U.S. independent ConocoPhillips plans a slight increase in capital spending for its existing assets in 2022, but will prioritize integrating Shell’s former assets into the Permian Basin of West Texas and Southeastern New -Mexico, company officials said Tuesday.
During the company’s third-quarter earnings call, chief executive Ryan Lance said the industry appeared to be entering a “very positive period” due to rising prices for oil and natural gas. Despite the higher prices, ConocoPhillips tends to maintain near its capital budget estimate of $ 7 billion announced in June.
“This (plan) included a modest ramp in Lower 48, to reactivate our optimized shelf plans, additional base investments in Alaska and longer cycles, at low cost despite investments in Canada and Norway,” said Spear.
“Since June we have seen inflationary pressures, particularly in the Lower 48. However, at this point we expect to adjust the scope slightly in order to keep our capital base at a level roughly consistent with our update. june day. And then, of course, we’ll add capital spending for Shell properties, ”he added.
For the remainder of the year, Lance said ConocoPhillips’ goal will be to complete the $ 9.5 billion acquisition of Shell’s Permian Basin assets, and then work on combining them with the existing portfolio of Shell. company.
“Once the fence is complete, we will work diligently to integrate these properties and realize efficiencies in a manner similar to what we have achieved through the integration of Concho Resources,” he said.
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ConocoPhillips said its production from Lower 48 averaged 790,000 barrels per day in the third quarter, including about 445,000 b / d from the Permian Basin, 217,000 b / d from the Eagle Ford Shale in South Texas and 95,000 bpd of the Bakken Shale in North Dakota. Of the three, company officials said the Permian would continue to receive the lion’s share of capital funding.
“The way we think about managing the Eagle Ford, the Bakken and the Permian is that there is an asset around which we can allocate capital,” said Lower 48 executive vice president Tim Leach.
“The Eagle Ford and the Bakken are much closer to being at their optimal plateau than the Permian,” he added.
In August, ConocoPhillips’ Willow Project on the North Slope of Alaska was halted by a Federal Court decision to cancel its existing permits. Senior vice president of global operations Nick Olds said ConocoPhillips and the Biden administration chose not to challenge the decision, but maintained the project was still alive.
“We believe that the best and most effective approach is to really resolve the three substantive issues identified in the district court decision,” he said. “We will do this through further analysis of the National Environmental Policy Act (NEPA). We are currently working with the BLM (US Bureau of Land Management) and cooperating agencies there, just working through them.
For the third quarter, ConocoPhillips reported earnings of $ 2.4 billion, $ 1.78 per diluted share, compared to a loss of $ 500 million in the third quarter, or 42 cents per share, in the third quarter of 2020.