ConocoPhillips said Thursday its 4Q2004 oil and natural gas production, including Syncrude, is expected to be 1.6 MMboe/d, and for the entire year, output will be 1.56 MMboe/d. Production was up worldwide in the final quarter, and the producer said it also benefited from higher crude oil, natural gas and midstream gas prices.

In the interim quarterly update, ConocoPhillips said 4Q production will be higher sequentially over 3Q as a result of maintenance completed in Alaska and the North Sea, including the adverse impact of approximately 15,000 boe/d from changes in the governmental royalty rate in Venezuela. Full-year 2004 exploration expenses are estimated to be $700 million, as expected.

The numbers exclude expected production increases from the company’s recent investments in Russian oil giant LUKOIL. The company brought its total ownership in LUKOIL shares to 10% by year-end 2004.

Because of “unusually low” year-end Canadian bitumen value estimates, the producer anticipates a negative revision of proved crude oil reserves for the Surmont project. However, ConocoPhillips still expects net reserve additions to approximate 2004 production, excluding acquisitions and sales. “Despite the revision, the Surmont project remains a valuable asset in ConocoPhillips’ overall portfolio,” the company said in a statement.

The Houston-based producer also said it expects its debt-to-capital ratio to be approximately 26% for the final quarter of 2004, down from 28% at the end of 3Q2004.

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