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DATE
Thursday, Nov. 5, 2026
CALL PARTICIPANTS
- Vice President, Investor Relations – Guy Allen Baber
- President and Chief Executive Officer – Andrew O’Brien
- Chief Financial Officer and Senior Vice President of Digital and Transformation – Kontessa S. Haynes-Welsh
- Executive Vice President of Lower 48 and Global HSE – Nicholas G. Olds
- Executive Vice President of Global Operations and Technical Functions – Kirk L. Johnson
TAKEAWAYS
- Adjusted Earnings — $3.27 per share, increasing from $1.61 per share driven by higher realized commodity prices.
- Cash From Operations (CFO) — $7.2 billion, supported by strong operational performance and higher pricing.
- Total Production — 2,302 MBOED, representing a 2% decrease year over year after adjusting for closed acquisitions and dispositions.
- Lower 48 Production — 1,517 MBOED, with 757 MBOED from the Delaware Basin and 197 MBOED from the Midland Basin.
- Shareholder Distributions — $3.4 billion, including $2.4 billion in share repurchases and $1.0 billion in ordinary dividends.
- Quarterly Dividend — $0.93 per share, representing an 11% increase effective for the fourth quarter payment.
- Realized Price — $61.40 per BOE, a 32% increase compared to $46.44 per BOE in the same period last year.
- Capital Expenditures — $3.1 billion, with the company maintaining its full-year spending guidance.
- Free Cash Flow (FCF) — $4 billion, calculated as cash from operations minus capital expenditures.
- Divestment Proceeds — $1.6 billion, received from the sale of noncore assets to complete a $5 billion program.
- Cash and Short-term Investments — $10.4 billion, alongside $1.1 billion in liquid long-term investments.
- Net Debt-to-CFO Ratio — 0.5x, reflecting the maintenance of an A-rated balance sheet.
- Q4 Production Guidance — 2.32 million to 2.36 million BOED, accounting for sequential growth in the Lower 48.
- Permian Completion Efficiency — 15% increase in pumping hours compared to the previous year average.
- Willow Project Status — Module fabrication is over 75% complete, with the project on track for first oil in early 2029.
- LNG Offtake Portfolio — 13 million tonnes per annum, following expanded commercial agreements.
- FCF Inflection Target — $7 billion by 2029, which would approximately double 2025 free cash flow at a $70 WTI price.
- Pre-dividend FCF Breakeven — Mid-$40s WTI currently, with a target to reach the low-$30s by 2029.
- Permian Lateral Lengths — 15% improvement in 2026, with the company doubling the number of three-mile laterals.
- Eagle Ford Production — 369 MBOED, contributing to total Lower 48 volumes.
- Bakken Production — 191 MBOED, as the company continues to optimize liquids-rich unconventional basins.
- 2027 Capital Outlook — Management expects capital spending to be modestly lower year over year.
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RISKS
- Johnson noted that Qatar production “remains below preconflict levels,” as regional conditions continue to affect utilization and flow through the Strait of Hormuz.
- Johnson warned that while inflation in fuel, logistics, and chemicals is “noteworthy” and has reached double digits in some cases, it remains a small component of the total cost structure.
- O’Brien stated that for the company to invest capital in Venezuela, they “need to see a real pathway to meaningful recovery on the $12 billion” currently owed.
SUMMARY
ConocoPhillips (COP -1.08%) reported third-quarter results that demonstrated progress toward its stated 2029 free cash flow inflection target of $7 billion. Management emphasized that the 2029 goal is not the final destination, as the company anticipates continued growth in cash from operations and free cash flow through the next decade at a structurally lower reinvestment rate. The company raised its quarterly dividend by 11% and remains on track to return 45% of annual cash from operations to shareholders. Operational highlights included record completion efficiencies in the Permian Basin and advancing the Willow project in Alaska, where drilling is scheduled to begin next year.
- Management reported that the Willow project’s infrastructure is designed to serve as a hub for future satellite pads, which CEO O’Brien stated “will be some of the most capital efficient and low cost supply opportunities in our portfolio.”
- The company is evaluating an unsolicited offer for its Norway assets but has made no final decision to divest, with O’Brien noting the asset remains a strong cash engine.
- The company reported a 20% oil productivity uplift in surfactant-treated wells in the Permian and expects to continue applying this technology in 2027.
- In Canada, the company brought the Surmont Pad 104W-B online ahead of schedule and under budget, with potential for further expansion under a proposed trilateral Memorandum of Understanding.
- The commercial LNG portfolio is expected to see its first significant volume contributions from Port Arthur Phase 1 and North Field East next year.
- Kirk Johnson noted that the company received federal permits to begin winter exploration drilling in Alaska, which includes plans for four wells to mature understanding of resources beyond Willow.
INDUSTRY GLOSSARY
- MBOED: Thousand barrels of oil equivalent per day.
- BOE: Barrel of oil equivalent, a unit of energy based on the approximate energy released by burning one barrel of crude oil.
- WTI: West Texas Intermediate, a grade of crude oil used as a benchmark in oil pricing.
- TTF: Title Transfer Facility, a virtual pricing point for natural gas in the Netherlands used as a European benchmark.
- MTPA: Million tonnes per annum, a standard measure of LNG production capacity.
- Simul-frac: A completion technique where two wells are hydraulicly fractured simultaneously using one set of equipment.
- Tier 1 Inventory: High-quality acreage that provides the most economic returns at lower commodity prices.
- NFE/NFS: North Field East and North Field South, major LNG expansion projects in Qatar.
Full Conference Call Transcript
Operator: Welcome to the Third Quarter 26 Phillip Earnings Conference Call. My name is Liz, and I will be your operator for today’s call. At this time, all participants are in a listen-only mode. During the question-and-answer session, if you have a question, please press I will now turn the call over to Guy Allen Baber. Vice President, Investor Relations. Sir, you may begin.
Guy Allen Baber: Thank you, Liz, and welcome, everyone, to our third quarter 26 earnings conference call. On the call today are several members of the ConocoPhillips leadership team, including Andy O’Brien, president and CEO Kontessa S. Haynes-Welsh, CFO and senior vice president of digital and transformation Nick Olds, executive v
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