Page 11 - NorthAmOil Week 05 2022
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NorthAmOil INVESTMENT NorthAmOil
ConocoPhillips to sell certain
Permian assets to Maverick
PERMIAN BASIN US-BASED ConocoPhillips has agreed to sell quality, oil-weighted drilling inventory,” stated
certain assets in the Permian Basin to privately Maverick’s CEO, Chris Heinson. Separately, he
owned Maverick Natural Resources for $440mn. told Hart Energy that the company was aiming
The producing assets are located in the Per- to apply its operational strengths at scale in the
mian’s Central Basin Platform and Northwest Permian by “aggressively controlling costs and
Shelf areas, spanning roughly 144,500 net acres by exploiting opportunities to generate addi-
(585 square km) across Texas’ Andrews and tional production”.
Ector counties and New Mexico’s Eddy and Lea For Maverick, which is majority-owned by
counties. The properties are largely operated and EIG, the acquisition is in line with its increased
held by production (HBP) and are reported to focus on Texas and Oklahoma, with the com-
have yielded over 11,000 barrels of oil equivalent pany having recently sold off assets in California
per day (boepd) over the course of September and Michigan. For ConocoPhillips, it forms part
2021, with crude accounting for around 50% of of an ongoing effort to hone its portfolio follow-
output. ing the acquisition of Permian assets from Royal
Maverick said in a January 28 statement that Dutch Shell for $9.5bn in December.
the acquisition would be funded by a fully com- When the Shell acquisition was first
mitted $500mn reserve-based loan (RBL) pro- announced in September, ConocoPhillips said
vided by JPMorgan Chase Bank, Royal Bank of it would seek to sell $4-5bn worth of non-core
Canada, Citizens Bank, KeyBank National Asso- assets by 2023. Indeed, energy data firm Enverus
ciation and KeyBanc Capital Markets. Maverick noted this week that ConocoPhillips had been
and ConocoPhillips expect the transaction to marketing conventional assets on the Central
close in the second quarter of 2022. Basin Platform and Northwest Shelf with invest-
“This Permian acquisition expands the scale ment bank RBC Capital Markets in the wake of
of Maverick’s operations and provides high the Shell deal.
PERFORMANCE
ConocoPhillips beats expectations
with fourth-quarter results
US CONOCOPHILLIPS has reported earnings of OPEC+ countries and global inventories, for the
$2.6bn, or $1.98 per share, for the fourth quarter US to return to the same rates of growth as in
of 2021. The result marks a year-on-year turna- those years would be a worrying development.
round from a loss of $800mn, or $0.72 per share, Despite Lance’s warning, ConocoPhillips
in the same quarter of 2020. is stepping up spending this year by 36%. The
The company posted adjusted earnings of company reaffirmed a capital budget of $7.2bn
$2.27 per share for the latest quarter, beating ana- for 2022, up from $5.3bn in 2021. The plan
lyst expectations of $2.20 per share as cited by includes funding for ongoing development drill-
both Refinitiv and Zacks Equity Research. Like ing programmes, major projects, exploration
other oil companies, it benefited from stronger and appraisal activities and base maintenance.
commodity prices. It also announced that it Around $200mn of the total has been earmarked
would increase its expected return of capital to for decarbonisation efforts.
shareholders by $1bn this year, bringing the total ConocoPhillips anticipates producing 1.8mn
for the year to $8bn – up by more than 30% on barrels of oil equivalent per day (boepd) in 2022,
2021. including from Libya. The company’s 2021
However, ConocoPhillips’ chairman and output – not including Libya – totalled 1.5mn
CEO, Ryan Lance, warned that high crude prices boepd. However, it noted that – including Libya
could undermine the financial discipline that – its first-quarter output this year was projected
has characterised the shale industry recently, to be 1.75-1.79mn boepd, which it described as
especially since the onset of the pandemic. On essentially flat compared to the fourth quarter of
the company’s earnings call, he said that while 2021. This illustrates a degree of caution when
circumstances were different now compared to it comes to raising production, even as capital
2014-15 in terms of the spare capacity among spending rises.
Week 05 03•February•2022 www. NEWSBASE .com P11
