Citi Global Energy Conference June 2012 Jeff Sheets EVP, Finance and CFO
Our Priorities Continue focus on safety and Dividend Growth (cents/share) operations excellence Finish repositioning Invest with discipline Production Growth Drive profitable organic growth Grow shareholder distributions…
ConocoPhillips Today Largest North Americanbased independent Production 1.6 MMBOED (2011) Lowerrisk, diversified international Liquids positions LNG + International Gas North American Gas Majors asset base with compelling growth…
Our Value Proposition Sectorleading distributions 3 5% annual production growth 3 5% annual margins growth Ongoing priority to improve returns Relentless focus on safety and execution 5
Disciplined Investment Approach Reinvest 75 80% of CFO for optimized Current Dividend Yield growth and returns Sustainable production growth 100%+ organic reserve replacement Build inventory of future investment options Return 20…
2012 2016 Production Growth Disciplined allocation of 15 B annual capex generates 3 5% CAGR with high margins and low risk * 2012 fullyear impact of disposition candidates 7
2012 2016 Margin Improvement Shift to highmargin production drives 3 5% cash margin CAGR Production MMBOED Production and Margin Growth 2012 FlatPrice Conditions 2012 to 2016 All periods reflect the 2012 price outlook as of March…
Focus on Returns Goal to continue absolute 2011 ROCE improvements Close gap and maintain strong relative position Capital allocated to highestreturn projects Diligence on cost structure and efficiency Independents: APA,…
Cash Flow Growth B 15 B annual capex optimizes growth and returns 3 4 B allocated to dividends Cash position and strong balance sheet provide significant financial flexibility 2012 CFO based on first call estimate for…
Impactful North American Position Largest independent producer in North America 3 5% production CAGR projected from highreturn programs Technical strengths in arctic, unconventional, heavy oil 2011 Production MBOED 2012 2016…
LowerRisk International Position Majority of production in longlived assets in OECD countries 4 6% production CAGR expected from highreturn major projects Technical capabilities in conventional, deepwater, LNG, unconventional…
Compelling NearTerm Growth Projects Five highmargin projects will account for 550+ MBOED by 2016 Lowerrisk geographies and geologies; diversified plays Production MBOED Canada North Sea North Sea Canada SAGD conventional…
Eagle Ford Best Position in Best Play 228 M net acres in liquidsrich play (77% liquids) with 1.8 BBOE resources 2012 program: over 180 wells with 16 rigs; 2.3 B investment; 50%+ return 1 Average cash margin: 48/BOE2; average F&D:…
Eagle Ford Excellence Bestinplay results driven by acreage quality, drilling and completion performance Average Eagle Ford Well BOED Spud to Rig Release Days per 10,000 Feet Production averages adjusted for first full month of…
Permian Emerging Liquids Growth 1.1 MM net acres in liquidsrich play (60% liquids) with 1.1 BBOE resources 2012 program: over 300 wells; 0.6 B investment; 40%+ return1 Average cash margin: 38/BOE2; average F&D: 16/BOE Exposure in…
Bakken Legacy Oil in Heart of Trend 207 M net lease / 419 M net mineral acres in oil play with 0.4 BBOE resources1 2012 program: over 120 wells; 0.5 B investment; 25%+ return 2 Average cash margin: 53/BOE3; average F&D: 24/BOE…
Canada SAGD WorldClass Assets 2012 program: 2.3 B investment; average project returns1 of 13%+ Average cash margin: 44/BOE2; average F&D: 11/BOE Repeatable manufacturing improves capital efficiency and time to first oil Opportunity…
Jasmine Phase 1 2 of 8 production wells drilled; subsurface results exceed expectations 2012 program: 0.4 B investment; project returns1 of 23%+ Average cash margin: 40/BOE2; project F&D: 22/BOE Additional nearfield potential…
Greater Ekofisk Area New Opportunity First Eldfisk II well completed Q1 2012; Ekofisk South progress on target 2012 program: 1.0 B investment; project returns1 of 22% Average cash margin: 42/BOE2; projects F&D: 24 27/BOE Future…
Malaysia Projects Deepwater Growth Includes 3 sanctioned projects, with 4th sanction expected mid2012 2012 program: 0.5 B investment; project returns1 of 17 20% Average cash margin: 56/BOE2; projects F&D: 17/BOE Appraisal and…
Australia Pacific LNG Project Update Completed marketing for first two 4.5 MTPA LNG trains On schedule with first cargo targeted for June 2015 2012 program: 2.0 B investment; fullcycle project returns1 of 8 10% Average cash margin:…
2012 2016 Growth Summary Compelling growth postrepositioning Production MMBOED Executing visible growth projects Highreturn, lowerrisk opportunities Shift to liquids Margins expand from 27/BOE to 32/BOE 2012 2016 Reserve…
ExplorationDriven LongTerm Growth Unconventional exploration North America: added 600,000 net acres in liquidsrich plays in 2011 (including Niobrara and Wolfcamp) North America: pilot programs in 7 plays Australia: early entry…
2012 Exploration and Appraisal Activity Diverse portfolio of conventional and liquidsrich unconventional Greenland: Baffin Bay seismic Greenland: Baffin Bay seismic Alaska: Chukchi Sea Alaska: Chukchi Sea Norway: Barents Sea…
Our Value Proposition Sectorleading distributions 3 5% annual production growth 3 5% annual margins growth Ongoing priority to improve returns Relentless focus on safety and execution Unique combination of growth, returns and…
Q&A
Additional Technical Slides Regions overview: Lower 48 Canada Alaska Europe Asia Pacific Russia, Caspian, Africa, Middle East Exploration focus: North American shale plays International shale plays Deepwater GOM and Angola…
HighQuality, LowerRisk Upstream Portfolio 2012 estimated production includes equity affiliates YE 2011 resource estimates and proved reserves 31
Lower 48 Widely recognized leader in onshore shale revolution and expanding footprint in deepwater GOM Early mover in new unconventional plays Production MBOED Directing capital to highmargin assets: Eagle Ford, Permian, Bakken,…
Canada Premier position in SAGD and large western Canada portfolio with liquidsrich potential Portfolio of lowF&D SAGD projects in Production MBOED Foster Creek, Christina Lake and Surmont Directing capital to liquidsrich plays…
Alaska Leading oil producer in resourcerich North Slope and recognized leader in arctic technology Focus on further developing core Production MBOED assets: Prudhoe, Kuparuk and Alpine Significant additional investment…
Europe 40 years experience in highmargin North Sea; 40 more years to go Focus on further developing core assets: Greater Ekofisk, J Block, Clair, Britannia, Production MBOED Alvheim and Heidrun Execute on nearterm, highreturn…
Asia Pacific Emerging positions in highvalue growth markets with renewed focus on exploration Focus on further developing assets in China, Production MBOED Indonesia and Australia Execute on growth from APLNG and Malaysia…
Russia/Caspian/Africa/Middle East Stable base with exploration options Efficient operations of all current assets Production MBOED Explore in Angola Blocks 36/37 30% operated WI, adjacent to recent Cameia discovery, 3D seismic…
North American Shale Plays Accessing and testing many highquality, highvalue, liquids rich plays Added 600,000 net acres in North Canol America in 2011 Horn River Material working interest in liquids Montney rich…
International Shale Plays International shale plays offer low cost entry for large acreage positions Australia Frontier shale play with significant liquids potential Farmin to New Standard Energy assets Canning Basin (option for…
Deepwater GOM and Angola Portfolio with exploration, appraisal, COP leases and new leasing opportunities Lower Tertiary Play Shenandoah Deepwater Gulf of Mexico 2011/2012 leasing Lease Sale 218, won top block in sale and 75% of…
Conventional North Sea and Caspian Rigorous portfolio highgrading for the best conventional opportunities Lacewing Norway North Sea Lacewing Blocks 23/21, 23/22a&b United 37% operated WI Kingdom Jasmine North Sea Analogous to…
Arctic Europe and Alaska Diverse portfolio avoiding most technically challenging ice conditions PL615 Barents Sea Skrugard PL605 151 M net acres Norway PL605 50% operated WI, PL615 25% WI Russia 2011 proprietary highquality 3D…
LNG Asia Pacific Exploring internationally for high Caldita CalditaBarossa value gas opportunities Bayu BayuUndan Browse Basin Blocks WA315 & 398P Browse Blocks 869 M net acres 60% operated WI in both AUSTRALIA 2009 Poseidon…
COP Non GAAP Reconciliation Return on Capital Employed (ROCE) Millions except as indicated 2011 Upstream estimated ROCE earnings 9,174 E&P segment special items (1,047) NonE&P segment ROCE earnings 255 E&P segment GAAP ROCE…
COP Non GAAP Reconciliation Return on Capital Employed (ROCE) Millions except as indicated 2010 2011 Numerator: E&P segment net income 9,251 8,303 Aftertax interest expense 91 79 E&P segment GAAP ROCE earnings 9,342 8,382…
Loading...
