Our Objective is to Deliver Double-Digit Returns to Shareholders We offer the marketplace an E&P investment that delivers sustainable double-digit returns annually to shareholders through cash flow growth and a competitive…
Our Value Proposition is Unchanged 3 5% production growth rate 3 5% margin growth rate Competitive dividend Ongoing priority to improve financial returns Relentless focus on safety and execution Production and cash margin…
Unmatched Position Today 1,556 MBOED Production1 2Q14 North Liquids Diversified asset base with scope and scale American 24% Gas Multiple sources of growth LNG + 57% International 19% Massive positions in key resource trends Gas…
2014: Set for Growth Average Capital Significant shift in capital toward development 16B programs Exploration & Exploration & Appraisal Appraisal 2013: 1,472 MBOED1 is base for growth Major Projects 2014: Expect 3-5% production…
Capital Allocation Drives Profitable Growth Average Capital Production1 16B 2.0 100% 1.8 90% North American 1.6 40/BOE 80% Margin Unconventional 45% of Capital 1.4 70% 1.2 LNG MMBOED 60% Oil Sands 1.0 50%…
High-Margin Production Growth Drives Cash Margin Improvement 2017 Production1 Cash Margin Production CAGR1 /BOE 2013-2017 North American North American 2013 Production1 Unconventional 40 22% Unconventional North American…
High-Margin Growth Generates Long-Term Cash Flow Improvements Cash From Continuing Operations Continued cash margin growth in 2014+ B Ongoing production mix shift Increased production in areas with more favorable fiscal regimes…
Committed to Shareholder Returns Dividend Yield Competitive dividend remains key to our value proposition Highest priority use of cash 3.3% Enhances capital discipline Predictable portion of shareholder returns Differential to…
The Power of Portfolio: Margins, Decline Rates and Returns 10-15/BOE Margins 30-40/BOE Margins 40/BOE Margins North American Short-cycle cash flow High 25% Unconventionals Avoid over capitalizing Increases capital intensity…
North American Unconventionals: Unmatched Portfolio and Capabilities Montney Duvernay Great positions in proven and emerging plays Eagle Ford and Bakken sweet spots Bakken Exceptional growth in high-margin resource base…
Eagle Ford: Significant Resource Increase 220 M net acres; acreage capture complete 96% average operated working interest 1.8 BBOE to 2.5 BBOE net EUR increase 3,000 identified drilling locations Outlook based on 12-rig program…
Eagle Ford: Premium Value from Best Wells in the Play 250 Highest Oil Rates per Well1 60 Industry-Leading Value2 50 200 Gross Operated Production (BPD) 40 NPV10 per Acre (M) 150 30 100 20 50 10 0 0…
Bakken: High-Margin Growth 620 M net acres; mostly HBP or mineral fee 45% average operated working interest 600 MMBOE net EUR 1,800 identified gross drilling locations Outlook based on average 10-rig program 20-25/BOE full-cycle…
Bakken: Advantaged Position in the Heart of the Trend Montana North Dakota Bakken Acreage Values by Area (NPV10 per Acre)1 VALLEY ROOSEVELT WILLIAMS MOUNTRAIL Nesson Anticline Anticline Parshall-Sanish Fort Berthold Williams Core…
Permian Unconventional: Early Appraisal Results Encouraging New Mexico Texas Positions in Delaware and Midland basins Central Delaware Platform Midland Basin Thick column of both shale and tight rock intervals Basin Basin Four…
Niobrara: Early Appraisal Results Encouraging ADAMS ADAMS 130 M net acres in the DJ Basin Appraisal program ongoing; 1 rig running DENVER ARAPAHOE 19 horizontal wells planned for 2014 ARAPAHOE Optimization of drilling and…
LNG: Positioned in High-Margin Markets AKLNG Oil-linked contracts; robust cash flows Kenai Darwin and Qatar: High-liquids yield; premium markets Kenai: Restarting for seasonal exports Qatar Darwin LNG AKLNG: Executed JV…
Oil Sands: Significant Growth from World Class SAGD Portfolio Saleski Fort McMurray Second largest net SAGD producer Surmont Thornbury Narrows Top quartile steam-to-oil ratio Lake Executing 7 major projects and 2 optimization…
International Oil & Gas: Major Projects Driving Growth Norway U.K. Strong legacy positions 130 MBOED major projects growth expected by 2017 Libya 2013: Ekofisk South and Jasmine started on schedule China 2014: 5 projects in Europe…
North American Conventional Oil: Protecting and Growing the Base Development drilling and major projects in Alaska ALASKA Infill drilling and waterflood expansion in the Permian Drilling and expanded waterflood recovery at Ursa…
North American Gas: Low-Cost Option on Significant Resource Base Capital program focused on liquids-rich gas 1.10/MCF lifting cost 6.5 BBOE total resource 15,000 identified well locations 1.5 billion annual cash from operations at…
2014: Testing Global Portfolio Norway Greenland Barents Chukchi NPR-A Canol Montney, UK & Norway Duvernay Poland Baltic Basin Nova Scotia Azerbaijan China Bohai Niobrara China Delaware & Sichuan Midland Gulf of Mexico…
Appraising Gulf of Mexico Discoveries TEXAS LOUISIANA Tiber 18% working interest Lower Tertiary oil discovery in 2009 Multiple reservoir intervals Appraisal commenced in 2013; continues in 2014 Shenandoah Gila Tiber Coronado…
Angola: Deepwater Exploration Block 36: 50% working interest; operator Atlantic Ocean Luanda Block 37: 30% working interest; operator Block 36 Orca Pre-salt lacustrine carbonate play in Kwanza Basin Lontra Kamoxi-1 Block 20…
Key Messages Value proposition unchanged Visible growth in 2014 Significant identified resource upside in unconventionals Options and choices for organic growth beyond 2017 Strategic linkage between capex, volume growth and…
Supplemental Slides 28
Our Strategy Achieves Value Proposition Average Capital Production1 16B 2.0 100% 15% Exploration & Delivers 2017+ 1.8 90% Appraisal growth 1.6 80% Generates strong production 1.4 70% 30% Major Projects growth 1.2…
Diversified and High-Margin Reserve Base 8.9 BBOE Reserves YE 2013 By Region By Product By Margin1 Other North American North American NGL Unconventional 4% Gas Asia Pacific & Alaska 8% Oil 16% 8% LNG Middle East 19% 16% 11%…
Current Status of Unconventional Plays 31
Disciplined Pace of Development Maximizes Value Reasons to Accelerate Reasons to Optimize Acreage Retention Cost Learning Curve Benefits Technology Learning Curve Benefits Driven by Growth Infrastructure Efficiency Faster Cash…
Eagle Ford: Acreage in Heart of the Sweet Spot Thermal Maturity Pressure & Thickness A B TEXAS GONZALES WILSON LAVACA ConocoPhillips A Acreage DE WITT ATASCOSA KARNES B Maturity FRIO Sweet Spot ConocoPhillips Acreage Dry Gas…
Eagle Ford: Value-Driven Approach to Well Density 2013 2014 Transition to High/Low Evaluating Further Upside Lower Eagle Ford 80-acre1 Single Layer Lower Eagle Ford 80-acre1 High/Low Lower Eagle Ford 40-acre2 1.8 BBOE EUR 2.5 BBOE EUR…
Scientific Piloting: Accelerating Pace of Learning Pressure Monitoring Instrumented Wells Logging and Coring Stimulated Rock Volume Producer Post-Stimulation Pilot Well Cored Section Pre-Stimulation Pilot Well Map View…
Eagle Ford: Value-Driven Approach to Fracture Stimulation Design Optimizing Proppant Density Extensive pilot testing to verify stimulation models 40% Constantly enhancing fracture stimulation design EUR Increase 30% 30%…
Eagle Ford: Delivering Capital Efficiencies 40% reduction in drilling days Drilling Cost Efficiency1 100% 40% reduction in completion cost per unit of proppant 80% 75% of 2014 wells benefit from multi-well pad drilling 60% 40%…
Drilling Execution Efficiency Platform (DEEP) Optimizes drilling performance in real time 1,250 Drilling Rate (feet/day) 20% Faster Currently being field piloted in Eagle Ford 1,100 and Permian 950 Demonstrated 20% increase…
Operations Excellence: Unlocking Full Eagle Ford Potential Eagle Ford Integrated Operations Center Leveraging success from conventional asset base 300 600 of Eagle Ford Flowing Wells Center Opens Integrated operations centers in…
Bakken: Optimal Well Spacing and Placement Current Testing Tighter Spacing Evaluating Further Upside 320-acre1 in Bakken/ 160-acre2 in Bakken/ Additional Wells in Upper Three Forks Upper Three Forks Middle Three Forks 11,320…
Bakken: Delivering Capital Efficiencies Drilling Cost Efficiency1 30% reduction in drilling days 100% 29% 80% Improvement 50% reduction in completion cost per unit of proppant 60% 90% of 2014 wells to benefit from multi-well pad…
Other N.A. Unconventionals: Strong Position in Emerging Plays Montney Focused on high-margin, liquids-rich opportunities Montney Duvernay 500 M net acres under appraisal Bakken Key programs in Permian, Niobrara and Canada…
Canada: Appraising Montney and Duvernay Montney 230 M net acres 90% average working Interest Montney Focused on 135 M net acres with 30-40% liquid yield Duvernay 14 horizontal wells planned for 2014 Access to existing…
APLNG: Long-Term Cash Flow Generation Two 4.5 MTPA trains with long-term sales to Asia Project 75% complete at the end of 2Q14 On schedule for first LNG in mid-2015 25/BOE full-cycle F&D cost 2017+ distributions 1 billion per year…
Surmont 2: Progressing Toward Startup Construction 68% complete at the end of 1Q14 First steam expected in mid-2015 Surmont 2 increases gross capacity to 150 MBOED Optimization and debottlenecking studies underway 20/BOE full-cycle…
Creating Value from Operations Excellence and Technology Oil Sands SAGD Projects Steam-Oil Ratio1 Operations Excellence 6 Surmont 1 operating 15% above design capacity SOR (2013 Average) 5 4 Reduced drilling cost by 12% in…
Robust Technology Pipeline Targeting Improved Project Returns Flow Control Devices (FCD) 1,600 FCD Cumulative Oil Production 1,400 Accelerates production and reduces SOR 1,200 Successfully deployed and expanding application…
North Sea: Revitalization from High-Margin Projects 2014: Jasmine and Ekofisk South ramp up; Britannia LTC startup 2015: Eldfisk II and Enochdhu startups 2016/17: Alder, Clair Ridge and Aasta Hansteen startups 5% production CAGR…
Malaysia: Building a Legacy Position 2014: Milestone year with 3 project startups expected Siakap North-Petai (SNP): First production achieved Gumusut FPS: 3Q14 startup targeted KBB gas development: 4Q14 startup targeted…
Alaska: Increased Investment Targeting Resource Development Increased investments reflect better fiscal terms Technology mitigating decline in mature fields CD5 project in execution Drill site 2S, GMT1 and 1H NEWS projects…
Australia: Appraising Discoveries at Poseidon and Barossa Greater Poseidon Complex Barossa 40% working interest; operator 37.5% working interest; operator Discovered in 2009 Discovered in 2006 Jurassic Plover and Elang formation…
Senegal: Deepwater Exploration Rufisque 35% working interest AFRICA SENEGAL FAN-1 well spud in 2Q 2014 Cretaceous pinch-out play Sangomar The Gambia Similar age as the recent Mauritanian discovery Atlantic Ocean Sangomar Deep…
International Unconventional Exploration Poland Colombia 70% working interest; operator Santa Isabel 70% working interest (70 M net acres) 350 M net acres in the Baltic Basin VMM Blocks 30% working interest (115 M net acres) Drilling…
Strength and Flexibility Throughout the E&P Value Creation Cycle Balance Capital Resources & Profitability Shareholder Sheet Investment Reserves Production & Cash Flow Distributions Asset Sales Growing portfolio of high-return,…
Annualized Net Income Sensitivities Crude Brent/ANS: 80-90MM change for 1/BBL change WTI: 35-40MM change for 1/BBL change WCS: 30-40MM change for 1/BBL change North American NGL Representative blend: 10-15MM change for 1/BBL…
On Track To Meet Production Growth Of 3-5% 2H14 Drivers 3Q Major Turnarounds Actual Alaska Actual UK Canada APME Major Project Startups Foster Creek Phase F Gumusut KBB Britannia LTC Ramp gas sales to third-party LNG…
2014 Outlook Guidance 2014 DD&A of 8.5 B Higher DD&A from Jasmine and Gumusut startup Reflects reserve booking schedule in unconventionals Expenses from continuing operations Production and SG&A expense of 8.7-8.9B 1…
Margin Class Categorization North American International North American North American Unconventionals LNG Oil Sands Oil & Gas Conventional Oil Gas Bakken AKLNG Christina Lake China Alaska North Slope Lobo Barnett APLNG Foster Creek…
Investor Information Stock Ticker Investor Relations Contacts: NYSE: COP Telephone: +1 212.207.1996 Website: www.conocophillips.com/investor Ellen DeSanctis: ellen.r.desanctisconocophillips.com Sidney J. Bassett:…
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