HOUSTON -- ConocoPhillips, which recently said that it is splitting into two entities--an upstream and a downstream company--effective second-quarter 2012, has announced a 2012 capital program of $15.5 billion that reflects an increase in Exploration & Production (E&P) segment expenditures. Approximately 90% will be in support of E&P, while the Refining & Marketing (R&M) segment represents 8% of 2012 planned expenditures.
ConocoPhillips, in reporting on the progress of its three-year strategic plan, also announced a program to repurchase up to an additional $10 billion of the company's common stock. The company additionally provided an update on its $15 billion to $20 billion asset divestiture program for 2010-2012.
"We have made strong progress on the plan set out in 2010 to enhance our business through a disciplined approach to capital investment, maintaining a strong balance sheet and growing distributions to our shareholders," said Jim Mulva, chairman and CEO. "We continue to optimize the portfolio, selling noncore holdings and allocating investments to the highest-returning projects to position our business for improved returns and greater value."
The company is also on track to complete its plans to reposition into two leading energy companies during second-quarter 2012. The downstream company, Phillips 66, will offer a "unique approach" to downstream integration, comprising segment-leading refining and marketing, midstream and chemicals businesses. ConocoPhillips will become one of the largest and most diverse global pure-play exploration and production companies.
"Our planned repositioning in 2012 will help us grow the value of these two companies for our shareholders and unlock the potential of our assets and employees," said Mulva. "We believe this is the best way for us to succeed and be competitive in the long term."
The 2012 capital program for R&M is approximately $1.2 billion, with $1 billion for its U.S. businesses and the remaining $200 million for international operations. These funds will be used primarily for refining projects related to sustaining and improving the existing business with a focus on safety, regulatory compliance, efficiency and reliability.
Houston-based ConocoPhillips is an integrated energy company with interests around the world. The company had approximately 29,700 employees, $155 billion of assets and $247 billion of annualized revenues as of September 30, 2011.
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