-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CpXr7rG+leGU/Zmhn+Soa2Ig+S7c6WLQVTfx8YfFIBVSl0UrlgL/XSWCzfjKjEbz NkLxf8M813CZ66pvsbRj3A== 0001157523-05-003867.txt : 20050427 0001157523-05-003867.hdr.sgml : 20050427 20050427100229 ACCESSION NUMBER: 0001157523-05-003867 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20050427 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050427 DATE AS OF CHANGE: 20050427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONOCOPHILLIPS CENTRAL INDEX KEY: 0001163165 STANDARD INDUSTRIAL CLASSIFICATION: PETROLEUM REFINING [2911] IRS NUMBER: 010562944 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32395 FILM NUMBER: 05774863 BUSINESS ADDRESS: STREET 1: CONOCOPHILLIPS STREET 2: 600 NORTH DAIRY ASHFORD ROAD CITY: HOUSTON STATE: TX ZIP: 77079 BUSINESS PHONE: 2812931000 MAIL ADDRESS: STREET 1: CONOCOPHILLIPS STREET 2: 600 NORTH DAIRY ASHFORD ROAD CITY: HOUSTON STATE: TX ZIP: 77079 FORMER COMPANY: FORMER CONFORMED NAME: CORVETTEPORSCHE CORP DATE OF NAME CHANGE: 20011204 8-K 1 a4873716.txt CONOCOPHILLIPS 8-K 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): April 27, 2005 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 (see General Instruction A.2. below): [ ] 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 April 27, 2005, ConocoPhillips issued a press release announcing the company's financial and operating results for the quarter ended March 31, 2005. 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. Item 9.01 Financial Statements and Exhibits (c) Exhibits 99.1 -- Press release issued by ConocoPhillips on April 27, 2005. 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/ John A. Carrig ---------------------------------------------------- John A. Carrig Executive Vice President, Finance, and Chief Financial Officer April 27, 2005 EXHIBIT INDEX Exhibit No. Description - --- ----------- 99.1 Press release issued by ConocoPhillips on April 27, 2005. 99.2 Financial and operational tables. 99.3 Supplemental financial information. EX-99.1 2 a4873716ex991.txt EXHIBIT 99.1 Exhibit 99.1 ConocoPhillips Reports First-Quarter Net Income of $2.9 Billion HOUSTON--(BUSINESS WIRE)--April 27, 2005--ConocoPhillips (NYSE:COP) Earnings at a glance First Quarter - --------------------------------------- ----------------------------- 2005 2004 - --------------------------------------- -------------- -------------- Income from continuing operations $2,923 million $1,603 million Income (loss) from discontinued operations (11) 13 Net income $2,912 1,616 - --------------------------------------- -------------- -------------- Diluted income per share Income from continuing operations $4.12 $2.31 Net income 4.10 2.33 - --------------------------------------- -------------- -------------- Revenues $38.9 billion $30.2 billion - --------------------------------------- -------------- -------------- ConocoPhillips (NYSE:COP) today reported first-quarter net income of $2,912 million, or $4.10 per share, compared with $1,616 million, or $2.33 per share, for the same quarter in 2004. Total revenues were $38.9 billion, versus $30.2 billion a year ago. Income from continuing operations for the first quarter was $2,923 million, or $4.12 per share, compared with $1,603 million, or $2.31 per share, for the same period a year ago. "Overall, our performance for the quarter was good, and would have been stronger without unplanned downtime," said Jim Mulva, chairman and chief executive officer. "In our Exploration and Production segment, oil and gas production was negatively impacted by planned and unplanned downtime. This resulted in total production of 1.80 million BOE per day, including our share of estimated LUKOIL production of 0.2 million BOE per day. In the Refining and Marketing segment, higher turnaround activity and unplanned downtime during the quarter reduced our crude oil capacity utilization to 92 percent and lowered our clean product yield. "We continued to strengthen our financial position. Our return on capital employed remains strong and competitive, and our debt-to-capital ratio declined from 26 percent to 23 percent during the quarter. We generated $4.1 billion in cash from operations, and spent $1.8 billion on capital projects and investments, including the purchase of an additional 1.3 percent of LUKOIL. Also, we announced a restructuring of DEFS that ultimately will increase our equity ownership to 50 percent. "We were pleased to recently announce a 24 percent increase in our dividend and a 2-for-1 stock split. In addition, we continue to acquire company stock consistent with the goal of bringing our diluted shares outstanding to approximately 700 million shares. As of the end of the first quarter of 2005, the company had purchased 2.1 million shares under this program." The results of ConocoPhillips' business segments follow. Exploration & Production (E&P) E&P income from continuing operations in the first quarter was $1,787 million, up from $1,671 million in the fourth quarter of 2004 and from $1,257 million in the first quarter of 2004. Higher realized crude oil and natural gas prices, increased crude oil sales and gains on asset sales, partially offset by reduced tax benefits, contributed to the improvement from the fourth quarter of 2004. Improved results from the first quarter of 2004 primarily were due to higher realized crude oil prices. ConocoPhillips' E&P daily production, including Canadian Syncrude and excluding the LUKOIL Investment segment, averaged 1.60 million barrels of oil equivalent (BOE) per day for the first quarter of 2005, flat with the prior quarter and down slightly from 1.61 million BOE per day in the first quarter of 2004. When compared with the previous quarter, the company experienced greater output during the first quarter of 2005 from Venezuela, the Lower 48 and Indonesia. These increases were offset by approximately 15,000 BOE per day of unscheduled maintenance in the United Kingdom, Canada and Alaska as well as approximately 10,000 BOE per day of planned downtime in Norway and Alaska. The decrease from the first quarter of 2004 primarily was due to lower production in the United Kingdom, Canada, Norway and Alaska and asset dispositions, partially offset by increases in the Timor Sea, Venezuela and the Gulf of Mexico. These increases include the ramp-up of production at Bayu-Undan, Hamaca and Magnolia. Midstream Midstream income from continuing operations was $385 million, up from $100 million in the fourth quarter of 2004 and $55 million in the first quarter of 2004. The improvement from the prior periods primarily was due to higher equity earnings from Duke Energy Field Services, LLC (DEFS), which included a gain from the sale of DEFS' interest in TEPPCO Partners, L.P. (TEPPCO). In addition, first-quarter 2005 natural gas liquids realizations were lower than the fourth quarter of 2004. The net first-quarter impact to ConocoPhillips associated with the restructuring of its ownership in DEFS, including the sale of TEPPCO, was $300 million. Refining and Marketing (R&M) R&M income from continuing operations was $700 million, down from $753 million in the previous quarter and up from $464 million in the first quarter of 2004. Higher U.S. refining margins during the first quarter of 2005 were more than offset by lower worldwide marketing margins, lower international refining margins, and higher turnaround activity and unplanned downtime. The improved results from the first quarter of 2004 were attributable to increased worldwide refining margins, partially offset by lower worldwide marketing margins, reduced volumes, and higher turnaround and utility costs. Domestically, realized refining margins benefited from continued strong light-heavy crude differentials. The company experienced planned turnaround activity at its Borger, Lake Charles, San Francisco, Sweeny and Wood River refineries. In addition, unplanned downtime at the company's Alliance and Borger refineries reduced processed inputs by approximately 60,000 barrels per day. As a result, first-quarter domestic refinery crude oil capacity utilization averaged 90 percent and clean products yield was two percentage points lower than that of the fourth quarter of 2004. In addition, U.S. marketing margins fell sharply from the previous quarter. Internationally, lower refining and sharply lower marketing margins significantly reduced first-quarter results. First-quarter international crude oil capacity utilization was 100 percent. Overall, R&M's refinery crude oil capacity utilization rate averaged 92 percent, compared with 94 percent in the previous quarter and 96 percent in the first quarter of 2004. Before-tax turnaround costs were $108 million, versus $73 million in the fourth quarter of 2004. LUKOIL Investment Income from continuing operations in the first quarter of 2005 was $110 million, compared with $74 million in the prior quarter. This represents ConocoPhillips' estimate of the company's 10.6 percent weighted average equity share of LUKOIL's income for the first quarter based on market indicators and historical production trends of LUKOIL. The increase from the fourth quarter of 2004 primarily was attributable to higher realized price estimates and an increased equity ownership position. At the end of the first quarter of 2005, the company's equity ownership in LUKOIL was 11.3 percent. ConocoPhillips' share of estimated BOE production was 201,000 per day. The company's share of estimated daily refining crude oil throughput was 92,000 barrels per day. Chemicals The Chemicals segment, which reflects the company's 50 percent interest in Chevron Phillips Chemical Company LLC, reported income from continuing operations of $133 million. This is compared with income of $83 million in the fourth quarter of 2004 and $39 million in the first quarter of 2004. Improvements from the fourth quarter primarily were driven by improved olefin and polyolefin margins, offset by slightly lower volumes. The increase from the first quarter of 2004 primarily was related to improved margins in both the olefins and polyolefins, as well as aromatics and styrenics business lines. Emerging Businesses The Emerging Businesses segment had a loss from continuing operations of $8 million in the first quarter of 2005, compared with losses of $24 million in the fourth quarter of 2004 and $22 million in the first quarter of 2004. Improved international and domestic power operations and the timing of certain expenses contributed to the reduced operating losses from both periods. Corporate and Other Corporate expenses from continuing operations during the first quarter were $184 million, compared with $177 million in the previous quarter and $190 million in the first quarter of 2004. The increase from the fourth quarter primarily was related to debt retirement premiums and lower foreign exchange gains, partially offset by lower net interest expense. Contributing to the decrease from the first quarter of 2004 was the absence of merger-related expenses recorded in the prior period. Total balance sheet debt at the end of the first quarter was $14.0 billion, down approximately $1.0 billion from the end of 2004. At the end of the first quarter of 2005, the company's debt-to-capital ratio was 23 percent, down from 26 percent at the end of the prior year. The company's income tax provision for the first quarter of 2005 was $2.0 billion, resulting in an effective tax rate of 43 percent, excluding the DEFS restructuring, and 41 percent including the DEFS restructuring. This is compared with 42 percent in the previous quarter and 46 percent in the first quarter of 2004. Discontinued Operations First quarter 2005 losses from discontinued operations were $11 million, compared with $48 million in the fourth quarter of 2004 and income of $13 million in the first quarter of 2004. The losses in the first quarter of 2005 primarily were due to the continued completion of various marketing asset sales. Outlook Mr. Mulva concluded: "A favorable commodity-price environment contributed to strong earnings, cash flows and continued debt reduction this quarter. We remain focused on our disciplined approach to improving operations and financial flexibility. "Although we expect second quarter production to be lower than that of the first quarter due to scheduled maintenance and facility downtime, we still anticipate full-year daily production, including Canadian Syncrude, to be approximately 3 percent higher than the amount produced in 2004, excluding the impacts of LUKOIL. We continue to progress plans for a joint venture with LUKOIL in Russia's Timan-Pechora province. We expect to complete the formation of the venture, which will be included in our E&P segment, sometime in the second quarter of 2005. "Downstream, execution of our extensive 2005 clean-fuels initiative is progressing as planned. We expect the second quarter to be another period of significant turnaround activity; however, we anticipate our full-year crude oil capacity utilization rate to be in the upper 90-percent range. "In addition to our announced capital program, we are planning to spend an additional $3 billion over the period 2006 through 2010 to increase our refining system's ability to process heavy-sour crude oil and other low-quality feedstocks. These investments, primarily domestic, are expected to incrementally increase refining capacity and clean products yield at our existing facilities, while providing competitive returns." As previously announced, capital spending for 2005 is expected to be $7.4 billion, excluding capitalized interest and minority interest, as well as the ConocoPhillips share repurchase program and additional equity investment in LUKOIL. ConocoPhillips is an integrated oil company with interests around the world. Headquartered in Houston, the company had approximately 36,000 employees and $97 billion of assets as of March 31, 2005. For more information, go to www.conocophillips.com. ConocoPhillips' quarterly conference call is scheduled for 10:00 a.m. Central today. To listen to the conference call and to view related presentation materials, go to www.conocophillips.com and click on the "First Quarter Earnings" link. For financial and operational tables, go to www.conocophillips.com/news/nr/earnings/highlights/1q05earnings.html. For detailed supplemental information, go to www.conocophillips.com/news/nr/earnings/detail/1q05summary.xls. CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This update contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements, such as, "we expect second quarter production to be lower than that of the first quarter"; "we still anticipate full-year production, including Canadian Syncrude, to be approximately 3 percent higher than the amount produced in 2004, excluding the impacts of LUKOIL"; "we continue to progress plans for a joint venture with LUKOIL in Russia's Timan-Pechora province"; "we expect to complete the formation of the venture, which will be included in our E&P segment, sometime in the second quarter of 2005"; "we expect the second quarter to be another period of significant turnaround activity; however, we anticipate our full-year crude oil capacity utilization rate to be in the upper 90-percent range"; "we are planning to spend an additional $3 billion over the period 2006 through 2010 to increase our refining system's ability to process heavy-sour crude oil and other low-quality feedstocks"; "these investments, primarily domestic, are expected to incrementally increase refining capacity and clean products yield at our existing facilities, while providing competitive returns"; and "capital spending for 2005 is expected to be $7.4 billion, excluding capitalized interest and minority interest, as well as the ConocoPhillips share repurchase program and additional equity investment in LUKOIL" involve certain risks, uncertainties and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Economic, business, competitive and regulatory factors that may affect ConocoPhillips' business are generally as set forth in ConocoPhillips' filings with the Securities and Exchange Commission (SEC). ConocoPhillips is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements whether as a result of new information, future events or otherwise. Cautionary Note to U.S. Investors -- The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. Production is distinguished from oil and gas production because SEC regulations define Syncrude as mining-related and not part of conventional oil and natural gas reserves. We use certain terms in this release, such as "including Syncrude" that the SEC's guidelines strictly prohibit us from including in filings with the SEC. U.S. investors are urged to consider closely the disclosure in the company's periodic filings with the SEC, available from the company at 600 North Dairy Ashford Road, Houston, Texas 77079. This information can also be obtained from the SEC by calling 1-800-SEC-0330. CONTACT: ConocoPhillips, Houston Laura Hopkins, 281-293-6030 (media) or Clayton Reasor, 212-207-1996 (investors) EX-99.2 3 a4873716ex992.txt EXHIBIT 99.2 Exhibit 99.2 ConocoPhillips Houston, Texas 77079 Preliminary FINANCIAL HIGHLIGHTS Millions of Dollars Three Months Ended March 31 2005 2004 Revenues Sales and other operating revenues* $37,631 29,813 Equity in earnings of affiliates 1,053 269 Other income 234 135 ---------- --------- 38,918 30,217 ---------- --------- Costs and expenses Purchased crude oil, natural gas and products 25,572 19,735 Production and operating expenses 1,952 1,665 Selling, general and administrative expenses 539 468 Exploration expenses 171 143 Depreciation, depletion and amortization 1,041 918 Property impairments 22 31 Taxes other than income taxes* 4,488 4,114 Accretion on discounted liabilities 48 36 Interest and debt expense 138 145 Foreign currency transaction gains (3) (16) Minority interests 10 14 ---------- --------- 33,978 27,253 ---------- --------- Income from continuing operations before income taxes 4,940 2,964 Provision for income taxes 2,017 1,361 ---------- --------- Income from continuing operations 2,923 1,603 Income/(loss) from discontinued operations (11) 13 ---------- --------- Net income $2,912 1,616 ========== ========= Income/(loss) per share of common stock (dollars) Basic Continuing operations $4.18 2.34 Discontinued operations (0.01) 0.02 ---------- --------- Net income $4.17 2.36 ========== ========= Diluted Continuing operations $4.12 2.31 Discontinued operations (0.02) 0.02 ---------- --------- Net income $4.10 2.33 ========== ========= Average common shares outstanding (in thousands) Basic 698,946 686,098 Diluted 710,186 694,052 *Includes excise, value added and other similar taxes on petroleum products sales: $4,155 3,822 1-1
ConocoPhillips Houston, Texas 77079 Preliminary SELECTED FINANCIAL DATA Millions of Dollars Three Months Ended March 31 2005 2004 INCOME/(LOSS) FROM CONTINUING OPERATIONS E&P United States $892 635 International 895 622 ---------- ----------- Total E&P 1,787 1,257 ---------- ----------- Midstream 385 55 ---------- ----------- R&M United States 570 403 International 130 61 ---------- ----------- Total R&M 700 464 ---------- ----------- LUKOIL Investment 110 - Chemicals 133 39 Emerging Businesses (8) (22) Corporate and other (184) (190) ---------- ----------- Consolidated $2,923 1,603 ========== =========== INCOME/(LOSS) FROM DISCONTINUED OPERATIONS Corporate and other (11) 13 SUMMARY OF NET INCOME/(LOSS) E&P United States $892 635 International 895 622 ---------- ----------- Total E&P 1,787 1,257 ---------- ----------- Midstream 385 55 ---------- ----------- R&M United States 570 403 International 130 61 ---------- ----------- Total R&M 700 464 ---------- ----------- LUKOIL Investment 110 - Chemicals 133 39 Emerging Businesses (8) (22) Corporate and other (195) (177) ---------- ----------- Net Income/(loss) $2,912 1,616 ========== =========== 1-2
ConocoPhillips Houston, Texas 77079 Preliminary SELECTED FINANCIAL DATA Three Months Ended March 31 2005 2004 INCOME FROM CONTINUING OPERATIONS Effective tax rate % 40.8 % 45.9 Millions of Dollars FOREIGN CURRENY GAINS (LOSSES) AFTER-TAX E&P $12 5 Midstream - - R&M (18) 1 LUKOIL Investment - - Chemicals - - Emerging Businesses - - Corporate and other 7 6 ---------- ----------- $1 12 ========== =========== CASH FLOWS FROM OPERATING ACTIVITIES Income from continuing operations $2,923 1,603 Depreciation, depletion and amortization 1,041 918 Property impairments 22 31 Dry hole costs and leasehold impairment 109 87 Accretion on discounted liabilities 48 36 Deferred income taxes 123 360 Undistributed equity earnings (805) (181) Net gain on asset dispositions (177) (82) Other (78) 70 Working capital changes 888 (777) ---------- ----------- Net cash provided by continuing operations 4,094 2,065 Net cash provided by discontinued operations (5) 8 ---------- ----------- Net cash provided by operating activities $4,089 2,073 ========== =========== CAPITAL EXPENDITURES AND INVESTMENTS E&P United States $322 306 International 884 904 ---------- ----------- 1,206 1,210 Midstream 1 3 R&M 275 215 LUKOIL Investment 324 - Chemicals - - Emerging Businesses (4) 28 Corporate and other* 20 25 ---------- ----------- $1,822 1,481 ========== =========== *Excludes discontinued operations
OTHER At March 31, 2005 At December 31, 2004 Total debt $14,012 15,002 Common stockholders' equity $45,031 42,723 1-3
ConocoPhillips Houston, Texas 77079 Preliminary OPERATING HIGHLIGHTS BY SEGMENT Three Months Ended March 31 2005 2004 Thousands of Barrels Daily E&P Crude oil produced United States Alaska 309 320 Lower 48 62 53 -------------- ------------- 371 373 Norway 207 215 United Kingdom 61 67 Canada 23 27 China 22 32 Indonesia 21 15 Vietnam 27 31 Timor Sea 36 5 Other 54 63 -------------- ------------- Total consolidated 822 828 Equity affiliates 120 113 -------------- ------------- Total Worldwide 942 941 ============== ============= Syncrude 14 23 ============== ============= Natural gas liquids produced United States Alaska* 24 26 Lower 48 27 24 -------------- ------------- 51 50 Norway 10 9 Canada 10 10 Timor Sea 17 - Other 6 7 -------------- ------------- Total Worldwide 94 76 ============== ============= *Includes reinjected volumes sold lease-to-lease. 13 16 Millions of Cubic Feet Daily Natural gas produced* United States Alaska 185 185 Lower 48 1,169 1,233 -------------- ------------- 1,354 1,418 Norway 298 319 United Kingdom 824 879 Canada 417 428 Timor Sea 35 40 Indonesia 273 248 Vietnam 18 17 Other 76 66 -------------- ------------- Total consolidated 3,295 3,415 Equity affiliates 5 9 -------------- ------------- Total Worldwide 3,300 3,424 ============== ============= *Represents quantities available for sale. Excludes gas equivalent of NGL shown above. Liquefied natural gas sales 132 118 LUKOIL Investment Production (MBOE/D)* 201 - Refinery crude oil throughput (MB/D)* 92 - *Represents our estimated net share of LUKOIL 1-4
ConocoPhillips Houston, Texas 77079 Preliminary OPERATING HIGHLIGHTS Three Months Ended March 31 2005 2004 E&P Per Unit Average sales prices Crude oil (per barrel) United States Alaska $44.15 32.93 Lower 48 41.29 31.86 Total U.S. 43.69 32.78 International 45.93 31.48 Total consolidated 44.89 32.08 Equity affiliates 30.38 19.27 Total Worldwide 43.15 30.44 Natural gas-lease (per MCF) United States Alaska 1.77 2.54 Lower 48 5.66 5.00 Total U.S. 5.45 4.88 International 5.03 4.11 Total consolidated 5.19 4.41 Equity affiliates 0.25 3.91 Total Worldwide 5.19 4.41 Midstream Thousands of Barrels Daily Natural gas liquids extracted Consolidated United States 23 54 International 53 47 Equity affiliates United States* 110 109 International 6 6 --------------- ------------- 192 216 =============== ============= *Represents 30.3 percent interest in Duke Energy Field Services LLC (DEFS). Per Barrel U.S. product prices Weighted average NGL** Consolidated $31.95 25.68 DEFS 30.61 24.81 **Prices are based on index prices from the Mont Belvieu and Conway market hubs that are weighted by DEFS' naural-gas-liquids component and location mix. 1-5
ConocoPhillips Houston, Texas 77079 Preliminary OPERATING HIGHLIGHTS Three Months Ended March 31 2005 2004 Thousands of Barrels Daily R&M United States Crude oil capacity 2,173 2,168 Crude oil runs 1,957 2,105 Refinery production 2,147 2,245 International* Crude oil capacity 428 447 Crude oil runs 428 409 Refinery production 443 410 U.S. Petroleum products outside sales Automotive gasoline 1,302 1,315 Distillates 642 570 Aviation fuels 198 178 Other products 461 517 -------------- ------------- 2,603 2,580 -------------- ------------- International 495 501 -------------- ------------- 3,098 3,081 ============== ============= Per Gallon U.S. Average sales prices** Automotive gasoline-wholesale $1.44 1.16 Automotive gasoline-retail 1.55 1.32 Distillates-wholesale 1.48 1.02 *Includes ConocoPhillips' share of equity affiliates except LUKOIL. **Excludes excise taxes. 1-6
EX-99.3 4 a4873716ex993.txt EXHIBIT 99.3 Exhibit 99.3 SUMMARY OF NET INCOME (LOSS) BY SEGMENT Millions of Dollars ---------------------------------------- --------------------------------------- 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- Income (Loss) from Continuing Operations Before Accounting Changes U.S. E&P 635 671 701 935 2,942 892 892 International E&P 622 683 719 736 2,760 895 895 - ---------------------------------------------------------------------------------------- --------------------------------------- Total E&P 1,257 1,354 1,420 1,671 5,702 1,787 1,787 - ---------------------------------------------------------------------------------------- --------------------------------------- Midstream 55 42 38 100 235 385 385 - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. R&M 403 734 505 484 2,126 570 570 International R&M 61 84 203 269 617 130 130 - ---------------------------------------------------------------------------------------- --------------------------------------- Total R&M 464 818 708 753 2,743 700 700 - ---------------------------------------------------------------------------------------- --------------------------------------- LUKOIL Investment - - - 74 74 110 110 Chemicals 39 46 81 83 249 133 133 Emerging Businesses (22) (29) (27) (24) (102) (8) (8) Corporate and Other (190) (218) (209) (177) (794) (184) (184) - ---------------------------------------------------------------------------------------- --------------------------------------- Consolidated 1,603 2,013 2,011 2,480 8,107 2,923 2,923 ======================================================================================== ======================================= Cumulative Effect of Accounting Changes U.S. E&P - - - - - - - International E&P - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total E&P - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Midstream - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. R&M - - - - - - - International R&M - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total R&M - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- LUKOIL Investment - - - - - - - Chemicals - - - - - - - Emerging Businesses - - - - - - - Corporate and Other - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Consolidated - - - - - - - ======================================================================================== ======================================= Income (Loss) from Discontinued Operations Corporate and Other 13 62 (5) (48) 22 (11) (11) ======================================================================================== ======================================= Net Income (Loss) U.S. E&P 635 671 701 935 2,942 892 892 International E&P 622 683 719 736 2,760 895 895 - ---------------------------------------------------------------------------------------- --------------------------------------- Total E&P 1,257 1,354 1,420 1,671 5,702 1,787 1,787 - ---------------------------------------------------------------------------------------- --------------------------------------- Midstream 55 42 38 100 235 385 385 - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. R&M 403 734 505 484 2,126 570 570 International R&M 61 84 203 269 617 130 130 - ---------------------------------------------------------------------------------------- --------------------------------------- Total R&M 464 818 708 753 2,743 700 700 - ---------------------------------------------------------------------------------------- --------------------------------------- LUKOIL Investment - - - 74 74 110 110 Chemicals 39 46 81 83 249 133 133 Emerging Businesses (22) (29) (27) (24) (102) (8) (8) Corporate and Other (177) (156) (214) (225) (772) (195) (195) - ---------------------------------------------------------------------------------------- --------------------------------------- Consolidated 1,616 2,075 2,006 2,432 8,129 2,912 2,912 ======================================================================================== ======================================= Page 1 of 11
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES Millions of Dollars ---------------------------------------- --------------------------------------- 2004 2005 ---------------------------------------- --------------------------------------- 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 987 1,049 1,057 1,433 4,526 1,388 1,388 International E&P 1,410 1,360 1,654 1,684 6,108 2,020 2,020 - ---------------------------------------------------------------------------------------- --------------------------------------- Total E&P 2,397 2,409 2,711 3,117 10,634 3,408 3,408 - ---------------------------------------------------------------------------------------- --------------------------------------- Midstream 86 66 62 158 372 449 449 - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. R&M 636 1,149 803 772 3,360 901 901 International R&M 79 111 268 356 814 160 160 - ---------------------------------------------------------------------------------------- --------------------------------------- Total R&M 715 1,260 1,071 1,128 4,174 1,061 1,061 - ---------------------------------------------------------------------------------------- --------------------------------------- LUKOIL Investment - - - 74 74 115 115 Chemicals 49 56 99 109 313 187 187 Emerging Businesses (34) (42) (44) (34) (154) (13) (13) Corporate and Other (249) (279) (239) (277) (1,044) (267) (267) - ---------------------------------------------------------------------------------------- --------------------------------------- Consolidated 2,964 3,470 3,660 4,275 14,369 4,940 4,940 ======================================================================================== ======================================= Income from Continuing Operations Effective Tax Rates U.S. E&P 35.7% 36.0% 33.7% 34.8% 35.0% 35.7% 35.7% International E&P 55.9% 49.8% 56.5% 56.3% 54.8% 55.7% 55.7% - ---------------------------------------------------------------------------------------- --------------------------------------- Total E&P 47.6% 43.8% 47.6% 46.4% 46.4% 47.6% 47.6% - ---------------------------------------------------------------------------------------- --------------------------------------- Midstream 36.0% 36.4% 38.7% 36.7% 36.8% 14.3% 14.3% - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. R&M 36.6% 36.1% 37.1% 37.3% 36.7% 36.7% 36.7% International R&M 22.8% 24.3% 24.3% 24.4% 24.2% 18.8% 18.8% - ---------------------------------------------------------------------------------------- --------------------------------------- Total R&M 35.1% 35.1% 33.9% 33.2% 34.3% 34.0% 34.0% - ---------------------------------------------------------------------------------------- --------------------------------------- LUKOIL Investment n/a n/a n/a 0.0% 0.0% 4.3% 4.3% Chemicals 20.4% 17.9% 18.2% 23.9% 20.4% 28.9% 28.9% Emerging Businesses 35.3% 31.0% 38.6% 29.4% 33.8% 38.5% 38.5% Corporate and Other 23.7% 21.9% 12.6% 36.1% 23.9% 31.1% 31.1% - ---------------------------------------------------------------------------------------- --------------------------------------- Consolidated 45.9% 42.0% 45.1% 42.0% 43.6% 40.8% 40.8% ======================================================================================== ======================================= Page 2 of 11
CERTAIN ITEMS INCLUDED IN INCOME FROM CONTINUING OPERATIONS (AFTER-TAX) Millions of Dollars -------------------------------------------------------------------------------- 2004 2005 ---------------------------------------- --------------------------------------- 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 Property impairments (3) - - (9) (12) - - Tax credit utilization - - 22 28 50 - - Insurance premium adjustment - - - (17) (17) - - Pending claims and settlements - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total (3) - 22 2 21 90 90 - ---------------------------------------------------------------------------------------- --------------------------------------- International E&P Gain (loss) on asset sales 56 (13) - - 43 - - Property impairments - - (1) (29) (30) - - Insurance premium adjustment - - - (17) (17) - - Canada tax law change - 31 - 41 72 - - Pending claims and settlements - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total 56 18 (1) (5) 68 - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total E&P 53 18 21 (3) 89 90 90 - ---------------------------------------------------------------------------------------- --------------------------------------- Midstream Property impairments (12) (10) - - (22) (6) (6) DEFS' sale of TEPPCO general partnership - - - - - 306 306 - ---------------------------------------------------------------------------------------- --------------------------------------- Total (12) (10) - - (22) 300 300 - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. R&M Gain (loss) on asset sales - - - - - 31 31 Property impairments (5) - (6) (28) (39) - - Insurance premium adjustment - - - (6) (6) - - Pending claims and settlements - - (34) - (34) - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total (5) - (40) (34) (79) 31 31 - ---------------------------------------------------------------------------------------- --------------------------------------- International R&M Gain (loss) on asset sales - - - - - - - Property impairments - - - - - - - Other - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total R&M (5) - (40) (34) (79) 31 31 - ---------------------------------------------------------------------------------------- --------------------------------------- LUKOIL Investment - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Chemicals - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Emerging Businesses - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Corporate and Other Property impairments - - - - - - - Merger-related expenses (14) - - - (14) - - Premium on early debt retirement - - (43) - (43) (8) (8) Other - - - - - - - - ---------------------------------------------------------------------------------------- --------------------------------------- Total (14) - (43) - (57) (8) (8) - ---------------------------------------------------------------------------------------- --------------------------------------- Total Company 22 8 (62) (37) (69) 413 413 ======================================================================================== ======================================= Page 3 of 11
CASH FLOW INFORMATION Millions of Dollars -------------------------------------------------------------------------------- 2004 2005 ---------------------------------------- --------------------------------------- 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 1,603 2,013 2,011 2,480 8,107 2,923 2,923 DD&A and property impairments 949 932 950 1,131 3,962 1,063 1,063 Dry hole costs and leasehold impairments 87 105 150 75 417 109 109 Accretion on discounted liabilities 36 41 49 45 171 48 48 Deferred income taxes 360 310 328 27 1,025 123 123 Undistributed equity earnings (181) (97) (263) (236) (777) (805) (805) Net (gain) loss on asset dispositions (82) (6) 6 (34) (116) (177) (177) Other 70 65 (30) (295) (190) (78) (78) Net working capital changes (777) (1,101) 1,267 10 (601) 888 888 Discontinued operations 8 14 (55) (6) (39) (5) (5) - ---------------------------------------------------------------------------------------- --------------------------------------- Net Cash Provided by Operating Activities 2,073 2,276 4,413 3,197 11,959 4,089 4,089 - ---------------------------------------------------------------------------------------- --------------------------------------- Cash Flows from Investing Activities Capital expenditures and investments: E&P (1,210) (1,239) (1,248) (1,552) (5,249) (1,206) (1,206) Midstream (3) (2) (1) (1) (7) (1) (1) R&M (215) (278) (277) (574) (1,344) (275) (275) LUKOIL Investment - - - (2,649) (2,649) (324) (324) Chemicals - - - - - - - Emerging Businesses (28) (27) (19) (1) (75) 4 4 Corporate and Other (25) (38) (49) (60) (172) (20) (20) - ---------------------------------------------------------------------------------------- --------------------------------------- Total capital expend. & investments (1,481) (1,584) (1,594) (4,837) (9,496) (1,822) (1,822) Acquisitions - adoption & application of FIN 46 - - 11 - 11 - - Proceeds from asset dispositions 449 905 73 164 1,591 87 87 Long-term advances to/collections from affiliates and other investments (44) 9 30 112 107 25 25 Discontinued operations (1) (1) - 1 (1) - - - ---------------------------------------------------------------------------------------- --------------------------------------- Net Cash Used for Investing Activities (1,077) (671) (1,480) (4,560) (7,788) (1,710) (1,710) - ---------------------------------------------------------------------------------------- --------------------------------------- Cash Flows from Financing Activities Net issuance (repayment) of debt (722) (1,361) (221) (471) (2,775) (986) (986) Issuance of stock 112 95 62 161 430 155 155 Repurchase of stock - - - - - (194) (194) Dividends (294) (296) (296) (346) (1,232) (348) (348) Other 89 94 (66) 61 178 64 64 - ---------------------------------------------------------------------------------------- --------------------------------------- Net Cash Provided by (Used for) Financing Activities (815) (1,468) (521) (595) (3,399) (1,309) (1,309) - ---------------------------------------------------------------------------------------- --------------------------------------- Effect of Exchange Rate Changes (12) 8 47 82 125 (36) (36) - ---------------------------------------------------------------------------------------- --------------------------------------- Net Change in Cash and Cash Equivalents 169 145 2,459 (1,876) 897 1,034 1,034 Cash and cash equivalents at beginning of period 490 659 804 3,263 490 1,387 1,387 - ---------------------------------------------------------------------------------------- --------------------------------------- Cash and Cash Equivalents at End of Period 659 804 3,263 1,387 1,387 2,421 2,421 ======================================================================================== ======================================= Page 4 of 11
TOTAL E&P 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- E&P Net Income ($ Millions) 1,257 1,354 1,420 1,671 5,702 1,787 1,787 ======================================================================================== ======================================= Production Total, Including Equity Affiliates and Canadian Syncrude (MBOE/D) 1,611 1,563 1,484 1,596 1,563 1,600 1,600 - ---------------------------------------------------------------------------------------- --------------------------------------- E&P segment plus LUKOIL Investment segment: 1,611 1,563 1,484 1,755 1,603 1,801 1,801 - ---------------------------------------------------------------------------------------- --------------------------------------- Crude Oil and Condensate (MB/D) Consolidated 828 809 733 821 797 822 822 Equity affiliates 113 104 111 103 108 120 120 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 941 913 844 924 905 942 942 ======================================================================================== ======================================= Sales of crude oil produced (MB/D) 927 888 875 903 898 940 940 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids (MB/D) 76 79 87 92 84 94 94 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas (MMCF/D) Consolidated 3,415 3,299 3,179 3,356 3,312 3,295 3,295 Equity affiliates 9 4 4 4 5 5 5 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 3,424 3,303 3,183 3,360 3,317 3,300 3,300 ======================================================================================== ======================================= Canadian Syncrude (MB/D) 23 20 22 20 21 14 14 - ---------------------------------------------------------------------------------------- --------------------------------------- Industry Prices (Platt's) Crude Oil ($/bbl) WTI spot 35.23 38.31 43.86 48.29 41.42 49.70 49.70 Brent dated 31.95 35.36 41.54 44.00 38.21 47.50 47.50 Natural Gas--Henry Hub 1st of month ($/mcf) 5.69 6.00 5.75 7.07 6.13 6.27 6.27 - ---------------------------------------------------------------------------------------- --------------------------------------- Average Realized Prices Crude Oil and Condensate ($/bbl) Consolidated 32.08 35.32 40.41 42.79 37.65 44.89 44.89 Equity affiliates 19.27 25.48 26.19 26.55 24.18 30.38 30.38 Total 30.44 34.17 38.78 40.96 36.06 43.15 43.15 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids ($/bbl) 25.43 26.71 30.73 35.37 30.02 33.44 33.44 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas ($/mcf) Consolidated 4.41 4.43 4.48 5.13 4.62 5.19 5.19 Equity affiliates 3.91 0.31 0.31 0.25 2.19 0.25 0.25 Total 4.41 4.43 4.48 5.13 4.61 5.19 5.19 - ---------------------------------------------------------------------------------------- --------------------------------------- Exploration Charges ($ Millions) Dry Holes 67 42 82 51 242 88 88 Lease Impairments 20 63 68 24 175 20 20 - ---------------------------------------------------------------------------------------- --------------------------------------- Total Non-Cash Charges 87 105 150 75 417 108 108 Other (G&G and Lease Rentals) 56 58 55 117 286 63 63 - ---------------------------------------------------------------------------------------- --------------------------------------- Total Exploration Charges 143 163 205 192 703 171 171 ======================================================================================== ======================================= Depreciation, Depletion and Amortization (DD&A) ($ Millions) 704 720 711 783 2,918 819 819 - ---------------------------------------------------------------------------------------- --------------------------------------- Page 5 of 11
U.S. E&P 2004 2005 ---------------------------------------- --------------------------------------- 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) 635 671 701 935 2,942 892 892 ======================================================================================== ======================================= Alaska ($ Millions) 403 397 451 581 1,832 532 532 - ---------------------------------------------------------------------------------------- --------------------------------------- Lower 48 ($ Millions) 232 274 250 354 1,110 360 360 - ---------------------------------------------------------------------------------------- --------------------------------------- Production Total U.S. (MBOE/D) 659 637 579 642 629 648 648 - ---------------------------------------------------------------------------------------- --------------------------------------- Crude Oil and Condensate (MB/D) Alaska 320 307 253 313 298 309 309 Lower 48 53 52 50 50 51 62 62 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 373 359 303 363 349 371 371 ======================================================================================== ======================================= Sales of crude oil produced (MB/D) 373 354 312 356 349 386 386 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids (MB/D)* Alaska 26 23 19 24 23 24 24 Lower 48 24 26 26 26 26 27 27 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 50 49 45 50 49 51 51 ======================================================================================== ======================================= *Includes reinjection volumes sold lease-to-lease: 16 15 10 14 14 13 13 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas (MMCF/D) Alaska 185 147 164 163 165 185 185 Lower 48 1,233 1,226 1,220 1,214 1,223 1,169 1,169 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 1,418 1,373 1,384 1,377 1,388 1,354 1,354 ======================================================================================== ======================================= Average Realized Prices Crude Oil and Condensate ($/bbl) Alaska North Slope 28.00 31.69 35.66 39.53 33.61 38.93 38.93 - ---------------------------------------------------------------------------------------- --------------------------------------- West Coast 32.93 36.53 40.48 44.37 38.47 44.15 44.15 - ---------------------------------------------------------------------------------------- --------------------------------------- Lower 48 31.86 34.39 39.56 42.30 36.95 41.29 41.29 - ---------------------------------------------------------------------------------------- --------------------------------------- Total U.S. 32.78 36.22 40.33 44.08 38.25 43.69 43.69 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids ($/bbl) Alaska 32.93 36.38 40.52 43.78 38.64 44.33 44.33 - ---------------------------------------------------------------------------------------- --------------------------------------- Lower 48 24.19 25.82 29.40 32.80 28.14 30.96 30.96 - ---------------------------------------------------------------------------------------- --------------------------------------- Total U.S. 26.80 28.38 32.22 36.21 31.05 34.68 34.68 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas ($/mcf) Alaska 2.54 2.31 2.22 2.23 2.35 1.77 1.77 - ---------------------------------------------------------------------------------------- --------------------------------------- Lower 48 5.00 5.49 5.29 6.04 5.46 5.66 5.66 - ---------------------------------------------------------------------------------------- --------------------------------------- Total U.S. 4.88 5.35 5.19 5.92 5.33 5.45 5.45 - ---------------------------------------------------------------------------------------- --------------------------------------- Kenai, Alaska LNG Sales Volume (MMCF/D) 118 82 115 107 105 132 132 - ---------------------------------------------------------------------------------------- --------------------------------------- Sales price per MCF 4.51 4.80 5.06 5.25 4.90 5.27 5.27 - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. Exploration Charges ($ Millions) Dry Holes 32 32 (5) - 59 74 74 Lease Impairments 11 11 10 10 42 10 10 - ---------------------------------------------------------------------------------------- --------------------------------------- Total Non-Cash Charges 43 43 5 10 101 84 84 Other (G&G and Lease Rentals) 15 19 15 37 86 12 12 - ---------------------------------------------------------------------------------------- --------------------------------------- Total U.S. Exploration Charges 58 62 20 47 187 96 96 ======================================================================================== ======================================= Alaska Only 17 43 7 14 81 85 85 - ---------------------------------------------------------------------------------------- --------------------------------------- DD&A ($ Millions) Alaska 119 125 122 144 510 133 133 Lower 48 146 145 157 150 598 219 219 - ---------------------------------------------------------------------------------------- --------------------------------------- Total U.S. 265 270 279 294 1,108 352 352 ======================================================================================== ======================================= Page 6 of 11
INTERNATIONAL E&P 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- International E&P Net Income ($ Millions) 622 683 719 736 2,760 895 895 ======================================================================================== ======================================= Production Total, Including Equity Affiliates and Canadian Syncrude (MBOE/D) 952 926 905 954 934 952 952 - ---------------------------------------------------------------------------------------- --------------------------------------- Crude Oil and Condensate (MB/D) Consolidated Norway 215 212 189 211 207 207 207 United Kingdom 67 64 59 66 64 61 61 Canada 27 25 24 24 25 23 23 China 32 28 25 17 25 22 22 Indonesia 15 14 14 18 15 21 21 Vietnam 31 31 35 33 33 27 27 Timor Sea 5 15 29 34 21 36 36 Other 63 61 55 55 58 54 54 Equity affiliates 113 104 111 103 108 120 120 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 568 554 541 561 556 571 571 ======================================================================================== ======================================= Sales of crude oil produced (MB/D) 554 534 563 547 549 554 554 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids (MB/D) Norway 9 8 8 9 8 10 10 Canada 10 10 10 11 10 10 10 Timor Sea - 4 14 16 9 17 17 Other 7 8 10 6 8 6 6 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 26 30 42 42 35 43 43 ======================================================================================== ======================================= Natural Gas (MMCF/D) Consolidated Norway 319 303 274 306 301 298 298 United Kingdom 879 821 720 852 818 824 824 Canada 428 437 425 442 433 417 417 Timor Sea 40 32 35 35 35 35 35 Indonesia 248 237 248 266 250 273 273 Vietnam 17 15 15 19 16 18 18 Other 66 81 78 59 71 76 76 Equity affiliates 9 4 4 4 5 5 5 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 2,006 1,930 1,799 1,983 1,929 1,946 1,946 ======================================================================================== ======================================= Canadian Syncrude (MB/D) 23 20 22 20 21 14 14 - ---------------------------------------------------------------------------------------- --------------------------------------- Average Realized Prices Crude Oil and Condensate ($/bbl) Consolidated Norway 32.13 34.72 40.70 41.82 37.55 45.52 45.52 United Kingdom 31.27 34.19 39.57 44.79 37.00 49.47 49.47 Canada 28.95 30.58 36.16 38.44 32.92 36.96 36.96 China 29.91 33.02 37.99 32.87 33.31 41.51 41.51 Indonesia 32.21 36.20 42.71 45.43 39.21 46.51 46.51 Vietnam 31.76 36.42 41.36 42.94 38.31 47.77 47.77 Timor Sea 35.49 37.32 46.65 45.95 43.91 47.99 47.99 Other 30.89 34.87 39.54 39.28 36.05 44.56 44.56 Equity affiliates 19.27 25.48 26.19 26.55 24.18 30.38 30.38 Total 28.86 32.81 37.92 38.93 34.67 42.77 42.77 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids ($/bbl) Norway 24.34 24.22 27.79 37.64 28.92 30.63 30.63 Canada 26.38 28.58 31.15 36.61 30.77 37.37 37.37 Timor Sea - 29.13 33.96 37.11 34.94 34.40 34.40 Other 18.43 18.03 22.76 19.64 19.99 21.34 21.34 Total 23.53 24.69 29.53 34.59 28.96 32.35 32.35 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas ($/mcf) Consolidated Norway 4.37 3.99 4.12 4.45 4.24 5.03 5.03 United Kingdom 4.04 3.47 3.79 4.76 4.03 5.54 5.54 Canada 4.88 5.01 4.64 5.43 5.00 5.33 5.33 Timor Sea 0.43 0.45 0.46 0.49 0.46 0.52 0.52 Indonesia 4.38 4.28 5.02 4.74 4.61 5.08 5.08 Vietnam 1.10 0.99 1.01 1.05 1.04 1.04 1.04 Other 0.66 0.59 0.62 0.97 0.69 0.70 0.70 Equity affiliates 3.91 0.31 0.31 0.25 2.19 0.25 0.25 Total 4.11 3.81 3.98 4.63 4.14 5.03 5.03 - ---------------------------------------------------------------------------------------- --------------------------------------- International Exploration Charges ($ Millions) Dry Holes 35 10 87 51 183 14 14 Lease Impairments 9 52 58 14 133 10 10 - ---------------------------------------------------------------------------------------- --------------------------------------- Total Non-Cash Charges 44 62 145 65 316 24 24 Other (G&G and Lease Rentals) 41 39 40 80 200 51 51 - ---------------------------------------------------------------------------------------- --------------------------------------- Total International Exploration Charges 85 101 185 145 516 75 75 ======================================================================================== ======================================= DD&A ($ Millions) 439 450 432 489 1,810 467 467 - ---------------------------------------------------------------------------------------- --------------------------------------- Page 7 of 11
R&M 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- R&M Net Income ($ Millions) 464 818 708 753 2,743 700 700 ======================================================================================== ======================================= United States ($ Millions) 403 734 505 484 2,126 570 570 - ---------------------------------------------------------------------------------------- --------------------------------------- International ($ Millions) 61 84 203 269 617 130 130 - ---------------------------------------------------------------------------------------- --------------------------------------- Market Indicators U.S. East Coast Crack Spread ($/bbl) 6.87 9.14 7.00 5.73 7.19 6.40 6.40 U.S. Gulf Coast Crack Spread ($/bbl) 6.36 9.17 6.33 4.09 6.49 6.37 6.37 U.S. Group Central Crack Spread ($/bbl) 6.91 11.65 8.09 5.52 8.04 7.92 7.92 U.S. West Coast Crack Spread ($/bbl) 16.10 24.13 17.92 17.25 18.85 19.61 19.61 U.S. Weighted 3:2:1 Crack Spread ($/bbl) 8.39 12.60 9.10 7.24 9.33 9.24 9.24 NW Europe Crack Spread ($/bbl) 7.78 10.43 11.76 15.24 11.30 11.14 11.14 Singapore 3:2:1 Crack Spread ($/bbl) 10.33 9.48 13.11 17.22 12.54 13.23 13.23 U.S. Wholesale Gasoline Mktg Mrgn ($/bbl) 0.69 1.83 1.50 1.97 1.50 0.16 0.16 - ---------------------------------------------------------------------------------------- --------------------------------------- Realized Margins Refining Margin ($/bbl) U.S. 7.12 9.88 8.84 8.38 8.56 10.11 10.11 International 5.51 7.24 9.01 10.78 8.40 7.34 7.34 - ---------------------------------------------------------------------------------------- --------------------------------------- Marketing Margin ($/bbl) U.S. 1.08 1.49 1.15 1.85 1.39 0.46 0.46 International 6.50 8.20 7.69 8.13 7.66 5.61 5.61 - ---------------------------------------------------------------------------------------- --------------------------------------- DD&A ($ Millions) 186 172 202 212 772 194 194 - ---------------------------------------------------------------------------------------- --------------------------------------- Turnaround Expense ($ Millions) 59 78 57 73 267 108 108 - ---------------------------------------------------------------------------------------- --------------------------------------- Eastern U.S. Crude Oil Charge Input (MB/D) 413 375 368 346 375 403 403 Total Charge Input (MB/D) 440 421 415 407 421 449 449 Crude Oil Capacity Utilization (%) 96% 87% 87% 82% 88% 95% 95% Clean Product Yield (%) 87% 84% 87% 90% 87% 92% 92% - ---------------------------------------------------------------------------------------- --------------------------------------- U.S. Gulf Coast Crude Oil Charge Input (MB/D) 699 709 617 689 678 659 659 Total Charge Input (MB/D) 774 789 717 779 765 733 733 Crude Oil Capacity Utilization (%) 97% 99% 88% 98% 96% 92% 92% Clean Product Yield (%) 79% 75% 78% 82% 78% 73% 73% - ---------------------------------------------------------------------------------------- --------------------------------------- Central U.S. Crude Oil Charge Input (MB/D) 601 638 634 583 614 538 538 Total Charge Input (MB/D) 636 673 669 614 648 577 577 Crude Oil Capacity Utilization (%) 96% 102% 99% 91% 97% 84% 84% Clean Product Yield (%) 83% 83% 85% 84% 84% 86% 86% - ---------------------------------------------------------------------------------------- --------------------------------------- Western U.S. Crude Oil Charge Input (MB/D) 392 397 392 387 392 357 357 Total Charge Input (MB/D) 409 419 409 409 412 382 382 Crude Oil Capacity Utilization (%) 100% 101% 99% 98% 99% 90% 90% Clean Product Yield (%) 81% 81% 82% 83% 82% 80% 80% - ---------------------------------------------------------------------------------------- --------------------------------------- TOTAL UNITED STATES Crude Oil Charge Input (MB/D) 2,105 2,119 2,011 2,005 2,059 1,957 1,957 Total Charge Input (MB/D) 2,259 2,302 2,210 2,209 2,246 2,141 2,141 Crude Oil Capacity Utilization (%) 97% 98% 93% 93% 95% 90% 90% Clean Product Yield (%) 82% 80% 82% 84% 82% 82% 82% - ---------------------------------------------------------------------------------------- --------------------------------------- Refined Products Production (MB/D) Gasoline 1,059 1,043 1,060 1,072 1,059 968 968 Distillates 604 591 574 619 597 599 599 Aviation Fuel 167 177 164 158 167 166 166 Other 415 489 400 383 422 414 414 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 2,245 2,300 2,198 2,232 2,245 2,147 2,147 ======================================================================================== ======================================= Petroleum Products Sales (MB/D) Gasoline 1,315 1,328 1,366 1,415 1,356 1,302 1,302 Distillates 570 538 544 562 553 642 642 Aviation Fuel 178 191 200 195 191 198 198 Other 517 573 553 613 564 461 461 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 2,580 2,630 2,663 2,785 2,664 2,603 2,603 ======================================================================================== ======================================= Page 8 of 11
R&M (continued) 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- International - Consolidated - United Kingdom and Ireland Crude Oil Charge Input (MB/D) 289 197 291 298 269 294 294 Total Charge Input (MB/D) 299 216 300 308 280 307 307 Crude Oil Capacity Utilization (%) 94% 64% 100% 102% 90% 101% 101% Clean Product Yield (%) 84% 81% 83% 81% 82% 79% 79% - ---------------------------------------------------------------------------------------- --------------------------------------- International - Equity Affiliates - Net Share* Crude Oil Charge Input (MB/D) 120 112 134 140 127 134 134 Total Charge Input (MB/D) 121 113 138 145 130 137 137 Crude Oil Capacity Utilization (%) 87% 81% 99% 103% 92% 98% 98% Clean Product Yield (%) 82% 83% 81% 81% 82% 83% 83% - ---------------------------------------------------------------------------------------- --------------------------------------- TOTAL INTERNATIONAL Crude Oil Charge Input (MB/D) 409 309 425 438 396 428 428 Total Charge Input (MB/D) 420 329 438 453 410 444 444 Crude Oil Capacity Utilization (%) 92% 69% 99% 102% 91% 100% 100% Clean Product Yield (%) 84% 82% 82% 81% 82% 80% 80% - ---------------------------------------------------------------------------------------- --------------------------------------- Refined Products Production (MB/D) Gasoline 124 109 138 144 129 141 141 Distillates 181 136 190 190 174 186 186 Aviation Fuel 24 16 22 25 22 21 21 Other 81 57 89 94 80 95 95 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 410 318 439 453 405 443 443 ======================================================================================== ======================================= Petroleum Products Sales (MB/D) Gasoline 185 180 173 180 180 185 185 Distillates 228 184 207 222 210 221 221 Aviation Fuel 6 9 10 8 8 7 7 Other 82 67 82 83 79 82 82 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 501 440 472 493 477 495 495 ======================================================================================== ======================================= Worldwide - Including Net Share of Equity Affiliates Crude Oil Charge Input (MB/D) 2,514 2,428 2,436 2,443 2,455 2,385 2,385 Total Charge Input (MB/D) 2,679 2,631 2,648 2,662 2,656 2,585 2,585 Crude Oil Capacity Utilization (%) 96% 93% 94% 94% 94% 92% 92% Clean Product Yield (%) 82% 80% 82% 84% 82% 82% 82% - ---------------------------------------------------------------------------------------- --------------------------------------- Refined Products Production (MB/D) Gasoline 1,183 1,152 1,198 1,216 1,188 1,109 1,109 Distillates 785 727 764 809 771 785 785 Aviation Fuel 191 193 186 183 189 187 187 Other 496 546 489 477 502 509 509 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 2,655 2,618 2,637 2,685 2,650 2,590 2,590 ======================================================================================== ======================================= Petroleum Products Sales (MB/D) Gasoline 1,500 1,508 1,539 1,595 1,536 1,487 1,487 Distillates 798 722 751 784 763 863 863 Aviation Fuel 184 200 210 203 199 205 205 Other 599 640 635 696 643 543 543 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 3,081 3,070 3,135 3,278 3,141 3,098 3,098 ======================================================================================== ======================================= * Represents 18.75 percent interest in a refinery complex at Karlsruhe, Germany; 16.33 percent interest in two refineries in Kralupy and Litvinov, Czech Republic; and 47 percent interest in a refinery at Melaka, Malaysia. Page 9 of 11
LUKOIL INVESTMENT 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- LUKOIL Investment Net Income ($ Millions) - - - 74 74 110 110 ======================================================================================== ======================================= Upstream Production* Net crude oil production (MB/D) - - - 150 38 190 190 Net natural gas production (MMCF/D) - - - 51 13 67 67 BOE Total (MBOE/D) - - - 159 40 201 201 - ---------------------------------------------------------------------------------------- --------------------------------------- * Represents our estimated net share of LUKOIL's production. Industry Prices Crude Oil ($/bbl) Urals crude (CIF Medium) - - - 38.82 38.82 43.21 43.21 - ---------------------------------------------------------------------------------------- --------------------------------------- Downstream Refinery Throughput* Crude Processed (MB/D) - - - 77 19 92 92 - ---------------------------------------------------------------------------------------- --------------------------------------- * Represents our estimated net share of LUKOIL's crude processed.
MIDSTREAM 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- Midstream Net Income ($ Millions) 55 42 38 100 235 385 385 ======================================================================================== ======================================= U.S. Equity Affiliate ($ Millions)* 33 33 26 51 143 359 359 - ---------------------------------------------------------------------------------------- --------------------------------------- Natural Gas Liquids Extracted (MB/D) Consolidated United States 54 24 28 23 32 23 23 International 47 33 49 49 45 53 53 Equity Affiliates United States* 109 112 111 113 111 110 110 International 6 5 6 7 6 6 6 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 216 174 194 192 194 192 192 ======================================================================================== ======================================= * Represents 30.3 percent interest in Duke Energy Field Services, LLC (DEFS). Natural Gas Liquids Fractionated (MB/D) United States* 158 144 145 140 147 149 149 International 63 43 62 62 58 64 64 - ---------------------------------------------------------------------------------------- --------------------------------------- Total 221 187 207 202 205 213 213 ======================================================================================== ======================================= * Excludes DEFS. Product Prices Weighted Average NGL ($/bbl)* Consolidated 25.68 26.42 31.03 34.40 29.38 31.95 31.95 DEFS 24.81 25.61 30.27 33.69 28.60 30.61 30.61 - ---------------------------------------------------------------------------------------- --------------------------------------- * Prices are based on index prices from the Mont Belvieu and Conway market hubs that are weighted by natural gas liquids component and location mix. DD&A ($ Millions) 13 9 11 10 43 9 9 - ---------------------------------------------------------------------------------------- ---------------------------------------
CHEMICALS 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- Chemicals Net Income (Loss) ($ Millions) 39 46 81 83 249 133 133 ======================================================================================== ======================================= Industry Margins (Cents/Lb)* Ethylene industry cash margin 9.38 10.70 8.27 12.22 10.14 18.11 18.11 HDPE industry contract sales margin 9.43 9.21 9.23 11.68 9.89 12.09 12.09 Styrene industry contract sales margin 13.06 13.33 13.73 13.40 13.38 13.91 13.91 - ---------------------------------------------------------------------------------------- --------------------------------------- * 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. Page 10 of 11
EMERGING BUSINESSES 2004 2005 ---------------------------------------- --------------------------------------- 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr YTD ---------------------------------------- --------------------------------------- Emerging Businesses Net Income (Loss) ($ Millions) (22) (29) (27) (24) (102) (8) (8) ======================================================================================== ======================================= Detail of Net Income (Loss) ($ Millions) Technology Solutions (4) (4) (3) (7) (18) (2) (2) Gas-to-Liquids (9) (7) (9) (8) (33) (7) (7) Power (4) (16) (8) (3) (31) 2 2 Other (5) (2) (7) (6) (20) (1) (1) - ---------------------------------------------------------------------------------------- --------------------------------------- Total (22) (29) (27) (24) (102) (8) (8) ======================================================================================== =======================================
CORPORATE AND OTHER 2004 2005 ---------------------------------------- --------------------------------------- 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) (177) (156) (214) (225) (772) (195) (195) ======================================================================================== ======================================= Detail of Net Income (Loss) ($ Millions) Net interest expense (113) (143) (149) (109) (514) (101) (101) Corporate overhead (48) (52) (51) (61) (212) (58) (58) Discontinued operations 13 62 (5) (48) 22 (11) (11) Merger-related costs (14) - - - (14) - - Accounting change - - - - - - - Other (15) (23) (9) (7) (54) (25) (25) - ---------------------------------------------------------------------------------------- --------------------------------------- Total (177) (156) (214) (225) (772) (195) (195) ======================================================================================== ======================================= Before-Tax Net Interest Expense ($ Millions) Interest expense (260) (263) (222) (231) (976) (226) (226) Capitalized interest 115 104 121 90 430 88 88 Interest revenue 16 12 8 11 47 25 25 Receivables monetization related (1) (1) 3 1 2 (1) (1) Premium on early debt retirement - - (58) - (58) (9) (9) - ---------------------------------------------------------------------------------------- --------------------------------------- (130) (148) (148) (129) (555) (123) (123) ======================================================================================== ======================================= Debt Total Debt ($ Millions) 17,109 15,619 15,486 15,002 15,002 14,012 14,012 Debt-to-Capital Ratio 32% 29% 28% 26% 26% 23% 23% - ---------------------------------------------------------------------------------------- --------------------------------------- Page 11 of 11
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