USA: ConocoPhillips Profit Drops

ConocoPhillips today reported second-quarter 2012 earnings of $2.3 billion, compared with second-quarter 2011 earnings of $3.4 billion.

The current quarter includes one month of downstream earnings related to discontinued operations associated with the April 30, 2012, spinoff of Phillips 66. Last year’s quarter included three months of downstream earnings.

Excluding special items of $732 million, second-quarter 2012 adjusted earnings were $1.5 billion, compared with second-quarter 2011 adjusted earnings of $2.3 billion. Special items for the current quarter include $534 million in earnings from discontinued operations and $285 million from gains on asset sales.

Second-Quarter Highlights

• Completed spinoff of downstream businesses into Phillips 66.
• Achieved production of 1.54 million BOE per day.
• Continued progress on North American unconventional programs.
• Progressed Australia Pacific LNG’s project with sanction of second train in early July.
• Initiated drilling and acquired additional leases in deepwater Gulf of Mexico.
• Completed disposition of Alba and Statfjord fields.
• Repurchased 52 million ConocoPhillips shares, representing 4 percent of outstanding shares.
• Paid quarterly dividend of 66 cents per share, consistent with pre-spinoff levels.

“We are off to a strong start as an independent E&P company and the business is running well,” said Ryan Lance, chairman and chief executive officer. “Our production was on target, our major growth projects are on track and we are continuing to add to our conventional and unconventional exploration inventory. We continue to progress our asset sales program, providing additional financial flexibility to fund our high-margin organic investments. We remain committed to growing our production by 3 to 5 percent, improving our financial returns and delivering a sector-leading dividend.”

The company completed the spinoff of its downstream businesses to stockholders on April 30, with the distribution of Phillips 66 common stock. Following completion of this transaction, ConocoPhillips is now the world’s largest independent exploration and production company, based on proved reserves and production of liquids and natural gas.

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LNG World News Staff, July 25, 2012; Image: ConocoPhillips