working interest through a subsidiary, while Cameroon’s state-owned National Hydrocarbons Corporation (SNH) retains the right to acquire up to 20% in any future development.

According to the African Energy Chamber (AEC), the agreements were signed in Yaoundé and establish a potential seven-year exploration programme valued at $202.4mn. However, most of that expenditure depends on subsequent exploration decisions.

Murphy has committed an initial $2.4mn over three years for seismic data reprocessing and geological studies, the AEC said in a November 12 media statement. Two successive two-year extensions, if both exercised, could involve eight exploration wells, one per block during each extension, at an estimated $25mn per well. This would bring potential expenditure to $202.4mn. The contracts therefore do not represent an immediate commitment to spend the full amount. Initial technical assessments will determine whether the company proceeds with drilling.

According to a November 11 report by Investir au Cameroun, the programme differs from the original licensing requirements, which called for at least one exploration well during the initial three-year period. Under the arrangements presented at the signing ceremony, drilling would instead take place during optional extensions. The publication said it remained unclear whether the original requirements had been formally amended during negotiations.

Cameroon is seeking new discoveries to compensate for declining production from mature fields. According to the AEC, national crude output fell 9.4% in 2025, from 21.38mn barrels to 19.37mn barrels.

The contracts follow a licensing process launched in August 2025, which offered nine offshore blocks. Murphy received four awards in April 2026, while privately held oil and gas explorer Octavia Energy secured the Bolongo exploration block. The AEC said Cameroon subsequently opened another licensing round covering six exploration blocks across three basins.

Murphy’s Cameroon entry also forms part of a wider international exploration expansion. World Oil reported on November 11 that the company had recently signed PSCs for the C-10 and Tiof blocks offshore Mauritania, covering approximately 3.1mn acres (12,545.25 square kilometres), and secured six exploration licences offshore Israel. The company also reported a light oil discovery at Bubale-1X offshore Côte d’Ivoire in June 2026.

For Cameroon, the immediate priority will be converting the new contracts into exploration activity. Geological assessments and potential drilling will determine whether the acreage contains commercially recoverable hydrocarbons capable of supporting future production.

“Cameroon has an opportunity to turn its offshore resource potential into a new generation of oil and gas discoveries,” said AEC Executive Chairman NJ Ayuk. “Murphy Oil’s commitment to these four blocks is an important step in that direction. We welcome this investment and encourage the government and industry to keep building the partnerships that will bring exploration forward, create opportunities and strengthen Cameroon’s position as an oil and gas producer.”