ConocoPhillips outlines $11.2 billion budget for 2010

ConocoPhillips approved a $11.2 billion capital program for 2010, representing a 10% decrease from estimated 2009 expenditures.

Dec 2nd, 2009

By OGJ editors
HOUSTON, Dec. 2
-- ConocoPhillips approved a $11.2 billion capital program for 2010, representing a 10% decrease from estimated 2009 expenditures. Previously, the company said it would reduce its 2010 budget from its 2009 budget to improve returns through increased capital discipline.

For next year, 86% of the capital program will support exploration and production while 12% is allocated for the refining and marketing units.

Jim Mulva, chairman and chief executive officer, said the company intends to replace reserves through drilling and to increase production from a reduced, more strategic asset base. He said details will be discussed with analysts next year.

The 2010 capital program for E&P is $9.7 billion, including $1.4 billion for worldwide exploration. In North America, the capital program is expected to total $4.1 billion. Spending in North America is reduced compared with earlier years.

In the Lower 48, spending will be prioritized on oil and certain natural gas assets that offer the highest potential returns, including ongoing development in the San Juan and Permian basins and the Bakken, Lobo, and Barnett trends. The company also plans to progress exploration drilling in the Eagle Ford shale position in the Lower 48, a coalseam gas play in China, and a shale gas play in Poland.

In Canada, spending will focus on existing oil sands projects and selective programs in the Western Canada gas basins, primarily on high-graded resource plays and on maintaining a substantial lease position for future development.

Spending in Alaska is expected to be directed toward development of existing Prudhoe Bay and Kuparuk fields, as well as the Alpine field and satellites on the Western North Slope.

In Europe, Asia, Africa, and the Middle East, the E&P capital program is expected to total $5.6 billion. Spending in the Russia and Caspian Sea region will primarily support continued development of Kashagan field in the Caspian Sea, ConocoPhillips said.

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