Equibles

8-K

CONOCOPHILLIPS (COP)

8-K 2022-02-03 For: 2022-02-03
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Added on April 09, 2026

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):   February 3, 2022

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.)

925 N. Eldridge Parkway

    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))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, $.01 Par Value COP New York Stock Exchange
7% Debentures due 2029 CUSIP-718507BK1 New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

On February 3, 2022 ConocoPhillips issued a press release announcing the company's financial and operating results for both the quarter ended and year ended December 31, 2021. 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 and full year is furnished as Exhibit 99.2 hereto and incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No. Description
99.1 — Press release issued by ConocoPhillips on February 3, 2022.
99.2 — Supplemental financial information.
104 — Cover Page Interactive Data File (formatted as Inline XBRL and filed herewith).

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/ Kontessa S. Haynes-Welsh
Kontessa S. Haynes-Welsh
Chief Accounting Officer
February 3, 2022
Exhibit 99.1
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ConocoPhillips Reports Fourth-Quarter and Full-Year 2021 Results; Increases Planned 2022 Return of Capital to $8 Billion and Declares Quarterly Dividend and Variable Return of Cash Distribution

HOUSTON--(BUSINESS WIRE)--February 3, 2022--ConocoPhillips (NYSE: COP) today reported fourth-quarter 2021 earnings of $2.6 billion, or $1.98 per share, compared with a fourth-quarter 2020 loss of $0.8 billion, or ($0.72) per share. Excluding special items, fourth-quarter 2021 adjusted earnings were $3.0 billion, or $2.27 per share, compared with a fourth-quarter 2020 adjusted loss of $0.2 billion, or ($0.19) per share. Special items for the current quarter were primarily comprised of non-cash impairments related to the company’s existing investment in APLNG and noncore assets in Lower 48, partially offset by a gain on Cenovus Energy (CVE) equity.

Full-year 2021 earnings were $8.1 billion, or $6.07 per share, compared with a full-year 2020 loss of $2.7 billion, or ($2.51) per share. Excluding special items, full-year 2021 adjusted earnings were $8.0 billion, or $6.01 per share, compared with a full-year 2020 adjusted loss of $1.0 billion, or ($0.97) per share.

In addition, ConocoPhillips today announced a $1 billion increase in expected 2022 return of capital to shareholders to a new total of $8 billion, an increase of more than 30% over 2021. The company declared both an ordinary dividend of 46 cents per share and a second-quarter variable return of cash (VROC) payment of 30 cents per share, a 50% increase over the first-quarter VROC. Combined, the targeted 2022 ordinary dividend and VROC represent a more than 50% increase in cash return to shareholders compared to 2021.

“Our strong fourth-quarter results capped a transformative year for our company as we continue to deliver on our Triple Mandate,” said Ryan Lance, ConocoPhillips chairman and chief executive officer. “During 2021, we strengthened our outstanding low cost of supply portfolio. We closed and successfully integrated the Concho acquisition while exceeding our synergy targets, acquired and began to integrate the accretive Shell Permian position into our portfolio, and announced both the sale of our Indonesia assets and acquisition of additional interest in APLNG. We generated a 14% return on capital employed and returned $6 billion, or 38% of our cash from operations, to shareholders through ordinary dividends and share repurchases, and today announced an expected $8 billion total return of capital to shareholders in 2022. We continued to advance our commitment to ESG excellence, announcing plans to further reduce both our net and gross emissions intensity by 2030. It has been a remarkable year for the company, and I could not be more proud of our employees.”

Full-Year 2021 Summary and Recent Announcements

  • Announced an increase to expected 2022 return of capital to shareholders to a total of $8 billion, with the incremental $1 billion to be distributed through share repurchases and VROC tiers.
  • Acquired and integrated Concho, capturing over $1 billion of savings ahead of schedule; acquired Shell’s Permian assets on Dec. 1, 2021.
  • Exercised preemption right to purchase additional 10% shareholding interest in APLNG, expected to close in the first quarter of 2022.
  • Generated $0.3 billion in disposition proceeds from noncore asset sales and entered into agreements to sell an additional $1.8 billion in assets, subject to customary closing adjustments.
  • Delivered strong operational performance across the company’s asset base, resulting in full-year production of 1,527 MBOED, excluding Libya.
  • Achieved first production from GMT2, Malikai Phase 2 and SNP Phase 2; completed Tor II project and started production from a third Montney multi-well pad.
  • Generated cash provided by operating activities of $17.0 billion and cash from operations (CFO) of $15.7 billion, exceeding capital expenditures and investments of $5.3 billion, yielding free cash flow of $10.4 billion.
  • Achieved 14% return on capital employed; 16% cash-adjusted return on capital employed.
  • Distributed $6.0 billion to shareholders through $2.4 billion in dividends and $3.6 billion of share repurchases, representing a 38% return of CFO.
  • Ended the year with cash, cash equivalents and restricted cash totaling $5.4 billion and short-term investments of $0.4 billion, totaling $5.8 billion in ending cash and short-term investments.
  • Initiated paced monetization of the company’s CVE investment, generating $1.1 billion in proceeds through sale of 117 million shares, with the funds applied to share repurchases; 91 million CVE shares remained outstanding at year-end 2021.
  • Advanced the company’s net-zero ambition with an increase in Scope 1 and 2 greenhouse gas emissions-intensity reduction targets to 40-50% from a 2016 baseline on a net equity and gross operated basis by 2030, from the previous target of 35-45% on only a gross operated basis.

Quarterly Dividend and Variable Return of Cash

ConocoPhillips announced a quarterly ordinary dividend of 46 cents per share, payable March 1, 2022, to stockholders of record at the close of business on Feb. 14, 2022. In addition, the company announced a second-quarter VROC of 30 cents per share, payable April 14, 2022, to stockholders of record at the close of business on March 31, 2022.

Fourth-Quarter Review

Production excluding Libya for the fourth quarter of 2021 was 1,567 thousand barrels of oil equivalent per day (MBOED), an increase of 423 MBOED from the same period a year ago. After adjusting for closed acquisitions and dispositions as well as impacts from converting previously acquired Concho two-stream contracted volumes to a three-stream basis, fourth-quarter 2021 production increased by 70 MBOED, or 5% from the same period a year ago. This increase was primarily due to new production from Lower 48 and other development programs across the portfolio, partially offset by normal field decline. Production from Libya averaged 41 MBOED.

In the Lower 48, production averaged 818 MBOED, including 483 MBOED from the Permian, 213 MBOED from the Eagle Ford and 100 MBOED from the Bakken. Lower 48 ended the quarter with 20 drilling rigs and nine frac crews at work, including ongoing activity on the Permian assets acquired in the fourth quarter. In Alaska, GMT2 achieved first oil on schedule at rates in line with expectations.

Earnings and adjusted earnings increased from fourth-quarter 2020 due to higher realized prices and volumes, partially offset by higher operating costs associated with the higher volumes. The company’s total average realized price was $65.56 per barrel of oil equivalent (BOE), 97% higher than the $33.21 per BOE realized in the fourth quarter of 2020, as production remains unhedged and thus realizes the full benefit of higher marker prices.

For the quarter, cash provided by operating activities was $5.9 billion. Excluding a $0.4 billion change in operating working capital, ConocoPhillips generated CFO of $5.5 billion. CFO included a $0.2 billion benefit from commercial and inventory timing, which was offset in operating working capital. Dispositions generated $0.9 billion primarily from sale of CVE shares, with the proceeds from CVE sales applied to additional share repurchases. The company completed the all-cash Shell Permian acquisition by making an $8.2 billion payment at closing, funded $1.6 billion of capital expenditures and investments, paid $0.6 billion in dividends and repurchased $1.4 billion of shares.

Full-Year Review

Production excluding Libya for 2021 was 1,527 MBOED. After adjusting for closed acquisitions and dispositions, impacts from 2020 curtailments, 2021 Winter Storm Uri and the conversion of Concho two-stream contracted volumes to a three-stream basis, production increased by 28 MBOED or 2%. This increase was primarily due to new production from Lower 48 and other development programs across the portfolio, partially offset by normal field decline. Production from Libya averaged 40 MBOED in 2021.

The company’s total realized price for 2021 was $54.63 per BOE, 70% higher than the $32.15 per BOE realized in 2020, as production remains unhedged and thus realizes the full benefit of higher marker prices.

In 2021, cash provided by operating activities was $17.0 billion. Excluding a $1.3 billion change in operating working capital, ConocoPhillips generated CFO of $15.7 billion. CFO was reduced by approximately $1.2 billion due to transaction and restructuring expenses and realized losses on the commodity hedging portfolio acquired from Concho. Dispositions generated $1.7 billion primarily from sale of CVE shares, with the proceeds from CVE sales applied to additional share repurchases. The company completed the Shell Permian acquisition for total net cash of $8.7 billion, funded capital expenditures and investments of $5.3 billion, paid dividends of $2.4 billion and repurchased shares of $3.6 billion.

Reserves Update

Preliminary 2021 year-end proved reserves are approximately 6.1 billion BOE, with total reserve replacement of 377%, including closed acquisitions and dispositions and market factors.

Reserve changes excluding closed acquisitions and dispositions as well as market factors are expected to add 0.4 billion BOE, resulting in an organic reserve replacement ratio of approximately 68%. Market factors represent the use of historical 12-month pricing in measuring proved reserves as prescribed by Securities and Exchange Commission (SEC) guidelines that increased reserves by 0.7 billion BOE.

Final information related to the company’s 2021 oil and gas reserves, as well as costs incurred, will be provided in ConocoPhillips’ Annual Report on Form 10-K, to be filed with the SEC in February.

Outlook

The company’s 2022 operating plan capital budget is $7.2 billion. The plan includes funding for ongoing development drilling programs, major projects, exploration and appraisal activities, base maintenance and $0.2 billion for projects to reduce the company’s Scope 1 and 2 emissions intensity and fund investments in several early-stage low-carbon opportunities that address end-use emissions.

The company’s 2022 production guidance is 1.8 million barrels of oil equivalent per day (MMBOED), including Libya but excluding impacts from the pending Indonesia disposition and acquisition of additional APLNG shareholding interest. First-quarter 2022 production is expected to be 1.75 MMBOED to 1.79 MMBOED, essentially flat to fourth-quarter 2021 on a pro forma basis.

Guidance for 2022 includes adjusted operating cost of $7.3 billion reflecting increased production, costs incurred following conversion of previously acquired Concho two-stream contracted volumes to a three-stream basis, and some anticipated inflation; adjusted corporate segment net loss of $1.0 billion; and depreciation, depletion and amortization of $7.9 billion. Guidance excludes potential special items.

ConocoPhillips will host a conference call today at 12:00 p.m. Eastern time to discuss this announcement. To listen to the call and view related presentation materials and supplemental information, go to www.conocophillips.com/investor.

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About ConocoPhillips

ConocoPhillips is one of the world’s leading exploration and production companies based on both production and reserves, with a globally diversified asset portfolio. Headquartered in Houston, Texas, ConocoPhillips had operations and activities in 14 countries, $91 billion of total assets and approximately 9,900 employees at Dec. 31, 2021. Production including Libya averaged 1,567 MBOED for the 12 months ended Dec. 31, 2021, and proved reserves were 6.1 BBOE as of Dec. 31, 2021. For more information, go to www.conocophillips.com.

CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

This news release contains forward-looking statements as defined under the federal securities laws. Forward-looking statements relate to future events, plans and anticipated results of operations, business strategies, and other aspects of our operations or operating results. Words and phrases such as “anticipate," “estimate,” “believe,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict," “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” and other similar words can be used to identify forward-looking statements. 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 be reasonable at the time such forward-looking statement is made. However, these statements are not guarantees of future performance and involve certain risks, uncertainties and other factors beyond our control. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in the forward-looking statements. Factors that could cause actual results or events to differ materially from what is presented include the impact of public health crises, including pandemics (such as COVID-19) and epidemics and any related company or government policies or actions; global and regional changes in the demand, supply, prices, differentials or other market conditions affecting oil and gas, including changes resulting from a public health crisis or from the imposition or lifting of crude oil production quotas or other actions that might be imposed by OPEC and other producing countries and the resulting company or third-party actions in response to such changes; changes in commodity prices, including a prolonged decline in these prices relative to historical or future expected levels; insufficient liquidity or other factors, such as those listed herein, that could impact our ability to repurchase shares and declare and pay dividends such that we suspend our share repurchase program and reduce, suspend, or totally eliminate dividend payments in the future, whether variable or fixed; changes in expected levels of oil and gas reserves or production; potential failures or delays in achieving expected reserve or production levels from existing and future oil and gas developments, including due to operating hazards, drilling risks or unsuccessful exploratory activities; unexpected cost increases or technical difficulties in constructing, maintaining or modifying company facilities; legislative and regulatory initiatives addressing global climate change or other environmental concerns; investment in and development of competing or alternative energy sources; disruptions or interruptions impacting the transportation for our oil and gas production; international monetary conditions and exchange rate fluctuations; changes in international trade relationships, including the imposition of trade restrictions or tariffs on any materials or products (such as aluminum and steel) used in the operation of our business; our ability to collect payments when due under our settlement agreement with PDVSA; our ability to collect payments from the government of Venezuela as ordered by the ICSID; our ability to liquidate the common stock issued to us by Cenovus Energy Inc. at prices we deem acceptable, or at all; our ability to complete any announced or any future dispositions or acquisitions on time, if at all; the possibility that regulatory approvals for any announced or any future dispositions or acquisitions will not be received on a timely basis, if at all, or that such approvals may require modification to the terms of the transactions or our remaining business; business disruptions following the acquisition of assets from Shell (the “Shell Acquisition”) or any other announced or any future dispositions or acquisitions, including the diversion of management time and attention; the ability to deploy net proceeds from our announced or any future dispositions in the manner and timeframe we anticipate, if at all; potential liability for remedial actions under existing or future environmental regulations; potential liability resulting from pending or future litigation, including litigation related directly or indirectly to our transaction with Concho Resources Inc.; the impact of competition and consolidation in the oil and gas industry; limited access to capital or significantly higher cost of capital related to illiquidity or uncertainty in the domestic or international financial markets; general domestic and international economic and political conditions; the ability to successfully integrate the assets from the Shell Acquisition or achieve the anticipated benefits from the transaction; unanticipated difficulties or expenditures relating to the Shell Acquisition; changes in fiscal regime or tax, environmental and other laws applicable to our business; and disruptions resulting from accidents, extraordinary weather events, civil unrest, political events, war, terrorism, cyber attacks or information technology failures, constraints or disruptions; and other economic, business, competitive and/or regulatory factors affecting our business generally as set forth in our filings with the Securities and Exchange Commission. Unless legally required, ConocoPhillips expressly disclaims any obligation to update 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, probable and possible reserves. We may use the term “resource” in this news release that the SEC’s guidelines prohibit us from including in filings with the SEC. U.S. investors are urged to consider closely the oil and gas disclosures in our Form 10-K and other reports and filings with the SEC. Copies are available from the SEC and from the ConocoPhillips website.

Use of Non-GAAP Financial Information – To supplement the presentation of the company’s financial results prepared in accordance with U.S. generally accepted accounting principles (GAAP), this news release and the accompanying supplemental financial information contain certain financial measures that are not prepared in accordance with GAAP, including adjusted earnings (calculated on a consolidated and on a segment-level basis), adjusted earnings per share, operating costs, adjusted operating costs, cash from operations (CFO), free cash flow, return on capital employed, cash adjusted return on capital employed and adjusted corporate segment net loss.

The company believes that the non-GAAP measures adjusted earnings (both on an aggregate and a per-share basis), adjusted operating costs and adjusted corporate segment net loss are useful to investors to help facilitate comparisons of the company’s operating performance associated with the company’s core business operations across periods on a consistent basis and with the performance and cost structures of peer companies by excluding items that do not directly relate to the company’s core business operations. Operating costs is defined by the company as the sum of production and operating expenses, selling, general and administrative expenses, exploration general and administrative expenses, geological and geophysical, lease rentals and other exploration expenses. Adjusted operating costs is defined as the company’s operating costs further adjusted to exclude expenses that do not directly relate to the company’s core business operations and are included as adjustments to arrive at adjusted earnings to the extent those adjustments impact operating costs. The company further believes that the non-GAAP measure CFO is useful to investors to help understand changes in cash provided by operating activities excluding the timing effects associated with operating working capital changes across periods on a consistent basis and with the performance of peer companies. Free cash flow is defined as CFO net of capital expenditures and investments. The company believes free cash flow is useful to investors in understanding how existing cash from operations is utilized as a source for sustaining our current capital plan and future development growth. Free cash flow is not a measure of cash available for discretionary expenditures since the company has certain non-discretionary obligations such as debt service that are not deducted from the measure. Return on capital employed (ROCE) is a measure of the profitability of the company’s capital employed in its business operations compared with that of its peers. The company calculates ROCE as a ratio, the numerator of which is net income, and the denominator of which is average total equity plus average total debt. The net income is adjusted for after‐tax interest expense, for the purposes of measuring efficiency of debt capital used in operations; net income is also adjusted for non‐operational or special items impacts to allow for comparability in the long-term view across periods. The company believes ROCE is a good indicator of long‐term company and management performance as it relates to capital efficiency, both absolute and relative to the company’s primary peer group. The basis of cash adjusted ROCE utilizes ROCE as defined above and further adjusts for cash and cash equivalents, restricted cash, and short-term investments as well as the after-tax interest income generated by these capital sources, as the company may retain these sources for other strategic purposes and not fully employ such capital for use in operations. As such, cash adjusted ROCE is useful for comparability across periods that may be cyclically impacted by significant cash-related transactions. Adjusted corporate segment net loss is defined as corporate and other segment earnings adjusted for special items. The company believes that the above-mentioned non-GAAP measures, when viewed in combination with the company’s results prepared in accordance with GAAP, provides a more complete understanding of the factors and trends affecting the company’s business and performance. The company’s Board of Directors and management also use these non-GAAP measures to analyze the company’s operating performance across periods when overseeing and managing the company’s business.

Each of the non-GAAP measures included in this news release and the accompanying supplemental financial information has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of the company’s results calculated in accordance with GAAP. In addition, because not all companies use identical calculations, the company’s presentation of non-GAAP measures in this news release and the accompanying supplemental financial information may not be comparable to similarly titled measures disclosed by other companies, including companies in our industry. The company may also change the calculation of any of the non-GAAP measures included in this news release and the accompanying supplemental financial information from time to time in light of its then existing operations to include other adjustments that may impact its operations.

Reconciliations of each non-GAAP measure presented in this news release to the most directly comparable financial measure calculated in accordance with GAAP are included in the release.

Other Terms – This news release also contains the term pro forma underlying production, return of capital, reserve replacement and organic reserve replacement. Pro forma underlying production excludes Libya and reflects the impact of closed acquisitions and closed dispositions as if they had closed January 1, 2020. The company believes that underlying production is useful to investors to compare production excluding Libya and reflecting the impact of closed acquisitions and dispositions on a consistent go-forward basis across periods and with peer companies. For the purposes of comparing first quarter 2022 versus fourth quarter 2021, pro forma underlying production includes Libya and reflects the impact of closed acquisitions and closed dispositions as if they had closed January 1, 2021. Returns of capital (also referred to as distributions) is defined as the total of the ordinary dividend, share repurchases and variable return of cash (VROC). Reserve replacement is defined by the Company as a ratio representing the change in proved reserves, net of production, divided by current year production. Organic reserve replacement is defined by the Company as a ratio representing the change in proved reserves, net of production and excluding acquisitions and dispositions, divided by current year production. The Company believes that reserve replacement and organic reserve replacement are useful to investors to help understand how changes in proved reserves, net of production, compare with the Company’s current year production, inclusive and exclusive of acquisitions and dispositions, respectively.

References in the release to earnings refer to net income/(loss) attributable to ConocoPhillips.

ConocoPhillips
Table 1: Reconciliation of earnings to adjusted earnings
Millions, Except as Indicated
4Q20 2021 FY 2020 FY
Income tax After-tax Per share of common stock (dollars) Pre-tax Income tax After-tax Per share of common stock (dollars) Pre-tax Income tax After-tax Per share of common stock (dollars) Pre-tax Income tax After-tax Per share of common stock (dollars)
Earnings $ 2,627 1.98 (772 ) (0.72 ) 8,079 6.07 (2,701 ) (2.51 )
Adjustments:
Impairments (20 ) 753 0.56 1,124 (255 ) 869 0.81 684 1 685 0.51 1,680 (377 ) 1,303 1.20
Transaction and restructuring expenses (16 ) 53 0.04 24 (5 ) 19 0.02 435 (94 ) 341 0.26 24 (5 ) 19 0.02
Pension settlement expense (6 ) 23 0.02 17 (4 ) 13 0.01 99 (20 ) 79 0.06 44 (10 ) 34 0.03
(Gain) loss on CVE shares ) - (297 ) (0.22 ) (447 ) - (447 ) (0.41 ) (1,040 ) - (1,040 ) (0.78 ) 855 - 855 0.79
(Gain) loss on asset sales ) 29 (97 ) (0.07 ) - - - - (347 ) 32 (315 ) (0.24 ) (551 ) (14 ) (565 ) (0.52 )
Unrealized (gain) loss on FX derivative ) 4 (17 ) (0.01 ) 17 (3 ) 14 0.01 (9 ) 1 (8 ) (0.01 ) (38 ) 8 (30 ) (0.03 )
Deferred tax adjustments (35 ) (35 ) (0.03 ) - - - - - 40 40 0.03 - 92 92 0.09
Exploration expenses - - - 84 (17 ) 67 0.06 - - - - 84 (17 ) 67 0.06
Net loss on accelerated settlement of Concho hedging program - - - - - - - 132 (31 ) 101 0.08 - - - -
Pending claims and settlements - - - 46 (10 ) 36 0.03 48 (10 ) 38 0.03 (75 ) 9 (66 ) (0.06 )
Alberta tax credit - - - - - - - - - - - - (48 ) (48 ) (0.04 )
Adjusted earnings / (loss) $ 3,010 2.27 (201 ) (0.19 ) 8,000 6.01 (1,040 ) (0.97 )
The income tax effects of the special items are primarily calculated based on the statutory rate of the jurisdiction in<br> which the discrete item resides.

All values are in US Dollars.

ConocoPhillips
Table 2: Reconciliation of reported production to pro forma underlying production
In MBOED, Except as Indicated
4Q21 4Q20 2021 FY 2020 FY
Total Reported ConocoPhillips Production 1,608 1,169 1,567 1,127
Adjustments:
Libya (41 ) (25 ) (40 ) (9 )
Total Production excluding Libya 1,567 1,144 1,527 1,118
Closed Dispositions^1^ (2 ) (11 ) (12 ) (31 )
Closed Acquisitions ^2^ - 322 - 322
Total Pro Forma Underlying Production 1,565 1,455 1,515 1,409
Estimated Production Curtailments^3^ - - - 80
Estimated Downtime from Winter Storm Uri^4^ - - 12 -
Estimated Uplift from 2 to 3 stream conversion^5^ (40 ) - (10 ) -
Total reported production excludes impacts from the Shell Permian acquisition as an accounting close date of December 31, 2021 was used for reporting purposes.
^1^Includes production related to the completed Australia-West disposition and various Lower 48 dispositions.
^2^Includes production related to the acquisition of Concho. 2020 has been pro forma adjusted for the acquisition. 4Q20 and 2020 FY production estimate is based on the average daily production volumes of 322 MBOED for the nine months ended September 30, 2020 as publicly reported by Concho.
^3^Estimated production impacts from price related curtailments, which are excluded from Total Production excluding Libya and Total Underlying Production.
^4^Estimated production impacts from Winter Storm Uri, which are excluded from Total Production excluding Libya and Total Underlying Production.
^5^Estimated production impacts from the conversion of Concho two-stream contracted volumes to a three-stream (crude oil, natural gas and natural gas liquids) reporting basis, which are included in Total Production excluding Libya and Total Underlying Production.
ConocoPhillips
Table 3: Reconciliation of net cash provided by operating activities to free cash flow
Millions, Except as Indicated
2021 FY
Net Cash Provided by Operating Activities 16,996
Adjustments:
Net operating working capital changes 1,271
Cash from operations 15,725
Capital expenditures and investments 5,324
Free Cash Flow 10,401

All values are in US Dollars.

ConocoPhillips
Table 4: Calculation of Reserve Replacement Ratios
MMBOE, Except as Indicated
End of 2020 4,459
End of 2021 6,101
Change in reserves 1,642
Production^1^ 593
Change in reserves excluding production^1^ 2,235
Total reserve replacement ratio 377 %
Production^1^ 593
Purchases^2^ (1,169 )
Sales^2^ 54
Market Factors^3^ (718 )
Changes in reserves excluding production^1^, purchases^2^, sales^2^and market factors^3^ 402
Organic reserve replacement ratio, excluding Market Factors 68 %
^1^Production includes fuel gas and Libya.
^2^Purchases refers to acquisitions and sales refers to dispositions.
^3^Market factors represent the use of historical 12-month pricing in measuring proved reserves as prescribed by SEC guidelines.
ConocoPhillips
Table 5: Return on capital employed (ROCE) and Cash Adjusted ROCE
Millions, Except as Indicated
CASH ADJUSTED ROCE
Numerator 2020 FY 2021 FY 2020 FY
Net Income Attributable to ConocoPhillips (2,701 ) 8,079 (2,701 )
Adjustment to exclude special items ) 1,661 (79 ) 1,661
Net income attributable to noncontrolling interests 46 - 46
After-tax interest expense 637 698 637
After-tax interest income - (26 ) (77 )
ROCE Earnings (357 ) 8,672 (434 )
Denominator
Average total equity¹ 31,528 42,293 31,528
Average total debt² 15,123 19,338 15,123
Average total cash³ - (8,430 ) (7,427 )
Average capital employed 46,651 53,201 39,224
ROCE (percent) % -1 % 16 % -1 %
¹Average total equity is the average of beginning total equity and ending total equity by quarter.
²Average total debt is the average of beginning long-term debt and short-term debt and ending long-term debt and short-term debt by<br> quarter.
3Average total cash is the average of beginning cash, cash equivalents, restricted cash and short-term investments and ending<br> cash, cash equivalents, restricted cash and short-term investments by quarter.

All values are in US Dollars.

ConocoPhillips
Table 6: Reconciliation of production and operating expenses to adjusted operating costs
Millions, Except as Indicated
2022 FY Guidance
Production and operating expenses ~6,600
Selling, general and administrative (G&A) expenses ~500
Exploration G&A, G&G and lease rentals ~200
Operating costs ~7,300
Adjustments to exclude special items:
Less pending claims and settlements ) -
Less transaction and restructuring expenses ) -
Adjusted operating costs ~7,300
ConocoPhillips
Table 7: Reconciliation of adjusted corporate segment net loss
Millions, Except as Indicated
2022 FY Guidance
Corporate and Other earnings ) ~(1,000 )
Adjustments to exclude special items:
Less loss (gain) on CVE share ) -
Less transaction and restructuring expenses -
Less pension settlement expense -
Less unrealized loss (gain) on FX derivative ) -
Less pending claims and settlements -
Less tax on special items -
Adjusted corporate segment net loss ) ~(1,000 )

All values are in US Dollars.

Contacts

Dennis Nuss (media)

              281-293-1149 

              *dennis.nuss@conocophillips.com*

Investor Relations

              281-293-5000 

              *investor.relations@conocophillips.com*
Exhibit 99.2
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2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
Millions, Except as Indicated
CONSOLIDATED INCOME STATEMENT
Revenues and Other Income
Sales and other operating revenues 6,158 2,749 4,386 5,491 18,784 9,826 9,556 11,326 15,120 45,828
Equity in earnings of affiliates 234 77 35 86 432 122 139 239 332 832
Gain (loss) on dispositions (42 ) 596 (3 ) (2 ) 549 233 59 2 192 486
Other income (loss) (1,539 ) 594 (38 ) 474 (509 ) 378 457 49 319 1,203
Total Revenues and Other Income 4,811 4,016 4,380 6,049 19,256 10,559 10,211 11,616 15,963 48,349
Costs and Expenses
Purchased commodities 2,661 1,130 1,839 2,448 8,078 4,483 2,998 4,179 6,498 18,158
Production and operating expenses 1,173 1,047 963 1,161 4,344 1,383 1,379 1,389 1,543 5,694
Selling, general and administrative expenses (3 ) 156 96 181 430 311 117 128 163 719
Exploration expenses 188 97 125 1,047 1,457 84 57 65 138 344
Depreciation, depletion and amortization 1,411 1,158 1,411 1,541 5,521 1,886 1,867 1,672 1,783 7,208
Impairments 521 (2 ) 2 292 813 (3 ) 2 (89 ) 764 674
Taxes other than income taxes 250 141 179 184 754 370 381 403 480 1,634
Accretion on discounted liabilities 67 66 62 57 252 62 63 61 56 242
Interest and debt expense 202 202 200 202 806 226 220 219 219 884
Foreign currency transactions (gain) loss (90 ) 7 (5 ) 16 (72 ) 19 10 (10 ) (41 ) (22 )
Other expenses (6 ) (7 ) 20 6 13 24 37 17 24 102
Total Costs and Expenses 6,374 3,995 4,892 7,135 22,396 8,845 7,131 8,034 11,627 35,637
Income (loss) before income taxes (1,563 ) 21 (512 ) (1,086 ) (3,140 ) 1,714 3,080 3,582 4,336 12,712
Income tax provision (benefit) 148 (257 ) (62 ) (314 ) (485 ) 732 989 1,203 1,709 4,633
Net Income (Loss) (1,711 ) 278 (450 ) (772 ) (2,655 ) 982 2,091 2,379 2,627 8,079
Less: net income attributable to noncontrolling interests (28 ) (18 ) - - (46 ) - - - - -
Net Income (Loss) Attributable to ConocoPhillips (1,739 ) 260 (450 ) (772 ) (2,701 ) 982 2,091 2,379 2,627 8,079
Net Income (Loss) Attributable to ConocoPhillips
Per Share of Common Stock (dollars)
Basic (1.60 ) 0.24 (0.42 ) (0.72 ) (2.51 ) 0.75 1.55 1.78 1.99 6.09
Diluted (1.60 ) 0.24 (0.42 ) (0.72 ) (2.51 ) 0.75 1.55 1.78 1.98 6.07
Average Common Shares Outstanding (in thousands)*
Basic 1,084,561 1,076,659 1,077,377 1,073,580 1,078,030 1,300,375 1,348,637 1,332,286 1,315,225 1,324,194
Diluted 1,084,561 1,077,606 1,077,377 1,073,580 1,078,030 1,302,691 1,353,201 1,336,379 1,320,829 1,328,151
*Ending Common Shares Outstanding is 1,302,243 as of December 31, 2021, compared with 1,318,947 as of September 30, 2021.
INCOME (LOSS) BEFORE INCOME TAXES
Alaska 107 (195 ) (30 ) (857 ) (975 ) 217 480 517 574 1,788
Lower 48 (562 ) (471 ) (105 ) (362 ) (1,500 ) 609 1,502 2,094 2,117 6,322
Canada (150 ) (177 ) (100 ) (84 ) (511 ) 16 135 205 252 608
Europe, Middle East and North Africa 311 (60 ) 113 221 585 511 697 878 1,624 3,710
Asia Pacific 445 702 84 70 1,301 432 289 377 (162 ) 936
Other International 27 (5 ) (11 ) (96 ) (85 ) (5 ) (6 ) (140 ) (9 ) (160 )
Corporate and Other (1,741 ) 227 (463 ) 22 (1,955 ) (66 ) (17 ) (349 ) (60 ) (492 )
Consolidated (1,563 ) 21 (512 ) (1,086 ) (3,140 ) 1,714 3,080 3,582 4,336 12,712
EFFECTIVE INCOME TAX RATES
Alaska* 24.3 % 27.6 % 47.6 % 25.0 % 26.2 % 26.8 % 22.8 % 21.6 % 21.4 % 22.5 %
Lower 48 22.3 % 22.5 % 25.0 % 33.2 % 25.2 % 23.2 % 21.7 % 22.1 % 21.7 % 22.0 %
Canada 26.8 % 51.8 % 24.9 % 33.4 % 36.2 % 33.7 % 24.9 % 24.4 % 24.2 % 24.7 %
Europe, Middle East and North Africa 35.3 % 142.3 % 19.0 % 40.9 % 23.3 % 70.1 % 70.3 % 72.5 % 65.2 % 68.5 %
Asia Pacific 32.7 % 5.2 % 70.0 % 75.9 % 22.6 % 26.6 % 39.4 % 31.9 % -82.9 % 51.6 %
Other International -2.0 % -2.6 % 28.7 % 17.9 % 24.3 % 28.0 % 7.6 % 30.4 % 91.6 % 33.0 %
Corporate and Other -1.9 % 18.7 % 15.9 % -361.1 % 3.9 % -85.1 % 496.6 % 38.9 % 198.2 % 57.3 %
Consolidated -9.5 % -1330.4 % 12.0 % 28.9 % 15.4 % 42.7 % 32.1 % 33.6 % 39.4 % 36.4 %
*Alaska including taxes other than income taxes. 61.2 % -18.9 % 126.4 % 16.9 % -15.1 % 50.3 % 38.8 % 36.0 % 37.9 % 39.3 %

All values are in US Dollars.

2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
Millions
EARNINGS BY SEGMENT
Alaska 81 (141 ) (16 ) (643 ) (719 ) 159 371 405 451 1,386
Lower 48 (437 ) (365 ) (78 ) (242 ) (1,122 ) 468 1,175 1,631 1,658 4,932
Canada (109 ) (86 ) (75 ) (56 ) (326 ) 10 102 155 191 458
Europe, Middle East and North Africa 201 25 92 130 448 153 207 241 566 1,167
Asia Pacific 272 648 25 17 962 317 175 257 (296 ) 453
Other International 28 (6 ) (8 ) (78 ) (64 ) (4 ) (5 ) (97 ) (1 ) (107 )
Corporate and Other (1,775 ) 185 (390 ) 100 (1,880 ) (121 ) 66 (213 ) 58 (210 )
Consolidated (1,739 ) 260 (450 ) (772 ) (2,701 ) 982 2,091 2,379 2,627 8,079
SPECIAL ITEMS
Alaska (120 ) 81 - (648 ) (687 ) (20 ) (2 ) (1 ) 3 (20 )
Lower 48 (467 ) 40 70 (221 ) (578 ) (236 ) (10 ) 56 (109 ) (299 )
Canada (29 ) 77 - - 48 (3 ) 52 77 97 223
Europe, Middle East and North Africa (2 ) 2 - - - - - (5 ) - (5 )
Asia Pacific (4 ) 601 - - 597 199 - - (688 ) (489 )
Other International 29 - - (67 ) (38 ) - - (105 ) (3 ) (108 )
Corporate and Other (1,632 ) 453 (189 ) 365 (1,003 ) 140 335 (15 ) 317 777
Consolidated (2,225 ) 1,254 (119 ) (571 ) (1,661 ) 80 375 7 (383 ) 79
Detailed reconciliation of these items is provided on page 3.
ADJUSTED EARNINGS
Alaska 201 (222 ) (16 ) 5 (32 ) 179 373 406 448 1,406
Lower 48 30 (405 ) (148 ) (21 ) (544 ) 704 1,185 1,575 1,767 5,231
Canada (80 ) (163 ) (75 ) (56 ) (374 ) 13 50 78 94 235
Europe, Middle East and North Africa 203 23 92 130 448 153 207 246 566 1,172
Asia Pacific 276 47 25 17 365 118 175 257 392 942
Other International (1 ) (6 ) (8 ) (11 ) (26 ) (4 ) (5 ) 8 2 1
Corporate and Other (143 ) (268 ) (201 ) (265 ) (877 ) (261 ) (269 ) (198 ) (259 ) (987 )
Consolidated 486 (994 ) (331 ) (201 ) (1,040 ) 902 1,716 2,372 3,010 8,000
ADJUSTED EFFECTIVE INCOME TAX RATES
Alaska 23.0 % 26.6 % 47.6 % 128.6 % 62.9 % 26.4 % 22.7 % 21.7 % 22.4 % 22.8 %
Lower 48 18.0 % 22.5 % 23.3 % 73.7 % 28.3 % 23.3 % 21.7 % 22.0 % 21.8 % 22.1 %
Canada 27.2 % 25.0 % 24.9 % 33.4 % 26.8 % 28.3 % 26.2 % 25.7 % 25.3 % 25.8 %
Europe, Middle East and North Africa 36.9 % 132.9 % 19.0 % 40.9 % 23.3 % 70.2 % 70.3 % 72.7 % 65.2 % 68.6 %
Asia Pacific 32.5 % 41.3 % 70.0 % 75.9 % 42.6 % 49.3 % 39.4 % 31.9 % 25.5 % 33.9 %
Other International 28.6 % -2.6 % 28.7 % 1.5 % 12.1 % 28.0 % 7.6 % -7.1 % 143.6 % 107.8 %
Corporate and Other -13.9 % 15.0 % 25.0 % 17.6 % 14.9 % 8.1 % 18.7 % 38.9 % 25.1 % 23.1 %
Consolidated 38.2 % 26.3 % 18.2 % 9.2 % 11.1 % 44.8 % 36.8 % 34.2 % 36.8 % 37.1 %

All values are in US Dollars.

2020 2021
$ Millions 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
DETAILED SPECIAL ITEMS
Alaska
Transaction and restructuring expenses - - - - - (26 ) (2 ) (1 ) (4 ) (33 )
Impairments (154 ) 109 - (841 ) (886 ) - - - - -
Subtotal before income taxes (154 ) 109 - (841 ) (886 ) (26 ) (2 ) (1 ) (4 ) (33 )
Income tax provision (benefit)^1^ (34 ) 28 - (193 ) (199 ) (6 ) - - (7 ) (13 )
Total (120 ) 81 - (648 ) (687 ) (20 ) (2 ) (1 ) 3 (20 )
Lower 48
Transaction and restructuring expenses - - - - - (175 ) (13 ) (15 ) (57 ) (260 )
Net realized loss on accelerated settlement of Concho hedging program - - - - - (132 ) - - - (132 )
Impairments (561 ) 50 - (283 ) (794 ) - - 89 (85 ) 4
Gain (loss) on asset sales (38 ) 2 - - (36 ) - - - - -
Pending claims and settlements - - 89 - 89 - - - - -
Subtotal before income taxes (599 ) 52 89 (283 ) (741 ) (307 ) (13 ) 74 (142 ) (388 )
Income tax provision (benefit) (132 ) 12 19 (62 ) (163 ) (71 ) (3 ) 18 (33 ) (89 )
Total (467 ) 40 70 (221 ) (578 ) (236 ) (10 ) 56 (109 ) (299 )
Canada
Impairments (39 ) 39 - - - - - - - -
Gain (loss) on asset sales - - - - - - 68 100 126 294
Transaction and restructuring expenses - - - - - (3 ) - - - (3 )
Subtotal before income taxes (39 ) 39 - - - (3 ) 68 100 126 291
Income tax provision (benefit)^2^ (10 ) (38 ) - - (48 ) - 16 23 29 68
Total (29 ) 77 - - 48 (3 ) 52 77 97 223
Europe, Middle East and North Africa
Impairments (11 ) 11 - - - - - - - -
Transaction and restructuring expenses - - - - - (1 ) - (24 ) - (25 )
Subtotal before income taxes (11 ) 11 - - - (1 ) - (24 ) - (25 )
Income tax provision (benefit) (9 ) 9 - - - (1 ) - (19 ) - (20 )
Total (2 ) 2 - - - - - (5 ) - (5 )
Asia Pacific
Gain (loss) on asset sales - 587 - - 587 200 - - - 200
Impairments (5 ) 5 - - - - - - (688 ) (688 )
Transaction and restructuring expenses - - - - - (1 ) - - - (1 )
Subtotal before income taxes (5 ) 592 - - 587 199 - - (688 ) (489 )
Income tax provision (benefit)^3^ (1 ) (9 ) - - (10 ) - - - - -
Total (4 ) 601 - - 597 199 - - (688 ) (489 )
Other International
Pending claims and settlements 29 - - - 29 - - - - -
Gain (loss) on asset sales - - - - - - - (147 ) - (147 )
Transaction and restructuring expenses - - - - - - - - (4 ) (4 )
Exploration expense - - - (84 ) (84 ) - - - - -
Subtotal before income taxes 29 - - (84 ) (55 ) - - (147 ) (4 ) (151 )
Income tax provision (benefit) - - - (17 ) (17 ) - - (42 ) (1 ) (43 )
Total 29 - - (67 ) (38 ) - - (105 ) (3 ) (108 )
Corporate and Other
Pension settlement expense - - (27 ) (17 ) (44 ) - (42 ) (28 ) (29 ) (99 )
Pending claims and settlements - 3 - (46 ) (43 ) - (48 ) - - (48 )
Transaction and restructuring expense - - - (24 ) (24 ) (85 ) (8 ) (12 ) (4 ) (109 )
Gain (loss) on investment in Cenovus Energy (1,691 ) 551 (162 ) 447 (855 ) 308 418 17 297 1,040
Unrealized gain (loss) on CAD FX derivative 75 (12 ) (8 ) (17 ) 38 (4 ) (8 ) - - (12 )
Unrealized gain (loss) on AUD FX derivative - - - - - - - - 21 21
Subtotal before income taxes (1,616 ) 542 (197 ) 343 (928 ) 219 312 (23 ) 285 793
Income tax provision (benefit)^4^ 16 89 (8 ) (22 ) 75 79 (23 ) (8 ) (32 ) 16
Total (1,632 ) 453 (189 ) 365 (1,003 ) 140 335 (15 ) 317 777
Total Company (2,225 ) 1,254 (119 ) (571 ) (1,661 ) 80 375 7 (383 ) 79
^1^Includes deferred tax adjustment in 2Q 2020 in Alaska.
^2^Includes recognition of a tax refund in 2Q 2020 in Canada.
^3^Includes tax adjustment in 2Q 2020 for the Australia-West disposition.
^4^Includes deferred tax adjustment related to foreign tax credits in 2Q 2020 and 1Q 2021; Q4 2021 tax adjustment<br> related to Indonesia disposition.

2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
Millions
CONSOLIDATED BALANCE SHEET
Assets
Cash and cash equivalents 3,908 2,907 2,490 2,991 2,991 2,831 6,608 9,833 5,028 5,028
Short-term investments 3,866 3,985 4,032 3,609 3,609 4,104 2,251 678 446 446
Accounts and notes receivable 2,116 1,399 1,984 2,634 2,634 4,339 4,401 5,336 6,543 6,543
Accounts and notes receivable—related parties 148 133 135 120 120 142 123 129 127 127
Investment in Cenovus Energy 420 971 809 1,256 1,256 1,564 1,802 1,416 1,117 1,117
Inventories 726 982 1,034 1,002 1,002 1,098 1,138 1,043 1,208 1,208
Prepaid expenses and other current assets 1,960 676 575 454 454 536 849 1,746 1,581 1,581
Total Current Assets 13,144 11,053 11,059 12,066 12,066 14,614 17,172 20,181 16,050 16,050
Investments and long-term receivables 8,707 8,334 8,295 8,017 8,017 8,286 8,013 8,058 7,113 7,113
Loans and advances—related parties 167 167 114 114 114 59 59 - - -
Net properties, plants and equipment 40,645 41,120 41,269 39,893 39,893 58,270 57,717 56,689 64,911 64,911
Other assets 2,370 2,372 2,420 2,528 2,528 2,464 2,442 2,376 2,587 2,587
Total Assets 65,033 63,046 63,157 62,618 62,618 83,693 85,403 87,304 90,661 90,661
Liabilities
Accounts payable 2,900 2,060 2,217 2,669 2,669 3,779 3,591 4,101 5,002 5,002
Accounts payable—related parties 21 20 22 29 29 22 22 30 23 23
Short-term debt 126 146 482 619 619 689 1,205 920 1,200 1,200
Accrued income and other taxes 853 312 339 320 320 959 1,406 2,082 2,862 2,862
Employee benefit obligations 323 422 469 608 608 567 571 691 755 755
Other accruals 1,852 1,145 1,111 1,121 1,121 1,168 1,355 2,625 2,179 2,179
Total Current Liabilities 6,075 4,105 4,640 5,366 5,366 7,184 8,150 10,449 12,021 12,021
Long-term debt 14,847 14,852 14,905 14,750 14,750 19,338 18,805 18,748 18,734 18,734
Asset retirement obligations and accrued environmental costs 5,316 5,465 5,651 5,430 5,430 5,782 5,819 5,721 5,754 5,754
Deferred income taxes 4,141 3,901 3,854 3,747 3,747 4,982 5,331 5,630 6,179 6,179
Employee benefit obligations 1,563 1,586 1,661 1,697 1,697 1,530 1,297 1,162 1,153 1,153
Other liabilities and deferred credits 1,704 1,644 1,663 1,779 1,779 1,722 1,725 1,479 1,414 1,414
Total Liabilities 33,646 31,553 32,374 32,769 32,769 40,538 41,127 43,189 45,255 45,255
Equity
Common stock issued
Par value 18 18 18 18 18 21 21 21 21 21
Capital in excess of par 47,027 47,079 47,113 47,133 47,133 60,278 60,337 60,431 60,581 60,581
Treasury stock (47,130 ) (47,130 ) (47,130 ) (47,297 ) (47,297 ) (47,672 ) (48,278 ) (49,521 ) (50,920 ) (50,920 )
Accumulated other comprehensive income (loss) (6,145 ) (5,825 ) (5,666 ) (5,218 ) (5,218 ) (5,080 ) (4,920 ) (5,123 ) (4,950 ) (4,950 )
Retained earnings 37,545 37,351 36,448 35,213 35,213 35,608 37,116 38,307 40,674 40,674
Total Common Stockholders' Equity 31,315 31,493 30,783 29,849 29,849 43,155 44,276 44,115 45,406 45,406
Noncontrolling Interests 72 - - - - - - - - -
Total Equity 31,387 31,493 30,783 29,849 29,849 43,155 44,276 44,115 45,406 45,406
Total Liabilities and Equity 65,033 63,046 63,157 62,618 62,618 83,693 85,403 87,304 90,661 90,661

All values are in US Dollars.

2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
Millions
CASH FLOW INFORMATION
Cash Flows from Operating Activities
Net income (loss) (1,711 ) 278 (450 ) (772 ) (2,655 ) 982 2,091 2,379 2,627 8,079
Depreciation, depletion and amortization 1,411 1,158 1,411 1,541 5,521 1,886 1,867 1,672 1,783 7,208
Impairments 521 (2 ) 2 292 813 (3 ) 2 (89 ) 764 674
Dry hole costs and leasehold impairments 67 3 44 969 1,083 6 1 - 37 44
Accretion on discounted liabilities 67 66 62 57 252 62 63 61 56 242
Deferred taxes (227 ) (93 ) (108 ) (406 ) (834 ) 203 364 328 451 1,346
Undistributed equity earnings 31 373 46 195 645 81 236 (59 ) 188 446
(Gain) loss on dispositions 42 (596 ) 3 2 (549 ) (233 ) (59 ) (2 ) (192 ) (486 )
(Gain) loss on investment in Cenovus Energy 1,691 (551 ) 162 (447 ) 855 (308 ) (418 ) (17 ) (297 ) (1,040 )
Other (284 ) 40 56 231 43 (581 ) (107 ) (178 ) 78 (788 )
Net working capital changes 497 (519 ) (360 ) 10 (372 ) (15 ) 211 702 373 1,271
Net Cash Provided by Operating Activities 2,105 157 868 1,672 4,802 2,080 4,251 4,797 5,868 16,996
Cash Flows from Investing Activities
Capital expenditures and investments (1,649 ) (876 ) (1,132 ) (1,058 ) (4,715 ) (1,200 ) (1,265 ) (1,302 ) (1,557 ) (5,324 )
Working capital changes associated with investing activities 81 (332 ) 22 74 (155 ) 61 (59 ) 77 55 134
Acquisition of businesses, net of cash acquired - - - - - 382 - - (8,672 ) (8,290 )
Proceeds from asset dispositions 549 764 (1 ) 5 1,317 (17 ) 177 632 861 1,653
Net sales (purchases) of investments (935 ) (95 ) (59 ) 431 (658 ) (499 ) 1,801 1,544 245 3,091
Collection of advances/loans—related parties 66 - 50 - 116 52 - 53 - 105
Other (44 ) 9 4 5 (26 ) 6 80 (472 ) 473 87
Net Cash Provided by (Used in) Investing Activities (1,932 ) (530 ) (1,116 ) (543 ) (4,121 ) (1,215 ) 734 532 (8,595 ) (8,544 )
Cash Flows from Financing Activities
Net issuance (repayment) of debt (24 ) (190 ) 280 (20 ) 46 (26 ) (18 ) (319 ) (142 ) (505 )
Issuance of company common stock 2 - (4 ) (3 ) (5 ) (28 ) 3 52 118 145
Repurchase of company common stock (726 ) - - (166 ) (892 ) (375 ) (606 ) (1,243 ) (1,399 ) (3,623 )
Dividends paid (458 ) (455 ) (454 ) (464 ) (1,831 ) (588 ) (583 ) (579 ) (609 ) (2,359 )
Other (24 ) (4 ) 1 1 (26 ) 2 1 3 1 7
Net Cash Used in Financing Activities (1,230 ) (649 ) (177 ) (652 ) (2,708 ) (1,015 ) (1,203 ) (2,086 ) (2,031 ) (6,335 )
Effect of Exchange Rate Changes (122 ) 29 31 42 (20 ) (2 ) 11 (12 ) (31 ) (34 )
Net Change in Cash, Cash Equivalents and Restricted Cash (1,179 ) (993 ) (394 ) 519 (2,047 ) (152 ) 3,793 3,231 (4,789 ) 2,083
Cash, cash equivalents and restricted cash at beginning of period 5,362 4,183 3,190 2,796 5,362 3,315 3,163 6,956 10,187 3,315
Cash, Cash Equivalents and Restricted Cash at End of Period 4,183 3,190 2,796 3,315 3,315 3,163 6,956 10,187 5,398 5,398
CAPITAL EXPENDITURES AND INVESTMENTS
Alaska 509 223 150 156 1,038 235 228 235 284 982
Lower 48 776 354 268 483 1,881 718 762 770 879 3,129
Canada 74 68 451 58 651 33 35 61 74 203
Europe, Middle East and North Africa 121 130 159 190 600 121 136 128 149 534
Asia Pacific 103 85 92 104 384 76 72 87 155 390
Other International 53 10 3 55 121 6 12 15 - 33
Corporate and Other 13 6 9 12 40 11 20 6 16 53
Total Capital Expenditures and Investments 1,649 876 1,132 1,058 4,715 1,200 1,265 1,302 1,557 5,324

All values are in US Dollars.

2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
TOTAL SEGMENTS
Production
Total (MBOED) 1,289 981 1,067 1,169 1,127 1,527 1,588 1,544 1,608 1,567
Crude Oil (MBD)
Consolidated operations 642 460 535 581 555 804 836 802 824 816
Equity affiliates 12 14 13 14 13 14 13 13 12 13
Total 654 474 548 595 568 818 849 815 836 829
Over (under) lifting of crude oil (MBD) (20 ) (9 ) 12 40 6 (28 ) 27 42 (13 ) 7
NGL (MBD)
Consolidated operations 116 85 89 98 97 105 120 123 186 134
Equity affiliates 7 8 8 8 8 8 8 7 8 8
Total 123 93 97 106 105 113 128 130 194 142
Bitumen (MBD)
Consolidated operations 66 34 49 69 55 70 68 69 68 69
Equity affiliates - - - - - - - - - -
Total 66 34 49 69 55 70 68 69 68 69
Natural Gas (MMCFD)
Consolidated operations 1,638 1,221 1,201 1,302 1,339 2,074 2,209 2,144 2,009 2,109
Equity affiliates 1,036 1,056 1,034 1,092 1,055 1,081 1,051 1,033 1,049 1,053
Total 2,674 2,277 2,235 2,394 2,394 3,155 3,260 3,177 3,058 3,162
Industry Prices
Crude Oil (/BBL)
WTI 46.06 27.85 40.93 42.66 39.37 57.84 66.07 70.56 77.19 67.92
WCS 25.54 16.58 31.83 33.46 26.85 45.32 54.60 56.99 62.58 54.87
Brent dated 50.31 29.20 43.00 44.23 41.68 60.90 68.83 73.47 79.73 70.73
JCC (/BBL) 65.89 67.71 30.58 40.83 51.25 43.77 55.88 67.00 73.13 59.94
Natural Gas (/MMBTU)
Henry Hub first of month 1.95 1.71 1.98 2.67 2.08 2.71 2.83 4.02 5.84 3.85
Average Realized Prices
Total (/BBL) 38.81 23.09 30.94 33.21 32.15 45.36 50.03 56.92 65.56 54.63
Crude Oil (/BBL)
Consolidated operations 48.77 25.10 39.49 40.89 39.56 57.18 65.54 70.39 76.69 67.61
Equity affiliates 53.14 25.32 37.56 41.16 39.02 59.73 64.10 73.44 81.53 69.45
Total 48.86 25.10 39.45 40.89 39.54 57.22 65.51 70.43 76.76 67.64
NGL (/BBL)
Consolidated operations 12.81 8.29 13.73 16.30 12.90 24.36 25.62 33.28 36.41 31.04
Equity affiliates 42.41 23.93 30.21 35.70 32.69 48.89 44.12 56.70 67.77 54.16
Total 14.82 9.88 15.29 17.98 14.61 26.44 26.87 34.79 37.72 32.45
Bitumen (/BBL)
Consolidated operations 5.90 (23.11 ) 15.87 19.41 8.02 30.78 37.60 41.19 40.74 37.52
Equity affiliates - - - - - - - - - -
Total 5.90 (23.11 ) 15.87 19.41 8.02 30.78 37.60 41.19 40.74 37.52
Natural Gas (/MCF)
Consolidated operations 3.60 2.64 2.77 3.47 3.17 4.89 4.25 5.93 9.13 6.00
Equity affiliates 5.41 3.90 2.61 2.93 3.71 3.54 3.97 5.95 7.80 5.31
Total 4.30 3.22 2.70 3.23 3.41 4.42 4.16 5.94 8.66 5.77
Exploration Expenses ( Millions)
Dry holes 36 3 44 132 215 6 - - 28 34
Leasehold impairment 31 - - 837 868 - 1 - 9 10
Total noncash expenses 67 3 44 969 1,083 6 1 - 37 44
Other (G&A, G&G and lease rentals) 121 94 81 78 374 78 56 65 101 300
Total exploration expenses 188 97 125 1,047 1,457 84 57 65 138 344
U.S. exploration expenses 99 72 86 914 1,171 50 35 32 99 216
International exploration expenses 89 25 39 133 286 34 22 33 39 128
DD&A ( Millions)
Alaska 209 191 274 322 996 317 262 201 217 997
Lower 48 707 548 619 680 2,554 1,000 1,017 988 1,070 4,075
Canada 69 66 95 109 339 126 93 85 82 386
Europe, Middle East and North Africa 196 167 194 212 769 219 234 217 216 886
Asia Pacific 217 170 217 205 809 211 240 167 170 788
Other International - - - - - - - - - -
Corporate and Other 13 16 12 13 54 13 21 14 28 76
Total DD&A 1,411 1,158 1,411 1,541 5,521 1,886 1,867 1,672 1,783 7,208

All values are in US Dollars.

2020 2021
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
PRODUCTION
Crude Oil (MBD)
Consolidated operations
Alaska 198 153 184 190 181 190 184 163 180 178
Lower 48 270 166 197 218 213 416 454 457 457 447
Canada 2 5 6 10 6 11 9 8 7 8
Norway 84 75 76 75 78 80 81 82 80 81
Libya 9 - 1 24 8 36 39 35 38 37
Europe, Middle East and North Africa 93 75 77 99 86 116 120 117 118 118
Australia/Timor-Leste 4 3 - - 2 - - - - -
China 31 30 29 28 30 31 27 27 28 28
Indonesia 2 2 2 3 2 2 2 2 2 2
Malaysia 42 26 40 33 35 38 40 28 32 35
Asia Pacific 79 61 71 64 69 71 69 57 62 65
Total consolidated operations 642 460 535 581 555 804 836 802 824 816
Equity affiliates 12 14 13 14 13 14 13 13 12 13
Total 654 474 548 595 568 818 849 815 836 829
NGL (MBD)
Consolidated operations
Alaska 19 13 14 16 16 17 15 13 17 16
Lower 48 89 64 68 75 74 79 97 101 162 110
Canada 1 2 2 3 2 4 4 4 3 4
Norway 5 5 5 4 4 5 4 5 4 4
Europe, Middle East and North Africa 5 5 5 4 4 5 4 5 4 4
Australia/Timor-Leste 2 1 - - 1 - - - - -
Asia Pacific 2 1 - - 1 - - - - -
Total consolidated operations 116 85 89 98 97 105 120 123 186 134
Equity affiliates 7 8 8 8 8 8 8 7 8 8
Total 123 93 97 106 105 113 128 130 194 142
Bitumen (MBD)
Canada 66 34 49 69 55 70 68 69 68 69
Total 66 34 49 69 55 70 68 69 68 69
Natural Gas (MMCFD)
Consolidated operations
Alaska 8 8 14 9 10 8 11 11 33 16
Lower 48 679 486 566 611 585 1,319 1,459 1,389 1,195 1,340
Canada 20 40 43 57 40 91 84 73 70 80
Norway 297 263 256 267 270 295 284 291 323 298
Libya 13 1 - 6 5 14 13 12 21 15
Europe, Middle East and North Africa 310 264 256 273 275 309 297 303 344 313
Australia/Timor-Leste 237 114 - - 87 - - - - -
Indonesia 309 266 283 300 290 290 290 299 296 294
Malaysia 75 43 39 52 52 57 68 69 71 66
Asia Pacific 621 423 322 352 429 347 358 368 367 360
Total consolidated operations 1,638 1,221 1,201 1,302 1,339 2,074 2,209 2,144 2,009 2,109
Equity affiliates 1,036 1,056 1,034 1,092 1,055 1,081 1,051 1,033 1,049 1,053
Total 2,674 2,277 2,235 2,394 2,394 3,155 3,260 3,177 3,058 3,162
Total (MBOED)
Consolidated operations
Alaska 218 167 201 208 198 208 201 178 203 197
Lower 48 472 311 359 395 385 715 794 790 818 780
Canada 72 48 64 91 70 100 95 93 90 94
Norway 139 124 124 123 127 134 132 135 138 135
Libya 11 - 1 25 9 39 41 37 41 40
Europe, Middle East and North Africa 150 124 125 148 136 173 173 172 179 175
Australia/Timor-Leste 46 24 - - 17 - - - - -
China 31 30 29 28 30 31 27 27 28 28
Indonesia 54 46 49 53 50 50 50 52 51 51
Malaysia 54 33 47 42 44 48 52 40 44 46
Asia Pacific 185 133 125 123 141 129 129 119 123 125
Total consolidated operations 1,097 783 874 965 930 1,325 1,392 1,352 1,413 1,371
Equity affiliates 192 198 193 204 197 202 196 192 195 196
Total 1,289 981 1,067 1,169 1,127 1,527 1,588 1,544 1,608 1,567

2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
AVERAGE REALIZED PRICES
Crude Oil (/BBL)
Consolidated operations
Alaska 54.78 26.81 40.88 42.61 42.12 59.56 67.87 72.55 79.61 69.87
Lower 48*** 40.97 19.87 36.43 38.50 35.17 55.68 64.13 68.59 74.82 66.12
Canada - 8.69 25.16 28.57 23.57 47.41 56.87 58.99 66.62 56.38
Norway 54.92 32.32 41.79 41.62 42.80 56.72 66.10 72.36 78.51 68.94
Libya 64.21 - - 44.93 48.64 59.78 66.88 72.57 77.64 69.06
Europe, Middle East and North Africa 55.53 32.32 41.79 42.35 43.30 57.75 66.34 72.43 78.27 68.97
Australia/Timor-Leste 47.35 47.21 - - 47.34 - - - - -
China 54.10 25.09 39.75 42.80 40.29 58.27 65.63 74.39 79.61 69.39
Indonesia 29.33 30.64 36.41 41.21 34.97 53.79 57.16 61.35 73.35 61.92
Malaysia 57.67 30.59 46.43 42.42 45.26 62.27 69.77 75.65 80.87 71.59
Asia Pacific 54.71 27.98 42.79 42.50 42.84 60.36 67.72 74.66 80.05 70.36
Total consolidated operations 48.77 25.10 39.49 40.89 39.56 57.18 65.54 70.39 76.69 67.61
Equity affiliates 53.14 25.32 37.56 41.16 39.02 59.73 64.10 73.44 81.53 69.45
Total 48.86 25.10 39.45 40.89 39.54 57.22 65.51 70.43 76.76 67.64
NGL (/BBL)
Consolidated operations
Lower 48 11.85 6.95 13.51 15.58 12.13 23.99 24.62 32.87 35.99 30.63
Canada - 1.64 5.99 8.52 5.41 25.32 27.14 33.47 39.68 31.18
Norway 21.54 16.76 23.50 30.80 23.27 34.70 39.49 50.32 57.91 43.97
Europe, Middle East and North Africa 21.54 16.76 23.50 30.80 23.27 34.70 39.49 50.32 57.91 43.97
Australia/Timor-Leste 39.34 27.90 - - 33.21 - - - - -
Asia Pacific 39.34 27.90 - - 33.21 - - - - -
Total consolidated operations 12.81 8.29 13.73 16.30 12.90 24.36 25.62 33.28 36.41 31.04
Equity affiliates 42.41 23.93 30.21 35.70 32.69 48.89 44.12 56.70 67.77 54.16
Total 14.82 9.88 15.29 17.98 14.61 26.44 26.87 34.79 37.72 32.45
Bitumen (/BBL)
Canada* 5.90 (23.11 ) 15.87 19.41 8.02 30.78 37.60 41.19 40.74 37.52
Total 5.90 (23.11 ) 15.87 19.41 8.02 30.78 37.60 41.19 40.74 37.52
Natural Gas (/MCF)
Consolidated operations
Alaska 3.07 2.56 2.48 3.88 2.91 2.23 4.53 2.63 2.22 2.81
Lower 48*** 1.48 1.18 1.63 2.21 1.65 4.56 3.27 4.63 5.25 4.38
Canada - 0.79 0.71 1.77 1.21 2.37 2.26 2.45 3.16 2.54
Norway 3.65 2.21 2.40 4.39 3.23 6.15 7.36 12.28 27.06 13.75
Libya 4.53 - - 2.26 3.71 2.71 3.02 4.17 4.58 3.73
Europe, Middle East and North Africa 3.68 2.21 2.40 4.34 3.23 5.99 7.17 11.96 25.71 13.27
Australia/Timor-Leste** 6.43 10.62 - - 10.04 - - - - -
Indonesia 6.58 4.69 5.75 5.85 5.75 6.57 7.19 7.49 8.23 7.38
Malaysia 2.93 2.22 2.22 1.85 2.38 2.35 2.61 3.02 3.59 2.93
Asia Pacific 5.94 4.74 5.33 5.26 5.39 5.88 6.32 6.66 7.33 6.56
Total consolidated operations 3.60 2.64 2.77 3.47 3.17 4.89 4.25 5.93 9.13 6.00
Equity affiliates 5.41 3.90 2.61 2.93 3.71 3.54 3.97 5.95 7.80 5.31
Total 4.30 3.22 2.70 3.23 3.41 4.42 4.16 5.94 8.66 5.77
*Average realized prices exclude additional value realized from third-party purchases and sales for optimization of our<br> pipeline capacity between Canada and the U.S. Gulf Coast.
**Excludes transfers to Darwin LNG plant.
***Average sales prices, including the impact of hedges settling per initial contract terms in the first quarter of 2021 assumed<br> in our Concho acquisition, were 65.19 per barrel for crude oil and 4.33 per mcf for natural gas for the year ended December 31, 2021. As of March 31, 2021, we had settled all oil and gas hedging positions acquired from Concho.

All values are in US Dollars.

2020 2021
2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD
CORPORATE AND OTHER
Corporate and Other Earnings (Loss) ( Millions) (1,775 ) 185 (390 ) 100 (1,880 ) (121 ) 66 (213 ) 58 (210 )
Detail of Earnings (Loss) ( Millions)
Net interest expense (155 ) (174 ) (179 ) (154 ) (662 ) (270 ) (181 ) (176 ) (174 ) (801 )
Corporate G&A expenses 50 (90 ) (50 ) (110 ) (200 ) (129 ) (65 ) (57 ) (66 ) (317 )
Technology* 1 (9 ) (8 ) (10 ) (26 ) 41 (4 ) (6 ) (6 ) 25
Other (1,671 ) 458 (153 ) 374 (992 ) 237 316 26 304 883
Total (1,775 ) 185 (390 ) 100 (1,880 ) (121 ) 66 (213 ) 58 (210 )
*Includes investment in new technologies or businesses outside of our normal scope of operations and licensing revenues.
Before-Tax Net Interest Expense ( Millions)
Interest expense (216 ) (216 ) (213 ) (216 ) (861 ) (241 ) (235 ) (236 ) (234 ) (946 )
Capitalized interest 14 14 13 14 55 15 15 17 15 62
Interest revenue 42 22 9 15 88 6 4 5 7 22
Total (160 ) (180 ) (191 ) (187 ) (718 ) (220 ) (216 ) (214 ) (212 ) (862 )
Debt
Total debt ( Millions) 14,973 14,998 15,387 15,369 15,369 20,027 20,010 19,668 19,934 19,934
Debt-to-capital ratio (%) 32 % 32 % 33 % 34 % 34 % 32 % 31 % 31 % 31 % 31 %
Equity ( Millions) 31,387 31,493 30,783 29,849 29,849 43,155 44,276 44,115 45,406 45,406

All values are in US Dollars.

REFERENCE
Commonly Used Abbreviations
Earnings Net Income (Loss) Attributable to ConocoPhillips
DD&A Depreciation, Depletion and Amortization
G&G Geological and Geophysical
G&A General and Administrative
JCC Japan Crude Cocktail
LNG Liquefied Natural Gas
NGL Natural Gas Liquids
WCS Western Canada Select
WTI West Texas Intermediate
Units of Measure
BBL Barrels
MMBBL Millions of Barrels
MBD Thousands of Barrels per Day
MBOED Thousands of Barrels of Oil Equivalent per Day
MCF Thousands of Cubic Feet
MMBTU Millions of British Thermal Units
MMCFD Millions of Cubic Feet per Day

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