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): October 25, 2006
ConocoPhillips
--------------
(Exact name of registrant as specified in its charter)
Delaware 001-32395 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
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[_] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[_] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[_] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On October 25, 2006, ConocoPhillips issued a press release announcing
the company's financial and operating results for the quarter ended September
30, 2006. 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 hereto and incorporated
herein by reference. The press release contains a measure, "effective tax rate,"
that is not calculated in accordance with U.S. generally accepted accounting
principles (GAAP). We have included this non-GAAP financial measure because, in
management's opinion, excluding the third-quarter 2006 charge from United
Kingdom tax legislation and the second-quarter 2006 favorable impact from tax
legislation changes in Canada and Texas in calculating our effective tax rate is
a better indicator of the company's ongoing effective tax rate and is therefore
more useful in comparing the Company's effective tax rate with prior and future
periods.
Item 9.01 Financial Statements and Exhibits
(c) Exhibits
99.1 -- Press release issued by ConocoPhillips on October 25, 2006.
99.2 -- Financial and operational tables.
99.3 -- Supplemental financial information.
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/ Rand C. Berney
----------------------------------------------------------
Rand C. Berney
Vice President and Controller
October 25, 2006
EXHIBIT INDEX
Exhibit
No. Description
99.1 Press release issued by ConocoPhillips on October 25, 2006.
99.2 Financial and operational tables.
99.3 Supplemental financial information.
Exhibit 99.1
ConocoPhillips Reports Third-Quarter Net
Income of $3.9 Billion or $2.31 Per Diluted Share
Results include $0.37 per share reduction due to certain
previously disclosed items
HOUSTON--(BUSINESS WIRE)--Oct. 25, 2006--ConocoPhillips
(NYSE:COP):
Earnings at a glance
Third Quarter Nine Months
- ------------------------------------------------- --------------------
2006 2005 2006 2005
- -------------------------------------- ---------- ---------- ---------
Income from continuing
operations $ 3,876 3,804 $ 12,353 9,858
million million million million
Income (loss) from
discontinued operations $ - (4) $ - (8)
Net income $ 3,876 3,800 $ 12,353 9,850
- -------------------------------------- ---------- ---------- ---------
Diluted income per share
Income from continuing
operations $ 2.31 2.68 $ 7.78 6.94
Net income $ 2.31 2.68 $ 7.78 6.94
- -------------------------------------- ---------- ---------- ---------
Revenues(a) $ 48.4 48.7 $ 142.4 128.2
billion billion billion billion
- -------------------------------------- ---------- ---------- ---------
(a) Effective April 1, 2006, revenues no longer include the sales
portion of buy/sell contracts, reflecting the adoption of EITF No.
04-13, "Accounting for Purchases and Sales of Inventory with the Same
Counterparty."
ConocoPhillips (NYSE:COP) today reported third-quarter net income
of $3,876 million, or $2.31 per share, compared to $3,800 million, or
$2.68 per share, for the same quarter in 2005. Revenues were $48.4
billion, versus $48.7 billion a year ago.
"Overall, we had consistent operations for the quarter. We
produced 2.47 million BOE per day, including an estimated 0.44 million
BOE per day from our LUKOIL Investment segment," said Jim Mulva,
chairman and chief executive officer. "Upstream results were
negatively impacted by the unexpected partial shut-down of the
partner-operated Prudhoe Bay oil field in Alaska, as well as planned
downtime in other areas.
"Our downstream crude oil capacity utilization rate improved to 95
percent, although we experienced downtime at our Wilhelmshaven and
Wood River refineries. The improvement in utilization came from an
overall decrease in turnaround activity and unplanned downtime during
the quarter."
Third-quarter net income was negatively impacted $0.37 per share
by the following previously disclosed items:
-- $400 million from new United Kingdom tax legislation impacting
Exploration & Production (E&P), including $270 million related
to the revaluation of deferred taxes and $130 million related
to the company's operations for the first six months of 2006.
-- $249 million impairment on certain Refining & Marketing (R&M)
assets held for sale.
-- $94 million from new Alaska tax legislation impacting the E&P
segment related to the company's operations for April through
June.
-- $121 million net benefit from business interruption insurance,
including $103 million related to the R&M segment.
"We ended the quarter with debt of $27.8 billion and a
debt-to-capital ratio of 25 percent," said Mulva. "During the quarter,
we generated $6.2 billion in cash from operations; funded $3.8 billion
in capital projects, investments and loans to affiliates; reduced debt
by $1.7 billion; paid $600 million in dividends; and repurchased $250
million of ConocoPhillips common stock."
For the first nine months of 2006, net income was $12,353 million,
or $7.78 per share, versus $9,850 million, or $6.94 per share, for the
same period a year ago. Revenues were $142.4 billion, versus $128.2
billion a year ago.
The results for ConocoPhillips' business segments follow.
Exploration and Production (E&P)
Third-quarter financial results: E&P net income was $1,904
million, including the $494 million in charges associated with the
U.K. and Alaska tax legislation noted above. Net income for the third
quarter was down from $3,304 million in the second quarter of 2006 and
$2,288 million in the third quarter of 2005. The decrease from the
second quarter of 2006 reflects the negative impact of the tax
legislation noted above and the absence of a $401 million
second-quarter benefit related to Canadian tax legislation. Lower
crude oil sales volumes and increased depreciation, depletion and
amortization expense from the application of purchase accounting for
the Burlington Resources acquisition at the operating-area level also
negatively impacted net income. The decrease from the third quarter of
2005 primarily was due to the negative impact of recent tax
legislation, partially offset by the inclusion of Burlington
Resources' results.
Daily production from the E&P segment, including Canadian Syncrude
and excluding the LUKOIL Investment segment, averaged 2.04 million
barrels of oil equivalent (BOE) per day, a decline from 2.13 million
BOE per day in the previous quarter and an increase from 1.52 million
BOE per day in the third quarter of 2005. The decrease from the second
quarter of 2006 primarily was due to the partial shut-down of the
Prudhoe Bay field and lower volumes from the United Kingdom and
Venezuela due to planned maintenance. The increase from the third
quarter of 2005 primarily was due to the addition of the Burlington
Resources assets and higher production from Libya and the Timor Sea,
partially offset by lower production from the Prudhoe Bay field.
Before-tax exploration expenses were $197 million in the third quarter
of 2006, versus $134 million in the previous quarter and $140 million
in the third quarter of 2005.
Nine months financial results: E&P net income for the first nine
months of 2006 was $7,761 million, up from $6,004 million in 2005,
primarily from higher realized crude oil prices and the inclusion of
Burlington Resources' results, partially offset by the net impact of
recent tax legislation.
Midstream
Third-quarter financial results: The Midstream segment, which
includes the company's 50 percent interest in Duke Energy Field
Services, LLC (DEFS), reported net income of $169 million, up from
$108 million in the previous quarter and up from $88 million in the
third quarter of 2005. The increase from the previous quarter reflects
the net impact of tax adjustments to gains on assets sold in 2005 and
higher natural gas liquids prices. The increase from the third quarter
of 2005 reflects a tax adjustment to the gain on assets sold in 2005
and higher natural gas liquids prices.
Nine months financial results: Midstream net income for the first
nine months of 2006 decreased to $387 million, from $541 million in
2005. The decrease primarily was due to the 2005 restructuring of
ConocoPhillips' ownership in DEFS, partially offset by higher natural
gas liquids prices.
Refining and Marketing (R&M)
Third-quarter financial results: R&M net income was $1,464
million, including a $249 million impairment on assets held for sale
and a net benefit of $103 million from business interruption
insurance, as noted above. Net income for the third quarter was down
from $1,708 million in the previous quarter and up from $1,390 million
in the third quarter of 2005. The decrease from the second quarter of
2006 primarily was the result of lower worldwide refining margins and
the impairment on assets held for sale. This decrease was partially
offset by higher worldwide marketing margins and domestic refining
volumes, the business interruption insurance benefit and lower
turnaround costs. The increase from the third quarter of 2005
primarily was due to higher worldwide marketing margins and domestic
refining volumes and the business interruption insurance benefit. This
increase was partially offset by lower worldwide refining margins, the
impairment on assets held for sale, and higher depreciation expense
and maintenance costs.
The domestic refining crude oil capacity utilization rate for the
third quarter was 96 percent, up from 91 percent in the previous
quarter. The improvement primarily was due to the return to normal
operations of the Trainer, Pa., refinery after an extended full plant
turnaround, as well as the Lake Charles refinery in Westlake, La.,
which had second-quarter unplanned downtime. This improvement was
partially offset by downtime at the Wood River refinery in Roxana,
Ill., due to damage sustained during a severe storm. The Wood River
refinery returned to normal operations during the quarter.
The international crude oil capacity utilization rate was 89
percent, down from 94 percent in the previous quarter. The decrease
primarily was due to planned downtime at the Wilhelmshaven, Germany,
refinery.
Worldwide, R&M's refining crude oil capacity utilization rate
averaged 95 percent, compared with 91 percent in the previous quarter
and 95 percent in the third quarter of 2005. Before-tax turnaround
costs were $42 million in the third quarter of 2006, versus $115
million in the previous quarter and $53 million in the third quarter
of 2005.
Nine months financial results: R&M net income for the first nine
months of 2006 increased to $3,562 million, compared with $3,200
million for the first nine months of 2005. The increased earnings were
due to higher domestic refining and worldwide marketing margins and
the business interruption insurance benefit. The increase was
partially offset by the impairment on assets held for sale, lower
domestic refining volumes and international refining margins, and
higher depreciation expense and maintenance costs. The nine-month
results for 2005 also included a gain on asset sales.
LUKOIL Investment
Third-quarter financial results: Net income was $487 million, up
from $387 million in the previous quarter and up from $267 million in
the third quarter of 2005. The results included ConocoPhillips'
estimated weighted-average equity share of OAO LUKOIL's (LUKOIL)
income for the third quarter, based on market indicators, historical
production trends for LUKOIL and an adjustment reflecting the
company's ownership interest based on shares outstanding in accordance
with U.S. GAAP (second-quarter average of 830 million). The company's
ownership interest in LUKOIL at the end of the third quarter was 19
percent of the 851 million authorized and issued shares.
The increase in net income from the previous quarter mainly was
due to the company's increased equity ownership and higher estimated
commodity prices. The increase from the third quarter of 2005
primarily was due to the company's increased equity ownership, higher
estimated volumes and commodity prices, and a net benefit from
alignment of the company's estimate of second-quarter net income to
LUKOIL's reported results.
For the third quarter of 2006, ConocoPhillips estimated its equity
share of LUKOIL production was 436,000 BOE per day and its share of
LUKOIL daily refining crude oil throughput was 164,000 barrels per
day.
Nine months financial results: Net income for the first nine
months of 2006 increased to $1,123 million, from $525 million in 2005.
The increase primarily was due to the company's increased equity
ownership, higher estimated prices and volumes, and a benefit from
alignment of LUKOIL's estimated net income to actual results.
Chemicals
Third-quarter financial results: The Chemicals segment, which
includes the company's 50 percent interest in Chevron Phillips
Chemical Company LLC, reported net income of $142 million, compared
with $103 million in the second quarter of 2006 and $13 million in the
third quarter of 2005. The increase from the second quarter primarily
was attributed to higher margins, a business interruption insurance
benefit and the negative impact of tax legislation on the previous
quarter results. The increase from the third quarter of 2005 was
largely due to higher margins, lower utility costs, a business
interruption insurance benefit, and 2005 hurricane-related downtime.
Nine months financial results: Chemicals net income for the first
nine months of 2006 increased to $394 million, compared with $209
million in the first nine months of 2005. The increase primarily was
due to higher olefins and polyolefins margins and volumes and a
business interruption insurance benefit.
Emerging Businesses
The Emerging Businesses segment had net income of $11 million in
the third quarter of 2006, compared with a net loss of $12 million in
the second quarter of 2006 and slightly positive results in the third
quarter of 2005. The increase from the previous quarter primarily was
due to the second-quarter write-down of a domestic power asset. The
increase from the third quarter of 2005 was due to improved
international power generation results.
Corporate and Other
Third-quarter Corporate expenses, after tax, were $301 million,
down from $412 million in the previous quarter and up from $246
million in the third quarter of 2005. The decrease from the second
quarter of 2006 primarily was due to favorable foreign exchange
impacts and lower interest expense. The increase from the third
quarter of 2005 is attributed to higher interest expense and
acquisition-related charges. This increase was partially offset by
favorable foreign exchange impacts and the absence in 2006 of premiums
incurred in 2005 on the early retirement of debt.
Total debt at the end of the third quarter was $27.8 billion, a
reduction of $1.7 billion from the end of the second quarter. The
company's debt-to-capital ratio was 25 percent, compared to 27 percent
at the end of the second quarter. The cash balance was $0.7 billion at
the end of the third quarter.
The company's third-quarter tax provision included the $400
million charge from the U.K. tax legislation. Excluding this item, the
tax provision was $3.7 billion, resulting in an effective tax rate of
46.1 percent, versus 51.2 percent including this item. This is
compared with 45.1 percent in the previous quarter excluding
second-quarter tax legislation impacts in Canada and Texas, and 40.3
percent including such impacts.
Outlook
Mr. Mulva concluded:
"We continue to progress our long-term strategic investment plans.
Our 2006 capital program remains on course, including the completion
of our planned equity investment in LUKOIL.
"Our asset rationalization program, anticipated to generate
proceeds of approximately $3 billion to $4 billion when it is
completed next year, is advancing as planned. We are actively
marketing a number of assets identified for disposition. For example,
in the third quarter we sold our remaining interest in the Permian
Basin Royalty Trust.
"We are pleased to have reached an agreement with EnCana
Corporation (EnCana) to create an integrated, North American heavy oil
business. This venture builds on our current and planned heavy-oil
expansion work in our Wood River and Borger refineries and makes
available a stable, long-term supply of bitumen. The venture also is
expected to enhance ConocoPhillips' near- and long-term production
growth, providing a steady, stable source of resource additions. We
look forward to working closely with EnCana to make this venture a
success.
"Looking ahead to the fourth quarter, we expect our upstream
production to increase, reflecting the resumption of operations at
Prudhoe Bay, normal seasonality, and less scheduled downtime in the
United Kingdom and Venezuela, partially offset by production sharing
contract impacts in the Timor Sea. Downstream, we expect crude oil
capacity utilization to be similar to the third quarter.
"Our full-year exploration expense is expected to be approximately
$800 million. Downstream, we expect full-year turnaround costs to be
approximately $400 million."
ConocoPhillips is an integrated petroleum company with interests
around the world. Headquartered in Houston, the company had
approximately 38,300 employees, $164 billion of assets, and $190
billion of year-to-date annualized revenues as of September 30, 2006.
For more information, go to www.conocophillips.com.
ConocoPhillips' quarterly conference call is scheduled for 11 a.m.
Eastern time today.
To listen to the conference call and to view related presentation
materials, go to www.conocophillips.com and click on the "Investor
Information" link.
For financial and operational tables and detailed supplemental
information, go to
http://www.conocophillips.com/investor/reports/index.htm
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR"
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Exchange Act of 1934, as amended, which
are intended to be covered by the safe harbors created thereby.
Forward-looking statements relate to future events and anticipated
results of operations, business strategies, and other aspects of our
operations or operating results. In many cases you can identify
forward-looking statements by terminology such as "anticipate,"
"estimate," "believe," "continue," "could," "intend," "may," "plan,"
"potential," "predict," "should," "will," "expect," "objective,"
"projection," "forecast," "goal," "guidance," "outlook," "effort,"
"target" and other similar words. However, the absence of these words
does not mean that the statements are not forward-looking. Where, in
any forward-looking statement, the company expresses an expectation or
belief as to future results, such expectation or belief is expressed
in good faith and believed to have a reasonable basis. However, there
can be no assurance that such expectation or belief will result or be
achieved. The actual results of operations can and will be affected by
a variety of risks and other matters including, but not limited to,
crude oil and natural gas prices; refining and marketing margins;
potential failure to achieve, and potential delays in achieving
expected reserves or production levels from existing and future oil
and gas development projects due to operating hazards, drilling risks,
and the inherent uncertainties in interpreting engineering data
relating to underground accumulations of oil and gas; unsuccessful
exploratory drilling activities; lack of exploration success;
potential disruption or unexpected technical difficulties in
developing new products and manufacturing processes; potential failure
of new products to achieve acceptance in the market; unexpected cost
increases or technical difficulties in constructing or modifying
company manufacturing or refining facilities; unexpected difficulties
in manufacturing, transporting or refining synthetic crude oil;
international monetary conditions and exchange controls; potential
liability for remedial actions under existing or future environmental
regulations; potential liability resulting from pending or future
litigation; our ability to successfully negotiate and execute final
definitive agreements with EnCana; general domestic and international
economic and political conditions, as well as changes in tax and other
laws applicable to our business. Other factors that could cause actual
results to differ materially from those described in the
forward-looking statements include other economic, business,
competitive and/or regulatory factors affecting our business generally
as set forth in our filings with the Securities and Exchange
Commission (SEC). Unless legally required, ConocoPhillips undertakes
no obligation to update publicly any 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. The company uses certain terms in this release,
such as "including Canadian Syncrude," and "resources" that the SEC's
guidelines strictly prohibit us from including in filings with the
SEC. U.S. investors are urged to consider closely the disclosures in
the company's periodic filings with the SEC, available from the
company at 600 North Dairy Ashford Road, Houston, Texas 77079 and the
company's Web site at www.conocophillips.com/investor/sec. This
information also can be obtained from the SEC by calling
1-800-SEC-0330.
CONTACT: ConocoPhillips
Becky Johnson, 281-293-6743 (media)
or
Gary Russell, 212-207-1996 (investors)
Exhibit 99.2
FINANCIAL AND OPERATIONAL TABLES
Preliminary
FINANCIAL HIGHLIGHTS
Millions of Dollars
Three Months Ended Nine Months Ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
Revenues and other income
Sales and other operating revenues* $ 48,393 48,745 142,448 128,184
Equity in earnings of affiliates 1,196 872 3,320 2,626
Other income 314 42 538 381
----------- ------ ------- -------
49,903 49,659 146,306 131,191
----------- ------ ------- -------
Costs and expenses
Purchased crude oil, natural gas and products 30,869 34,508 93,772 88,603
Production and operating expenses 2,640 1,982 7,549 6,081
Selling, general and administrative expenses 650 612 1,826 1,690
Exploration expenses 197 140 443 432
Depreciation, depletion and amortization 2,137 1,049 5,282 3,075
Impairments 267 -- 317 31
Taxes other than income taxes* 4,853 4,606 13,661 13,758
Accretion on discounted liabilities 74 46 207 135
Interest and debt expense 308 122 783 387
Foreign currency transaction losses (gains) (50) 34 (10) 52
Minority interests 21 6 60 21
----------- ------ ------- -------
41,966 43,105 123,890 114,265
----------- ------ ------- -------
Income from continuing operations before income taxes 7,937 6,554 22,416 16,926
Provision for income taxes 4,061 2,750 10,063 7,068
----------- ------ ------- -------
Income from continuing operations 3,876 3,804 12,353 9,858
Income (loss) from discontinued operations -- (4) -- (8)
----------- ------ ------- -------
Net income $ 3,876 3,800 12,353 9,850
=========== ====== ======= ========
Income per share of common stock (dollars)
Basic
Continuing operations $ 2.35 2.73 7.90 7.06
Discontinued operations -- -- -- (0.01)
Net income $ 2.35 2.73 7.90 7.05
Diluted
Continuing operations $ 2.31 2.68 7.78 6.94
Discontinued operations -- -- -- --
Net income $ 2.31 2.68 7.78 6.94
Average common shares outstanding (in thousands)
Basic 1,652,623 1,393,943 1,564,423 1,396,180
Diluted 1,675,839 1,417,796 1,587,892 1,419,898
*Includes excise taxes on petroleum products sales: $ 4,098 4,292 12,010 12,785
1
Preliminary
SELECTED FINANCIAL DATA
Millions of Dollars
Three Months Ended Nine Months Ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
INCOME (LOSS) FROM CONTINUING OPERATIONS
E&P
United States $ 995 1,107 3,476 2,965
International 909 1,181 4,285 3,039
------- ------- ----- -----
Total E&P 1,904 2,288 7,761 6,004
------- ------- ----- -----
Midstream 169 88 387 541
------- ------- ----- -----
R&M
United States 1,444 1,096 3,174 2,602
International 20 294 388 598
------- ------- ----- -----
Total R&M 1,464 1,390 3,562 3,200
------- ------- ----- -----
LUKOIL Investment 487 267 1,123 525
Chemicals 142 13 394 209
Emerging Businesses 11 -- 7 (16)
Corporate and other (301) (242) (881) (605)
------- ------- ----- -----
Consolidated $ 3,876 3,804 12,353 9,858
======= ======= ====== =====
INCOME (LOSS) FROM DISCONTINUED OPERATIONS
Corporate and other $ -- (4) -- (8)
SUMMARY OF NET INCOME (LOSS)
E&P
United States $ 995 1,107 3,476 2,965
International 909 1,181 4,285 3,039
------- ------- ----- -----
Total E&P 1,904 2,288 7,761 6,004
------- ------- ----- -----
Midstream 169 88 387 541
------- ------- ----- -----
R&M
United States 1,444 1,096 3,174 2,602
International 20 294 388 598
------- ------- ----- -----
Total R&M 1,464 1,390 3,562 3,200
------- ------- ----- -----
LUKOIL Investment 487 267 1,123 525
Chemicals 142 13 394 209
Emerging Businesses 11 -- 7 (16)
Corporate and other (301) (246) (881) (613)
------- ------- ----- -----
Net Income $ 3,876 3,800 12,353 9,850
======= ======= ====== =====
2
Preliminary
SELECTED FINANCIAL DATA
Three Months Ended Nine Months Ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
INCOME FROM CONTINUING OPERATIONS
Effective tax rate % 51.2 % 42.0 44.9 41.8
Millions of Dollars
FOREIGN CURRENCY GAINS (LOSSES)
AFTER-TAX
E&P $ (20) 2 (47) 6
Midstream - - - 7
R&M (6) (13) 25 (49)
LUKOIL Investment 1 (1) 2 (1)
Chemicals - - - -
Emerging Businesses - - - -
Corporate and other 48 (23) 4 (27)
-------- ----- ------ -----
$ 23 (35) (16) (64)
======== ===== ====== =====
CASH FLOWS FROM OPERATING ACTIVITIES
Income from continuing operations $ 3,876 3,804 12,353 9,858
Depreciation, depletion and amortization 2,137 1,049 5,282 3,075
Impairments 267 - 317 31
Dry hole costs and leasehold impairments 56 55 141 211
Accretion on discounted liabilities 74 46 207 135
Deferred taxes 495 261 273 753
Undistributed equity earnings (253) (463) (1,007) (1,682)
Net gain on asset dispositions (8) (22) (64) (264)
Other (282) 192 (296) 1
Working capital adjustments (127) 1,177 (1,327) 841
-------- ----- ------ -----
Net cash provided by continuing operations 6,235 6,099 15,879 12,959
Net cash provided by discontinued operations - (3) - (6)
Net cash provided by operating activities $ 6,235 6,096 15,879 12,953
======== ===== ====== =====
CAPITAL EXPENDITURES AND INVESTMENTS
E&P
United States $ 828 323 2,003 1,221
International 1,626 1,152 4,829 3,797
-------- ----- ------ -----
2,454 1,475 6,832 5,018
Midstream - 838 2 839
R&M 374 440 2,484 1,075
LUKOIL Investment 702 815 1,962 1,523
Chemicals - - - -
Emerging Businesses 6 2 46 5
Corporate and other 61 56 187 113
-------- ----- ------ -----
$ 3,597 3,626 11,513 8,573
======== ===== ====== =====
OTHER
At September 30, 2006 At December 31, 2005
Total debt $ 27,807 12,516
Common stockholders' equity $ 80,477 52,731
3
Preliminary
OPERATING HIGHLIGHTS
BY SEGMENT
Three Months Ended Nine Months Ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
Thousands of Barrels Daily
E&P
Crude oil produced
United States
Alaska 234 281 265 296
Lower 48 119 56 101 60
--- --- --- ---
353 337 366 356
Norway 190 198 190 200
United Kingdom 50 56 56 59
Canada 26 22 25 23
China 36 22 32 23
Indonesia 11 10 13 16
Vietnam 24 30 25 27
Timor Sea 40 38 39 32
Libya 71 -- 49 --
Other 64 53 60 54
--- --- --- ---
Total consolidated 865 766 855 790
Equity affiliates 104 124 117 122
--- --- --- ---
Total Worldwide 969 890 972 912
=== === === ===
Syncrude 23 21 20 19
=== === === ===
Natural gas liquids produced
United States
Alaska* 11 18 18 19
Lower 48 75 30 58 30
--- --- --- ---
86 48 76 49
Norway 9 10 9 9
Canada 28 10 23 10
Timor Sea 20 20 20 15
Other 3 4 4 5
--- --- --- ---
Total Worldwide 146 92 132 88
=== === === ===
*Includes reinjected volumes sold lease-to-lease. 7 8 11 7
Millions of Cubic Feet Daily
Natural gas produced*
United States
Alaska 123 173 150 169
Lower 48 2,320 1,218 1,953 1,194
----- ----- ----- -----
2,443 1,391 2,103 1,363
Norway 260 259 263 275
United Kingdom 665 588 770 717
Canada 1,154 429 930 422
China 8 -- 6 --
Timor Sea 300 35 232 35
Indonesia 342 303 320 288
Vietnam 20 20 21 17
Other 187 74 173 77
----- ----- ----- -----
Total consolidated 5,379 3,099 4,818 3,194
Equity affiliates 8 10 9 8
----- ----- ----- -----
Total Worldwide 5,387 3,109 4,827 3,202
===== ===== ===== =====
*Represents quantities available for sale. Excludes
gas equivalent of NGL shown above.
Liquefied natural gas sales 522 123 407 117
LUKOIL Investment
Production (MBOE/D)* 436 266 388 231
Refinery crude oil throughput (MB/D)* 164 138 165 110
*Represents our estimated net share of LUKOIL.
4
Preliminary
OPERATING HIGHLIGHTS
Three Months Ended Nine Months Ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
E&P
Per Unit
Average sales prices
Crude oil (per barrel)
United States
Alaska $ 69.66 58.70 64.48 50.54
Lower 48 62.45 50.00 59.21 44.83
Total U.S. 67.25 57.31 63.05 49.59
International 67.45 59.52 65.27 51.46
Total consolidated 67.37 58.49 64.30 50.61
Equity affiliates* 46.98 45.25 47.36 37.45
Total Worldwide 65.04 56.64 62.18 48.80
Natural gas-lease (per MCF)
United States
Alaska 3.36 2.57 3.47 2.66
Lower 48 6.00 7.67 6.25 6.53
Total U.S. 5.98 7.48 6.21 6.40
International 5.87 5.60 6.23 5.25
Total consolidated 5.92 6.40 6.22 5.71
Equity affiliates* 0.32 0.20 0.30 0.25
Total Worldwide 5.91 6.38 6.21 5.70
*Excludes our equity share of LUKOIL reported in
the LUKOIL Investment segment.
Midstream
Thousands of Barrels Daily
Natural gas liquids extracted
Consolidated
United States 23 23 23 22
International - 5 - 34
Equity affiliates
United States** 180 171 180 131
International 7 6 6 6
--- --- --- ---
210 205 209 193
=== === === ===
**Represents 30.3 percent interest in Duke Energy Field Services LLC (DEFS), through June 30, 2005, and 50 percent
interest beginning in July 2005.
Per Barrel
U.S. product prices
Weighted average NGL**
Consolidated $ 44.10 39.60 41.16 34.68
DEFS 43.00 38.31 40.49 33.42
**Prices are based on index prices from the Mont Belvieu and Conway market hubs
that are weighted by naural-gas-liquids component and location mix.
5
Three Months Ended Nine Months Ended
September 30 September 30
2006 2005 2006 2005
---- ---- ---- ----
Thousands of Barrels Daily
R&M
United States
Crude oil capacity 2,208 2,182 2,208 2,179
Crude oil runs 2,127 2,040 1,990 2,044
Refinery production 2,334 2,223 2,173 2,238
International*
Crude oil capacity 693 428 637 428
Crude oil runs 617 431 586 420
Refinery production 643 448 613 434
U.S. Petroleum products outside sales
Automotive gasoline 1,369 1,397 1,309 1,376
Distillates 668 725 638 683
Aviation fuels 180 203 189 205
Other products 519 526 530 518
----- ----- ----- -----
2,736 2,851 2,666 2,782
International 749 470 772 481
----- ----- ----- -----
3,485 3,321 3,438 3,263
===== ===== ===== =====
Per Gallon
U.S. Average sales prices**
Automotive gasoline-wholesale $ 2.27 2.00 2.13 1.71
Automotive gasoline-retail 2.46 2.14 2.28 1.86
Distillates-wholesale 2.31 1.97 2.15 1.71
*Includes ConocoPhillips' share of equity affiliates, except for our share of
LUKOIL, which is reported in the LUKOIL Investment segment.
**Excludes excise taxes.
6
Exhibit 99.3
SUPPLEMENTAL FINANCIAL INFORMATION
CONOCOPHILLIPS
================================================================================
SUMMARY OF NET INCOME (LOSS) BY SEGMENT
Millions of Dollars
-------------------------------------------------------------------------------------------
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Income (Loss) from Continuing Operations
U.S. E&P 892 966 1,107 1,325 4,290 1,181 1,300 995 3,476
International E&P 895 963 1,181 1,105 4,144 1,372 2,004 909 4,285
- ------------------------------------------------------------------------------------- --------------------------------------------
Total E&P 1,787 1,929 2,288 2,430 8,434 2,553 3,304 1,904 7,761
- ------------------------------------------------------------------------------------- --------------------------------------------
Midstream 385 68 88 147 688 110 108 169 387
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. R&M 570 936 1,096 805 3,407 297 1,433 1,444 3,174
International R&M 130 174 294 251 849 93 275 20 388
- ------------------------------------------------------------------------------------- --------------------------------------------
Total R&M 700 1,110 1,390 1,056 4,256 390 1,708 1,464 3,562
- ------------------------------------------------------------------------------------- --------------------------------------------
LUKOIL Investment 110 148 267 189 714 249 387 487 1,123
Chemicals 133 63 13 114 323 149 103 142 394
Emerging Businesses (8) (8) - (4) (20) 8 (12) 11 7
Corporate and Other (184) (179) (242) (150) (755) (168) (412) (301) (881)
- ------------------------------------------------------------------------------------- --------------------------------------------
Consolidated 2,923 3,131 3,804 3,782 13,640 3,291 5,186 3,876 12,353
===================================================================================== ============================================
Cumulative Effect of Accounting Changes
U.S. E&P - - - (2) (2) - - - -
International E&P - - - (2) (2) - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Total E&P - - - (4) (4) - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Midstream - - - - - - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. R&M - - - (78) (78) - - - -
International R&M - - - (5) (5) - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Total R&M - - - (83) (83) - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
LUKOIL Investment - - - - - - - - -
Chemicals - - - - - - - - -
Emerging Businesses - - - (1) (1) - - - -
Corporate and Other - - - - - - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Consolidated - - - (88) (88) - - - -
===================================================================================== ============================================
Income (Loss) from Discontinued Operations
Corporate and Other (11) 7 (4) (15) (23) - - - -
===================================================================================== ============================================
Net Income (Loss)
U.S. E&P 892 966 1,107 1,323 4,288 1,181 1,300 995 3,476
International E&P 895 963 1,181 1,103 4,142 1,372 2,004 909 4,285
- ------------------------------------------------------------------------------------- --------------------------------------------
Total E&P 1,787 1,929 2,288 2,426 8,430 2,553 3,304 1,904 7,761
- ------------------------------------------------------------------------------------- --------------------------------------------
Midstream 385 68 88 147 688 110 108 169 387
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. R&M 570 936 1,096 727 3,329 297 1,433 1,444 3,174
International R&M 130 174 294 246 844 93 275 20 388
- ------------------------------------------------------------------------------------- --------------------------------------------
Total R&M 700 1,110 1,390 973 4,173 390 1,708 1,464 3,562
- ------------------------------------------------------------------------------------- --------------------------------------------
LUKOIL Investment 110 148 267 189 714 249 387 487 1,123
Chemicals 133 63 13 114 323 149 103 142 394
Emerging Businesses (8) (8) - (5) (21) 8 (12) 11 7
Corporate and Other (195) (172) (246) (165) (778) (168) (412) (301) (881)
- ------------------------------------------------------------------------------------- --------------------------------------------
Consolidated 2,912 3,138 3,800 3,679 13,529 3,291 5,186 3,876 12,353
===================================================================================== ============================================
Page 1 of 12
CONOCOPHILLIPS
================================================================================
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
Millions of Dollars
-------------------------------------------------------------------------------------------
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Income from Continuing Operations
Before Income Taxes
U.S. E&P 1,388 1,504 1,728 2,019 6,639 1,853 2,062 1,598 5,513
International E&P 2,020 2,152 2,567 2,550 9,289 2,862 3,814 3,460 10,136
- ------------------------------------------------------------------------------------- --------------------------------------------
Total E&P 3,408 3,656 4,295 4,569 15,928 4,715 5,876 5,058 15,649
- ------------------------------------------------------------------------------------- --------------------------------------------
Midstream 449 107 138 208 902 173 187 214 574
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. R&M 901 1,485 1,766 1,379 5,531 512 2,260 2,282 5,054
International R&M 160 203 368 330 1,061 112 343 107 562
- ------------------------------------------------------------------------------------- --------------------------------------------
Total R&M 1,061 1,688 2,134 1,709 6,592 624 2,603 2,389 5,616
- ------------------------------------------------------------------------------------- --------------------------------------------
LUKOIL Investment 115 153 275 196 739 257 398 496 1,151
Chemicals 187 84 (3) 148 416 209 134 191 534
Emerging Businesses (13) (13) (2) (10) (38) 9 (20) 14 3
Corporate and Other (267) (243) (283) (199) (992) (190) (496) (425) (1,111)
- ------------------------------------------------------------------------------------- --------------------------------------------
Consolidated 4,940 5,432 6,554 6,621 23,547 5,797 8,682 7,937 22,416
===================================================================================== ============================================
Income from Continuing Operations
Effective Tax Rates
U.S. E&P 35.7% 35.8% 35.9% 34.4% 35.4% 36.3% 37.0% 37.7% 36.9%
International E&P 55.7% 55.3% 54.0% 56.7% 55.4% 52.1% 47.5% 73.7% 57.7%
- ------------------------------------------------------------------------------------- --------------------------------------------
Total E&P 47.6% 47.2% 46.7% 46.8% 47.0% 45.9% 43.8% 62.4% 50.4%
- ------------------------------------------------------------------------------------- --------------------------------------------
Midstream 14.3% 36.4% 36.2% 29.3% 23.7% 36.4% 42.2% 21.0% 32.6%
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. R&M 36.7% 37.0% 37.9% 41.6% 38.4% 42.0% 36.6% 36.7% 37.2%
International R&M 18.8% 14.3% 20.1% 23.9% 20.0% 17.0% 19.8% 81.3% 31.0%
- ------------------------------------------------------------------------------------- --------------------------------------------
Total R&M 34.0% 34.2% 34.9% 38.2% 35.4% 37.5% 34.4% 38.7% 36.6%
- ------------------------------------------------------------------------------------- --------------------------------------------
LUKOIL Investment 4.3% 3.3% 2.9% 3.6% 3.4% 3.1% 2.8% 1.8% 2.4%
Chemicals 28.9% 25.0% -- 23.0% 22.4% 28.7% 23.1% 25.7% 26.2%
Emerging Businesses 38.5% 38.5% -- 60.0% 47.4% 11.1% 40.0% 21.4% --
Corporate and Other 31.1% 26.3% 14.5% 24.6% 23.9% 11.6% 16.9% 29.2% 20.7%
- ------------------------------------------------------------------------------------- --------------------------------------------
Consolidated 40.8% 42.4% 42.0% 42.9% 42.1% 43.2% 40.3% 51.2% 44.9%
===================================================================================== ============================================
Page 2 of 12
CONOCOPHILLIPS
================================================================================
CERTAIN ITEMS INCLUDED IN INCOME FROM CONTINUING OPERATIONS (AFTER-TAX)
Millions of Dollars
-------------------------------------------------------------------------------------------
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
U.S. E&P
Gain (loss) on asset sales 90 - - - 90 - 15 - 15
Impairments - - - - - - (26) - (26)
Insurance premium adjustments - (5) (4) (8) (17) (2) - (5) (7)
Pending claims and settlements - 15 - (23) (8) - - 18 18
Business interruption insurance
claims recovery - - - - - - - 15 15
Enacted tax legislation - - - - - - 2 - 2
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 90 10 (4) (31) 65 (2) (9) 28 17
- ------------------------------------------------------------------------------------- --------------------------------------------
International E&P
Gain (loss) on asset sales - 15 - - 15 - 25 - 25
Insurance premium adjustments - (10) (12) (19) (41) (10) - (10) (20)
International tax law changes - - - 38 38 - 401 (270) 131
Impairments - - - - - - - (4) (4)
Business interruption insurance
claims recovery - - - - - - - 11 11
Pending claims and settlements - - - - - - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Total - 5 (12) 19 12 (10) 426 (273) 143
- ------------------------------------------------------------------------------------- --------------------------------------------
Total E&P 90 15 (16) (12) 77 (12) 417 (245) 160
- ------------------------------------------------------------------------------------- --------------------------------------------
Midstream
Impairments (6) (7) - - (13) - - - -
DEFS' sale of TEPPCO general partnership 306 - - - 306 - - 30 30
Enacted tax legislation - - - - - - (6) - (6)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 300 (7) - - 293 - (6) 30 24
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. R&M
Gain (loss) on asset sales 31 - - - 31 - - - -
Impairments - - - - - - - (35) (35)
Insurance premium adjustments - (7) (9) (14) (30) (6) - (7) (13)
Discontinuation of a marketing
incentive program - - (16) - (16) - - - -
Hurricanes impact on maintenance & repairs - - - (57) (57) - - - -
Business interruption insurance
claims recovery - - - - - - - 111 111
Pending claims and settlements - - - - - - - - -
Enacted tax legislation - - - - - - 34 - 34
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 31 (7) (25) (71) (72) (6) 34 69 97
- ------------------------------------------------------------------------------------- --------------------------------------------
International R&M
Gain (loss) on asset sales - 25 - - 25 - - - -
Impairments - - - - - - - (214) (214)
Insurance premium adjustments - - - - - (1) - (1) (2)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total - 25 - - 25 (1) - (215) (216)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total R&M 31 18 (25) (71) (47) (7) 34 (146) (119)
- ------------------------------------------------------------------------------------- --------------------------------------------
LUKOIL Investment
Ownership interest adjustment - - - - - - - 23 23
- ------------------------------------------------------------------------------------- --------------------------------------------
Total - - - - - - - 23 23
- ------------------------------------------------------------------------------------- --------------------------------------------
Chemicals
Business interruption insurance
claims recovery - - - - - - - 7 7
Enacted tax legislation - - - - - - (5) - (5)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total - - - - - - (5) 7 2
- ------------------------------------------------------------------------------------- --------------------------------------------
Emerging Businesses
Property write-down - - - - - - (14) - (14)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total - - - - - - (14) - (14)
- ------------------------------------------------------------------------------------- --------------------------------------------
Corporate and Other
Acquisition-related expenses - - - - - (5) (39) (32) (76)
Premium on early debt retirement (8) - (42) (42) (92) - - - -
Pending claims and settlements - - - - - (15) - - (15)
Canada tax law change - - - - - - (10) - (10)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total (8) - (42) (42) (92) (20) (49) (32) (101)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total Company 413 26 (83) (125) 231 (39) 377 (363) (25)
===================================================================================== ============================================
Page 3 of 12
CONOCOPHILLIPS
================================================================================
CASH FLOW INFORMATION
Millions of Dollars
-------------------------------------------------------------------------------------------
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Cash Flows from Operating Activities
Income from continuing operations 2,923 3,131 3,804 3,782 13,640 3,291 5,186 3,876 12,353
DD&A and property impairments 1,063 994 1,049 1,189 4,295 1,180 2,015 2,404 5,599
Dry hole costs and leasehold impairments 109 47 55 138 349 38 47 56 141
Accretion on discounted liabilities 48 41 46 58 193 60 73 74 207
Deferred income taxes 123 369 261 348 1,101 168 (390) 495 273
Undistributed equity earnings (805) (414) (463) (92) (1,774) (67) (687) (253) (1,007)
Net gain on asset dispositions (177) (65) (22) (14) (278) (3) (53) (8) (64)
Other (78) (113) 192 (140) (139) (203) 189 (282) (296)
Net working capital changes 888 (1,224) 1,177 (595) 246 336 (1,536) (127) (1,327)
Discontinued operations (5) 2 (3) 1 (5) - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Net Cash Provided by
Operating Activities 4,089 2,768 6,096 4,675 17,628 4,800 4,844 6,235 15,879
- ------------------------------------------------------------------------------------- --------------------------------------------
Cash Flows from Investing Activities
Capital expenditures and investments*:
E&P (1,206) (2,337) (1,475) (1,666) (6,684) (2,206) (2,172) (2,454) (6,832)
Midstream (1) - (838) - (839) (1) (1) - (2)
R&M (275) (360) (440) (663) (1,738) (1,635) (475) (374) (2,484)
LUKOIL Investment (324) (384) (815) (637) (2,160) (612) (648) (702) (1,962)
Chemicals - - - - - - - - -
Emerging Businesses 4 (7) (2) - (5) (12) (28) (6) (46)
Corporate and Other (20) (37) (56) (81) (194) (48) (78) (61) (187)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total capital expend. & investments (1,822) (3,125) (3,626) (3,047) (11,620) (4,514) (3,402) (3,597) (11,513)
Acquisition of Burlington Resources Inc.* - - - - - (14,190) (94) (1) (14,285)
Proceeds from asset dispositions 87 221 300 160 768 5 68 173 246
Long-term advances to/collections from
affiliates and other investments 25 4 (58) (135) (164) (115) (151) (251) (517)
Discontinued operations - - - - - - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
Net Cash Used for Investing Activities (1,710) (2,900) (3,384) (3,022) (11,016) (18,814) (3,579) (3,676) (26,069)
- ------------------------------------------------------------------------------------- --------------------------------------------
Cash Flows from Financing Activities
Net issuance (repayment) of debt (986) (13) (513) (1,038) (2,550) 15,324 (2,756) (1,630) 10,938
Issuance of stock 155 108 114 25 402 40 64 41 145
Repurchase of stock (194) (382) (589) (759) (1,924) - (425) (250) (675)
Dividends (348) (432) (430) (429) (1,639) (496) (595) (593) (1,684)
Other 64 33 (10) (60) 27 (27) (20) (76) (123)
- ------------------------------------------------------------------------------------- --------------------------------------------
Net Cash Provided by (Used for)
Financing Activities (1,309) (686) (1,428) (2,261) (5,684) 14,841 (3,732) (2,508) 8,601
- ------------------------------------------------------------------------------------- --------------------------------------------
Effect of Exchange Rate Changes (36) (62) (22) 19 (101) (33) 113 (9) 71
- ------------------------------------------------------------------------------------- --------------------------------------------
Net Change in Cash
and Cash Equivalents 1,034 (880) 1,262 (589) 827 794 (2,354) 42 (1,518)
Cash and cash equivalents
at beginning of period 1,387 2,421 1,541 2,803 1,387 2,214 3,008 654 2,214
- ------------------------------------------------------------------------------------- --------------------------------------------
Cash and Cash Equivalents
at End of Period 2,421 1,541 2,803 2,214 2,214 3,008 654 696 696
===================================================================================== ============================================
* Net of cash acquired.
Page 4 of 12
CONOCOPHILLIPS
================================================================================
TOTAL E&P
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
E&P Net Income ($ Millions) 1,787 1,929 2,288 2,426 8,430 2,553 3,304 1,904 7,761
===================================================================================== ============================================
Production
Total, Including Equity Affiliates
and Canadian Syncrude (MBOE/D) 1,600 1,537 1,521 1,590 1,562 1,610 2,134 2,036 1,929
- ------------------------------------------------------------------------------------- --------------------------------------------
E&P segment plus LUKOIL Investment segment:1,801 1,760 1,787 1,883 1,808 1,932 2,537 2,472 2,317
- ------------------------------------------------------------------------------------- --------------------------------------------
Crude Oil and Condensate (MB/D)
Consolidated 822 780 766 777 786 777 924 865 855
Equity affiliates 120 123 124 116 121 126 121 104 117
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 942 903 890 893 907 903 1,045 969 972
===================================================================================== ============================================
Sales of crude oil produced (MB/D) 940 932 883 916 918 913 1,040 953 969
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids (MB/D) 94 80 92 99 91 97 152 146 132
- -----------------------------------------------------------------------------------------------------------------------------------
Natural Gas (MMCF/D)
Consolidated 3,295 3,191 3,099 3,468 3,263 3,554 5,498 5,379 4,818
Equity affiliates 5 7 10 3 7 11 10 8 9
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 3,300 3,198 3,109 3,471 3,270 3,565 5,508 5,387 4,827
===================================================================================== ============================================
Canadian Syncrude (MB/D) 14 21 21 20 19 16 19 23 20
- ------------------------------------------------------------------------------------- --------------------------------------------
Industry Prices (Platt's)
Crude Oil ($/bbl)
WTI spot 49.70 53.03 63.05 59.99 56.44 63.28 70.40 70.38 68.02
Brent dated 47.50 51.59 61.54 56.90 54.38 61.75 69.62 69.49 66.96
Natural Gas ($/mmbtu)
Henry Hub -- First of Month 6.27 6.74 8.53 13.00 8.64 9.01 6.80 6.58 7.47
- ------------------------------------------------------------------------------------- --------------------------------------------
Average Realized Prices
Crude Oil and Condensate ($/bbl)
Consolidated 44.89 48.88 58.49 55.06 51.74 58.97 65.89 67.37 64.30
Equity affiliates 30.38 36.11 45.25 38.90 37.79 43.38 52.28 46.98 47.36
Total 43.15 46.93 56.64 53.05 49.87 56.63 64.34 65.04 62.18
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids ($/bbl) 33.44 35.10 41.54 42.75 38.32 43.13 41.75 43.62 42.78
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas ($/mcf)
Consolidated 5.24 5.53 6.40 7.96 6.32 7.26 5.86 5.92 6.22
Equity affiliates 0.25 0.32 0.20 0.28 0.26 0.23 0.36 0.32 0.30
Total 5.24 5.52 6.38 7.94 6.30 7.24 5.85 5.91 6.21
- ------------------------------------------------------------------------------------- --------------------------------------------
Exploration Charges ($ Millions)
Dry Holes 88 30 32 83 233 19 15 18 52
Lease Impairments 20 18 23 55 116 19 33 37 89
- ------------------------------------------------------------------------------------- --------------------------------------------
Total Non-Cash Charges 108 48 55 138 349 38 48 55 141
Other (G&G and Lease Rentals) 63 73 85 91 312 74 86 142 302
- ------------------------------------------------------------------------------------- --------------------------------------------
Total Exploration Charges 171 121 140 229 661 112 134 197 443
===================================================================================== ============================================
Depreciation, Depletion and
Amortization (DD&A) ($ Millions) 819 755 823 915 3,312 910 1,659 1,860 4,429
- ------------------------------------------------------------------------------------- --------------------------------------------
Page 5 of 12
CONOCOPHILLIPS
================================================================================
U.S. E&P
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
U.S. E&P Net Income ($ Millions) 892 966 1,107 1,323 4,288 1,181 1,300 995 3,476
===================================================================================== ============================================
Alaska ($ Millions) 532 572 730 718 2,552 692 760 425 1,877
- ------------------------------------------------------------------------------------- --------------------------------------------
Lower 48 ($ Millions) 360 394 377 605 1,736 489 540 570 1,599
- ------------------------------------------------------------------------------------- --------------------------------------------
Production
Total U.S. (MBOE/D) 648 631 617 636 633 636 894 846 793
- ------------------------------------------------------------------------------------- --------------------------------------------
Crude Oil and Condensate (MB/D)
Alaska 309 297 281 291 294 283 279 234 265
Lower 48 62 63 56 54 59 64 120 119 101
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 371 360 337 345 353 347 399 353 366
===================================================================================== ============================================
Sales of crude oil produced (MB/D) 386 352 352 337 357 363 398 355 372
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids (MB/D)*
Alaska 24 16 18 21 20 22 20 11 18
Lower 48 27 31 30 31 30 29 70 75 58
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 51 47 48 52 50 51 90 86 76
===================================================================================== ============================================
*Includes reinjection volumes sold
lease-to-lease: 13 1 8 13 9 14 14 7 11
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas (MMCF/D)
Alaska 185 148 173 172 169 163 163 123 150
Lower 48 1,169 1,195 1,218 1,264 1,212 1,264 2,265 2,320 1,953
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 1,354 1,343 1,391 1,436 1,381 1,427 2,428 2,443 2,103
===================================================================================== ============================================
Average Realized Prices
Crude Oil and Condensate ($/bbl)
Alaska
North Slope 38.93 43.92 53.30 52.34 46.95 52.92 59.89 62.85 58.43
- ------------------------------------------------------------------------------------- --------------------------------------------
West Coast 44.15 49.22 58.70 57.61 52.24 58.87 66.02 69.66 64.48
- ------------------------------------------------------------------------------------- --------------------------------------------
Lower 48 41.29 43.58 50.00 46.62 45.24 52.21 59.63 62.45 59.21
- ------------------------------------------------------------------------------------- --------------------------------------------
Total U.S. 43.69 48.21 57.31 55.86 51.09 57.70 64.09 67.25 63.05
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids ($/bbl)
Alaska 44.33 49.20 57.11 57.58 51.30 58.88 65.25 67.12 62.77
- ------------------------------------------------------------------------------------- --------------------------------------------
Lower 48 30.96 31.22 39.92 42.89 36.43 38.20 38.29 41.34 39.60
- ------------------------------------------------------------------------------------- --------------------------------------------
Total U.S. 34.68 37.26 43.95 45.94 40.40 43.00 40.45 42.68 41.86
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas ($/mcf)
Alaska 2.96 2.49 2.57 3.01 2.75 3.58 3.42 3.36 3.47
- ------------------------------------------------------------------------------------- --------------------------------------------
Lower 48 5.66 6.20 7.67 9.37 7.28 7.50 5.81 6.00 6.25
- ------------------------------------------------------------------------------------- --------------------------------------------
Total U.S. 5.57 6.07 7.48 9.17 7.12 7.42 5.78 5.98 6.21
- ------------------------------------------------------------------------------------- --------------------------------------------
Kenai, Alaska LNG Sales
Volume (MMCF/D) 132 96 123 118 117 128 126 110 122
- ------------------------------------------------------------------------------------- --------------------------------------------
Sales price per MCF 5.27 5.24 5.90 6.36 5.71 6.45 5.16 6.16 5.91
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. Exploration Charges ($ Millions)
Dry Holes 74 8 (2) 3 83 8 3 8 19
Lease Impairments 10 9 9 10 38 8 15 13 36
- ------------------------------------------------------------------------------------- --------------------------------------------
Total Non-Cash Charges 84 17 7 13 121 16 18 21 55
Other (G&G and Lease Rentals) 12 17 19 7 55 14 1 66 81
- ------------------------------------------------------------------------------------- --------------------------------------------
Total U.S. Exploration Charges 96 34 26 20 176 30 19 87 136
===================================================================================== ============================================
Alaska Only 85 13 11 1 110 18 (7) 50 61
- ------------------------------------------------------------------------------------- --------------------------------------------
DD&A ($ Millions)
Alaska 133 134 126 142 535 132 135 137 404
Lower 48 219 172 243 231 865 251 634 784 1,669
- ------------------------------------------------------------------------------------- --------------------------------------------
Total U.S. 352 306 369 373 1,400 383 769 921 2,073
===================================================================================== ============================================
Page 6 of 12
CONOCOPHILLIPS
================================================================================
INTERNATIONAL E&P
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
International E&P
Net Income ($ Millions) 895 963 1,181 1,103 4,142 1,372 2,004 909 4,285
===================================================================================== ============================================
Production
Total, Including Equity Affiliates
and Canadian Syncrude (MBOE/D) 952 906 904 954 929 974 1,240 1,190 1,136
- ------------------------------------------------------------------------------------- --------------------------------------------
Crude Oil and Condensate (MB/D)
Consolidated
Norway 207 195 198 188 197 188 192 190 190
United Kingdom 61 60 56 62 60 62 57 50 56
Canada 23 23 22 22 23 22 27 26 25
China 22 25 22 23 23 25 34 36 32
Indonesia 21 16 10 13 15 14 14 11 13
Vietnam 27 26 30 37 29 31 22 24 25
Timor Sea 36 21 38 36 33 39 39 40 39
Libya - - - - - - 74 71 49
Other 54 54 53 51 53 49 66 64 60
Equity affiliates 120 123 124 116 121 126 121 104 117
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 571 543 553 548 554 556 646 616 606
===================================================================================== ============================================
Sales of crude oil produced (MB/D) 554 580 531 579 561 550 642 598 597
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids (MB/D)
Norway 10 9 10 11 9 11 8 9 9
Canada 10 10 10 10 10 9 30 28 23
Timor Sea 17 9 20 19 16 20 20 20 20
Other 6 5 4 7 6 6 4 3 4
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 43 33 44 47 41 46 62 60 56
===================================================================================== ============================================
Natural Gas (MMCF/D)
Consolidated
Norway 298 268 259 264 272 269 260 260 263
United Kingdom 824 741 588 851 751 851 796 665 770
Canada 417 422 429 430 425 424 1,204 1,154 930
China - - - - - - 10 8 6
Timor Sea 35 35 35 33 34 144 251 300 232
Indonesia 273 287 303 330 298 294 323 342 320
Vietnam 18 14 20 19 18 24 19 20 21
Other 76 81 74 105 84 121 207 187 173
Equity affiliates 5 7 10 3 7 11 10 8 9
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 1,946 1,855 1,718 2,035 1,889 2,138 3,080 2,944 2,724
===================================================================================== ============================================
Canadian Syncrude (MB/D) 14 21 21 20 19 16 19 23 20
- ------------------------------------------------------------------------------------- --------------------------------------------
Darwin, Australia LNG Sales (MMCF/D) - - - - - 136 305 411 285
- ------------------------------------------------------------------------------------- --------------------------------------------
Page 7 of 12
CONOCOPHILLIPS
================================================================================
INTERNATIONAL E&P (continued)
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Average Realized Prices
Crude Oil and Condensate ($/bbl)
Consolidated
Norway 45.52 50.21 60.42 56.36 53.18 61.36 68.64 68.48 66.11
United Kingdom 49.47 48.02 60.83 54.87 53.13 59.13 65.32 64.67 63.61
Canada 36.96 41.09 54.74 46.44 44.70 44.28 60.86 61.00 56.03
China 41.51 46.95 51.89 49.86 47.85 57.90 66.68 64.68 63.70
Indonesia 46.51 47.57 61.77 47.00 49.45 57.94 58.15 62.69 59.34
Vietnam 47.77 53.32 58.52 52.77 53.23 62.34 68.53 71.35 67.00
Timor Sea 47.99 50.90 59.03 52.90 52.95 60.37 66.98 66.84 64.69
Libya - - - - - - 68.07 67.75 67.90
Other 44.56 50.11 60.99 57.03 52.93 62.95 69.20 70.39 67.80
Equity affiliates 30.38 36.11 45.25 38.90 37.79 43.38 52.28 46.98 47.36
Total 42.77 46.16 56.19 51.41 49.09 55.92 64.50 63.73 61.63
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids ($/bbl)
Norway 30.63 28.20 37.29 33.81 32.45 42.55 40.99 43.91 42.39
Canada 37.37 37.66 44.22 49.63 42.20 46.21 46.73 46.16 46.42
Timor Sea 34.40 35.99 40.45 47.29 40.11 46.68 41.35 45.63 44.45
Other 21.34 22.30 26.63 20.30 22.17 27.16 33.82 26.79 29.59
Total 32.35 32.03 39.29 40.04 36.25 43.25 43.28 44.89 43.84
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas ($/mcf)
Consolidated
Norway 5.03 5.30 5.13 6.40 5.46 7.28 7.09 7.48 7.28
United Kingdom 5.54 5.01 4.92 7.64 5.89 8.81 6.84 7.08 7.63
Canada 5.33 6.14 7.54 9.86 7.25 6.28 5.47 5.43 5.57
China - - - - - - 1.90 4.11 2.91
Timor Sea 0.52 0.52 0.56 0.61 0.55 0.67 0.65 0.69 0.67
Indonesia 5.08 5.96 6.73 6.23 6.03 7.45 7.53 6.71 7.21
Vietnam 1.04 1.04 1.05 1.07 1.05 1.07 1.07 1.07 1.07
Other 0.70 0.59 0.66 0.72 0.67 0.82 2.57 2.04 1.97
Equity affiliates 0.25 0.32 0.20 0.28 0.26 0.23 0.36 0.32 0.30
Total 5.03 5.15 5.57 7.16 5.76 7.13 5.90 5.85 6.21
- ------------------------------------------------------------------------------------- --------------------------------------------
International Exploration Charges ($ Millions)
Dry Holes 14 22 34 80 150 11 12 10 33
Lease Impairments 10 9 14 45 78 11 18 24 53
- ------------------------------------------------------------------------------------- --------------------------------------------
Total Non-Cash Charges 24 31 48 125 228 22 30 34 86
Other (G&G and Lease Rentals) 51 56 66 84 257 60 85 76 221
- ------------------------------------------------------------------------------------- --------------------------------------------
Total International Exploration Charges 75 87 114 209 485 82 115 110 307
===================================================================================== ============================================
DD&A ($ Millions) 467 449 454 542 1,912 527 890 939 2,356
- ------------------------------------------------------------------------------------- --------------------------------------------
Page 8 of 12
CONOCOPHILLIPS
================================================================================
R&M
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
R&M Net Income ($ Millions) 700 1,110 1,390 973 4,173 390 1,708 1,464 3,562
===================================================================================== ============================================
United States ($ Millions) 570 936 1,096 727 3,329 297 1,433 1,444 3,174
- ------------------------------------------------------------------------------------- --------------------------------------------
International ($ Millions) 130 174 294 246 844 93 275 20 388
- ------------------------------------------------------------------------------------- --------------------------------------------
Market Indicators
U.S. East Coast Crack Spread ($/bbl) 6.40 8.80 14.81 9.32 9.83 7.52 15.21 10.54 11.09
U.S. Gulf Coast Crack Spread ($/bbl) 6.37 9.63 17.42 10.27 10.92 8.28 17.26 11.00 12.18
U.S. Group Central Crack Spread ($/bbl) 7.92 11.51 17.06 11.93 12.10 9.81 19.60 17.75 15.72
U.S. West Coast Crack Spread ($/bbl) 19.61 22.20 26.61 16.29 21.18 18.87 32.47 21.70 24.35
U.S. Weighted 3:2:1 Crack Spread ($/bbl) 9.24 12.35 18.51 11.69 12.95 10.56 20.39 14.86 15.27
NW Europe Crack Spread ($/bbl) 11.14 15.09 16.53 13.68 14.11 10.18 15.20 14.18 13.19
Singapore 3:1:2 Crack Spread ($/bbl) 13.23 13.95 16.70 12.43 14.08 10.58 19.30 15.13 15.00
U.S. Wholesale Gasoline Mktg Mrgn ($/bbl) 0.16 2.05 0.70 2.63 1.38 0.71 1.83 5.75 2.76
- ------------------------------------------------------------------------------------- --------------------------------------------
Realized Margins
Refining Margin ($/bbl)
U.S. 10.11 11.23 14.61 12.71 12.17 10.18 17.23 14.10 13.98
International 8.43 8.89 11.19 8.95 9.38 5.30 7.64 6.46 6.59
- ------------------------------------------------------------------------------------- --------------------------------------------
Marketing Margin ($/bbl)
U.S. 0.46 2.01 0.18 2.52 1.28 0.12 0.48 2.81 1.16
International 5.61 8.56 6.80 8.62 7.43 6.07 6.67 11.17 8.00
- ------------------------------------------------------------------------------------- --------------------------------------------
DD&A ($ Millions) 194 197 197 230 818 239 253 246 738
- ------------------------------------------------------------------------------------- --------------------------------------------
Turnaround Expense ($ Millions) 108 106 53 86 353 163 115 42 320
- ------------------------------------------------------------------------------------- --------------------------------------------
Eastern U.S.
Crude Oil Charge Input (MB/D) 403 414 409 416 410 354 281 377 337
Total Charge Input (MB/D) 449 454 456 446 451 359 309 418 362
Crude Oil Capacity Utilization (%) 95% 98% 97% 98% 97% 84% 66% 89% 80%
Clean Product Yield (%) 92% 88% 89% 91% 90% 90% 87% 88% 88%
- ------------------------------------------------------------------------------------- --------------------------------------------
U.S. Gulf Coast
Crude Oil Charge Input (MB/D) 659 715 596 397 591 529 681 730 647
Total Charge Input (MB/D) 733 835 674 467 676 587 777 822 730
Crude Oil Capacity Utilization (%) 92% 100% 83% 55% 83% 72% 93% 100% 88%
Clean Product Yield (%) 73% 79% 80% 80% 78% 74% 81% 83% 80%
- ------------------------------------------------------------------------------------- --------------------------------------------
Central U.S.
Crude Oil Charge Input (MB/D) 538 594 620 619 594 571 619 600 597
Total Charge Input (MB/D) 577 625 653 666 630 613 663 638 638
Crude Oil Capacity Utilization (%) 84% 93% 97% 97% 93% 89% 97% 94% 93%
Clean Product Yield (%) 86% 84% 85% 85% 85% 84% 86% 85% 85%
- ------------------------------------------------------------------------------------- --------------------------------------------
Western U.S.
Crude Oil Charge Input (MB/D) 357 410 415 421 401 386 419 420 409
Total Charge Input (MB/D) 382 431 439 445 425 419 443 446 436
Crude Oil Capacity Utilization (%) 90% 101% 102% 104% 100% 94% 101% 102% 99%
Clean Product Yield (%) 80% 82% 79% 79% 80% 79% 81% 80% 80%
- ------------------------------------------------------------------------------------- --------------------------------------------
TOTAL UNITED STATES
Crude Oil Charge Input (MB/D) 1,957 2,133 2,040 1,853 1,996 1,840 2,000 2,127 1,990
Total Charge Input (MB/D) 2,141 2,345 2,222 2,024 2,182 1,978 2,192 2,324 2,166
Crude Oil Capacity Utilization (%) 90% 98% 93% 85% 92% 83% 91% 96% 90%
Clean Product Yield (%) 82% 83% 83% 84% 83% 81% 83% 84% 83%
- ------------------------------------------------------------------------------------- --------------------------------------------
Refined Products Production (MB/D)
Gasoline 968 1,071 1,030 949 1,004 890 1,031 1,084 1,002
Distillates 599 655 640 583 619 538 601 655 598
Aviation Fuel 166 174 153 135 157 146 163 166 158
Other 414 449 400 370 406 414 403 429 415
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 2,147 2,349 2,223 2,037 2,186 1,988 2,198 2,334 2,173
===================================================================================== ============================================
Petroleum Products Sales (MB/D)
Gasoline 1,302 1,426 1,397 1,368 1,374 1,258 1,300 1,369 1,309
Distillates 642 680 725 653 675 626 620 668 638
Aviation Fuel 198 214 203 189 201 187 200 180 189
Other 461 566 526 521 519 517 555 519 530
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 2,603 2,886 2,851 2,731 2,769 2,588 2,675 2,736 2,666
===================================================================================== ============================================
Page 9 of 12
CONOCOPHILLIPS
================================================================================
R&M (continued)
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
International - Consolidated*
Crude Oil Charge Input (MB/D) 294 259 289 291 283 357 505 474 446
Total Charge Input (MB/D) 307 266 305 310 297 369 550 503 474
Crude Oil Capacity Utilization (%) 101% 89% 99% 100% 97% 94% 92% 86% 90%
Clean Product Yield (%) 79% 76% 82% 82% 80% 71% 64% 69% 68%
- ------------------------------------------------------------------------------------- --------------------------------------------
International - Equity Affiliates - Net Share**
Crude Oil Charge Input (MB/D) 134 143 142 144 141 133 144 143 140
Total Charge Input (MB/D) 137 147 145 145 144 137 149 149 145
Crude Oil Capacity Utilization (%) 98% 105% 105% 106% 103% 94% 102% 102% 99%
Clean Product Yield (%) 83% 82% 80% 83% 82% 82% 82% 81% 82%
- ------------------------------------------------------------------------------------- --------------------------------------------
TOTAL INTERNATIONAL
Crude Oil Charge Input (MB/D) 428 402 431 435 424 490 649 617 586
Total Charge Input (MB/D) 444 413 450 455 441 506 699 652 619
Crude Oil Capacity Utilization (%) 100% 94% 101% 102% 99% 94% 94% 89% 92%
Clean Product Yield (%) 80% 78% 81% 82% 80% 74% 68% 72% 71%
- ------------------------------------------------------------------------------------- --------------------------------------------
Refined Products Production (MB/D)
Gasoline 141 115 143 152 138 142 165 165 157
Distillates 186 178 191 191 186 215 284 271 257
Aviation Fuel 21 21 24 24 22 13 13 17 14
Other 95 96 90 91 93 130 233 190 185
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 443 410 448 458 439 500 695 643 613
===================================================================================== ============================================
Petroleum Products Sales (MB/D)
Gasoline 185 176 178 175 178 197 225 204 209
Distillates 221 212 216 224 218 319 379 352 350
Aviation Fuel 7 10 12 8 9 20 18 22 20
Other 82 79 64 83 77 159 249 171 193
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 495 477 470 490 482 695 871 749 772
===================================================================================== ============================================
Worldwide - Including Net Share of Equity Affiliates
Crude Oil Charge Input (MB/D) 2,385 2,535 2,471 2,288 2,420 2,330 2,649 2,744 2,576
Total Charge Input (MB/D) 2,585 2,758 2,672 2,479 2,623 2,484 2,891 2,976 2,785
Crude Oil Capacity Utilization (%) 92% 97% 95% 88% 93% 85% 91% 95% 91%
Clean Product Yield (%) 82% 82% 83% 84% 82% 79% 80% 81% 80%
- ------------------------------------------------------------------------------------- --------------------------------------------
Refined Products Production (MB/D)
Gasoline 1,109 1,186 1,173 1,101 1,142 1,032 1,196 1,249 1,159
Distillates 785 833 831 774 805 753 885 926 855
Aviation Fuel 187 195 177 159 179 159 176 183 172
Other 509 545 490 461 499 544 636 619 600
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 2,590 2,759 2,671 2,495 2,625 2,488 2,893 2,977 2,786
===================================================================================== ============================================
Petroleum Products Sales (MB/D)
Gasoline 1,487 1,602 1,575 1,543 1,552 1,455 1,525 1,573 1,518
Distillates 863 892 941 877 893 945 999 1,020 988
Aviation Fuel 205 224 215 197 210 207 218 202 209
Other 543 645 590 604 596 676 804 690 723
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 3,098 3,363 3,321 3,221 3,251 3,283 3,546 3,485 3,438
===================================================================================== ============================================
* Represents our Humber refinery in the United Kingdom, the Whitegate
refinery in Ireland, and, effective March 1, 2006, our Wilhelmshaven
refinery in Germany.
** Represents 18.75 percent interest in a refinery complex in Karlsruhe,
Germany; 16.33 percent interest in two refineries in Kralupy and Litvinov,
Czech Republic; and 47 percent interest in a refinery in Melaka, Malaysia.
Page 10 of 12
CONOCOPHILLIPS
================================================================================
LUKOIL INVESTMENT
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
LUKOIL Investment
Net Income ($ Millions) 110 148 267 189 714 249 387 487 1,123
===================================================================================== ============================================
Upstream
Production*
Net crude oil production (MB/D) 190 215 253 281 235 306 346 388 347
Net natural gas production (MMCF/D) 67 50 79 72 67 98 343 288 244
BOE Total (MBOE/D) 201 223 266 293 246 322 403 436 388
- -----------------------------------------------------------------------------------------------------------------------------------
* Represents our estimated net share of LUKOIL's production.
Industry Prices
Crude Oil ($/bbl)
Urals crude (CIF Mediterranean) 43.21 48.49 57.39 54.07 50.87 58.25 64.85 65.81 62.97
- ------------------------------------------------------------------------------------- --------------------------------------------
Downstream
Refinery Throughput*
Crude Processed (MB/D) 92 101 138 156 122 163 168 164 165
- ------------------------------------------------------------------------------------- --------------------------------------------
* Represents our estimated net share of LUKOIL's crude processed.
MIDSTREAM
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Midstream Net Income ($ Millions) 385 68 88 147 688 110 108 169 387
===================================================================================== ============================================
U.S. Equity Affiliate ($ Millions)* 359 51 76 105 591 93 91 128 312
- ------------------------------------------------------------------------------------- --------------------------------------------
Natural Gas Liquids Extracted (MB/D)
Consolidated
United States 23 21 23 22 22 23 22 23 23
International 53 44 5 - 25 - - - -
Equity Affiliates
United States* 110 112 171 172 142 178 183 180 180
International 6 6 6 6 6 6 6 7 6
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 192 183 205 200 195 207 211 210 209
===================================================================================== ============================================
* Represents 30.3 percent interest in Duke Energy Field Services, LLC (DEFS),
through June 30, 2005, and 50 percent interest beginning in July 2005.
Natural Gas Liquids Fractionated (MB/D)
United States* 149 131 123 127 132 141 125 124 130
International 64 55 15 10 36 11 14 14 13
- ------------------------------------------------------------------------------------- --------------------------------------------
Total 213 186 138 137 168 152 139 138 143
===================================================================================== ============================================
* Excludes DEFS.
Product Prices
Weighted Average NGL ($/bbl)*
Consolidated 31.95 32.49 39.60 42.70 36.68 37.64 41.73 44.10 41.16
DEFS 30.61 31.33 38.31 41.84 35.52 37.29 41.18 43.00 40.49
- ------------------------------------------------------------------------------------- --------------------------------------------
* Prices are based on index prices from the Mont Belvieu and Conway market
hubs that are weighted by natural gas liquids component and location mix.
DD&A ($ Millions) 9 8 7 8 32 7 8 7 22
- ------------------------------------------------------------------------------------- --------------------------------------------
Page 11 of 12
CONOCOPHILLIPS
================================================================================
CHEMICALS
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Chemicals
Net Income (Loss) ($ Millions) 133 63 13 114 323 149 103 142 394
===================================================================================== ============================================
Industry Margins (Cents/Lb)*
Ethylene industry cash margin 18.1 12.8 8.8 21.1 15.2 20.5 14.3 17.0 17.3
HDPE industry contract sales margin 12.1 12.0 8.2 12.9 11.3 15.9 14.0 13.9 14.6
Styrene industry contract sales margin 13.9 13.6 12.4 12.3 13.1 12.5 11.9 11.3 11.9
- ------------------------------------------------------------------------------------- --------------------------------------------
* Prices, economics and views expressed by CMAI are strictly the opinion of
CMAI and Purvin & Gertz and are based on information collected within the
public sector and on assessments by CMAI and Purvin & Gertz staff utilizing
reasonable care consistent with normal industry practice. CMAI and Purvin &
Gertz make no guarantee or warranty and assume no liability as to their
use.
EMERGING BUSINESSES
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Emerging Businesses
Net Income (Loss) ($ Millions) (8) (8) - (5) (21) 8 (12) 11 7
===================================================================================== ============================================
Detail of Net Income (Loss) ($ Millions)
Technology Solutions (2) (4) (5) (5) (16) (12) (4) (3) (19)
Gas-to-Liquids (7) (7) (4) (5) (23) (4) (3) (4) (11)
Power 2 9 17 15 43 31 3 26 60
Other (1) (6) (8) (10) (25) (7) (8) (8) (23)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total (8) (8) - (5) (21) 8 (12) 11 7
===================================================================================== ============================================
CORPORATE AND OTHER
2005 2006
--------------------------------------------- --------------------------------------------
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
--------------------------------------------- --------------------------------------------
Corporate and Other
Net Income (Loss) ($ Millions) (195) (172) (246) (165) (778) (168) (412) (301) (881)
===================================================================================== ============================================
Detail of Net Income (Loss) ($ Millions)
Net interest expense * (106) (90) (139) (132) (467) (93) (267) (242) (602)
Corporate overhead (58) (46) (64) (15) (183) (26) (39) (35) (100)
Discontinued operations (11) 7 (4) (15) (23) - - - -
Acquisition-related expenses - - - - - (5) (39) (32) (76)
Accounting change - - - - - - - - -
Other * (20) (43) (39) (3) (105) (44) (67) 8 (103)
- ------------------------------------------------------------------------------------- --------------------------------------------
Total (195) (172) (246) (165) (778) (168) (412) (301) (881)
===================================================================================== ============================================
* Amounts in periods prior to 3rd Quarter 2006 have been reclassified to conform to current period presentation.
Before-Tax Net Interest Expense ($ Millions)
Interest expense (226) (219) (223) (224) (892) (226) (468) (417) (1,111)
Capitalized interest 88 91 102 114 395 111 107 110 328
Interest revenue 25 24 28 36 113 30 35 38 103
Receivables monetization related (1) - - - (1) - - - -
Premium on early debt retirement (9) - (50) (51) (110) - - - -
- ------------------------------------------------------------------------------------- --------------------------------------------
(123) (104) (143) (125) (495) (85) (326) (269) (680)
===================================================================================== ============================================
Debt
Total Debt ($ Millions) 14,012 14,013 13,497 12,516 12,516 32,193 29,510 27,807 27,807
Debt-to-Capital Ratio 23% 22% 21% 19% 19% 30% 27% 25% 25%
- ------------------------------------------------------------------------------------- --------------------------------------------
Page 12 of 12