The firm has also announced an initial $3bn share repurchase program and plans to reduce its capital budget by 4% to $5bn next year in order to strengthen balance sheet.
ConocoPhillips CEO and chairman Ryan Lance said: “During the past two years, we have significantly transformed ConocoPhillips to succeed in a lower, more volatile price environment.
“We’ve lowered the capital intensity and breakeven price of the company, lowered the cost of supply of our investment portfolio, and created strategic flexibility for future price cycles.”
The firm said it intends to deliver modest production growth in 2017 by further reducing capital expenditures and adjusted operating costs compared with 2016.
As part of this effort, the firm plans to focus primarily on flexible unconventional development programs in the Lower 48, conventional projects in Europe, Asia Pacific and Alaska, and base asset maintenance.
Lance added: “The acceleration actions we’ve announced today will allow us to achieve our value proposition priorities at Brent prices of about $50 per barrel.
“These priorities include a debt target of $20bn, a 20% to 30% payout of operating cash flows to shareholders, and modest production growth to drive margin and cash flow expansion.
“In setting out these priorities, our goal is to have strong resilience to low commodity prices with the ability to capture upside during periods of higher prices.”
The company said it has included approximately $0.6bn for exploration with focus on unconventionals, appraisal of the Barossa discovery, and the closeout of deepwater Gulf of Mexico and Nova Scotia drilling obligations.
Image: Oil producer ConocoPhillips intends to boost its operations. Photo: courtesy of ConocoPhillips Company.
