Page 8 - NorthAmOil Week 06 2023

NorthAmOil PERFORMANCE NorthAmOil

ConocoPhillips profits double in 2022

US CONOCOPHILLIPS had its profits double in
2022 to reach $18.7bn, its highest earnings in a
decade, as crude prices rose. A year earlier, the
company’s profits totalled $8.1bn.
Excluding special items, the US oil compa-
ny’s full-year 2022 adjusted earnings reached
$17.3bn, compared with full-year earnings of
$8.0bn in 2021.
ConocoPhillips earned $71.05 per barrel of
oil equivalent (boe) in the fourth quarter of 2022,
compared with $65.56 per boe a year earlier. Its
production was unhedged, thus realising the full
impact of changes in marker prices, it said. But
its quarterly profit was $2.71 per share, which
missed analysts’ expectations of $2.81.
“We returned $15bn of capital to sharehold-
ers and achieved record production in our Lower
48 assets, while adding new high-quality strate-
gic projects to enhance our global portfolio for
decades to come,” said ConocoPhillips’ chair-
man and CEO, Ryan Lance.
“Building on 60 years of global LNG exper-
tise, we expanded our LNG business in Australia,
Germany, Qatar and along the US Gulf Coast.
We also set a new methane emissions intensity ConocoPhillips is
target in support of our continuing focus on low told the news service that ConocoPhillips had awaiting federal
GHG production,” he added. finished 2022 “on a solid note with production approval for its
ConocoPhillips said it would return $11bn volumes exceeding consensus forecasts by 1.5%”. proposed Willow project
to shareholders in 2023, with this figure below The administration of US President Joe in Alaska.
analysts’ expectations. Biden recently indicated that it could support a
The company’s fourth-quarter 2022 pro- scaled-back version of the company’s $7-7.5bn
duction totalled 1.758mn boe per day (boepd), Willow project, which would be developed in the
including a 27,000 boepd negative impact National Petroleum Reserve-Alaska (NPR-A).
from weather events in the Lower 48 states. Its Environmentalists oppose the project on various
fourth-quarter Lower 48 production averaged grounds, including their concern that it would
997,000 boepd, including 671,000 boepd from endanger local wildlife.
the Permian Basin, 214,000 boepd from the In an environmental review, the US Depart-
Eagle Ford play, and 96,000 boepd from the ment of the Interior’s (DoI) Bureau of Land
Bakken. Management (BLM) said that it favoured the
The company’s 2023 total capital expend- company drilling from only three sites at Wil-
iture guidance has been set at $10.7-11.3bn, low, instead of the five that ConocoPhillips was
which includes $9.1-9.3bn for base capital and proposing. The BLM is also recommending that
spending for the company’s Willow oil and gas ConocoPhillips reduce surface infrastructure
drilling project in Alaska, which has not yet been such as pipelines and gravel roads, limiting con-
approved. struction time and damage to wildlife.
ConocoPhillips expects to invest about $2bn “The department has substantial concerns
in Sempra’s Port Arthur LNG facility, in whose about the Willow project and the preferred
first phase it bought a 30% equity stake in 2022. alternative as presented in the final supplemen-
Company executives issued guidance for tal environmental impact statement, including
2023 for full-year production in the range of direct and indirect greenhouse gas [GHG] emis-
1.76-1.8mn boepd, representing 1-4% organic sions and impacts to wildlife and Alaska Native
growth. The company’s first-quarter 2023 pro- subsistence,” said the DoI.
duction guidance range is 1.72-1.76 mn boepd, The BLM has estimated that under its three-
which includes $35,000 of planned maintenance, well-pad scenario, oil production could still
primarily in Qatar and the Lower 48. reach about 614mn barrels over 31 years, which
“Headline numbers across this morning’s would not be much less that the 629mn Cono-
report are mixed,” a Tudor, Pickering, Holt & Co. coPhillips envisions under its preferred five-site
analyst, Jeoffrey Lambujon, told Reuters. He said plan.
the company’s project spending was higher than A final decision on Willow from the Biden
expected and its production outlook for 2023 administration is expected in the first week of
was weaker than forecast. March, said ConocoPhillips executives in the
But a Third Bridge analyst, Peter McNally, fourth-quarter earnings call.™

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