Murphy Oil (MUR)

Insurance

Murphy maintains insurance against certain, but not all, hazards that could arise from its operations, and such insurance is believed to be reasonable for the hazards and risks faced by the Company. As of December 31, 2007, the Company maintained total excess liability insurance with limits of $750 million per occurrence covering certain general liability and certain “sudden and accidental” environmental risks. The Company also maintained insurance coverage with an additional limit of $250 million per occurrence, all or part of which could be applicable to certain sudden and accidental pollution events. There can be no assurance that such insurance will be adequate to offset costs associated with certain events or that insurance coverage will continue to be available in the future on terms that justify its purchase. The occurrence of an event that is not fully insured could have a material adverse effect on the Company’s financial condition and results of operations in the future. During 2005, damages from hurricanes caused shut-down of certain U.S. oil and gas production operations as well as the Meraux, Louisiana refinery. The Company repaired the Meraux refinery and it restarted operations in mid-2006. The Company does not expect to fully recover repair costs incurred at Meraux under its insurance policies. See Note Q in the consolidated financial statements for further discussion.

Insurance

Murphy maintains insurance against certain, but not all, hazards that could arise from its operations, and such insurance is believed to be reasonable for the hazards and risks faced by the Company. As of December 31, 2006, the Company maintained total excess liability insurance with limits of $750 million per occurrence covering certain general liability and certain “sudden and accidental” environmental risks. The Company also maintained insurance coverage with an additional limit of $250 million per occurrence, all or part of which could be applicable to certain sudden and accidental pollution events. There can be no assurance that such insurance will be adequate to offset costs associated with certain events or that insurance coverage will continue to be available in the future on terms that justify its purchase. The occurrence of an event that is not fully insured could have a material adverse effect on the Company’s financial condition and results of operations in the future. During 2005, damages from hurricanes caused shut-down of certain U.S. oil and gas production operations as well as the Meraux, Louisiana refinery. The Company repaired the Meraux refinery and it restarted operations in mid-2006. The Company does not expect to fully recover repair costs incurred at Meraux under its insurance policies. See Note O in the consolidated financial statements for further discussion.

Insurance

Murphy maintains insurance against certain, but not all, hazards that could arise from its operations, and such insurance is believed to be reasonable for the hazards and risks faced by the Company. As of December 31, 2005, the Company maintained total excess liability insurance with limits of $750 million per occurrence covering certain general liability and certain “sudden and accidental” environmental risks. The

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Table of Contents

Index to Financial Statements

Company also maintained insurance coverage with an additional limit of $250 million per occurrence, all or part of which could be applicable to certain sudden and accidental pollution events. There can be no assurance that such insurance will be adequate to offset costs associated with certain events or that insurance coverage will continue to be available in the future on terms that justify its purchase. The occurrence of an event that is not fully insured could have a material adverse effect on the Company’s financial condition and results of operations in the future. During 2005, damages from hurricanes caused shut-down of certain U.S. oil and gas production operations as well as the Meraux, Louisiana refinery. At year-end 2005, the Company was in the process of repairing the Meraux refinery. The Company does not expect to fully recover repair costs incurred at Meraux in 2006 under its insurance policies. See Note O in the consolidated financial statements for further discussion.

Insurance

Murphy maintains insurance against certain, but not all, hazards that could arise from its operations, and such insurance is believed to be reasonable for the hazards and risks faced by the Company. As of December 31, 2005, the Company maintained total excess liability insurance with limits of $750 million per occurrence covering certain general liability and certain “sudden and accidental” environmental risks. The

8

Table of Contents

Index to Financial Statements

Company also maintained insurance coverage with an additional limit of $250 million per occurrence, all or part of which could be applicable to certain sudden and accidental pollution events. There can be no assurance that such insurance will be adequate to offset costs associated with certain events or that insurance coverage will continue to be available in the future on terms that justify its purchase. The occurrence of an event that is not fully insured could have a material adverse effect on the Company’s financial condition and results of operations in the future. During 2005, damages from hurricanes caused shut-down of certain U.S. oil and gas production operations as well as the Meraux, Louisiana refinery. At year-end 2005, the Company was in the process of repairing the Meraux refinery. The Company does not expect to fully recover repair costs incurred at Meraux in 2006 under its insurance policies. See Note O in the consolidated financial statements for further discussion.

ARTICLE 18 – INSURANCE

edition of Best’s Report, as stated or insurers acceptable to COMPANY. To the extent of CONTRACTOR’s indemnity obligations under this CONTRACT, a certificate naming COMPANY as additional insureds and evidencing coverages, specifically quoting the indemnification provisions set forth in this CONTRACT and waiving all rights of subrogation, but such naming and waiving shall only be to the extent of the indemnity obligations assumed by CONTRACTOR in this CONTRACT, against COMPANY GROUP shall be delivered to COMPANY prior to commencement of the WORK, or in case of a subcontractor, prior to the commencement of subcontractor’s part of the WORK. Such certificates shall provide that any change restricting or reducing coverage or the cancellation of any policies under which certificates are issued shall not be valid as respects the interest of COMPANY and other working interest owners therein until COMPANY has received thirty (30) days notice in writing of such change or cancellation. CONTRACTOR’s liabilities shall not be limited in any way by the amounts of available insurance coverage. Failure to secure the insurance coverages, or the failure to comply fully with any of the insurance provisions of this CONTRACT, or the failure to secure such endorsements on the policies as may be necessary to carry out the terms and conditions of this CONTRACT, shall in no way act to relieve CONTRACTOR from the obligations of this CONTRACT, any provisions hereof to the contrary notwithstanding. In the event that liability for loss or damage be denied by the insurer(s) in all or in part, because of breach of the said insurance provisions by CONTRACTOR, or for any other reason, or if CONTRACTOR fails to maintain any of the insurances herein required, CONTRACTOR shall hold harmless, defend and indemnify COMPANY GROUP and its insurers against all claims, demands, costs and

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omission or breach of CONTRACTOR. Any invalidation of coverage, exceptions and exclusions and/or warranties in the CAR insurance policy which are brought into effect by the act, omission or breach of CONTRACTOR shall be for the account of CONTRACTOR. CONTRACTOR shall comply in all respects with any conditions stipulated in the insurance policies which COMPANY is required to obtain pursuant to this CONTRACT, and refrain from any action which might prejudice the continued effectiveness of such insurance so long as COMPANY provides CONTRACTOR with prior written notification of these requirements and these requirements are customary for the SCOPE OF WORK and are reasonable in nature. CONTRACTOR shall provide required information to, and coordinate with, any insurance surveyor appointed under COMPANY’s insurance to undertake preshipment, loading and discharge surveys. CONTRACTOR shall comply with and shall cause its contractors and subcontractors to comply with any claims or accident notification, recording and investigation procedures required by COMPANY in connection with COMPANY’s insurance. To the extent of COMPANY’s indemnity obligations under this CONTRACT, COMPANY shall name CONTRACTOR GROUP as additional insureds and shall ensure all COMPANY’s insurances waive all rights of subrogation against CONTRACTOR GROUP, subject to CONTRACTOR GROUP complying with any QA/QC requirements contained within the CAR insurance policy. CONTRACTOR shall be named

COMPANY’s indemnification obligations. COMPANY shall ensure all COMPANY’s insurances waive all rights of subrogation against CONTRACTOR and its subcontractors of all tiers.

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Any claim by CONTRACTOR against COMPANY-provided insurance shall require the prior written consent of COMPANY which consent shall not be unreasonably withheld, and be made through COMPANY. CONTRACTOR shall fully co-operate with COMPANY which shall be entitled to control or manage the handling of the claim with the insurance underwriter.

effect during the term of this CONTRACT shall constitute a breach of this CONTRACT, and the non-defaulting party shall have the right at its option, in addition to other rights, to terminate within thirty (30) days this CONTRACT with resultant costs to be borne by the defaulting party.