Proudly combining the two venerable oil industry names of Conoco and Phillips, ConocoPhillips is the world's largest independent exploration and production company based on reserves and oil production. The company explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas (LNG), and natural gas liquids (NGLs) around the world. ConocoPhillips explores for oil and gas in 30 countries and in 2012 it had proved reserves of 8.6 billion barrels of oil equivalent. It produced about 1.6 million barrels per day in 2012.
Conoco Phillips has oil and gas assets in Asia, Australia, Europe, and North America. In 2012 the US accounted for 49% of the company’s revenues.
The company manages its operations through six operating segments: Alaska, Lower 48 and Latin America, Canada, Europe, Asia Pacific and Middle East, and Other International.
Sales and Marketing
ConocoPhillips' worldwide commodity portfolio (natural gas, crude oil, bitumen, NGLs and LNG) is marketed through offices in the US, Canada, Europe and Asia. Commodity sales (made at prevailing market prices) are boosted through the purchase of third-party volumes for better economies of scale in trading transactions.
Natural gas is sold to a diverse client portfolio which includes local distribution companies; gas and power utilities; large industrial enterprises; oil and gas exploration and production companies; and marketing companies.
Crude oil, bitumen, and natural gas liquids are sold under contracts with prices based on market indices, adjusted for location, quality and transportation.
In 2012 revenues fell by 75% primarily as the result of the divestiture of the company's Downstream Business, but also from lower natural gas and NGL prices, partly offset by higher LNG prices.
ConocoPhillips reported $8.43 million of net income in 2012 (32% down on 2011) due to lower revenues and decreased income from discounted operations.
In 2012 ConocoPhillips spun off its refining and marketing unit as Phillips 66. Prior to that event the then-integrated company had a refining capacity of more than 2.2 million barrels per day. The company also had 8,300 retail outlets in the US under the 76, Conoco, and Phillips 66 brands, and at 1,700 owned or dealer-owned gas stations in Europe.
The Phillips 66 company absorbed the refining and marketing, midstream, and chemicals businesses, freeing up ConocoPhillips as a pure exploration and production play.
The spin off was seen as a way to add more value for investors by creating two public traded companies with separate strategic businesses - ConocoPhillips (upstream activities) and Phillips 66 (midstream and downstream activities).
Continuing to raise cash to pay down debt, that year the company sold its stakes in two non-core US oil pipelines, Colonial and Seaway (the sale of the latter was completed in late 2011) for about $2 billion. It also sold its Vietnam assets for about $1.1 billion in 2012.
In 2013 it agreed to sell more than $1 billion in oilfield assets in Montana and North Dakota to Denbury Resources and its Clyden oil sands assets in Canada to Imperial Oil and ExxonMobil Canada for $720 million. The deals both raises cash and allows the company to focus on its core US shale assets.
In 2013 ConocoPhillips announced an oil discovery in the deepwater Gulf of Mexico.