ConocoPhillips (NYSE:COP) said on Wednesday that it had completed its 2016 asset sales program, generating US$1.3 billion from disposals, more than the US$1-billion in proceeds it had targeted.
ConocoPhillips will book some US$800 million of the proceeds from asset sales in the fourth quarter, mostly interests in Senegal, Indonesia, and iron ore assets in the North Cook Inlet and Minnesota. The production for 2016 associated with this year's asset sales is 27,000 barrels of oil equivalent per day.
The group left its 2016 total production guidance unchanged in the range of 1.56 million boepd-1.57 million boepd.
Upon announcing its third-quarter results in October, ConocoPhillips increased its 2016 midpoint production guidance to 1.565 million boepd to reflect the 1.56 million boepd -1.57 million boepd expected range due to stronger performance across Lower 48, Europe, and Asia Pacific.
In today's press release, ConocoPhillips expect next year's output - excluding Libya - to be in the range of flat to 2-percent growth compared to this year, when adjusted for the 2016 asset sale-associated production.
"Our company is focused on generating free cash flow that will be allocated toward debt reduction, shareholder distributions and modest growth," chairman and chief executive officer Ryan Lance said in the statement.
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ConocoPhillips is also "confident in our ability to deliver on our planned $5 to $8 billion asset disposition program over the next two years, which will accelerate our value proposition," the manager added.
As part of actions to boost value proposition, the company said last month that it would be seeking to reap up to US$8 billion from a divestiture program that would focus mainly on selling natural gas assets in North America. The plan also included a share repurchase program of US$3 billion, which is now underway.
At the time, CEO Lance said that ConocoPhillips would be adjusting costs and spending to increase its resilience during a time of low commodity prices and to seize upside opportunities when prices rise.
By Tsvetana Paraskova for Oilprice.com
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