ConocoPhillips expands LNG capacity

Permian Basin leads company’s American production

HOUSTON ConocoPhillips was busy in the Mideast, North America and Europe during the second quarter, finalizing the acquisition of its interest in the Qatar North Field South joint venture, executing agreements for 2.2 million tons per annum of offtake at the Saguaro liquefied natural gas project on the West Coast of Mexico and securing 2.8 million tons per year of regasification LNG capacity in Germany.

“While commodity prices were volatile, ConocoPhillips continued to deliver strong underlying performance,” said Chairman-CEO Ryan Lance. “Once again we had record global and Lower 48 production and we raised our full-year production guidance for the second straight quarter.

“We have distributed $5.8 billion through dividends and buybacks year to date, putting us well on track to achieve our planned $11 billion return of capital for 2023. And we did this while funding the shorter- and longer-term organic growth opportunities that we see across the entire portfolio.”

Executive Vice President-CFO Bill Bullock reported a production record of 1.8 million barrels of oil equivalent per day for a six-percent increase.

“Planned turnarounds were successfully completed in Norway and Qatar and Lower 48 production was also a record, averaging 1,063,000 barrels of oil equivalent per day including 709,000 from the Permian, 235,000 from the Eagle Ford and 104,000 from the Bakken,” Bullock said.

“Lower 48 underlying production grew 8 percent year on year with new wells online and strong well performance relative to our expectations across our asset base. Second quarter gas flow was $4.7 billion at an average West Texas Intermediate crude oil price of $74 per barrel and with Australia Pacific LNG distributions of $405 million.”

He said second quarter capital expenditures totaled $2.9 billion with $624 million spent for long-cycle projects.

“Now through the first half of the year we have funded $700 million for Port Arthur LNG of the planned $1.1 billion for the year, which we expect to lead to a step down in overall capital in the second half,” Bullock said. “Turning to guidance we forecast third quarter production to be in the range of $1.78 billion to 1.82 million barrels of oil per day with 20,000 barrels per day of planned seasonal turnaround primarily in Alaska and Europe.”

Expecting APLNG distributions of $400 million in the third quarter and $1.9 billion for the full year, ConocoPhillips has adjusted its full-year operating cost and depreciation, depletion and amortization guidance by $100 million each to $8.3 billion and $8.2 billion respectively, he said.