ConocoPhillips earnings up quarter-over-quarter

Nov. 2, 2021
ConocoPhillips had third-quarter 2021 earnings of $2.4 billion, compared with a third-quarter 2020 loss of $500 million, and second-quarter 2021 earnings of $2.1 billion.

ConocoPhillips had third-quarter 2021 earnings of $2.4 billion, compared with a third-quarter 2020 loss of $500 million, and second-quarter 2021 earnings of $2.1 billion. Excluding special items, third-quarter 2021 adjusted earnings were $2.4 billion, compared with a third-quarter 2020 adjusted loss of $300 million, and second-quarter 2021 adjusted earnings of $1.7 billion.

Special items for the current quarter included a contingent payment from Cenovus associated with the 2017 Canadian disposition and a non-cash impairment credit, partially offset by a loss on asset sales and transaction and restructuring expenses.

Production excluding Libya for third-quarter 2021 was 1.507 MMboe/d, an increase of 441,000 boe/d from the same period a year ago. After adjusting for closed acquisitions and dispositions as well as impacts from the 2020 curtailment program, third-quarter 2021 production increased 26,000 boe/d or 2% from the same period a year ago. This increase was primarily due to new production from the Lower 48 and other development programs across the portfolio, partially offset by normal field decline. Production from Libya averaged 37,000 boe/d.

In the Lower 48, production averaged 790,000 boe/d, including 445,000 boe/d from the Permian, 217,000 boe/d from the Eagle Ford, and 95,000 boe/d from the Bakken. Lower 48 development progressed as planned and the quarter ended with 15 drilling rigs and seven frac crews at work. In Alaska, drilling continued at GMT2 with first oil on track for fourth-quarter 2021. Turnarounds were completed during the quarter in Alaska and the Asia Pacific region.

For the quarter, cash provided by operating activities was $4.8 billion. Excluding working capital, ConocoPhillips generated cash from operations of $4.1 billion.

Fourth-quarter 2021 production is expected to be 1.53-1.57 MMboe/d, excluding Libya as well as impacts from the pending Shell Permian acquisition.

This guidance includes the impact of planned conversion of the significant majority of previously acquired Concho two-stream contracted volumes to a three-stream (crude oil, natural gas, and natural gas liquids) reporting basis as Concho volumes are integrated into the company’s commercial activities. The conversion to three-stream reporting is neutral to earnings. Effective in the fourth quarter, this conversion is expected to add production of about 40,000 boe/d and increase both revenue and operating costs by roughly $70 million.