Conoco News - 2006

News summaries from company press releases and from unaffiliated news agencies are provided below. The summaries are sorted by month and are further categorized as upstream news, downstream news, and business/finance news.

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January

• Upstream news:

• Downstream news:

• Business/Finance news:

- This update is intended to give an overview of market and operating conditions experienced by ConocoPhillips during the fourth quarter of 2005. The market indicators and company estimates may differ considerably from the company’s actual results scheduled to be reported on Jan. 25, 2006. Highlights – Fourth-Quarter 2005 vs. Third-Quarter 2005 Exploration and Production • Lower crude oil prices. • Higher natural gas prices. • Higher worldwide production, as expected. • Significantly higher exploration expenses. Refining and Marketing • Lower worldwide refining margins. • Higher U.S. and international marketing margins. • Lower worldwide capacity utilization rate in the high 80-percent range, including hurricane impacts. • Increased turnaround activity and hurricane-related maintenance costs. LUKOIL Investment • Ownership of 16.1 percent at year end. Midstream / Chemicals • Midstream results expected to be higher than previous quarter, including a gain from Duke Energy Field Services’ formation of a master limited partnership. • Chemicals results anticipated to be higher than previous quarter. Corporate • Debt balance of approximately $12.5 billion.

February

• Upstream news:

- ConocoPhillips announced preliminary net additions of 1.553 billion barrels of oil equivalent (BOE), including Libya and equity affiliates, to its proved reserves during 2005. The company’s reserve replacement ratio was 230 percent, based on 675 million BOE of production, bringing ConocoPhillips’ total reserves to 9.4 billion BOE. Excluding sales and acquisitions, such as increases in LUKOIL ownership and re-entry into Libya, ConocoPhillips’ reserve replacement ratio was 100 percent. Total reserve additions, including revisions, improved recovery, purchases, and extensions and discoveries, were 1.569 billion BOE. Costs incurred, as defined by Statement of Financial Accounting Standards No. 69 (SFAS No. 69), are expected to be $10.508 billion. This includes ConocoPhillips’ estimate of LUKOIL’s 2005 year-end results. At the end of 2005, ConocoPhillips had a 16.1 percent equity interest in LUKOIL. Estimated reserve additions and costs incurred related to LUKOIL were 0.655 billion BOE and $2.511 billion, respectively.

• Downstream news:

- ConocoPhillips announced the completion of its purchase of the Wilhelmshaven refinery in Wilhelmshaven, Germany, from Louis Dreyfus Energy Holdings Limited. The purchase includes the 275,000 barrel-per-day refinery, a marine terminal, rail and truck loading facilities and a tank farm, as well as Louis Dreyfus Refining and Marketing Limited, which provides commercial and administrative support to the refinery.

• Business/Finance news:

- The board of directors has declared a quarterly dividend of 36 cents per share. The dividend is payable March 1, 2006, to stockholders of record at the close of business Feb. 21, 2006. This represents a 16 percent increase in the dividend rate for the company’s common stock over the previous quarter’s rate of 31 cents per share.

- The board of directors of ConocoPhillips [NYSE:COP] has approved the following actions concerning the company's management.Jim W. Nokes, executive vice president, Refining, Marketing, Supply & Transportation, has elected to retire after 36 years of service. James L. (Jim) Gallogly, currently president and chief executive officer (CEO) of Chevron Phillips Chemical Company LLC, will become executive vice president, Refining, Marketing & Transportation, for ConocoPhillips, effective April 1, 2006.

- The board of directors of Chevron Phillips Chemical Company LLC has elected Raymond I. Wilcox as President and CEO of the company effective April 1, 2006. Mr. Wilcox, 59, currently serves as Vice President of Chevron Corporation and President of Chevron North America Exploration and Production Company, headquartered in Houston, Texas.

- ConocoPhillips and Burlington Resources announced the expiration of the waiting period under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976, applicable to ConocoPhillips' proposed acquisition of Burlington Resources. Completion of the transaction is subject to approval by Burlington Resources shareholders and other customary closing conditions, and is expected to occur in the first half of 2006. Burlington Resources ranks among the world's largest independent oil and gas companies, and holds one of the industry’s leading positions in North American natural gas reserves and production.

- Burlington Resources announced that the date of the special meeting of stockholders to vote on the proposed merger with ConocoPhillips has been set for March 30, 2006.

- Nearly 6,400 participants took part in the 19th annual ConocoPhillips Rodeo Run, raising $145,000 for the Houston Livestock Show and Rodeo™ Educational Fund, setting a new record.

March

• Upstream news:

- ConocoPhillips will shut down production within the next week from the Greater Ekofisk Area in the Norwegian North Sea for unscheduled equipment modifications and maintenance designed to ensure continued safe and reliable operations. The total gross production impact is expected to be approximately 1.6 million barrels of oil equivalent (approximately 560,000 BOE net to ConocoPhillips). Production from the connected fields Valhall, Hod, Ula, Tambar and Gyda, which produce through Ekofisk, will also be affected. Total daily average production from the Greater Ekofisk Area is approximately 400,000 BOE per day.

• Downstream news:

- Essent and ConocoPhillips have completed a feasibility study for a Liquefied Natural Gas (LNG) terminal at the Port of Eemshaven in the North Groningen municipality of Eemsmond and have submitted the Environmental Impact Assessment Starting Memorandum to the Province of Groningen, officially starting the permitting process. Detailed joint studies continue on the terminal which could be in operation by 2010. If approved, the regasification terminal will include a jetty for ships and storage facilities. In addition to supplying more natural gas to the Netherlands and the surrounding region, the proposed project will reduce dependence on limited gas imports from existing pipelines. The LNG terminal project at Eemshaven is consistent with the Dutch government’s energy policy that supports additional LNG imports.

- Results of a feasibility study indicate that the construction of an LNG terminal at Eemshaven is technically feasible. The nautical study shows that deepening of the channel in the (Wester) Eems will ensure safe passage of LNG ships calling at the terminal.

- ConocoPhillips [NYSE:COP] announced its proprietary S Zorb™ Sulfur Removal Technology (SRT) will be installed at Giant Industries, Inc.’s Yorktown refinery in York County, Va. The refinery will use the 30,000-barrel-per-day (BPD) S Zorb unit to desulfurize gasoline blendstocks. Its design will allow for a flexibility of feedstocks from a variety of refinery sources, including light coker naphtha. Projected start-up is slated for 2007. The project will be managed by D-CÔK, a subsidiary of Triten Corp. S Zorb SRT is an advanced process technology that removes sulfur from gasoline streams through the use of a novel, regenerable sorbent. It was developed to help oil companies comply with the U.S. Environmental Protection Agency’s Tier 2 sulfur regulatory levels.

• Business/Finance news:

- ConocoPhillips [NYSE:COP] Executive Vice President, Finance, and Chief Financial Officer John Carrig will be a presenter at the A.G. Edwards Energy Conference on Tuesday, March 14, from 8:30 to 8:55 a.m. Eastern.

- Burlington Resources announced that the proposed merger with ConocoPhillips was approved at the special meeting of stockholders held today in Houston, Texas. The merger is expected to close March 31, 2006. The company said that, based upon the preliminary tally of shares voted, approximately 280 million shares, or more than 74 percent of the total shares outstanding as of the record date for the special meeting, were voted in favor of the merger. Of the shares voted, more than 98 percent were voted in favor of the merger. Approval of the merger required the affirmative vote of a majority of the shares outstanding as of the record date for the special meeting, February 24, 2006. As of the record date, Burlington Resources had 375,620,120 shares of stock outstanding. Under the terms of the merger agreement, Burlington Resources stockholders will receive $46.50 in cash and 0.7214 shares of ConocoPhillips stock for each share of Burlington Resources stock.

- ConocoPhillips announced that it has completed its acquisition of Burlington Resources following approval by Burlington’s shareholders yesterday. With the completion of this transaction, using Dec. 31, 2005, data, ConocoPhillips’ net proved reserves are expected to increase to 11.5 billion barrels of oil equivalent (BOE), including the company’s interest in LUKOIL but excluding Syncrude. As a result of the merger, each share of Burlington Resources common stock has been converted into the right to receive $46.50 in cash and 0.7214 shares of ConocoPhillips common stock. Information regarding exchange of share certificates will be sent to former Burlington Resources shareholders as soon as practicable. ConocoPhillips stock is listed on the New York Stock Exchange under the symbol “COP.”

- The board of directors of ConocoPhillips has elected Richard L. Armitage, Bobby S. Shackouls and William E. Wade Jr. as new outside directors. This increases the total number of ConocoPhillips directors to 18, of which 17 are outside directors.

April

• Upstream news:

• Downstream news:

• Business/Finance news:

- This update is intended to give an overview of market and operating conditions experienced by ConocoPhillips during the first quarter of 2006. The market indicators and company estimates may differ considerably from the company’s actual results scheduled to be reported on April 26, 2006.Highlights – First-Quarter 2006 vs. Fourth-Quarter 2005 • Exploration and Production: • Completed the acquisition of Burlington Resources. • Higher crude oil prices. • Lower U.S. natural gas prices. • Daily production similar to fourth quarter. • Refining and Marketing: • Completed the acquisition of the Wilhelmshaven, Germany, refinery. • Lower worldwide refining margins. • Significantly lower worldwide marketing margins. • Worldwide capacity utilization rate in the mid-80-percent range. • Significantly higher turnaround activity. • LUKOIL Investment: • Ownership of 17.1 percent at quarter end. • Midstream / Chemicals: • Midstream results expected to be lower than previous quarter. • Chemicals results anticipated to be higher than previous quarter. • Corporate: • Debt balance of approximately $32.2 billion, reflecting the funding for the acquisition of Burlington Resources. • Cash balance of approximately $3 billion.

- ConocoPhillips will release its first-quarter earnings on Wednesday, April 26, at 8:30 a.m. Eastern. The news release will be issued through Business Wire.

- ConocoPhillips reported first-quarter net income of $3,291 million, or $2.34 per share, compared to $2,912 million, or $2.05 per share, for the same quarter in 2005. Total revenues were $47.9 billion, versus $38.9 billion a year ago. During the quarter, the company reinvested 141 percent of its net income into the development of oil and gas resources and its global refining business, excluding the acquisition of Burlington Resources.

May

• Upstream news:

• Downstream news:

- The State of Alaska released the draft Alaska Gas Pipeline Project fiscal contract between the State and the North Slope producers. ConocoPhillips is supportive of starting the public review process. The company looks forward to providing input to the Alaska State Legislature regarding the need for a fiscal contract supportive of project development and a tax system that balances the needs of the State while encouraging investment. The fiscal agreement will provide the essential elements for clarity and fiscal certainty necessary to advance the Alaska Gas Pipeline project. The terms of the agreement include state fiscal certainty, as well as the six principles mandated by the State of Alaska for the project. The fiscal contract outlines activities and plans between ConocoPhillips, the other major producers and the State of Alaska for equity ownership, state revenue, Alaska hire, access to gas for in-state use, access for explorers, and future expansion.

- The Saudi Arabian Oil Company (Saudi Aramco) and ConocoPhillips signed a comprehensive Memorandum of Understanding (MOU) to conduct a detailed evaluation for the proposed development of a 400,000 barrel-per-day, full-conversion refinery in Yanbu, Saudi Arabia. The refinery would be designed to process Arabian heavy crude and produce high-quality, ultra-low sulfur refined products that meet current and future U.S. and European product specifications. The project is targeted to start up in 2011.

- ConocoPhillips announced a license agreement with Engen Petroleum Ltd. for the installation of its proprietary Split Olefin Feed Technology (SOFT™) and Reduced Volatility Alkylation Process (ReVAP™) at Engen’s refinery in Durban, South Africa. The technologies will significantly enhance the refinery’s octane capabilities while also reducing the risk to the neighboring community to well below current levels. The installation is slated for completion in 2008. The company owns and manages a 125,000-barrel-per-day crude oil refinery and a state-of-the-art lubricants blending plant at Durban.

• Business/Finance news:

- ConocoPhillips will webcast its annual meeting of stockholders on Wednesday, May 10, at 11:30 a.m. Eastern.

- ConocoPhillips held its Annual Stockholders’ Meeting, where owners of the company’s stock voted on the election of board members, the appointment of an independent auditor, and five additional proposals.

- The board of directors of ConocoPhillips declared a quarterly dividend of 36 cents per share, payable June 1, 2006, to stockholders of record as of May 22, 2006.

- ConocoPhillips Alaska announced its new partnership with the U.S. Environmental Protection Agency (EPA) in the Natural Gas STAR Program. This voluntary program encourages natural gas companies to reduce methane emissions by adopting cost-effective technologies and practices that often improve operational efficiency. Methane, the primary component of natural gas, is considered to be a greenhouse gas. The Gas STAR program will be implemented throughout ConocoPhillips Alaska’s operations, but the Kenai Liquefied Natural Gas (LNG) facility will be used initially to demonstrate future emission reductions opportunities. This Alaska partnership is an extension of ongoing involvement in the Gas STAR program by ConocoPhillips’ other U.S. business units.

June

• Upstream news:

• Downstream news:

- ConocoPhillips and Bechtel announced that the world’s newest and largest operating Liquefied Natural Gas (LNG) plant has been transferred to Atlantic LNG of Trinidad and Tobago after passing a performance test. The plant, which was engineered and constructed by Bechtel, uses the ConocoPhillips Optimized Cascade process designed to safely and efficiently meet the growing demand for clean-burning natural gas. The plant has a nominal capacity of 5.2 million tonnes per year and was delivered three months ahead of schedule. Atlantic LNG’s Train 4 is the third ConocoPhillips – Bechtel LNG train to achieve the distinction of being the largest operating LNG plant in the world at the time of its startup.

- ConocoPhillips announced that it has withdrawn the application for a license under the federal Deepwater Port Act for its Compass Port liquefied natural gas (LNG) project that had been proposed for 11 miles off the Alabama coast. At Governor Riley's request, ConocoPhillips will begin evaluating the economics of utilizing a Closed Loop warming system as an alternative to Open Loop vaporization. Compass Port remains an attractive location and the decision on whether or not to proceed with re-filing an application will be made after consideration of all the economic factors.

- ConocoPhillips announced it has completed the acquisition of a partial interest in the planned 1,663-mile Rockies Express Pipeline (REX) project. The over-$4 billion pipeline, a joint venture of Kinder Morgan Energy Partners, Sempra Pipelines and Storage and ConocoPhillips will be one of the largest natural gas pipelines ever constructed in North America. Interim service has begun on the first phase of the four-segment pipeline. The next two segments are expected to be in service by January 2007 and January 2008, respectively. The final segment is expected to be in interim service as early as January 2009 and fully completed by June 2009.

• Business/Finance news:

July

• Upstream news:

- ConocoPhillips and Anadarko Petroleum Corporation announced the discovery and test production from the Qannik accumulation, a satellite oil field overlying the Alpine oil field on the North Slope of Alaska. The Qannik accumulation recorded an average production rate of 1,200 barrels per day of 30-degree API gravity oil from a 25-foot thick sandstone at 4,000 feet sub sea. The Qannik accumulation would be the third satellite field to be developed near Alpine. The previously announced Fiord and Nanuq satellite accumulations are currently being drilled with first production scheduled for later this year. First production may occur by late 2008.

• Downstream news:

• Business/Finance news:

- This update is intended to give an overview of market and operating conditions experienced by ConocoPhillips during the second quarter of 2006. The market indicators and company estimates may differ considerably from the company’s actual results scheduled to be reported on July 26, 2006. Highlights – Second-Quarter 2006 vs. First-Quarter 2006: • Exploration and Production: * Higher crude oil prices. * Lower U.S. natural gas prices. * Higher worldwide production, reflecting the impact of Burlington Resources and make-up volumes in Libya. • Refining and Marketing: * Higher worldwide refining margins. * Continued pressure on worldwide marketing margins. * Worldwide refining capacity utilization rate in the low-90-percent range. * Decreased turnaround activity and costs. • LUKOIL Investment: * Ownership of approximately 18 percent at quarter end. * Higher estimated earnings. • Midstream, Chemicals and Emerging Businesses * Midstream results expected to be similar to the previous quarter. * Results from the Chemicals and Emerging Businesses segments anticipated to be lower than the previous quarter. • Corporate: * Higher interest expense. * Debt balance of approximately $29.5 billion.

- ConocoPhillips announced it will donate a combined $8 million to build a new community center in Belle Chasse, La., and to support educational programs in the Belle Chasse and Lake Charles, La., areas.

- ConocoPhillips and International Petroleum Investment Company (IPIC) of Abu Dhabi announced the signing of a Memorandum of Understanding (MOU) to identify new upstream and downstream opportunities for joint investment. The parties also announced the signing of a Heads of Agreement (HOA) to conduct a feasibility study for construction of a world scale refinery in Fujairah, United Arab Emirates. The feasibility study will focus on developing the optimum configuration for the Fujairah Refinery Project, which would have a capacity of 500,000 barrels per day and serve global markets. Upon completion of the feasibility study, and if the parties decide to proceed with the project, it is expected that ConocoPhillips and IPIC would form a joint venture to own and operate the refinery that would be 51 percent owned by IPIC and 49 percent by ConocoPhillips.

- ConocoPhillips will release its second-quarter earnings on Wednesday, July 26, at 8:30 a.m. Eastern.

- ConocoPhillips reported second-quarter net income of $5,186 million, or $3.09 per share, compared to $3,138 million, or $2.21 per share, for the same quarter in 2005. Revenues were $47.1 billion, versus $41.8 billion a year ago. Year-to-date excluding the first-quarter acquisition of Burlington Resources, the company reinvested 97 percent of its net income into the growth and development of oil and gas resources and its global refining business. For the first six months of 2006, net income was $8,477 million, or $5.49 per share, versus $6,050 million, or $4.26 per share, for the same period a year ago. Revenues were $94.1 billion, versus $79.4 billion a year ago.

- ConocoPhillips, the first major American oil company to report results for the second quarter, said that its profits leapt by nearly two-thirds, a windfall it owes largely to soaring oil prices.

August

• Upstream news:

- The Government of Dubai and Dubai Petroleum Company (DPC) announced a joint agreement that will change the operating arrangements for Dubai offshore oilfields. Effective April 2007, DPC will end its role as operator, marking the end of Dubai's first offshore oil concession and the beginning of a new phase in which the Emirate of Dubai will directly control its offshore oil resources. DPC is wholly owned by ConocoPhillips and part of the DPC/Dubai Marine Areas Limited ("DUMA") consortium involving interests from Total (France), Repsol YPF (Spain), RWE Dea AG, a subsidiary of RWE AG (Germany) and Wintershall AG, a subsidiary of BASF (Germany). Dubai oil will continue to be freely traded in the international oil market under contracts established by the Government and Dubai Petroleum Establishment (DPE), a new entity wholly owned by the Government of Dubai. Effective 2 April 2007, DPE will be responsible for operating the oilfields and for all future business related to the production of oil and gas in Dubai.

- ConocoPhillips and Anadarko Petroleum Corporation announced the successful startup of the first Alpine satellite oil field, known as the Fiord field. The Fiord oil field is located five miles north of the Alpine oil field on Alaska’s North Slope. Fiord is expected to have peak production of approximately 22,500 barrels of oil per day (BOPD) gross in 2008. Fiord was developed exclusively with horizontal well technology and will employ enhanced oil recovery, similar to the Alpine field. The currently approved plan for Fiord development will entail approximately 17 wells. Construction of the field and the second Alpine satellite, Nanuq, involved more than 1,400 people over the past two winter seasons. Nanuq is scheduled for startup later this year. Production from Fiord and Nanuq will be processed through the existing Alpine facilities. Together, the two fields represent approximately $650 million in capital reinvestment and are expected to have peak production of approximately 35,000 BOPD gross in 2008. ConocoPhillips is pursuing state, local and federal permits for additional Alpine satellite developments, including the recently announced Qannik reservoir and Alpine West, which would be the first development within the National Petroleum Reserve-Alaska.

• Downstream news:

• Business/Finance news:

- ConocoPhillips announced an offering to the public of 8,365,862 of its units of beneficial interest in the Permian Basin Royalty Trust, pursuant to an effective registration statement on Form S-3 filed with the Securities Exchange Commission on June 20, 2006. ConocoPhillips is the sole selling unitholder, and no units will be sold by the Trust. Additionally, ConocoPhillips has granted the underwriters a 30-day option to purchase up to 1,254,879 additional units to cover over-allotments, if any. The Trust will not receive any proceeds from this offering.

September

• Upstream news:

- ConocoPhillips confirmed the discovery of a new gas condensate field in blocks 30/6 and 30/7 in the United Kingdom sector of the North Sea, approximately five miles (nine kilometres) west of the Judy field. ConocoPhillips UK Limited is the Operator and holds a participating interest of 36.5 percent in the new discovery along with ENI SpA (33.0 percent) and BG Group (30.5 percent). Exploration well 30/6-6, which ConocoPhillips drilled earlier this year in a water depth of 265 feet (81 meters), confirmed the presence of a hydrocarbon accumulation. An immediate sidetrack of the well, drilled to a total depth of approximately 16,000 feet (4800 meters) True Vertical Depth Subsea (TVDSS), further delineated the discovery. The sidetrack resulted in a gross hydrocarbon column of more than 2000 feet (600 meters) in the Triassic Joanne sandstone.

• Downstream news:

• Business/Finance news:

- ConocoPhillips Chairman and Chief Executive Officer Jim Mulva will address investors and securities analysts at the Bank of America’s 36th Annual Investment Conference on Tuesday, Sept. 19, 2006, at 12:20 p.m. (Pacific Time).

October

• Upstream news:

• Downstream news:

- ConocoPhillips announced the approval of an investment of approximately $400 million (£210 million) to expand the capacity at its Immingham Combined Heat and Power (CHP) plant in the United Kingdom by 450 Megawatts (MW), from 730 MW to 1,180 MW. The plant provides steam heat and electrical power to ConocoPhillips’ Humber refinery and steam heat to Total’s Lindsey oil refinery, both adjacent to the plant in North Lincolnshire, U.K. By combining the production of heat and power, Immingham CHP uses 20 percent less fuel and produces 25 percent less carbon than the alternative of producing heat and power separately.

- Polar Tankers, Inc., a wholly owned subsidiary of ConocoPhillips, christened the Polar Enterprise, the company’s newest double-hulled crude oil tanker. Classed by the American Bureau of Shipping, Polar Enterprise is the fifth and final Endeavour Class tanker in Polar Tankers’ U.S. flag fleet and is specifically designed to carry crude oil from Alaska to the West Coast and Hawaii. The Polar Enterprise is expected to load her first cargo of Alaska North Slope crude oil in late January 2007. Endeavour Class vessels have double hulls with 10 feet of space between the inner and outer hulls, two independent engine rooms, redundant propulsion and twin steering systems, a bow thruster and state of the art navigation systems.

• Business/Finance news:

- This update is intended to give an overview of market and operating conditions experienced by ConocoPhillips during the third quarter of 2006. The market indicators and company estimates may differ considerably from the company’s actual results scheduled to be reported on October 25, 2006. Highlights – Third-Quarter 2006 vs. Second-Quarter 2006 • Exploration and Production: * Crude oil prices similar to second quarter. * Lower U.S. natural gas prices. * Lower worldwide production. * Results negatively impacted by recent tax legislation and revised depreciation, depletion and amortization rates. • Refining and Marketing: * Significantly lower worldwide refining margins. * Significantly higher worldwide marketing margins. * Improved refining capacity utilization rate in the mid-90-percent range. * Significantly lower turnaround activity. * Loss from impairment of certain assets held for sale. • LUKOIL Investment: * Ownership of approximately 19 percent at quarter end. • Midstream, Chemicals and Emerging Businesses * Midstream and Chemicals results expected to be improved from the previous quarter. • Corporate and Other: * Corporate expenses anticipated to be lower than the previous quarter. * Debt balance of approximately $27.8 billion. * Benefit from hurricane-related insurance impacts.

- The board of directors of ConocoPhillips declared a quarterly dividend of 36 cents per share, payable December 1, 2006, to stockholders of record at the close of business October 31, 2006.

- ConocoPhillips and EnCana Corporation have entered into an agreement to create an integrated, North American heavy oil business consisting of strong upstream and downstream assets. The venture will be comprised of two 50/50 operating partnerships, one Canadian upstream partnership and one U.S. downstream partnership, with both companies contributing equally valued assets and equity for future capital expenditures. The upstream partnership will consist of EnCana’s Foster Creek and Christina Lake projects, both located in the prolific eastern flank of the Athabasca oilsands in northeast Alberta. The assets hold independently estimated recoverable bitumen of more than 6.5 billion barrels, and the partnership’s goal is to increase production from the current 50,000 barrels per day (BPD) to 400,000 BPD of bitumen by 2015. The downstream partnership will consist of ConocoPhillips’ Wood River and Borger refineries, located in Roxana, Illinois, and Borger, Texas, respectively. The partnership plans to expand heavy oil processing capacity at these facilities from approximately 60,000 BPD to 550,000 BPD (30,000 BPD to 275,000 BPD of bitumen handling capacity) by 2015. Total throughput at the two facilities is expected to increase from the current 450,000 BPD to 600,000 BPD over the same time period.

- ConocoPhillips will release its third-quarter earnings on Wednesday, Oct. 25, at 8:30 a.m. Eastern.

- ConocoPhillips [NYSE:COP] reported third-quarter net income of $3,876 million, or $2.31 per share, compared to $3,800 million, or $2.68 per share, for the same quarter in 2005. Revenues were $48.4 billion, versus $48.7 billion a year ago. Third-quarter net income was negatively impacted $0.37 per share by the following previously disclosed items: • $400 million from new United Kingdom tax legislation impacting Exploration & Production (E&P), including $270 million related to the revaluation of deferred taxes and $130 million related to the company’s operations for the first six months of 2006. • $249 million impairment on certain Refining & Marketing (R&M) assets held for sale. • $94 million from new Alaska tax legislation impacting the E&P segment related to the company’s operations for April through June. • $121 million net benefit from business interruption insurance, including $103 million related to the R&M segment.

- ConocoPhillips Chairman and Chief Executive Officer Jim Mulva will address investors and securities analysts at the Merrill Lynch Global Energy Conference on Thursday, Nov. 2, 2006, at 12:15 p.m. (Eastern Time).

November

• Upstream news:

- ConocoPhillips and Anadarko Petroleum Corporation announced the successful startup of a second Alpine satellite oil field, known as Nanuq. The Nanuq oil field is located three miles south of the Alpine oil field on Alaska’s North Slope. Nanuq is expected to have peak production of approximately 15,000 barrels of oil per day (BOPD) in 2008. Discovered in 2000, Nanuq was developed exclusively with horizontal well technology and will employ gas and water injection enhanced oil recovery, similar to the Alpine field. The currently approved plan for the Nanuq Project development will entail drilling of approximately 19 wells.

• Downstream news:

• Business/Finance news:

- ConocoPhillips announced changes in its Exploration and Production organization’s senior management, all effective Dec. 1. Kevin Meyers, currently president, Russia and Caspian Region, will become president, ConocoPhillips Canada, replacing Brent Smolik who left the company. Don Wallette, currently vice president, Shtokman Project, will become president, Russia and Caspian Region, replacing Meyers and continue to be located in Moscow. Paul Warwick, president, Middle East and North Africa, will become president, Europe and West Africa.

December

• Upstream news:

- ConocoPhillips has announced the successful testing of the Barossa-1 exploration well in the NT/P69 license located offshore Northern Territory, Australia. Drilling of the Barossa-1 well commenced in July this year and was drilled to a total depth of 4,310 meters. Barossa-1 has been plugged and abandoned as planned. Drilling has now commenced on the Caldita-2 well to appraise the Caldita accumulation. A 3D seismic survey over both Barossa and Caldita will commence in early December. NT/P 69 is located in the Timor Sea approximately 295 kilometers northwest of Darwin. The Barossa-1 well was drilled in 233 meters of water.

- LUKOIL and ConocoPhillips have reached definitive agreement for LUKOIL to purchase 376 ConocoPhillips fueling stations in six countries in Europe. The agreement covers 156 stations in Belgium, 49 in Finland, 44 in the Czech Republic, 30 in Hungary, 83 in Poland, and 14 in the Slovak Republic. These stations are among the most efficient in their respective markets. At present, all facilities are branded Jet stations and will be re-branded as LUKOIL stations within two years. The transaction is expected to close in the second quarter of 2007 following review by relevant authorities.

- ConocoPhillips has begun commercial production of renewable diesel fuel at the company’s Whitegate Refinery in Cork, Ireland. The production process was developed by ConocoPhillips and uses soybean and other vegetable oils to produce renewable diesel fuel that meets European Union standards for diesel fuels. The refinery is producing 1,000 barrels per day (150,000 litres) of renewable diesel fuel for sale into the Irish market. The fuel is produced using existing equipment at the refinery and is blended and transported with petroleum-based diesel, unlike biodiesel fuel. The process can also be used to convert animal fats and oils to renewable diesel fuel. ConocoPhillips developed the production process and conducted a successful test run at Whitegate last year. Soybean oil will be the primary renewable feedstock used, although the plant can also produce renewable diesel using grape seed oil and other vegetable oils. The reduction in hydrocarbon based emissions will contribute to Ireland’s progress in meeting carbon dioxide emission standards required under the Kyoto protocol.

• Downstream news:

• Business/Finance news:

- ConocoPhillips approved 2007 cash capital expenditures of approximately $11.8 billion. Combined with about $0.6 billion for loans to affiliates and a $0.6 billion contribution to fund the recently announced EnCana transaction, the total cash capital spend is expected to be $13.0 billion. Including capitalized interest of $0.5 billion, the total authorized capital program for 2007 is $13.5 billion. Eighty-four percent of the company’s 2007 total authorized capital program will be allocated to its Exploration and Production segment. The Refining and Marketing segment will receive approximately 13 percent, with the remaining being spent in Emerging Businesses and Corporate. Additional details on the capital program for each of the company’s business segments are provided below.




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