ConocoPhillips posts $1.1-billion net loss in second quarter

Houston independent ConocoPhillips Co. reported a second-quarter net loss of $1.1 billion, down from a second-quarter 2015 net loss of $179 million. Excluding special items, second-quarter adjusted earnings were a net loss of $985 million, down from second-quarter 2015 adjusted earnings of $81 million.

The firm posted a first-half net loss of $2.5 billion, down from earnings of $93 million in the year-ago period. First-half adjusted earnings were a net loss of $2.2 billion, down from a net loss of $141 million a year earlier.

Guidance for capital expenditures has been lowered to $5.5 billion vs. prior guidance of $5.7 billion.

“Our financial position improved as we reduced our debt by [$800 million] and generated asset sale proceeds of [$200 million], remaining on track for about $1 billion of asset sale proceeds this year,” commented Ryan Lance, ConocoPhillips chairman and chief executive officer.

The firm progressed its phased exit from deepwater exploration with its July agreement to sell three exploration blocks offshore Senegal to Woodside Petroleum Ltd. (OGJ Online, July 14, 2016).

Production for the second quarter was 1.55 million boe/d, a decrease of 49,000 boe/d compared with the same period a year ago due to normal field decline, dispositions, planned downtime, and the impact of wildfires in Canada. Production for the first 6 months of the year was 1.56 million boe/d, a drop from 1.6 million boe/d for the same period in 2015 due to normal field decline and dispositions.

ConocoPhillips notes that, by the end of June, output from its Surmont oil sands project was restored to first-quarter levels after wildfires scorched the area. Production also began to ramp up from the Kebabangan gas development offshore Malaysia.

The APLNG project in Australia continued to operate above expectations, with Train 2 expected to start up in the fourth quarter, the firm says.

The firm is increasing its full-year production guidance to 1.54-1.57 million boe/d. Its third-quarter production guidance is 1.51-1.55 million boe/d, reflecting “significant planned turnaround activity during the quarter.”

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