ConocoPhillips Issues Market Overview, Third Quarter Estimates

This update is intended to give an overview of market and operating conditions experienced by ConocoPhillips during the third quarter of 2008. The market indicators and company estimates may differ considerably from the Company's actual results scheduled to be reported on October 22, 2008.

Highlights – Third-Quarter 2008 vs. Second-Quarter 2008

Exploration and Production

  • Lower crude oil prices.
  • Lower natural gas prices.
  • Worldwide production at or slightly below second quarter.

Corporate and Other

  • Corporate expenses expected to be higher than the previous quarter.
  • Debt balance of approximately $22.1 billion.
  • Share repurchases of approximately $2.5 billion.

Exploration and Production (E&P)

Total third-quarter production on a barrel-of-oil equivalent (BOE) per day basis, including Syncrude and excluding LUKOIL, is anticipated to be at or slightly below the previous quarter, including estimated hurricane disruptions during the third quarter of approximately 20,000 BOE per day in the U.S. Lower 48. Exploration expenses are expected to be approximately $275 million before-tax for the quarter.

Corporate and Other

ConocoPhillips' debt balance is expected to be approximately $22.1 billion at the end of the third quarter.

The Company anticipates a net benefit of approximately $125 million after-tax associated with ConocoPhillips' asset rationalization efforts. This net benefit is expected to be largely offset by asset retirement obligations and other accruals.

The Company anticipates third-quarter repurchases under the share repurchase program to be approximately $2.5 billion. The number of weighted-average diluted shares outstanding during the third quarter is expected to be approximately 1,528 million.