ConocoPhillips · NYSE:COP
ConocoPhillips — Investor Presentation (December 2014)
22 slides from ConocoPhillips's investor presentation, Dec 9, 2014
Slide 1: Investor Update
Investor Update Updated as of Dec. 9, 2014.
Slide 2: Cautionary Statement
Cautionary Statement The following presentation includes forward-looking statements. These statements relate to future events, such as anticipated revenues, earnings, business strategies, competitive position or other aspects of our operations or operating results or the industries or markets in whi
Slide 3: Resilient Value Proposition
Resilient Value Proposition Foster Creek • Growth and returns with a competitive dividend • Well positioned for current environment • Announced 2015 capital budget of $13.5 B Exploration & Appraisal Exploration & Appraisal • Major project capital rolling off Major Projects • Significant flexibility
Slide 4: Unmatched Position Today
Unmatched Position Today 1,473 MBOED Production1 – 3Q14 North Liquids • Diversified asset base with scope and scale American 25% Gas • Multiple sources of growth LNG + 57% International 18% • Massive positions in key resource trends Gas • Growing portfolio with options and choices 8.9 BBOE Reserves
Slide 5: Committed to Shareholder Returns
Committed to Shareholder Returns Dividend Yield • Competitive dividend is appropriate and remains key to our value proposition • Highest priority use of cash 4.2% • Enhances capital discipline • Predictable portion of shareholder returns • Differential to independent peers • Dividend increased 5.8 p
Slide 6: Full-Cycle Project Returns
The Power of Portfolio: Margins, Decline Rates and Returns Low Margins High Margins Highest Margins North American • Short-cycle cash flow Higher Unconventionals • Avoid over capitalizing • Increases capital intensity of portfolio Full-Cycle Project Returns North American Conventional Oil • Medium-c
Slide 7: U.S. Liquids-Rich Unconventional Reservoir Revolution
U.S. Liquids-Rich Unconventional Reservoir Revolution U.S. Oil Production Top Four Oil Producing States 10 3.0 Texas 2.5 8 2.0 MMBD MMBD 6 1.5 Alaska Conventional North Dakota Decline Curve 1.0 4 California 0.5 0.0 2 Jan-1981 Jan-1989 Jan-1997 Jan-2005 Jan-2013 1949 1957 1965 1973 1981 1989 1997 200
Slide 8: U.S. Unconventional Reservoirs Liquids Production Growth
U.S. Unconventional Reservoirs Liquids Production Growth 4.1 MMB per Day 3.1 MMB per Day 1.3 MMB 0.5 MMB per Day per Day OPEC production ranked from highest (Saudi Arabia) to lowest per 2013 IEA reported production volumes. Neutral Zone production split between Saudi Arabia and Kuwait. Oil Source: I
Slide 9: North American Unconventionals: Unmatched Portfolio and Capabilities
North American Unconventionals: Unmatched Portfolio and Capabilities Montney Duvernay • Great positions in proven and emerging plays • Eagle Ford and Bakken sweet spots Bakken • Exceptional growth in high-margin resource base Niobrara Anadarko Permian • Decades of drilling inventory with upside Barn
Slide 10: Eagle Ford: Significant Resource Increase, Robust Production Growth
Eagle Ford: Significant Resource Increase, Robust Production Growth • ~220 M net acres; acreage capture complete GONZALES TEXAS LAVACA WILSON • 96% average operated working interest DE WITT • 1.8 BBOE to 2.5 BBOE net EUR increase ATASCOSA KARNES • >3,000 identified drilling locations FRIO ConocoPhil
Slide 11: Eagle Ford: Premium Value from Best Wells in the Play
Eagle Ford: Premium Value from Best Wells in the Play 250 Highest Oil Rates per Well1 60 Industry-Leading Value2 50 200 Gross Operated Production (BPD) 40 NPV10 per Acre ($M) 150 30 100 20 50 10 0 0 Competitors Competitors 1Texas Railroad Commission, 2013. 2Wood Mackenzie. 11
Slide 12: Eagle Ford: Value-Driven Approach to Well Density, Considerable Upside
Eagle Ford: Value-Driven Approach to Well Density, Considerable Upside 2013 2014 Transition to High/Low Evaluating Further Upside Lower Eagle Ford 80-acre1 Single Layer Lower Eagle Ford 80-acre1 High/Low Lower Eagle Ford 40-acre2 1.8 BBOE EUR 2.5 BBOE EUR Upper Eagle Ford/Austin Chalk 1660’ between
Slide 13: Bakken: High-Margin, Extremely Liquids-Rich Production Growth
Bakken: High-Margin, Extremely Liquids-Rich Production Growth • ~620 M net acres; mostly HBP or COP minerals • 45% average operated working interest • 600 MMBOE net EUR • >1,800 identified gross drilling locations • Outlook based on average 10-rig program • $20-25/BOE full-cycle F&D cost 1 Productio
Slide 14: Bakken: Advantaged Position in the Heart of the Trend
Bakken: Advantaged Position in the Heart of the Trend Montana North Dakota Bakken Acreage Values by Area (NPV10 per Acre)1 VALLEY ROOSEVELT WILLIAMS MOUNTRAIL Nesson Anticline Anticline Parshall-Sanish Fort Berthold Williams Core MCCONE Nesson West Nesson Anticline Northern Mountrail MCKENZIE Elm Co
Slide 15: Unconventional Reservoir Technology and Knowledge Sharing
Unconventional Reservoir Technology and Knowledge Sharing • ConocoPhillips • Google ConocoPhillips Current Avg. Completion Design • Apple Cumulative Production • IBM 350% • Facebook • Microsoft Avg. • Amazon Initial Design – Industry Standard • Proctor & Gamble 0 90 180 270 360 450 • Fluor Days • Va
Slide 16: Resilient Value Proposition
Resilient Value Proposition Foster Creek • Growth and returns with a competitive dividend • Well positioned for current environment • Announced 2015 capital budget of $13.5 B Exploration & Appraisal Exploration & Appraisal • Major project capital rolling off Major Projects • Significant flexibility
Slide 17: Appendix
SAFETY ects ceatet ConocoPhillips echnolo North Sea oY REPUTATION set FOP Portoiic Optimization GROWTH. ENERGY ennen SPIRIT Values COLLABORATION Ekofisk South Appendix
Slide 18: Annualized Net Income Sensitivities
Annualized Net Income Sensitivities • Crude • Brent/ANS: $80-90MM change for $1/BBL change • WTI: $35-40MM change for $1/BBL change • WCS¹: $30-40MM change for $1/BBL change • North American NGL • Representative blend: $10-15MM change for $1/BBL change • Natural Gas • Henry Hub: $100-110MM change fo
Slide 19: Meeting Our Growth Targets
Meeting Our Growth Targets ~4% PRODUCTION Full-Year Guidance on GROWTH1 Track Actual Actual 3Q14 vs. 4Q14 Drivers Actual • Major turnarounds completed in 3Q14 • Major project ramp • Value-driven ethane rejection 1Q14 2Q14 3Q14 4Q14 FY14 Continuing Operations 1,530 1,556 1,473 1,545 – 1,575 1,525 – 1
Slide 20: Margin Class Categorization
Margin Class Categorization North American International North American North American Unconventionals LNG Oil Sands Oil & Gas Conventional Oil Gas • Bakken • AKLNG • Christina Lake • China • Alaska North Slope • Lobo • Barnett • APLNG • Foster Creek • Indonesia • Anadarko • San Juan • Canada Unconv
Slide 21: Abbreviations and Glossary
Abbreviations and Glossary • 4-D: four dimensional • MM: million • ANS: Alaska North Slope • MBOED: thousands of barrels of oil equivalent per day • Average Cash Margin (2014-2017): Average cash margin represents the projected cash flow from operating activities, excluding working capital, divided •
Slide 22: Investor Information
Investor Information Stock Ticker Investor Relations Contacts: NYSE: COP Telephone: +1 212.207.1996 Website: www.conocophillips.com/investor Ellen DeSanctis: ellen.r.desanctis@conocophillips.com Sidney J. Bassett: sid.bassett@conocophillips.com Headquarters Vladimir R. dela Cruz: v.r.delacruz@conoco
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