ConocoPhillips' earnings soar in Q1 on higher prices, volumes
US major ConocoPhillips reported a 480% increase in net earnings for Q1 2022 on May 5, driven by divestitures, higher realised prices and increased production, and committed to returning about $10bn in capital to shareholders this year.
First quarter earnings jumped to $5.8bn from $1.0bn in the same period last year; special items, including the ongoing monetisation of Conoco’s investment in Canadian oil sands producer Cenovus Energy and an Indonesian divestiture, added about $1.5bn to earnings.
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“The first quarter saw all aspects of the business running well as we continued to deliver on our strategic, financial, and operational plans,” CEO Ryan Lance said. “We efficiently and safely delivered on our capital scope, enhanced our balance sheet strength and closed strategic transactions that further optimise our diverse, low-cost of supply portfolio.”
Alongside the earnings report, ConocoPhillips announced a $2bn increase in expected 2022 returns of capital to shareholders, bringing the target to $10bn. The additional returns will be distributed through share repurchases and variable return of cash (VROC) payments. In the first quarter, $2.3bn was returned to shareholders, including $900mn in ordinary dividends and the VROC and $1.4bn through share repurchases.
Production in Q1 averaged 1.75mn barrels of oil equivalent (boe)/day, an increase of 220,000 boe/day from a year ago. Permian basin production averaged 640,000 boe/day, Eagle Ford output averaged 208,000 boe/day and Bakken production averaged 97,000 boe/day.
Realised prices in the quarter averaged $76.99/boe, up from $45.36/boe in Q1 2021.