Conocophillips · NYSE:COP

Conocophillips — Shareholder Meeting (May 2010)

23 slides from Conocophillips's shareholder meeting presentation, May 12, 2010

  1. Slide 1: 2010 Annual Meeting of Stockholders

    2010 Annual Meeting of Stockholders May 12, 2010

  2. Slide 2: 2010 Annual Meeting of Stockholders - Jim Mulva

    2010 Annual Meeting of Stockholders Jim Mulva Chairman & Chief Executive Officer May 12, 2010

  3. Slide 3: ConocoPhillips Today

    ConocoPhillips Today  International, integrated, major oil and gas company • ~50 BBOE captured resources • 10 BBOE reserves 4% 7% • 2.3 MBOED production • 3.0 MMBPD refining capacity 25% 64% • Assets of $153 B E&P R&M • ~30,000 employees LUKOIL Other • $85 B market cap ConocoPhillips Portfolio Prod

  4. Slide 4: Global Market Conditions

    Global Market Conditions Global GDP1 Non‐OECD GDP1 S&P 5002 2009 2010 2009 2010 2009 2010 6% 1,156 884 4% 3% ‐1% Bond Spread3 (bps)  Global economic growth returning 2009 2010  Driven by emerging markets  U.S. equity and credit markets recovering 207 104 1 – IHS Global Insight (April 2009 and Apr

  5. Slide 5: Commodity Market Conditions

    Commodity Market Conditions WTI1 ‐ $/bbl Henry Hub1 ‐ $/mmbtu 76.37 4.41 4.13 58.03 2009 2010 2009 2010 Refining Margins2 ‐ $/bbl  Energy prices recovering with demand 11.99  Oil prices recovering faster than 8.50 natural gas prices and refining margins 2009 2010 1 – Platts (May 13, 2009 and May 1

  6. Slide 6: Demand for Hydrocarbons

    Demand for Hydrocarbons World Energy Demand World Oil Demand 350 Renewables 120 Developing Million Barrels Oil Equivalent per Day Nuclear OECD 300 Coal 100 Natural Gas Million Barrels Oil per Day Oil 250 80 200 60 150 40 100 20 50 0 0 2000 2015 2030 2000 2015 2030 Fossil fuels will still be 80% of t

  7. Slide 7: U.S. Natural Gas Supply Sources and Projected Demand

    U.S. Natural Gas Supply Sources 80 Projected U.S. Natural Gas Demand 70 Alaska CBM 60 LNG Imports Net Pipeline Imports 50 Tight Sands BCFD 40 30 Shale 20 Conventional 10 Existing Production 0 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 All sources needed to meet future demand Source:

  8. Slide 8: Summary of Consensus Forecasts

    Summary of Consensus Forecasts WTI1 ‐ $/bbl Oil prices  Increase with demand recovery 58 76  Long‐term $80‐100 / bbl 2009 2010 LT Forecast Henry Hub1 ‐ $/mmbtu Natural Gas prices  Rise over time as demand increases 4.41 4.13  Long‐term $6‐8 / mmbtu 2009 2010 LT Forecast Refining Margins2 ‐ $/bbl

  9. Slide 9: Challenging Political Environment

    Challenging Political Environment  Restricted access  Higher taxes  Climate change policy uncertainty  Increased regulatory burden  Geopolitical risk Facing increasing political challenges 8

  10. Slide 10: Challenges

    Challenges  Exposure to North America natural gas and refining  Debt levels above target range  Trading at discount to peer group  Competition for new resources  Balancing growth vs. returns 9

  11. Slide 11: Strategic Options

    Strategic Options  Emphasize absolute production growth • Fully invest in available opportunities • Accept incremental projects with marginal economics • Higher leverage, no share repurchases  Significant restructuring • Divest or spin out of significant business lines • Sale of legacy assets high

  12. Slide 12: Key 2010 / 2011 Initiatives

    Key 2010 / 2011 Initiatives Portfolio  Disciplined capital program  $10 B asset sales program  Reduce LUKOIL interest Picture Financial  Reduce debt  Increase dividends  Share repurchase program 11

  13. Slide 13: Path to Increased Shareholder Value

    Path to Increased Shareholder Value 2010 / 2011 Two‐Year Cash Sources and Uses ‐ $B 60 50 5 40 10 24 30 6 5–8 20 35 5 7 ‐ 10 10 20 0 Cash From Asset Sales Capital Available Debt Share Add'l Capex / Operations & LUKOIL Program & Cash Reduction Repurchase Add'l Share Dividends Repurchase Cash from ope

  14. Slide 14: Optimizing Debt Level

    Optimizing Debt Level Net‐Debt‐to‐Capital Ratio 35%  Target 20% near term 30% 25% 20%  15% longer term 15% 10% 5%  Low cost source of capital 0% COP TOT BP RDS CVX XOM  Consistent with peers Rating A AA AA AA+ AA AAA Improving financial flexibility 13

  15. Slide 15: Annual Dividend Increases

    Annual Dividend Increases COP Quarterly Dividend Growth  Eight consecutive annual 55 increases Quarterly dividend (cents/share) th 50 ow 47 gr ed aliz nu 41 % a n 36  Current Yield = 3.7% 1 3.5 31 25 20 22  <20% of operating cash flow  Annual increases expected '02 '03 '04 '05 '06 '07 '08 '09 '1

  16. Slide 16: Gulf of Mexico

    Gulf of Mexico COP Leases  ~1% of COP 2009 production COP Producing Assets COP Exploration Activity COP Refining Assets  Exploration Lake Charles Alliance • COP’s focus area is remote DEEPWATER HORIZON from the incident • Tiber appraisal schedule will LOOP be impacted Magnolia  Downstream Shenand

  17. Slide 17: Total Company Safety

    Total Company Safety Total Recordable Incident Rate Incidents per 200,000 hours worked 1.2 Contractors Employees  2009 combined work force performance improved 1.0 0.8  Reduced process safety 0.6 incident rate 0.4  Reduced permit / 0.2 regulatory exceedances 0.0 2004 2005 2006 2007 2008 2009 Safe

  18. Slide 18: Environmental Stewardship

    Environmental Stewardship  Rigorous management systems  Minimizing environmental footprint  Developing and applying technology 17

  19. Slide 19: Operations

    Operations  Safety and reliability excellence  Focus on controllable costs  Exploration and Production • 100%+ organic reserve replacement • 10 BBOE resources to reserves over 10 years • Long‐term production growth  Refining and Marketing • Streamline portfolio • Disciplined capital spend Focuse

  20. Slide 20: Total Shareholder Return

    Total Shareholder Return 1‐Year 5‐Year Annual Avg. 10‐Year Annual Avg. 10/1/09 – 5/11/10 1/1/09 – 12/31/09 1/1/05 – 12/31/09 1/1/00 – 12/31/09 COP 29.4% CVX 16.7% COP2 11.0% BP CVX S&P 26.5% XOM TOT S&P1 9.3% TOT TOT CVX RDS RDS COP 6.1% XOM XOM CVX RDS BP BP COP 2.9% BP RDS TOT XOM S&P 0.4% S&P ‐0.

  21. Slide 21: Taking Decisive Action

    Taking Decisive Action Portfolio  Disciplined capital investments  Safety, reliability and cost excellence  Move portfolio to 85% upstream  Build stronger exploration portfolio  Convert 10 BBOE resources to reserves Financial  Improve returns  Strengthen balance sheet  Increase shareholder d

  22. Slide 22: Cautionary Statement

    Cautionary Statement FOR THE PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 The following presentation includes forward‐looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities E

  23. Slide 23: 2010 Annual Meeting of Stockholders

    2010 Annual Meeting of Stockholders May 12, 2010 22

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