ConocoPhillips said Friday it will set aside about 22% of its total worldwide exploration budget to bolster North American development in the coming year, with $3.3 billion targeted for the U.S. Lower 48 states, $1 billion for Alaska and $2.2 billion for Canadian development.
Worldwide, the Houston-based major said it plans to spend $14.3 billion in 2008, which is about 13% more than it budgeted for 2007. Loans to affiliates and contributions to its oilsands venture with EnCana Corp. in Canada will add an additional $1 billion, with the total authorized capital spending of $15.3 billion. Chevron Corp. Thursday said it plans to spend about 15% more worldwide next year, with $4.8 billion slotted for its U.S. upstream program (see Daily GPI, Dec. 7).
“The business environment remains challenging, with inflation in materials and services impacting both project investment and day-to-day operating costs,” said CEO Jim Mulva. “We have, however, built a strong foundation of assets that enables us to generate competitive investment opportunities. We will continue to exercise capital discipline and selectively invest in projects that add production and increase our capability to add value over the long term.”
Almost 80% of the total budget will be allocated to ConocoPhillips’ Exploration and Production (E&P) segment.
In the U.S. Lower 48, the company intends to spend about $3.3 billion, primarily on its ongoing development programs, including those in the Bossier and Lobo trends and the San Juan, Permian, Barnett and Piceance basins. Funds also will be spent on the development of new projects, including the Rockies Express Pipeline, its joint venture with Sempra Energy and Kinder Morgan Energy Partners.
Another $2.2 billion is slotted for Canadian exploration to fund ongoing development programs in the Western Canada gas basins and “progression of heavy oil projects” including those associated with the EnCana business venture. In Alaska, ConocoPhillips plans to spend around $1 billion, which would primarily be invested in development of Alpine satellites and the West Sak heavy oilfield, as well as continued development within the existing Prudhoe Bay and Kuparuk areas.
In addition to the research and development funds already dedicated to projects as part of the 2008 capital program, ConocoPhillips said it once again will allocate more than $150 million for research efforts focused on the development of unconventional oil and gas resources and the development of new energy sources, such as alternatives and renewables.
“ConocoPhillips believes a number of energy sources are necessary to meet the demands of consumers,” said Mulva. “We are committed to diversifying our energy resource development and improving energy efficiency, and doing so in an environmentally responsible manner.”
This year, Mulva said ConocoPhillips’ asset sales are expected to generate proceeds of about $3.1 billion. “In 2008, we anticipate completing the disposition of our U.S. retail assets, and we will continue to evaluate additional opportunities to optimize and strengthen our asset portfolio.”
©Copyright 2007Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.
© 2020 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |