ConocoPhillips’ 1Q earnings down y-o-y on lower realized prices

ConocoPhillips had first-quarter 2023 earnings and adjusted earnings of $2.9 billion, compared with first-quarter 2022 earnings of $5.8 billion, and first-quarter 2022 adjusted earnings of $4.3 billion.

First-quarter 2023 earnings decreased from the year ago period primarily due to lower realized prices partially offset by commercial performance and timing, as well as the absence of special items in the prior year’s first quarter. The company’s total average realized price was $60.86/boe in first-quarter 2023, 21% lower than the $76.99/boe realized in first-quarter 2022.

Production for the year’s first quarter was 1.79 MMboe/d, an increase of 45,000 boe/d from the same period a year ago. After adjusting for impacts from closed acquisitions and dispositions, first-quarter 2023 production increased by 65,000 boe/d or 4% from the same period a year ago. This was primarily driven by new wells online in the Lower 48 and improved well performance across the portfolio, partially offset by normal field decline and downtime.

In the Lower 48, first-quarter production averaged 1.04 MMboe/d, including 694,000 boe/d from the Permian basin, 227,000 boe/d from the Eagle Ford shale, and 98,000 boe/d from the Bakken shale. Operationally, a stabilizer expansion in the Eagle Ford and a planned turnaround at QatarGas 3 were successfully completed.

For the quarter, cash provided by operating activities was $5.4 billion. Excluding a $300 million change in operating working capital, the company generated cash flow from operating activities of $5.7 billion and received disposition proceeds of $200 million. The company funded $2.9 billion of capital expenditures and investments, including $400 million billion for its investment in the joint venture responsible for development of Port Arthur LNG and $100 million in Lower 48 acquisitions. In addition, the company repurchased $1.7 billion of shares and paid $1.5 billion in ordinary dividends and variable return of cash.

Second-quarter 2023 production is expected to be 1.77-1.81 MMboe/d. The company raised its full-year production guidance midpoint by 10,000 boe/d. Full-year production of 1.78-1.8 MMboe/d is expected, up from prior guidance of 1.76-1.8 MMboe/d.