ConocoPhillips trims 2017 spending by $200 million

July 27, 2017
ConocoPhillips is reducing its planned capital expenditures for 2017 by $200 million to $4.8 billion.

ConocoPhillips is reducing its planned capital expenditures for 2017 by $200 million to $4.8 billion.

The Houston firm is the latest US independent to roll back spending amid prolonged oil price volatility. Anadarko Petroleum Corp. earlier this week said it’s cutting its capital investment for the year by $300 million (OGJ Online, July 24, 2017).

“We remain focused on lowering our breakeven price for the business, generating free cash flow and delivering strong per-share growth with improving returns through the price cycles,” said Ryan Lance, ConocoPhillips’s chairman and chief executive officer. “This is the right approach for value creation in the upstream sector, especially at a time of uncertainty in the commodity markets.”

ConocoPhillips expects its third-quarter production to reach 1.17-1.21 million boe/d, which excludes Libya and reflects expected impacts from the firm’s San Juan, Barnett, and Panhandle asset sales. The firm’s full-year production on the same basis is expected at 1.34-1.37 million boe/d.

The firm reported a second-quarter loss of $3.4 billion, compared with a second-quarter 2016 loss of $1.1 billion. Excluding special items, second-quarter 2017 adjusted earnings were $200 million, compared with a second-quarter 2016 adjusted loss of $1 billion.

Special items for the current quarter were primarily driven by a noncash impairment of Australia Pacific LNG, noncash impairments from its San Juan and Barnett sales, and premiums on early debt retirement, partially offset by gains from its Canada asset sale.

For the first half, ConocoPhillips took a loss of $2.9 billion, compared with a first-half 2016 loss of $2.5 billion. First-half 2017 adjusted earnings were $1 million, compared with a first-half 2016 adjusted loss of $2.2 billion.