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Conoco approves $6.9B capital budget
Kristen Nelson Petroleum News Editor-in-Chief
The bulk of ConocoPhillips’ 2004 capital budget goes to exploration and production, with Asia-Pacific, Europe and Africa, and the Lower 48 and Latin America garnering the most dollars.
The company said Dec. 16 that its board of directors approved a 2004 capital budget of approximately $6.9 billion. Excluding $900 million in capitalized and minority interest, the company said, 2004 cash capital expenditures are approximately $6 billion, essentially equal to 2003. Approximately 78 percent of the 2004 capital budget goes to exploration and production, 19 percent to refining and marketing and the remainder to emerging businesses and corporate.
ConocoPhillips’ 2004 E&P budget is approximately $4.5 billion, with some $1.3 billion slated for projects in the Asia-Pacific region, the majority of those funds going toward continued development of the Bayu-Undan liquids and gas recycling project in the Timor Sea, oil and gas reserves in the offshore Block B and onshore South Sumatra blocks in Indonesia and the second phase of Bohai Bay in China.
Europe and Africa garnered approximately $1 billion of the E&P budget, for projects such as expansion of legacy positions in the United Kingdom and Norwegian sectors of the North Sea. Projects in the Lower 48 and Latin America were allocated $900 million, with focus on continued development of the Magnolia field in the deepwater Gulf of Mexico, completion of the heavy oil upgrader associated with the Hamaca project in Venezuela and development of the Corocoro field offshore Venezuela. Alaska budget increased slightly In Alaska, ConocoPhillips plans to spend approximately $600 million, with a majority of the capital spending going to Prudhoe Bay, Kuparuk and western North Slope operations, as well as construction of Endeavour class tankers to transport Alaska North Slope crude oil.
ConocoPhillips Alaska spokeswoman Dawn Patience told Petroleum News that the company expects to drill about four North Slope exploration wells this winter season, with the final number “dependent on further internal reviews and approval from our partners.” Patience said the company is not making any specifics available at this time.
The 2004 Alaska budget “is increased slightly from the 2003 actual capital spend,” she said, with 2003 numbers currently estimated at $540 million, compared to the projected $600 million for 2004.
In Canada, ConocoPhillips’ E&P capital expenditures are expected to be about $400 million, with a focus on Syncrude expansion, Surmont heavy oil development and Mackenzie Delta gas development.
Some $400 million budgeted internationally includes the Kashagan field and the Baku-Tbilisi-Ceyhan pipeline in the Caspian region and the Qatar facility.
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