UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): July 30, 2003
ConocoPhillips
(Exact name of registrant as specified in its charter)
Delaware 000-49987 01-0562944
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation) File Number) Identification No.)
600 North Dairy Ashford
Houston, Texas 77079
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (281) 293-1000
Item 7. Financial Statements and Exhibits
(c) Exhibits
99.1 -- Press release issued by ConocoPhillips on July 30, 2003.
99.2 -- Financial and operational tables.
99.3 -- Supplemental financial information.
Item 12. Results of Operations and Financial Condition
On July 30, 2003, ConocoPhillips issued a press release announcing the
company's financial and operating results for the quarter ended June 30, 2003. A
copy of the press release is furnished as Exhibit 99.1 hereto and incorporated
herein by reference. Additional financial and operating information about the
quarter is furnished as Exhibits 99.2 and 99.3 to this report and incorporated
by reference herein.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONOCOPHILLIPS
/s/ John A. Carrig
-------------------------------------------
John A. Carrig
Executive Vice President, Finance
and Chief Financial Officer
July 30, 2003
EXHIBIT INDEX
Exhibit
No. Description
99.1 -- Press release issued by ConocoPhillips on July 30, 2003.
99.2 -- Financial and operational tables.
99.3 -- Supplemental financial information.
Exhibit 99.1
ConocoPhillips Reports Second Quarter Net Income of $1.1 Billion;
Solid Operating Performance Drives Debt Reduction
HOUSTON--(BUSINESS WIRE)--July 30, 2003--ConocoPhillips (NYSE:COP)
Earnings at a glance
Second Quarter Six Months
---------------------------- ----------------------------
2003 2002 2003 2002
-------------- ------------ -------------- ------------
Income from
continuing
operations $1,079 million $312 million $2,349 million $214 million
Income from
discontinued
operations $59 39 $81 35
Cumulative
effect of
change in
accounting
principle $- - $145 -
Net income $1,138 351 $2,575 249
- ----------------------------------------------------------------------
Diluted income
per share
Income from
continuing
operations $1.58 0.81 $3.44 0.55
Net income $1.66 0.91 $3.77 0.65
- ----------------------------------------------------------------------
Revenues $25.6 billion $10.5 billion $52.7 billion $18.9 billion
- ----------------------------------------------------------------------
ConocoPhillips (NYSE:COP) today reported second quarter net income
of $1,138 million, or $1.66 per share, compared with $351 million, or
91 cents per share, for the same quarter in 2002, which was prior to
the ConocoPhillips merger. Total revenues were $25.6 billion, versus
$10.5 billion a year ago. Income from continuing operations for the
second quarter was $1,079 million, or $1.58 per share, compared with
$312 million, or 81 cents per share, for the same period a year ago.
After-tax items impacting second quarter income from continuing
operations included charges of $135 million for merger-related
expenses and contingency accruals, as well as $25 million related to
marketing lease-loss accruals. Also included were the benefits of an
$87 million net gain from changes in certain international tax laws
and $55 million related to the Bayu-Undan project in the Timor Sea.
"We are pleased with our operating and financial performance
during the second quarter," said Jim Mulva, president and chief
executive officer. "Operationally, upstream production was 1.64
million barrels-of-oil-equivalent (BOE) per day during the quarter and
1.63 million BOE for the first half of 2003. Our refining and
marketing business also had another solid quarter as our refineries
ran at 96 percent of capacity.
"This operating performance combined with solid commodity prices,
disciplined capital spending, asset sales, and the financial benefits
of our synergy initiatives contributed to continued strong earnings
and allowed us to reduce our debt by $2.2 billion so far this year."
For the first six months of 2003, net income was $2,575 million,
or $3.77 per share, versus $249 million, or 65 cents per share, for
2002. Income from continuing operations was $2,349 million, or $3.44
per share, compared with $214 million, or 55 cents per share, for the
same period a year ago. Total revenues were $52.7 billion, versus
$18.9 billion a year ago.
The ConocoPhillips merger was consummated on Aug. 30, 2002, and
used purchase accounting to recognize the fair value of the Conoco
assets and liabilities. While the results of the second quarter and
first six months of 2003 reflect the operations of the combined
company, the second quarter of 2002, as well as the first six months
of 2002, reflect only Phillips' results, restated for discontinued
operations. Definitive sales agreements for all asset dispositions
required by the Federal Trade Commission (FTC) have now been executed
and, pending FTC approval, these agreements are expected to close by
the end of the third quarter.
The results of ConocoPhillips' business segments follow.
Exploration & Production (E&P)
Second quarter financial results: E&P income from continuing
operations in the second quarter was $1,070 million, down from $1,137
million in the first quarter of 2003 and up from $339 million in the
second quarter of 2002. The decrease from the first quarter was
primarily the result of lower realized crude oil and natural gas
prices and foreign currency exchange losses, partially offset by tax
law changes in certain jurisdictions and increased production.
Improved results from the second quarter of 2002 were due to higher
realized crude oil and natural gas prices, benefits from tax law
changes in certain jurisdictions, and increased production resulting
from the addition of the Conoco assets. Additionally, improvements
from prior periods reflect progress made on the implementation of
synergy initiatives.
ConocoPhillips' daily production for the quarter was slightly
above the first quarter, averaging 1.64 million BOE per day, including
Canadian Syncrude. Increased production primarily in Venezuela was
partially offset by seasonal declines in Alaska and the North Sea.
ConocoPhillips' second quarter 2003 average worldwide crude oil
sales price was $25.19 per barrel, down from $30.73 in the first
quarter of 2003. The company's U.S. Lower 48 and worldwide natural gas
prices averaged $4.72 and $3.93 per thousand cubic feet, respectively,
compared with $5.47 and $4.49 in the first quarter of 2003.
In June, the Norway Removal Grant Act (1986) was repealed. This
resulted in a net after-tax benefit of $87 million in the second
quarter. Also in the second quarter, in connection with the Bayu-Undan
project, Australia and Timor-Leste ratified the treaty between the two
nations governing fiscal and other arrangements in the Timor Sea, and
the company received final approvals from the relevant authorities to
proceed with the gas development phase of the project. The company
recognized a $55 million benefit related to restructuring of ownership
interest and other matters associated with the Bayu-Undan project.
Six months financial results: E&P income from continuing
operations for the first six months of 2003 was $2,207 million, up
from $481 million in 2002, primarily due to additional volumes from
the Conoco operations, higher realized worldwide crude oil and natural
gas prices, and tax law changes.
ConocoPhillips' average worldwide crude oil price was $27.82 per
barrel for the first six months of 2003, compared with $21.90 for
2002. The company's U.S. Lower 48 and worldwide natural gas prices
averaged $5.10 and $4.21 per thousand cubic feet, respectively, versus
$2.26 and $2.27 in 2002.
Midstream
Second quarter financial results: Midstream income from continuing
operations was $25 million, down from $31 million in the first quarter
of 2003 and up from $12 million in the second quarter of 2002. The
decrease from the first quarter was due primarily to lower natural gas
liquids prices. The increase over the second quarter of 2002 was
primarily due to higher natural gas liquids prices for Duke Energy
Field Services, LLC (DEFS).
Six months financial results: Midstream operating results
increased to $56 million, from $24 million in 2002. Contributing to
the increase were higher equity earnings from DEFS and the addition of
the Conoco midstream operations.
Refining and Marketing (R&M)
Second quarter financial results: R&M income from continuing
operations was $301 million, down from $371 million in the previous
quarter and improved from $68 million in the second quarter of 2002.
The decline in second quarter R&M earnings compared with the first
quarter of 2003 was primarily driven by lower worldwide refining
margins. These lower margins were partially offset by higher sales
volumes, higher U.S. and international marketing margins, and lower
utility and turnaround costs. The improved results over the second
quarter of 2002 were attributable to the addition of the Conoco
assets, higher refining and marketing margins, and business
improvements, which included the benefits from progress made on
implementing synergy initiatives. These improvements were partially
offset by higher refining utility costs and marketing lease-loss
accruals.
The refinery crude oil capacity utilization rate averaged 96
percent, compared with 92 percent last quarter. After-tax turnaround
costs were $26 million and $40 million in the second quarter and first
quarter of 2003, respectively.
Six months financial results: R&M income from continuing
operations for the first six months of 2003 increased to $672 million,
compared with a loss of $19 million in the first half of 2002. The
addition of the Conoco assets, as well as increased refining and
marketing margins, contributed to the increase. These increases were
partly offset by higher utility costs and lease-loss accruals on the
company's marketing operations.
Chemicals
Second quarter financial results: The Chemicals segment, which
reflects the company's 50 percent interest in Chevron Phillips
Chemical Company LLC, reported income from continuing operations of
$12 million, compared with a loss of $23 million in the first quarter
of 2003 and income of $7 million in the second quarter of 2002.
Improvements from the first quarter were the result of higher margins
as feedstock and utility costs trended downward. Second quarter 2003
results included approximately $6 million of after-tax charges related
to severance and contingency accruals. The increase from the second
quarter of 2002 primarily reflects higher margins, particularly in
olefins and polyolefins.
Six months financial results: During the first six months of 2003,
the Chemicals segment had a loss from continuing operations of $11
million, compared with a loss of $4 million for the same period a year
ago. The increased loss was primarily due to higher feedstock and
utility costs in 2003, especially in the first quarter.
Emerging Businesses
The Emerging Businesses segment had a loss from continuing
operations of $23 million in the second quarter of 2003, compared with
losses of $34 million in the first quarter of 2003 and $3 million in
the second quarter of 2002. The improvement from the first quarter was
primarily attributable to a reduction in carbon fibers expenses, as
well as reduced costs associated with a gas-to-liquids plant. The
increased costs from the second quarter of 2002 resulted from the
addition of the Conoco assets.
Corporate and Other
Second quarter after-tax Corporate expenses from continuing
operations were $306 million, compared with $212 million in the
previous quarter and $111 million in the second quarter of 2002.
Contributing to the increase over the first quarter was a $39 million
charge to accelerate the recognition of certain pension costs, which
was required by accounting rules due to the number of employee
retirements associated with the merger. In addition, Corporate
expenses increased due to a $35 million charge for restructuring
accruals and $41 million of additional merger-related expenses.
Corporate charges were reduced by lower interest expense and gains on
foreign currency transactions. The increase over the second quarter of
2002 included expenses associated with the addition of the Conoco
assets, pension charges and other merger-related expenses.
Total debt at the end of the second quarter was $17.6 billion,
$600 million lower than the end of the previous quarter and $2.2
billion below year-end 2002. This improvement resulted from strong
operating performance, solid commodity prices, disciplined capital
spending and asset sales. At the end of the second quarter, the
company's debt-to-capital ratio was 35 percent, down from 36 percent
at the end of the first quarter.
The company's second quarter effective tax rate of 38.4 percent
was lower than that of the first quarter primarily due to the impact
of changes in tax legislation in Norway and a higher proportion of
income from lower-tax-rate jurisdictions in the second quarter.
Discontinued Operations
Second quarter 2003 earnings from discontinued operations were $59
million, compared with $22 million in the first quarter. The
improvement was primarily related to higher marketing margins. Both
first and second quarter earnings were negatively impacted by
approximately $25 million due to lease-loss accruals on the company's
downstream marketing operations.
Outlook
Mr. Mulva concluded:
"A strong operating performance during the first half of the year,
combined with above-average crude oil and natural gas prices and solid
refining and marketing margins, allowed us to generate net cash from
operating activities of $5.4 billion. This enabled us to fund $2.9
billion in capital expenditures, reduce debt by $2.2 billion, and pay
$540 million in dividends. During this period, we improved our
debt-to-capital ratio from 39 percent to 35 percent. As previously
reported, implementation of two new accounting rules in the third
quarter will increase our balance sheet debt by about $3 billion,
however we expect our off-balance-sheet debt and minority interest to
concurrently decrease by a similar amount. Our debt targets remain
unchanged, and we still plan to reduce our debt-to-capital ratio to 30
percent over the next several years.
"We continue to strengthen our upstream portfolio through legacy
project advancement and planned asset dispositions, as well as through
efforts aimed at growing our worldwide natural gas business. For
example, we announced a major integrated liquefied natural gas project
in Qatar, and the Mackenzie Delta participants submitted a Preliminary
Information Package, in connection with a pipeline, required for the
ultimate development of this area.
"Downstream, we continue to make progress toward achieving higher
mid-cycle margin returns through cost reduction and integration
efforts. We are also looking to optimize capital spending required for
clean fuels projects through implementing best practices. As
announced, we reached an agreement to sell certain retail and dealer
marketing sites in the Northeast, and are on track with our plan to
rationalize a substantial portion of our U.S. retail marketing
assets."
ConocoPhillips is an integrated petroleum company with interests
around the world. Headquartered in Houston, the company had
approximately 55,800 employees, $81 billion of assets, and $105
billion of annualized revenues as of June 30, 2003. For more
information, go to www.conocophillips.com.
ConocoPhillips' quarterly conference call is scheduled for noon
Central today. To listen to the conference call and to view related
presentation materials, go to www.conocophillips.com and click on the
"Second Quarter Earnings" link.
For financial and operational tables, go to
www.conocophillips.com/news/nr/earnings/highlights/2q03earnings.html.
For detailed supplemental information, go to
www.conocophillips.com/news/nr/earnings/detail/2q03summary.xls.
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR"
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This update contains forward-looking statements within the meaning
of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. The forward-looking statements, such as "however
we expect our off-balance-sheet debt and minority interest to
concurrently decrease by a similar amount" and "we still plan to
reduce our debt-to-capital ratio to 30 percent over the next several
years" involve certain risks, uncertainties and assumptions that are
difficult to predict. Further, certain forward-looking statements are
based on assumptions as to future events that may not prove to be
accurate. Therefore, actual outcomes and results may differ materially
from what is expressed or forecast in such forward-looking statements.
Economic, business, competitive and regulatory factors that may affect
ConocoPhillips' business are generally as set forth in ConocoPhillips'
filings with the Securities and Exchange Commission (SEC).
ConocoPhillips is under no obligation (and expressly disclaims any
such obligation) to update or alter its forward-looking statements
whether as a result of new information, future events or otherwise.
Cautionary Note to U.S. Investors -- The SEC permits oil and gas
companies, in their filings with the SEC, to disclose only proved
reserves that a company has demonstrated by actual production or
conclusive formation tests to be economically and legally producible
under existing economic and operating conditions. Production is
distinguished from oil and gas production because SEC regulations
define Syncrude as mining-related and not part of conventional oil and
natural gas reserves. We use certain terms in this release, such as
"including Canadian Syncrude" that the SEC's guidelines strictly
prohibit us from including in filings with the SEC. U.S. investors are
urged to consider closely the disclosure in the company's periodic
filings with the SEC, available from the company at 600 North Dairy
Ashford Road, Houston, Texas 77079. This information can also be
obtained from the SEC by calling 1-800-SEC-0330.
CONTACT: ConocoPhillips, Houston
Kristi DesJarlais (media), 281-293-4595
or
Clayton Reasor (investors), 212-207-1996
Exhibit 99.2
ConocoPhillips
Houston, Texas 77079
FINANCIAL HIGHLIGHTS
Millions of Dollars
Three Months Ended Six Months Ended
June 30 June 30
2003 2002** 2003 2002**
Revenues
Sales and other operating revenues* $25,347 10,414 52,289 18,845
Equity in earnings of affiliates 156 29 205 49
Other income 92 22 178 51
---------- --------- --------- -----------
25,595 10,465 52,672 18,945
---------- --------- --------- -----------
Costs and expenses
Purchased crude oil and products 16,377 7,154 34,063 12,793
Production and operating expenses 1,847 882 3,496 1,799
Selling, general and administrative
expenses 675 207 1,184 471
Exploration expenses 142 67 258 230
Depreciation, depletion and amortization 847 395 1,696 791
Property impairments 146 8 174 18
Taxes other than income taxes* 3,624 977 7,046 1,891
Accretion on discounted contingent
liabilities 35 6 68 11
Interest and debt expense 184 106 393 213
Foreign currency transaction gains (20) (6) (23) (5)
Preferred dividend requirements of
capital trusts
and minority interests 13 12 27 25
---------- --------- --------- -----------
23,870 9,808 48,382 18,237
---------- --------- --------- -----------
Income from continuing operations before income
taxes and subsidiary equity
transactions 1,725 657 4,290 708
Gain on subsidiary equity transactions 28 - 28 -
---------- --------- --------- -----------
Income from continuing operations before
income 1,753 657 4,318 708
taxes
Provision for income taxes 674 345 1,969 494
---------- --------- --------- -----------
Income from continuing operations 1,079 312 2,349 214
Income from discontinued operations, net
of
income taxes 59 39 81 35
---------- --------- --------- -----------
Income before cumulative effect of change
in
accounting principle 1,138 351 2,430 249
Cumulative effect of change in accounting
principle - - 145 -
---------- --------- --------- -----------
Net income $1,138 351 2,575 249
========== ========= ========= ===========
Income per share of common stock
Basic
Continuing operations $1.59 0.81 3.46 0.56
Discontinued operations 0.08 0.10 0.12 0.09
Before cumulative effect of change in accounting
principle 1.67 0.91 3.58 0.65
Cumulative effect of change in
accounting principle - - 0.21 -
Net income $1.67 0.91 3.79 0.65
Diluted
Continuing operations $1.58 0.81 3.44 0.55
Discontinued operations 0.08 0.10 0.12 0.10
Before cumulative effect of change in accounting
principle 1.66 0.91 3.56 0.65
Cumulative effect of change in
accounting principle - - 0.21 -
Net income $1.66 0.91 3.77 0.65
Average common shares outstanding (in thousands)
Basic 680,028 383,913 679,784 383,130
Diluted 684,188 386,711 683,867 385,927
*Includes excise taxes on petroleum
products sales: $3,387 819 6,535 1,583
**Restated for discontinued operations.
1-1
ConocoPhillips
Houston, Texas 77079
SELECTED FINANCIAL DATA
Millions of Dollars
Three Months Ended Six Months Ended
June 30 June 30
2003 2002 2003 2002
INCOME/(LOSS) FROM CONTINUING OPERATIONS
BEFORE ACCOUNTING CHANGE
E&P
United States $516 280 1,192 435
International 554 59 1,015 46
---------- ----------- ---------- -----------
Total E&P 1,070 339 2,207 481
---------- ----------- ---------- -----------
Midstream 25 12 56 24
---------- ----------- ---------- -----------
R&M
United States 227 73 484 (19)
International 74 (5) 188 -
---------- ----------- ---------- -----------
Total R&M 301 68 672 (19)
---------- ----------- ---------- -----------
Chemicals 12 7 (11) (4)
Emerging Businesses (23) (3) (57) (8)
Corporate and other (306) (111) (518) (260)
---------- ----------- ---------- -----------
Consolidated $1,079 312 2,349 214
========== =========== ========== ===========
CUMULATIVE EFFECT OF ACCOUNTING CHANGE
E&P
United States $- - 161 -
International - - (15) -
---------- ----------- ---------- -----------
Total E&P - - 146 -
---------- ----------- ---------- -----------
Midstream - - - -
---------- ----------- ---------- -----------
R&M
United States - - (1) -
International - - - -
---------- ----------- ---------- -----------
Total R&M - - (1) -
---------- ----------- ---------- -----------
Chemicals - - - -
Emerging Businesses - - -
Corporate and other - - - -
---------- ----------- ---------- -----------
Consolidated $- - 145 -
========== =========== ========== ===========
INCOME FROM DISCONTINUED OPERATIONS
Corporate and other 59 39 81 35
SUMMARY OF NET INCOME/(LOSS)
E&P
United States $516 280 1,353 435
International 554 59 1,000 46
---------- ----------- ---------- -----------
Total E&P 1,070 339 2,353 481
---------- ----------- ---------- -----------
Midstream 25 12 56 24
---------- ----------- ---------- -----------
R&M
United States 227 73 483 (19)
International 74 (5) 188 -
---------- ----------- ---------- -----------
Total R&M 301 68 671 (19)
---------- ----------- ---------- -----------
Chemicals 12 7 (11) (4)
Emerging Businesses (23) (3) (57) (8)
Corporate and other (247) (72) (437) (225)
---------- ----------- ---------- -----------
Net income/(loss) $1,138 351 2,575 249
========== =========== ========== ===========
1-2
ConocoPhillips
Houston, Texas 77079
SELECTED FINANCIAL DATA
Three Months Ended Six Months Ended
June 30 June 30
2003 2002 2003 2002
INCOME/(LOSS) FROM CONTINUING
OPERATIONS
Effective tax rate % 38.4 % 52.5 45.6 69.8
Millions of Dollars
FOREIGN CURRENCY GAINS/(LOSSES)
AFTER-TAX
E&P $(24) (7) (14) (5)
Midstream - - - -
R&M 10 2 11 5
Chemicals - - - -
Emerging Businesses 1 - - -
Corporate and other 18 12 19 8
---------- ----------- ---------- -----------
$5 7 16 8
========== =========== ========== ===========
CASH FLOWS FROM OPERATING ACTIVITIES
Income from continuing operations $1,079 312 2,349 214
Depreciation, depletion and amortization 847 395 1,696 791
Property impairments 146 8 174 18
Dry hole costs and leasehold impairment 54 32 94 141
Accretion on discounted liabilities 35 6 68 11
Deferred taxes (1) 146 235 65
Other (149) (27) (82) 120
Working capital changes 91 (385) 803 (301)
---------- ----------- ---------- -----------
Net cash provided by continuing
operations 2,102 487 5,337 1,059
Net cash provided by discontinued
operations 158 43 102 50
---------- ----------- ---------- -----------
Net cash provided by operating
activities $2,260 530 5,439 1,109
========== =========== ========== ===========
CAPITAL EXPENDITURES AND INVESTMENTS
E&P
United States $381 257 707 526
Foreign 786 444 1,472 692
---------- ----------- ---------- -----------
1,167 701 2,179 1,218
Midstream 2 - 4 -
R&M 257 130 460 234
Chemicals - 9 - 19
Emerging Businesses 98 - 164 -
Corporate and other 50 34 76 48
---------- ----------- ---------- -----------
$1,574 874 2,883 1,519
========== =========== ========== ===========
OTHER
At June 30, 2003 At December 31, 2002
Total debt $17,569 19,766
Common stockholders' equity $32,032 29,517
1-3
ConocoPhillips
Houston, Texas 77079
OPERATING HIGHLIGHTS
BY SEGMENT
Three Months Ended Six Months Ended
June 30 June 30
2003 2002 2003 2002
Thousands of Barrels Daily
E&P
Crude oil produced
United States
Alaska 331 339 334 346
Lower 48 57 31 58 32
---------- ----------- ----------- ----------
388 370 392 378
Norway 214 119 220 118
United Kingdom 82 18 85 18
Canada 31 1 32 1
Nigeria 39 23 38 25
China 27 11 25 12
Indonesia 17 - 19 -
Other 52 4 54 4
---------- ----------- ----------- ----------
Total consolidated 850 546 865 556
Equity affiliates 117 4 86 5
---------- ----------- ----------- ----------
Total Worldwide 967 550 951 561
========== =========== =========== ==========
Syncrude 19 - 18 -
========== =========== =========== ==========
Natural gas liquids produced
United States
Alaska* 23 25 24 26
Lower 48 21 1 20 1
---------- ----------- ----------- ----------
44 26 44 27
Norway 7 4 8 5
Canada 11 - 11 -
Other 5 4 4 3
---------- ----------- ----------- ----------
Total Worldwide 67 34 67 35
========== =========== =========== ==========
*Includes reinjected volumes sold lease-to-
lease. 14 14 14 15
Millions of Cubic Feet Daily
Natural gas produced*
United States
Alaska 162 160 175 164
Lower 48 1,311 689 1,324 711
---------- ----------- ----------- ----------
1,473 849 1,499 875
Norway 273 131 289 133
United Kingdom 952 189 977 181
Canada 424 22 430 21
Indonesia 246 - 235 -
Other 117 95 115 107
---------- ----------- ----------- ----------
Total consolidated 3,485 1,286 3,545 1,317
Equity affiliates 11 - 11 -
---------- ----------- ----------- ----------
Total Worldwide 3,496 1,286 3,556 1,317
========== =========== =========== ==========
*Represents quantities available for sale. Excludes gas equivalent of NGL
shown above.
Liquefied natural gas sales 91 114 111 116
1-4
ConocoPhillips
Houston, Texas 77079
OPERATING HIGHLIGHTS
Three Months Ended Six Months Ended
June 30 June 30
2003 2002 2003 2002
E&P (continued)
Per Unit
Average sales prices
Crude oil (per barrel)
United States
Alaska $27.19 24.40 29.32 21.55
Lower 48 27.34 24.53 29.44 21.64
Total U.S. 27.21 24.41 29.34 21.55
International 25.62 24.58 28.30 22.74
Total consolidated 26.33 24.46 28.76 21.93
Equity affiliates 16.85 21.06 18.02 17.91
Total Worldwide 25.19 24.44 27.82 21.90
Natural gas-lease (per MCF)
United States
Alaska 1.88 1.80 1.92 1.94
Lower 48 4.72 2.56 5.10 2.26
Total U.S. 4.58 2.51 4.96 2.25
International 3.47 2.20 3.70 2.31
Total consolidated 3.92 2.40 4.21 2.27
Equity affiliates 4.89 - 4.85 -
Total Worldwide 3.93 2.40 4.21 2.27
Midstream*
Thousands of Barrels Daily
Natural gas liquids extracted
Consolidated
United States 53 - 52 -
International 35 - 41 -
Equity affiliates
United States* 110 119 112 118
International 11 - 11 -
---------- ----------- ---------- -----------
209 119 216 118
========== =========== ========== ===========
*Represents 30.3 percent interest in Duke Energy Field Services LLC
(DEFS)
Per Barrel
U.S. product prices
Weighted average NGL**
Consolidated $20.99 - 23.29 -
DEFS 20.53 15.59 22.53 14.21
* Prices are based on index prices from the Mont Belvieu and Conway market
hubs that are weighted by natural-gas-liquids component and location mix.
1-5
ConocoPhillips
Houston, Texas 77079
Three Months Ended Six Months Ended
June 30 June 30
2003 2002 2003 2002
Thousands of Barrels Daily
R&M
United States
Crude oil capacity 2,168 1,660 2,168 1,651
Crude oil runs 2,128 1,576 2,068 1,496
Refinery production 2,357 1,732 2,305 1,654
International*
Crude oil capacity 442 72 442 72
Crude oil runs 376 67 386 66
Refinery production 407 63 421 63
U.S. Petroleum products outside sales
Gasoline 1,381 1,159 1,356 1,122
Distillates 590 424 595 432
Aviation fuels 164 185 164 174
Other products 493 341 501 368
---------- ----------- ---------- --------------------
2,628 2,109 2,616 2,096
International 448 50 438 52
---------- ----------- ---------- --------------------
3,076 2,159 3,054 2,148
========== =========== ========== ====================
Per Gallon
U.S. Average sales prices**
Automotive gasoline-wholesale $1.02 0.87 1.06 0.77
Automotive gasoline-retail 1.34 1.00 1.35 0.91
Distillates-wholesale 0.85 0.69 0.95 0.64
* Includes ConocoPhillips' share of equity affiliates.
** Excludes excise taxes.
1-6
Exhibit 99.3
SUMMARY OF NET INCOME (LOSS) BY SEGMENT
Millions of Dollars
----------------------------------------------------------------
2002 2003
--------------------------------- ------------------------------
1st 2nd Qtr 3rd 4th Qtr YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr
--------------------------------- ------------------------------
Income from Continuing Operations
Before Accounting Change
U.S. E&P 155 280 306 415 1,156 676 516 1,192
International E&P (13) 59 154 393 593 461 554 1,015
----------------------------------------------------------- ------------------------------
Total E&P 142 339 460 808 1,749 1,137 1,070 2,207
----------------------------------------------------------- ------------------------------
Midstream 12 12 11 20 55 31 25 56
----------------------------------------------------------- ------------------------------
U.S. R&M (92) 73 44 113 138 257 227 484
International R&M 5 (5) 13 (8) 5 114 74 188
----------------------------------------------------------- ------------------------------
Total R&M (87) 68 57 105 143 371 301 672
----------------------------------------------------------- ------------------------------
Chemicals (11) 7 3 (13) (14) (23) 12 (11)
Emerging Businesses (5) (3) (262) (40) (310) (34) (23) (57)
Corporate and Other (149) (111) (343) (322) (925) (212) (306) (518)
----------------------------------------------------------- ------------------------------
Consolidated (98) 312 (74) 558 698 1,270 1,079 2,349
=========================================================== ==============================
Cumulative Effect of Accounting Change
U.S. E&P - - - - - 161 - 161
International E&P - - - - - (15) - (15)
----------------------------------------------------------- ------------------------------
Total E&P - - - - - 146 - 146
----------------------------------------------------------- ------------------------------
Midstream - - - - - - - -
----------------------------------------------------------- ------------------------------
U.S. R&M - - - - - (1) - (1)
International R&M - - - - - - - -
----------------------------------------------------------- ------------------------------
Total R&M - - - - - (1) - (1)
----------------------------------------------------------- ------------------------------
Chemicals - - - - - - - -
Emerging Businesses - - - - - - - -
Corporate and Other - - - - - - - -
----------------------------------------------------------- ------------------------------
Consolidated - - - - - 145 - 145
=========================================================== ==============================
Income (Loss) from Discontinued Operations
Corporate and Other (4) 39 (42) (986) (993) 22 59 81
=========================================================== ==============================
Net Income (Loss)
U.S. E&P 155 280 306 415 1,156 837 516 1,353
International E&P (13) 59 154 393 593 446 554 1,000
----------------------------------------------------------- ------------------------------
Total E&P 142 339 460 808 1,749 1,283 1,070 2,353
----------------------------------------------------------- ------------------------------
Midstream 12 12 11 20 55 31 25 56
----------------------------------------------------------- ------------------------------
U.S. R&M (92) 73 44 113 138 256 227 483
International R&M 5 (5) 13 (8) 5 114 74 188
----------------------------------------------------------- ------------------------------
Total R&M (87) 68 57 105 143 370 301 671
----------------------------------------------------------- ------------------------------
Chemicals (11) 7 3 (13) (14) (23) 12 (11)
Emerging Businesses (5) (3) (262) (40) (310) (34) (23) (57)
Corporate and Other (153) (72) (385)(1,308)(1,918) (190) (247) (437)
----------------------------------------------------------- ------------------------------
Consolidated (102) 351 (116) (428) (295) 1,437 1,138 2,575
=========================================================== ==============================
Page 1 of 13
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
Millions of Dollars
------------------------------------------------------------------
2002 2003
-------------------------------- ---------------------------------
1st 2nd Qtr 3rd 4th YTD 1st Qtr 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr
-------------------------------- ---------------------------------
Income from Continuing
Operations
Before Income Taxes
U.S. E&P 223 419 450 536 1,628 1,048 799 1,847
International E&P 167 260 555 949 1,931 1,280 960 2,240
---------------------------------------------------------- ---------------------------------
Total E&P 390 679 1,005 1,485 3,559 2,328 1,759 4,087
---------------------------------------------------------- ---------------------------------
Midstream 20 20 23 35 98 51 42 93
---------------------------------------------------------- ---------------------------------
U.S. R&M (140) 118 75 175 228 411 361 772
International R&M 5 (5) 19 (25) (6) 150 94 244
---------------------------------------------------------- ---------------------------------
Total R&M (135) 113 94 150 222 561 455 1,016
---------------------------------------------------------- ---------------------------------
Chemicals (18) 3 (1) (16) (32) (44) 15 (29)
Emerging Businesses (8) (5) (274) (62) (349) (51) (34) (85)
Corporate and Other (198) (153) (535) (471)(1,357) (280) (484) (764)
---------------------------------------------------------- ---------------------------------
Consolidated 51 657 312 1,121 2,141 2,565 1,753 4,318
========================================================== =================================
Income from Continuing
Operations
Effective Tax Rates
U.S. E&P 30.5% 33.2% 32.0% 22.6% 29.0% 35.5% 35.4% 35.5%
International E&P 107.8% 77.3% 72.3% 58.6% 69.3% 64.0% 42.3% 54.7%
---------------------------------------------------------- ---------------------------------
Total E&P 63.6% 50.1% 54.2% 45.6% 50.9% 51.2% 39.2% 46.0%
---------------------------------------------------------- ---------------------------------
Midstream 40.0% 40.0% 52.2% 42.9% 43.9% 39.2% 40.5% 39.8%
---------------------------------------------------------- ---------------------------------
U.S. R&M 34.3% 38.1% 41.3% 35.4% 39.5% 37.5% 37.1% 37.3%
International R&M 0.0% 0.0% 31.6% 68.0% 183.3% 24.0% 21.3% 23.0%
---------------------------------------------------------- ---------------------------------
Total R&M 35.6% 39.8% 39.4% 30.0% 35.6% 33.9% 33.8% 33.9%
---------------------------------------------------------- ---------------------------------
Chemicals 38.9%-133.3%400.0% 18.8% 56.3% 47.7% 20.0% 62.1%
Emerging Businesses 37.5% 40.0% 4.4% 35.5% 11.2% 33.3% 32.4% 32.9%
Corporate and Other 24.7% 27.5% 35.9% 31.6% 31.8% 24.3% 36.8% 32.2%
---------------------------------------------------------- ---------------------------------
Consolidated 292.2% 52.5%123.7% 50.2% 67.4% 50.5% 38.4% 45.6%
========================================================== =================================
Page 2 of 13
CERTAIN ITEMS AFFECTING NET INCOME (AFTER-TAX)
Millions of Dollars
-------------------------------------------------------------------
2002 2003
--------------------------------- ---------------------------------
1st 2nd 3rd 4th Qtr YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr
--------------------------------- ---------------------------------
U.S. E&P
Asset sales - - (5) - (5) 2 17 19
Property
impairments - (3) (5) - (8) - (14) (14)
Dry hole charges (9) (2) (1) (38) (50) (10) (1) (11)
- ----------------------------------------------------------- ---------------------------------
Total (9) (5) (11) (38) (63) (8) 2 (6)
- ----------------------------------------------------------- ---------------------------------
International E&P
Asset sales - - - 17 17 (1) (3) (4)
Property
impairments (7) (2) - (14) (23) (12) (32) (44)
Foreign currency
transaction gains
(losses) 2 (7) (6) (23) (34) 10 (24) (14)
Dry hole charges (2) (7) (1) (48) (58) (5) (6) (11)
- ----------------------------------------------------------- ---------------------------------
Total (7) (16) (7) (68) (98) (8) (65) (73)
- ----------------------------------------------------------- ---------------------------------
Total E&P (16) (21) (18) (106) (161) (16) (63) (79)
- ----------------------------------------------------------- ---------------------------------
Midstream
Asset sales - - - - - - - -
Property
impairments - - - - - - - -
- ----------------------------------------------------------- ---------------------------------
Total - - - - - - - -
- ----------------------------------------------------------- ---------------------------------
U.S. R&M
Asset sales - - - - - - 1 1
Impairments and lease loss
accruals - - - (88) (88) (25) (25) (50)
Maintenance turnaround
expense (46) (19) (29) (16) (110) (39) (23) (62)
- ----------------------------------------------------------- ---------------------------------
Total (46) (19) (29) (104) (198) (64) (47) (111)
- ----------------------------------------------------------- ---------------------------------
International R&M
Asset sales - - - - - - - -
Maintenance turnaround
expense - - - (1) (1) (1) (3) (4)
Foreign currency
transaction gains
(losses) 3 2 3 1 9 1 10 11
Property
impairments - - - - - - - -
- ----------------------------------------------------------- ---------------------------------
Total 3 2 3 - 8 - 7 7
- ----------------------------------------------------------- ---------------------------------
Total R&M (43) (17) (26) (104) (190) (64) (40) (104)
- ----------------------------------------------------------- ---------------------------------
Chemicals
- - - - - - - -
- ----------------------------------------------------------- ---------------------------------
Total - - - - - - - -
- ----------------------------------------------------------- ---------------------------------
Emerging Businesses
Asset sales - - - - - - - -
Foreign currency
transaction gains
(losses) - - - - - (1) 1 -
- ----------------------------------------------------------- ---------------------------------
Total - - - - - (1) 1 -
- ----------------------------------------------------------- ---------------------------------
Corporate and Other
Discontinued operations
Impairments and lease
loss accruals - - (69)(1,008) (1,077) (25) (24) (49)
Other
results (4) 39 27 22 84 47 83 130
Asset sales - - - - - - - -
Foreign currency
transaction gains
(losses) (4) 12 5 8 21 1 18 19
Merger-related expenses (2) (1) (221) (83) (307) (27) (115) (142)
Premium on early debt
retirement - (15) - (1) (16) (10) (9) (19)
- ----------------------------------------------------------- ---------------------------------
Total (10) 35 (258)(1,062) (1,295) (14) (47) (61)
- ----------------------------------------------------------- ---------------------------------
The above financial information represents certain items of a
recurring nature that are included in the reporting segments' net
income. These items often result in variability in the company's
revenues or expenses. Non-recurring items that may affect
comparability between periods, such as the company's write-off of
in-process research and development costs of $246 million in the third
quarter of 2002, are not included above.
Page 3 of 13
CASH FLOW INFORMATION
Millions of Dollars
-------------------------------------------------------------------
2002 2003
---------------------------------- --------------------------------
1st 2nd Qtr3rd Qtr4th Qtr YTD 1st Qtr2nd Qtr 3rd 4th YTD
Qtr Qtr Qtr
---------------------------------- --------------------------------
DD&A (including property impairments)
included in net cash provided
by
operating
activities 406 402 557 1,035 2,400 877 993 1,870
============================================================ ================================
Net Cash Provided
by
Operating
Activities 579 530 1,878 1,982 4,969 3,179 2,260 5,439
- ------------------------------------------------------------ --------------------------------
Cash Flows from Investing
Activities
Capital expenditures and investments:
E&P (517) (701) (715)(1,343)(3,276) (1,012)(1,167) (2,179)
Midstream - - (2) (3) (5) (2) (2) (4)
R&M (104) (130) (191) (415) (840) (203) (257) (460)
Chemicals (10) (9) (10) (31) (60) - - -
Emerging Businesses - - (35) (87) (122) (66) (98) (164)
Corporate and Other (14) (34) (7) (30) (85) (26) (50) (76)
- ------------------------------------------------------------ --------------------------------
Total capital
expend. &
investments (645) (874) (960)(1,909)(4,388) (1,309)(1,574) (2,883)
Acquisitions, net of
cash acquired - - 1,242 (62) 1,180 - - -
Proceeds from asset
dispositions 45 36 19 715 815 121 373 494
Long-term advances to affiliates and
other
investments (12) 14 (83) (11) (92) (28) (8) (36)
Discontinued operations (12) (12) (23) (52) (99) (17) (1) (18)
- ------------------------------------------------------------ --------------------------------
Net Cash Used for
Investing Activities (624) (836) 195 (1,319)(2,584) (1,233)(1,210) (2,443)
- ------------------------------------------------------------ --------------------------------
Cash Flows from Financing Activities
Net issuance (repayment)
of debt 204 725 (1,432) (587)(1,090) (1,556) (626) (2,182)
Redemption of preferred
stock - (300) - - (300) - - -
Dividends (138) (137) (138) (271) (684) (271) (272) (543)
Other 7 (7) (131) (15) (146) (3) 36 33
- ------------------------------------------------------------ --------------------------------
Net Cash Provided by (Used for)
Financing
Activities 73 281 (1,701) (873)(2,220) (1,830) (862) (2,692)
- ------------------------------------------------------------ --------------------------------
Net Change in Cash
and Cash Equivalents 28 (25) 372 (210) 165 116 188 304
Cash and cash equivalents
at beginning of period 142 170 145 517 142 307 423 307
- ------------------------------------------------------------ --------------------------------
Cash and Cash Equivalents
at End of Period 170 145 517 307 307 423 611 611
============================================================ ================================
Page 4 of 13
TOTAL E&P
2002 2003
-------------------------------- ------------------------------
1st 2nd Qtr 3rd 4th YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr
-------------------------------- ------------------------------
E&P Net Income ($
Millions) 142 339 460 808 1,749 1,283 1,070 2,353
========================================================== ==============================
Production
Total, Including Equity
Affiliates
and Canadian Syncrude
(MBOE/D) 833 798 1,046 1,623 1,077 1,622 1,636 1,629
---------------------------------------------------------- ------------------------------
Crude Oil and Condensate (MB/D)
Consolidated 566 546 620 854 647 880 850 865
Equity affiliates 5 4 44 87 35 55 117 86
---------------------------------------------------------- ------------------------------
Total 571 550 664 941 682 935 967 951
========================================================== ==============================
Sales of crude oil
produced (MB/D) 566 557 664 918 677 911 996 954
---------------------------------------------------------- ------------------------------
Natural Gas Liquids (MB/D) 37 34 43 70 46 67 67 67
-----------------------------------------------------------------------------------------
Natural Gas (MMCF/D)
Consolidated 1,349 1,286 1,982 3,529 2,043 3,605 3,485 3,545
Equity affiliates - - 4 13 4 12 11 11
---------------------------------------------------------- ------------------------------
Total 1,349 1,286 1,986 3,542 2,047 3,617 3,496 3,556
========================================================== ==============================
Canadian Syncrude (MB/D) - - 8 22 8 17 19 18
---------------------------------------------------------- ------------------------------
Industry Prices (Platt's)
Crude Oil ($/bbl)
WTI spot 21.56 26.27 28.31 28.20 26.09 34.06 29.02 31.54
Brent dated 21.14 25.04 26.94 26.78 24.98 31.51 26.03 28.77
Natural Gas--Henry Hub 1st
of month ($/mcf) 2.34 3.38 3.16 3.97 3.21 6.58 5.40 5.99
---------------------------------------------------------- ------------------------------
Average Realized Prices
Crude Oil and Condensate ($/bbl)
Consolidated 19.41 24.46 26.38 26.12 24.38 31.27 26.33 28.76
Equity affiliates 15.86 21.06 20.29 17.50 18.41 20.97 16.85 18.02
Total 19.37 24.44 25.97 25.31 24.07 30.73 25.19 27.82
---------------------------------------------------------- ------------------------------
Natural Gas Liquids
($/bbl) 16.00 20.36 19.42 19.32 18.93 24.73 19.17 21.86
---------------------------------------------------------- ------------------------------
Natural Gas ($/mcf)
Consolidated 2.15 2.40 2.49 3.27 2.77 4.49 3.92 4.21
Equity affiliates - - 1.78 3.00 2.71 4.82 4.89 4.85
Total 2.15 2.40 2.49 3.27 2.77 4.49 3.93 4.21
---------------------------------------------------------- ------------------------------
Exploration Charges ($ Millions)
Dry Holes 16 17 4 124 161 20 30 50
Lease Impairments 93 16 15 22 146 20 24 44
---------------------------------------------------------- ------------------------------
Total Non-Cash Charges 109 33 19 146 307 40 54 94
Other (G&G and Lease
Rentals) 54 34 66 131 285 76 88 164
---------------------------------------------------------- ------------------------------
Total Exploration Charges 163 67 85 277 592 116 142 258
========================================================== ==============================
Depreciation, Depletion & Amortization
Producing operations ($
millions) 274 278 398 666 1,616 641 628 1,269
---------------------------------------------------------- ------------------------------
Page 5 of 13
U.S. E&P
2002 2003
-------------------------------- ------------------------------
1st 2nd Qtr 3rd 4th YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr
-------------------------------- ------------------------------
U.S. E&P Net Income ($
Millions) 155 280 306 415 1,156 837 516 1,353
========================================================== ==============================
Alaska ($
Millions) 123 223 246 278 870 525 301 826
- ---------------------------------------------------------- ------------------------------
Lower 48 ($
Millions) 32 57 60 137 286 312 215 527
- ---------------------------------------------------------- ------------------------------
Production
Total U.S. (MBOE/D) 564 538 562 684 587 696 678 686
- ---------------------------------------------------------- ------------------------------
Crude Oil and Condensate (MB/D)
Alaska 353 339 310 323 331 337 331 334
Lower 48 33 31 38 58 40 60 57 58
- ---------------------------------------------------------- ------------------------------
Total 386 370 348 381 371 397 388 392
========================================================== ==============================
Sales of crude oil
produced (MB/D) 383 374 360 370 372 391 389 390
- ---------------------------------------------------------- ------------------------------
Natural Gas Liquids
(MB/D)*
Alaska 27 25 21 24 24 25 23 24
Lower 48 1 1 9 21 8 19 21 20
- ---------------------------------------------------------- ------------------------------
Total 28 26 30 45 32 44 44 44
========================================================== ==============================
*Includes reinjection
volumes sold lease-to-
lease: 15 14 13 15 14 15 14 14
- ---------------------------------------------------------- ------------------------------
Natural Gas (MMCF/D)
Alaska 168 160 183 186 175 189 162 175
Lower 48 734 689 922 1,362 928 1,338 1,311 1,324
- ---------------------------------------------------------- ------------------------------
Total 902 849 1,105 1,548 1,103 1,527 1,473 1,499
========================================================== ==============================
Average Realized Prices
Crude Oil and Condensate ($/bbl)
Alaska
North Slope 13.58 18.96 20.42 21.10 18.42 25.95 21.70 23.81
- ---------------------------------------------------------- ------------------------------
West Coast 18.72 24.40 25.83 26.43 23.75 31.47 27.19 29.32
- ---------------------------------------------------------- ------------------------------
Lower 48 18.86 24.53 26.87 26.00 24.48 31.48 27.34 29.44
- ---------------------------------------------------------- ------------------------------
Total U.S. 18.73 24.41 25.94 26.36 23.83 31.47 27.21 29.34
- ---------------------------------------------------------- ------------------------------
. .
Natural Gas Liquids
($/bbl)
Alaska 18.67 24.40 25.68 26.48 23.48 31.32 27.24 29.32
- ---------------------------------------------------------- ------------------------------
Lower 48 12.75 16.74 14.62 16.17 15.66 21.91 15.89 18.68
- ---------------------------------------------------------- ------------------------------
Total U.S. 18.13 23.61 20.17 19.27 20.00 25.13 19.33 22.11
- ---------------------------------------------------------- ------------------------------
Natural Gas ($/mcf)
Alaska 2.13 1.80 1.58 1.95 1.85 1.97 1.88 1.92
- ---------------------------------------------------------- ------------------------------
Lower 48 1.99 2.56 2.65 3.43 2.79 5.47 4.72 5.10
- ---------------------------------------------------------- ------------------------------
Total U.S. 1.99 2.51 2.60 3.38 2.75 5.34 4.58 4.96
- ---------------------------------------------------------- ------------------------------
Kenai, Alaska LNG Sales
Volume (MMCF/D) 117 114 128 128 122 130 91 111
- ---------------------------------------------------------- ------------------------------
Sales price per MCF 4.00 3.74 4.21 4.30 4.07 4.38 4.56 4.45
- ---------------------------------------------------------- ------------------------------
U.S. Exploration Charges ($ Millions)
Dry Holes 14 3 1 61 79 16 3 19
Lease Impairments 13 12 10 14 49 13 12 25
- ---------------------------------------------------------- ------------------------------
Total Non-Cash Charges 27 15 11 75 128 29 15 44
Other (G&G and Lease
Rentals) 17 10 20 39 86 28 22 50
- ---------------------------------------------------------- ------------------------------
Total U.S. Exploration
Charges 44 25 31 114 214 57 37 94
========================================================== ==============================
Alaska Only 27 12 11 45 95 25 10 35
- ---------------------------------------------------------- ------------------------------
Depreciation, Depletion & Amortization
Producing operations ($
millions)
Alaska 156 157 136 140 589 110 122 232
Lower 48 54 48 93 149 344 148 148 296
- ---------------------------------------------------------- ------------------------------
Total
U.S. 210 205 229 289 933 258 270 528
========================================================== ==============================
Page 6 of 13
INTERNATIONAL E&P
2002 2003
-------------------------------- ------------------------------
1st 2nd Qtr 3rd 4th YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr
-------------------------------- ------------------------------
International E&P
Net Income (Loss) ($
Millions) (13) 59 154 393 593 446 554 1,000
========================================================== ==============================
Production
Total, Including Equity
Affiliates
and Canadian Syncrude
(MBOE/D) 269 261 484 939 490 926 958 943
- ---------------------------------------------------------- ------------------------------
Crude Oil and Condensate (MB/D)
Consolidated
Norway 118 119 156 233 157 226 214 220
United Kingdom 17 18 35 86 39 87 82 85
Canada 1 1 14 37 13 33 31 32
Nigeria 27 23 29 38 29 38 39 38
China 13 11 12 11 12 23 27 25
Indonesia - - 6 13 5 21 17 19
Other 4 4 20 55 21 55 52 54
Equity affiliates 5 4 44 87 35 55 117 86
- ---------------------------------------------------------- ------------------------------
Total 185 180 316 560 311 538 579 559
========================================================== ==============================
Sales of crude oil
produced (MB/D) 183 183 304 548 306 520 607 564
- ---------------------------------------------------------- ------------------------------
Natural Gas Liquids (MB/D)
Norway 5 4 6 7 6 8 7 8
Canada - - 3 14 4 11 11 11
Other 4 4 4 4 4 4 5 4
- ---------------------------------------------------------- ------------------------------
Total 9 8 13 25 14 23 23 23
========================================================== ==============================
Natural Gas (MMCF/D)
Consolidated
Norway 135 131 183 232 171 305 273 289
United Kingdom 173 189 349 975 424 1,002 952 977
Canada 19 22 172 442 165 436 424 430
Indonesia - - 68 220 72 224 246 235
Other 120 95 105 112 108 111 117 115
Equity affiliates - - 4 13 4 12 11 11
- ---------------------------------------------------------- ------------------------------
Total 447 437 881 1,994 944 2,090 2,023 2,057
========================================================== ==============================
Canadian Syncrude (MB/D) - - 8 22 8 17 19 18
- ---------------------------------------------------------- ------------------------------
Average Realized Prices
Crude Oil and Condensate ($/bbl)
Consolidated
Norway 21.04 24.49 27.19 26.35 25.21 32.72 26.28 29.39
United Kingdom 21.21 24.14 26.88 25.98 25.33 30.11 24.34 27.25
Canada 20.03 24.85 27.20 21.26 22.87 28.40 23.61 26.07
Nigeria 21.14 24.95 27.51 26.97 25.37 31.94 26.35 28.87
China 19.57 25.27 26.31 29.64 25.03 28.87 26.51 27.57
Indonesia - - 24.89 30.59 28.10 29.35 24.54 27.20
Other 15.00 25.18 25.75 25.18 24.94 29.10 25.38 27.25
Equity affiliates 15.86 21.06 20.29 17.50 18.41 20.97 16.85 18.02
Total 20.71 24.51 26.01 24.60 24.36 30.17 23.90 26.77
- ---------------------------------------------------------- ------------------------------
Natural Gas Liquids
($/bbl)
Norway 12.88 15.48 15.64 20.69 16.51 21.85 18.13 19.90
Canada - - 29.12 18.42 20.39 26.11 20.78 23.49
Other 12.58 13.29 13.74 20.51 15.29 23.40 16.73 19.88
Total 12.76 14.58 18.42 19.39 17.47 24.22 18.96 21.54
- ---------------------------------------------------------- ------------------------------
Natural Gas ($/mcf)
Consolidated
Norway 3.22 3.02 3.16 3.33 3.20 3.66 3.86 3.75
United Kingdom 3.18 2.55 2.22 3.20 2.92 3.55 3.17 3.36
Canada 2.23 2.21 2.32 3.37 3.03 5.42 4.34 4.89
Indonesia - - 4.18 4.11 4.12 4.66 4.16 4.40
Other 0.41 0.39 0.41 0.45 0.42 0.48 0.48 0.48
Equity affiliates - - 1.78 3.00 2.71 4.82 4.89 4.85
Total 2.41 2.20 2.37 3.20 2.79 3.92 3.48 3.70
- ---------------------------------------------------------- ------------------------------
International Exploration Charges ($
Millions)
Dry Holes 2 14 3 63 82 4 27 31
Lease Impairments 80 4 5 8 97 7 12 19
- ---------------------------------------------------------- ------------------------------
Total Non-Cash Charges 82 18 8 71 179 11 39 50
Other (G&G and Lease
Rentals) 37 24 46 92 199 48 66 114
- ---------------------------------------------------------- ------------------------------
Total International
Exploration Charges 119 42 54 163 378 59 105 164
========================================================== ==============================
Depreciation, Depletion & Amortization
Producing operations ($
millions) 64 73 169 377 683 383 358 741
- ---------------------------------------------------------- ------------------------------
Page 7 of 13
R&M
2002 2003
------------------------------- ------------------------------
1st 2nd 3rd 4th YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr Qtr
------------------------------- ------------------------------
R&M Net Income (Loss) ($
Millions) (87) 68 57 105 143 370 301 671
========================================================================================
United States ($
Millions) (92) 73 44 113 138 256 227 483
- --------------------------------------------------------- ------------------------------
International ($
Millions) 5 (5) 13 (8) 5 114 74 188
- --------------------------------------------------------- ------------------------------
Market Indicators
U.S. East Coast Crack
Spread ($/bbl) 2.90 2.86 3.06 4.58 3.35 6.16 3.46 4.81
U.S. Gulf Coast Crack
Spread ($/bbl) 2.78 3.70 2.79 3.74 3.25 5.64 3.65 4.64
U.S. Group Central Spread
($/bbl) 3.88 5.07 5.16 5.69 4.95 6.12 6.96 6.54
U.S. West Coast Crack
Spread ($/bbl) 9.67 9.53 8.58 8.40 9.04 12.79 11.39 12.09
NW Europe Crack Spread
($/bbl) 0.74 1.38 1.70 2.72 1.64 5.68 3.17 4.42
- --------------------------------------------------------- ------------------------------
Realized Margins
Refining Margin ($/bbl)
U.S. n/a n/a n/a 5.07 n/a 6.50 5.34 5.90
International n/a n/a n/a 2.98 n/a 5.63 3.98 4.82
- --------------------------------------------------------- ------------------------------
Marketing Margin ($/gal)
U.S. n/a n/a n/a 0.04 n/a 0.04 0.06 0.05
International n/a n/a n/a 0.16 n/a 0.17 0.22 0.19
- --------------------------------------------------------- ------------------------------
Depreciation, Depletion &
Amortization ($
Millions) 102 98 119 167 486 162 171 333
- --------------------------------------------------------- ------------------------------
Consolidated
EASTERN U.S.
Charge Barrels Input
(MB/D)
Crude Oil 348 404 338 399 372 415 435 425
Other Feed and Blending
Stocks 53 47 16 61 44 51 53 52
- --------------------------------------------------------- ------------------------------
Total 401 451 354 460 416 466 488 477
========================================================= ==============================
Percentage Utilization 81% 94% 79% 93% 87% 97% 101% 99%
- --------------------------------------------------------- ------------------------------
Refined Products Production
(MB/D)
Gasoline 214 247 187 260 227 244 249 246
Distillates 111 114 88 116 107 138 131 135
Aviation Fuel 35 37 37 37 36 32 29 30
Other 46 52 36 51 47 55 85 71
- --------------------------------------------------------- ------------------------------
Total 406 450 348 464 417 469 494 482
========================================================= ==============================
U.S. GULF COAST
Charge Barrels Input
(MB/D)
Crude Oil 414 428 509 652 501 668 702 685
Other Feed and Blending
Stocks 80 67 87 101 85 103 95 99
- --------------------------------------------------------- ------------------------------
Total 494 495 596 753 586 771 797 784
========================================================= ==============================
Percentage Utilization 90% 92% 93% 91% 92% 93% 98% 96%
- --------------------------------------------------------- ------------------------------
Refined Products Production
(MB/D)
Gasoline 213 211 236 300 240 289 277 283
Distillates 146 144 172 247 177 242 249 245
Aviation Fuel 37 39 52 62 48 70 63 67
Other 102 116 148 181 137 221 242 231
- --------------------------------------------------------- ------------------------------
Total 498 510 608 790 602 822 831 826
========================================================= ==============================
CENTRAL U.S.
Charge Barrels Input
(MB/D)
Crude Oil 348 424 466 633 469 631 663 647
Other Feed and Blending
Stocks 34 32 39 46 37 32 24 28
- --------------------------------------------------------- ------------------------------
Total 382 456 505 679 506 663 687 675
========================================================= ==============================
Percentage Utilization 84% 98% 90% 92% 91% 92% 96% 94%
- --------------------------------------------------------- ------------------------------
Refined Products Production
(MB/D)
Gasoline 200 235 269 389 274 367 375 371
Distillates 64 74 76 148 91 144 152 148
Aviation Fuel 50 49 58 64 55 59 57 58
Other 61 98 99 91 87 96 110 103
- --------------------------------------------------------- ------------------------------
Total 375 456 502 692 507 666 694 680
========================================================= ==============================
n/a = not
available.
Page 8 of 13
R&M (continued)
2002 2003
--------------------------------- ---------------------------------
1st 2nd 3rd 4th YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr Qtr
--------------------------------- ---------------------------------
WESTERN U.S.
Charge Barrels Input
(MB/D)
Crude Oil 306 320 330 320 319 294 328 311
Other Feed and Blending
Stocks (3) 16 13 16 11 9 13 11
- ----------------------------------------------------------- ---------------------------------
Total 303 336 343 336 330 303 341 322
=========================================================== =================================
Percentage Utilization 92% 96% 99% 96% 96% 88% 99% 93%
- ----------------------------------------------------------- ---------------------------------
Refined Products Production
(MB/D)
Gasoline 137 148 175 174 159 160 176 168
Distillates 71 77 78 81 77 66 83 75
Aviation Fuel 27 31 33 30 30 29 24 26
Other 61 60 51 48 55 42 55 48
- ----------------------------------------------------------- ---------------------------------
Total 296 316 337 333 321 297 338 317
=========================================================== =================================
TOTAL UNITED STATES
Charge Barrels Input
(MB/D)
Crude Oil 1,416 1,576 1,643 2,004 1,661 2,008 2,128 2,068
Other Feed and Blending
Stocks 164 162 155 224 177 195 185 190
- ----------------------------------------------------------- ---------------------------------
Total 1,580 1,738 1,798 2,228 1,838 2,203 2,313 2,258
=========================================================== =================================
Percentage Utilization 86% 95% 90% 93% 91% 93% 98% 95%
- ----------------------------------------------------------- ---------------------------------
Refined Products Production
(MB/D)
Gasoline 764 841 867 1,123 900 1,060 1,077 1,068
Distillates 392 409 414 592 452 590 615 603
Aviation Fuel 149 156 180 193 169 190 173 181
Other 270 326 334 371 326 414 492 453
- ----------------------------------------------------------- ---------------------------------
Total 1,575 1,732 1,795 2,279 1,847 2,254 2,357 2,305
=========================================================== =================================
UNITED KINGDOM and IRELAND
Charge Barrels Input
(MB/D)
Crude Oil 65 67 126 177 109 262 244 253
Other Feed and Blending
Stocks - - 15 30 11 39 42 41
- ----------------------------------------------------------- ---------------------------------
Total 65 67 141 207 120 301 286 294
=========================================================== =================================
Percentage Utilization 90% 92% 85% 58% 73% 86% 80% 83%
- ----------------------------------------------------------- ---------------------------------
Refined Products Production
(MB/D)
Gasoline 15 16 42 64 34 99 91 95
Distillates 26 26 56 76 46 125 118 122
Aviation Fuel - - 4 6 3 14 7 10
Other 21 21 32 77 38 54 59 56
- ----------------------------------------------------------- ---------------------------------
Total 62 63 134 223 121 292 275 283
=========================================================== =================================
Equity Affiliates - Net
Share
International*
Charge Barrels Input
(MB/D)
Crude Oil - - 42 130 43 134 132 133
Other Feed and Blending
Stocks - - 1 3 1 2 3 2
- ----------------------------------------------------------- ---------------------------------
Total - - 43 133 44 136 135 135
=========================================================== =================================
Percentage Utilization - - 95% 95% 95% 98% 97% 98%
- ----------------------------------------------------------- ---------------------------------
Refined Products Production
(MB/D)
Gasoline - - 13 41 14 43 41 42
Distillates - - 18 58 19 58 59 58
Aviation Fuel - - 4 7 3 10 8 9
Other - - 9 19 7 33 24 29
- ----------------------------------------------------------- ---------------------------------
Total - - 44 125 43 144 132 138
=========================================================== =================================
* Represents 18.75 percent interest in a refinery complex at
Karlsruhe, Germany; 16.33 percent interest in two refineries in
Kralupy and Litvinov, Czech Republic; and 47 percent interest in a
refinery at Melaka, Malaysia.
Page 9 of 13
R&M (continued)
2002 2003
--------------------------------- --------------------------------
1st 2nd 3rd Qtr 4th YTD 1st Qtr 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr
--------------------------------- --------------------------------
Worldwide - Including Share of Equity
Affiliates
Charge Barrels Input
(MB/D)
Crude Oil 1,481 1,643 1,811 2,311 1,813 2,404 2,504 2,454
Other Feed and Blending
Stocks 164 162 171 257 189 236 230 233
- ----------------------------------------------------------- --------------------------------
Total 1,645 1,805 1,982 2,568 2,002 2,640 2,734 2,687
=========================================================== ================================
Percentage Utilization 86% 95% 90% 89% 90% 92% 96% 94%
- ----------------------------------------------------------- --------------------------------
Refined Products Production
(MB/D)
Gasoline 779 857 922 1,228 948 1,202 1,209 1,205
Distillates 418 435 488 726 517 773 792 783
Aviation Fuel 149 156 188 206 175 214 188 200
Other 291 347 375 467 371 501 575 538
- ----------------------------------------------------------- --------------------------------
Total 1,637 1,795 1,973 2,627 2,011 2,690 2,764 2,726
=========================================================== ================================
U.S. PETROLEUM PRODUCTS SALES (MB/D)*
Gasoline 1,084 1,159 1,195 1,478 1,230 1,331 1,381 1,356
Distillates 439 424 449 692 502 600 590 595
Aviation Fuel 162 185 219 172 185 164 164 164
Other 398 341 350 403 372 509 493 501
- ----------------------------------------------------------- --------------------------------
Total 2,083 2,109 2,213 2,745 2,289 2,604 2,628 2,616
=========================================================== ================================
*2002 amounts restated.
INTERNATIONAL PETROLEUM PRODUCTS SALES (MB/D)
Gasoline 12 12 78 163 67 202 190 196
Distillates 20 21 84 147 69 181 199 190
Aviation Fuel - - 2 6 2 5 7 6
Other 22 17 37 24 24 40 52 46
- ----------------------------------------------------------- --------------------------------
Total 54 50 201 340 162 428 448 438
=========================================================== ================================
SPECIALTIES
Base Oil Production(MB/D)
United States - Equity
Affiliate - - 3 10 3 10 7 8
- ----------------------------------------------------------- --------------------------------
Petroleum Coke Sales (MMT)*
United States
Fuel coke 297 311 500 565 1,673 683 653 1,336
Specialty coke 56 57 196 292 601 276 282 558
- ----------------------------------------------------------- --------------------------------
International
Fuel coke - - 12 54 66 57 50 107
Specialty coke - - 68 180 248 176 180 356
- ----------------------------------------------------------- --------------------------------
Finished Lubes Sales (MB/D)*
United States 8 9 9 10 9 10 10 10
- ----------------------------------------------------------- --------------------------------
International - - - 1 - 1 - 1
- ----------------------------------------------------------- --------------------------------
*Included in "Other" in the petroleum products sales statistics
above.
Page 10 of 13
MIDSTREAM
2002 2003
---------------------------------- --------------------------------
1st 2nd Qtr3rd Qtr4th Qtr YTD 1st Qtr2nd Qtr 3rd 4th YTD
Qtr Qtr Qtr
---------------------------------- --------------------------------
Midstream Net Income ($
Millions) 12 12 11 20 55 31 25 56
=============================================================================================
U.S. Equity Affiliate ($
Millions)* 5 7 6 5 23 13 23 36
- ------------------------------------------------------------ --------------------------------
Natural Gas Liquids Extracted (MB/D)
Consolidated
United States - - 19 56 19 51 53 52
International - - 15 45 15 47 35 41
Equity Affiliates
United States* 118 119 120 119 119 114 110 112
International - - 3 10 3 10 11 11
- ------------------------------------------------------------ --------------------------------
Total 118 119 157 230 156 222 209 216
============================================================ ================================
* Represents 30.3 percent interest in Duke Energy Field Services, LLC
(DEFS).
Natural Gas Liquids Fractionated (MB/D)
United States 107 104 139 179 133 168 158 163
- ------------------------------------------------------------ --------------------------------
Product Prices
Weighted Average NGL ($/bbl)*
Consolidated - - 18.57 19.24 19.07 25.59 20.99 23.29
DEFS 12.83 15.59 16.32 18.95 15.92 24.53 20.53 22.53
- ------------------------------------------------------------ --------------------------------
* Prices are based on index prices from the Mont Belvieu and Conway market hubs that are
weighted by natural gas liquids component and location mix.
Depreciation, Depletion &
Amortization ($
Millions) 1 - 5 13 19 14 14 28
- ------------------------------------------------------------ --------------------------------
EMERGING BUSINESSES
2002 2003
---------------------------------- --------------------------------
1st 2nd Qtr3rd Qtr4th Qtr YTD 1st Qtr2nd Qtr 3rd 4th YTD
Qtr Qtr Qtr
---------------------------------- --------------------------------
Emerging Businesses
Net Income (Loss) ($
Millions)* (5) (3) (262) (40) (310) (34) (23) (57)
=============================================================================================
Detail of Net Income (Loss) ($
Millions)
Carbon Fibers - - (4) (11) (15) (6) - (6)
Fuels Technology (5) (3) (4) (4) (16) (5) (6) (11)
Gas-to-Liquids* - - (253) (20) (273) (20) (13) (33)
Power - - (1) (2) (3) 1 (1) -
Other - - - (3) (3) (4) (3) (7)
- ------------------------------------------------------------ --------------------------------
Total (5) (3) (262) (40) (310) (34) (23) (57)
============================================================ ================================
* Third quarter 2002 results include a $246 million write down of acquired in-
process R&D.
CORPORATE AND OTHER
2002 2003
---------------------------------- --------------------------------
1st 2nd Qtr3rd Qtr4th Qtr YTD 1st Qtr2nd Qtr 3rd 4th YTD
Qtr Qtr Qtr
---------------------------------- --------------------------------
Corporate and Other
Net Income (Loss) ($
Millions) (153) (72) (385)(1,308)(1,918) (190) (247) (437)
=============================================================================================
Detail of Net Income (Loss) ($
Millions)
Net Interest
Expense (78) (91) (83) (160) (412) (167) (137) (304)
Corporate Overhead (47) (27) (32) (67) (173) (35) (38) (73)
Discontinued operations
Impairments and loss
accruals - - (69)(1,008)(1,077) (25) (24) (49)
Operating results (4) 39 27 22 84 47 83 130
Merger-related
costs (2) (1) (221) (83) (307) (27) (115) (142)
Other (22) 8 (7) (12) (33) 17 (16) 1
- ------------------------------------------------------------ --------------------------------
Total (153) (72) (385)(1,308)(1,918) (190) (247) (437)
============================================================ ================================
Before-Tax Net Interest Expense ($ Millions)
Interest Expense (158) (157) (193) (291) (799) (283) (268) (551)
Capitalized
Interest 51 51 59 72 233 74 83 157
Interest Revenue 4 2 13 21 40 3 1 4
Premium on early debt
retirement - (21) - (3) (24) (12) (11) (23)
- ------------------------------------------------------------ --------------------------------
(103) (125) (121) (201) (550) (218) (195) (413)
============================================================ ================================
Debt
Total Debt ($ Millions) 8,902 9,635 20,453 19,766 19,766 18,240 17,569 17,569
Debt-to-Capital
Ratio 37.6% 39.4% 39.8% 39.3% 39.3% 36.4% 34.7% 34.7%
- ------------------------------------------------------------ --------------------------------
Page 11 of 13
SELECTED PRO FORMA STATISTICS (E&P)
2002 2003
-------------------------------- ----------------------------------
1st 2nd 3rd Qtr 4th YTD 1st 2nd 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr Qtr Qtr
-------------------------------- ----------------------------------
E&P
E&P Production
Total Including Equity
Affiliates
and Canadian Syncrude
(MBOE/D) 1,676 1,619 1,546 1,623 1,616 1,622 1,636 1,629
- ---------------------------------------------------------- ----------------------------------
Crude Oil and Condensate (MB/D)
Consolidated
U.S. 424 406 370 381 395 397 388 392
Norway 200 208 219 233 215 226 214 220
United Kingdom 81 78 63 86 77 87 82 85
Canada 46 45 42 37 42 33 31 32
Nigeria 40 34 35 38 37 38 39 38
China 13 11 12 11 12 23 27 25
Indonesia 26 23 22 13 21 21 17 19
Other 52 50 48 55 51 55 52 54
Equity affiliates 91 84 104 87 92 55 117 86
- ---------------------------------------------------------- ----------------------------------
Total 973 939 915 941 942 935 967 951
========================================================== ==================================
Natural Gas Liquids (MB/D)
U.S. 48 46 42 45 45 44 44 44
International 24 22 24 25 24 23 23 23
- ---------------------------------------------------------- ----------------------------------
Total 72 68 66 70 69 67 67 67
========================================================== ==================================
Natural Gas (MMCF/D)
Consolidated
U.S. 1,635 1,566 1,578 1,548 1,581 1,527 1,473 1,499
Norway 291 290 252 232 266 305 273 289
United Kingdom 869 856 603 975 826 1,002 952 977
Canada 548 565 512 442 517 436 424 430
Indonesia 179 169 189 220 189 224 246 235
Other 120 95 105 112 108 111 117 115
Equity affiliates 12 13 13 13 13 12 11 11
- ---------------------------------------------------------- ----------------------------------
Total 3,654 3,554 3,252 3,542 3,500 3,617 3,496 3,556
========================================================== ==================================
Canadian Syncrude (MB/D) 22 20 23 22 22 17 19 18
- ---------------------------------------------------------- ----------------------------------
E&P Average Realized Prices
Crude Oil and Condensate ($/bbl)
Consolidated
U.S. 18.66 24.33 25.85 26.36 23.69 31.47 27.21 29.34
Norway 20.77 24.42 26.78 26.35 24.61 32.72 26.28 29.39
United Kingdom 19.78 23.69 26.15 25.98 23.99 30.11 24.34 27.25
Canada 19.39 21.79 24.96 21.26 21.82 28.40 23.61 26.07
Nigeria 21.33 25.16 27.40 26.97 25.12 31.94 26.35 28.87
China 19.57 25.27 26.31 29.64 25.03 28.87 26.51 27.57
Indonesia 19.38 24.46 24.21 30.59 23.51 29.35 24.54 27.20
Other 19.39 24.66 25.55 25.18 23.58 29.10 25.38 27.25
Equity affiliates 13.40 18.26 19.06 17.50 17.14 20.97 16.85 18.02
Total 18.93 23.71 25.24 25.31 23.26 30.73 25.19 27.82
- ---------------------------------------------------------- ----------------------------------
Natural Gas Liquids
($/bbl)
U.S. 12.92 17.05 16.78 19.27 16.44 25.13 19.33 22.11
International 9.86 15.62 18.56 19.39 15.95 24.22 18.96 21.54
Total 11.67 16.49 17.57 19.32 16.24 24.73 19.17 21.86
- ---------------------------------------------------------- ----------------------------------
Natural Gas ($/mcf)
Consolidated
U.S. 2.26 2.80 2.71 3.38 2.78 5.34 4.58 4.96
Norway 3.20 2.99 3.26 3.33 3.19 3.66 3.86 3.75
United Kingdom 3.43 2.37 1.95 3.20 2.81 3.55 3.17 3.36
Canada 1.74 2.50 2.13 3.37 2.40 5.42 4.34 4.89
Indonesia 3.16 4.13 4.13 4.11 3.89 4.66 4.16 4.40
Other 0.41 0.39 0.41 0.45 0.42 0.48 0.48 0.48
Equity affiliates 2.17 2.60 1.78 3.00 2.39 4.82 4.89 4.85
Total 2.53 2.66 2.52 3.27 2.75 4.49 3.93 4.21
- ---------------------------------------------------------- ----------------------------------
Note: Pro forma information derived by summing the historical Phillips and Conoco data for
the period indicated.
Page 12 of 13
SELECTED PRO FORMA STATISTICS (Midstream and R&M)
2002 2003
--------------------------------- ---------------------------------
1st 2nd Qtr 3rd 4th Qtr YTD 1st 2nd Qtr 3rd 4th YTD
Qtr Qtr Qtr Qtr Qtr
--------------------------------- ---------------------------------
Midstream
Natural Gas Liquids Extracted (MB/D)
Consolidated
United States 49 52 50 56 52 51 53 52
International 42 42 46 45 44 47 35 41
Equity Affiliates
United States* 118 119 120 119 119 114 110 112
International 9 9 9 10 9 10 11 11
- ----------------------------------------------------------- ---------------------------------
Total 218 222 225 230 224 222 209 216
=========================================================== =================================
* Represents 30.3 percent interest in Duke Energy Field Services, LLC
(DEFS).
Natural Gas Liquids Fractionated (MB/D)
United States 166 159 177 179 170 168 158 163
- ----------------------------------------------------------- ---------------------------------
Product Prices
Weighted Average NGL ($/bbl)*
Consolidated 13.23 15.99 16.69 19.24 16.31 25.59 20.99 23.29
DEFS 12.83 15.59 16.32 18.95 15.92 24.53 20.53 22.53
- ----------------------------------------------------------- ---------------------------------
* Prices are based on index prices from the Mont Belvieu and Conway market hubs that are
weighted by natural gas liquids component and location mix.
R&M
Charge Barrels Input
(MB/D)
Eastern U.S.
Crude Oil 348 404 338 399 372 415 435 425
Other Feed and Blending
Stocks 53 47 16 61 44 51 53 52
- ----------------------------------------------------------- ---------------------------------
Total 401 451 354 460 416 466 488 477
=========================================================== =================================
Percentage Utilization 81% 94% 79% 93% 87% 97% 101% 99%
- ----------------------------------------------------------- ---------------------------------
U.S. Gulf Coast
Crude Oil 648 669 675 652 661 668 702 685
Other Feed and Blending
Stocks 116 96 90 101 101 103 95 99
- ----------------------------------------------------------- ---------------------------------
Total 764 765 765 753 762 771 797 784
=========================================================== =================================
Percentage Utilization 91% 94% 94% 91% 93% 93% 98% 96%
- ----------------------------------------------------------- ---------------------------------
Central U.S.
Crude Oil 568 664 624 633 622 631 663 647
Other Feed and Blending
Stocks 25 23 22 46 29 32 24 28
- ----------------------------------------------------------- ---------------------------------
Total 593 687 646 679 651 663 687 675
=========================================================== =================================
Percentage Utilization 85% 96% 91% 92% 91% 92% 96% 94%
- ----------------------------------------------------------- ---------------------------------
Western U.S.
Crude Oil 306 320 330 320 319 294 328 311
Other Feed and Blending
Stocks (3) 16 13 16 11 9 13 11
- ----------------------------------------------------------- ---------------------------------
Total 303 336 343 336 330 303 341 322
=========================================================== =================================
Percentage Utilization 92% 96% 99% 96% 96% 88% 99% 93%
- ----------------------------------------------------------- ---------------------------------
Total U.S.
Crude Oil 1,870 2,057 1,967 2,004 1,975 2,008 2,128 2,068
Other Feed and Blending
Stocks 191 182 141 224 184 195 185 190
- ----------------------------------------------------------- ---------------------------------
Total 2,061 2,239 2,108 2,228 2,159 2,203 2,313 2,258
=========================================================== =================================
Percentage Utilization 87% 95% 91% 93% 92% 93% 98% 95%
- ----------------------------------------------------------- ---------------------------------
United Kingdom and Ireland
Crude Oil 279 260 273 177 247 262 244 253
Other Feed and Blending
Stocks 18 27 43 30 30 39 42 41
- ----------------------------------------------------------- ---------------------------------
Total 297 287 316 207 277 301 286 294
=========================================================== =================================
Percentage Utilization 92% 86% 90% 58% 81% 86% 80% 83%
- ----------------------------------------------------------- ---------------------------------
Equity Affiliates -- Net Share --
International*
Crude Oil 119 127 127 130 126 134 132 133
Other Feed and Blending
Stocks 4 6 4 3 4 2 3 2
- ----------------------------------------------------------- ---------------------------------
Total 123 133 131 133 130 136 135 135
=========================================================== =================================
Percentage Utilization 88% 93% 93% 94% 92% 98% 97% 98%
- ----------------------------------------------------------- ---------------------------------
* Represents 18.75 percent interest in a refinery complex at Karlsruhe,
Germany; 16.33 percent interest in two refineries in Kralupy and Litvinov,
Czech Republic; and 47 percent interest in a refinery at Melaka, Malaysia.
Worldwide -- Including Net Share of Equity
Affiliates
Crude Oil 2,268 2,444 2,367 2,311 2,348 2,404 2,504 2,454
Other Feed and Blending
Stocks 213 215 188 257 218 236 230 233
- ----------------------------------------------------------- ---------------------------------
Total 2,481 2,659 2,555 2,568 2,566 2,640 2,734 2,687
=========================================================== =================================
Percentage Utilization 88% 94% 91% 89% 90% 92% 96% 94%
- ----------------------------------------------------------- ---------------------------------
U.S. Petroleum Products Sales (MB/D)
Gasoline 1,375 1,461 1,417 1,478 1,433 1,331 1,381 1,356
Distillates 653 650 602 692 649 600 590 595
Aviation Fuel 231 259 268 172 232 164 164 164
Other 524 479 456 403 465 509 493 501
- ----------------------------------------------------------- ---------------------------------
Total 2,783 2,849 2,743 2,745 2,780 2,604 2,628 2,616
=========================================================== =================================
Note: Pro forma information derived by summing the historical Phillips and Conoco data for
the period indicated.
Page 13 of 13