2024
Annual Report
Delivering on
our returns-focused
value proposition
$9.1B
Shareholder return in 2024
Ordinary dividend
and variable return of cash
$3.6B
Share repurchases
$5.5B
ADVANCING A FINANCIAL
FRAMEWORK THAT REWARDS
SHAREHOLDERS
+
Dear fellow shareholders,
2024 was another strong year for ConocoPhillips.
We continued to deliver on our returns-focused
value proposition, distributed $9.1 billion to
shareholders and enhanced our portfolio with
the acquisition of Marathon Oil. We achieved
significant operational milestones across our
business with a focus on safety and efficiency.
And we further progressed our global
liquefied natural gas (LNG) strategy.
Looking ahead to 2025, we remain
committed to returning over 30% of cash
from operations (CFO) to our shareholders,
with a planned target of $10 billion in
distributions.
These accomplishments align with
our Triple Mandate of responsibly and
reliably meeting global energy demand
and delivering competitive returns on
and of capital, while working to meet our
previously established emissions-reduction
targets. They also reflect the commitment
and ingenuity of our workforce.
Industry-leading value
proposition
At ConocoPhillips, our focus is on
delivering superior returns through the
cycles based on our foundational principles
of balance sheet strength, peer-leading
distributions and disciplined investments,
with an emphasis on environmental,
social and governance performance. We
are committed to our value proposition
and financial plan that produce reliable
free cash flow, allowing us to reward
shareholders now and in the future.
Letter to shareholders
With assets in some of the most prolific
basins in the U.S. Lower 48 and Alaska, as
well as in Africa, Asia, Australia, Canada
and Europe, ConocoPhillips produced
1,987 thousand barrels of oil equivalent
per day (MBOED) globally in 2024, which
was a record for the company. Our reserve
replacement ratio was 244% and our
organic reserve replacement ratio was
123%. In the Lower 48, we continued to
deliver drilling and completion efficiency
improvements, resulting in mid-single-
digit production growth while maintaining
similar activity levels as in 2023. In Alaska,
our teams reached first oil at Nuna, and we
opportunistically exercised our preferential
rights to acquire additional working interests
in the Kuparuk River and Prudhoe Bay Units.
Internationally, we reached first production
“ConocoPhillips is
well positioned
to achieve strong,
consistent financial
results, now and for
decades to come.”
at Eldfisk North in Norway and Bohai Phase
5 in China. We also celebrated the 1,000th
cargo lifts at Bohai Bay and APLNG. And the
company progressed long-cycle projects,
including Willow in Alaska, North Field East
and North Field South in Qatar, and Port
Arthur LNG along the U.S. Gulf Coast.
ConocoPhillips always looks for
opportunities to enhance our portfolio
— but only when they meet our rigorous
financial framework and strengthen our
business. In November 2024, we acquired
Marathon Oil in a $22.5 billion all-stock
transaction, adding high-quality, low
cost of supply inventory adjacent to our
leading U.S. unconventional position
in the Eagle Ford, Bakken and Permian
Basin. We have a strong history of
seamlessly integrating assets, and we
expect the Marathon Oil transaction to
deliver synergies of over $1 billion on a
run rate basis by the end of 2025, half of
which were incorporated into our 2025
capital guidance.
We also advanced our global LNG
strategy in 2024 through new long-term
agreements in Europe and Asia. With the
addition of Marathon Oil, we’ve added
approximately 2 million tonnes per annum
of net LNG capacity in Equatorial Guinea
to our global portfolio. We have equity,
offtake and regasification agreements
across major global markets.
Our competitive advantage
ConocoPhillips executed across all
aspects of our Triple Mandate in 2024.
We achieved a 14% return on capital
employed and returned $9.1 billion of
capital to shareholders, well in excess
As of Dec. 31, 2024
Generated
earnings1 of
$9.2 billion.
Returned
$9.1 billion
of capital to
shareholders.
Increased
ordinary
dividend by
34%.
Produced
1,987 MBOED.
2024 HIGHLIGHTS
WHO WE ARE
ONE OF THE
WORLD’S LEADING
EXPLORATION
AND PRODUCTION
COMPANIES
IN TOTAL ASSETS
$123B
14
COUNTRIES
WITH OPERATIONS
AND ACTIVITIES
BALANCED,
DIVERSIFIED GLOBAL
PORTFOLIO
ConocoPhillips
at a glance
Acquired
Marathon Oil, on
track to deliver
over $1 billion
in synergies.
Reached first oil
at new sites in
Norway, Alaska
and China.
Expanded
global LNG
business with
new agreements in
Europe and Asia.
1Earnings refers to net income.
of our greater than 30% of CFO annual
through-the-cycle commitment. In December
2024, we increased our ordinary dividend by
34%, effectively incorporating our variable
return of cash into the ordinary dividend.
Since 2017, following our strategy reset,
our total shareholder distributions have
averaged more than 45% of CFO. We believe
that our CFO-based returns framework
differentiates us relative to peers and is a
competitive advantage.
As part of our commitment to reduce Scope 1
and Scope 2 greenhouse gas emissions, our
Low Carbon Technologies team worked with
our business units to develop and implement
region-specific emissions-reduction initiatives
and identify potential technology solutions for
hard-to-abate emissions. We are in our third
year of membership in the Oil & Gas Methane
Partnership 2.0 and recently achieved the
Gold Standard reporting designation. This
recognition is for our ambitious measurement-
based methane emissions reporting that goes
beyond current regulatory requirements.
World-class workforce
At ConocoPhillips, we work together to help
supply the energy that communities around
the world depend on. Our people make that
mission possible. Every day, we strive to
create a culture that prioritizes safety, well-
being and career growth, with a focus on
innovation and collaboration.
Positioned for the future
The world needs access to responsibly
produced, reliable energy — and
ConocoPhillips is uniquely equipped to
deliver it with a deep, durable and diverse
portfolio that provides competitive returns
and cash flow. Combined with our high-
performing operations, continuously
advancing technology and world-class
workforce, ConocoPhillips is well positioned
to achieve strong, consistent financial
results, now and for decades to come.
Ryan M. Lance
Chairman and Chief Executive Officer
Feb. 18, 2025
SPOTLIGHT
A perfect fit: The acquisition
of Marathon Oil
1 With an estimated average point forward cost of supply of less than $30 per barrel WTI.
we already operate: the Eagle Ford in Texas,
Bakken in North Dakota and the Permian
Basin, which spans Texas and New Mexico.
The transaction also complemented our
LNG business with capacity at a production
facility in Equatorial Guinea.
With integration underway, our teams are
focused on safety and efficiency, while
leveraging our operational and technical
expertise to maximize results. We are also
shifting Marathon Oil’s Lower 48 assets
to a steady-state drilling and completions
program. This approach aligns with our
existing program, which has helped us
optimize production and reduce costs.
The bottom line: This transaction deepens
our inventory base, makes our financial
plan stronger and enhances our free cash
flow generation.
In November 2024, ConocoPhillips acquired
Marathon Oil, an independent oil and gas
exploration and production company with
operations in multiple basins in the U.S.
Lower 48 as well as in Equatorial Guinea.
The transaction expanded our existing U.S.
onshore portfolio in the Lower 48 and added
more than 2 billion barrels of resource.1
We expect to deliver over $1 billion of run rate
synergies by the end of 2025.
“This acquisition of Marathon Oil is a perfect
fit for ConocoPhillips, adding to our deep,
durable and diverse portfolio while meeting
our strict financial framework,” said Ryan
Lance, chairman and chief executive officer.
“Marathon Oil adds high-quality, low cost of
supply inventory adjacent to our leading U.S.
unconventional position.”
Marathon Oil’s unconventional portfolio was
concentrated in the Lower 48 in areas where
A drill site in Live Oak County, Texas, in the Eagle Ford after
rainfall. The site was acquired by ConocoPhillips as part of
its November 2024 purchase of Marathon Oil.
2024
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-K
(Mark One)
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2024
OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
Commission file number: 001-32395
ConocoPhillips
(Exact name of registrant as specified in its charter)
Delaware
01-0562944
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer identification No.)
925 N. Eldridge Parkway, Houston, TX 77079
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 281-293-1000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbols
Name of each exchange on which registered
Common Stock, $.01 Par Value
COP
New York Stock Exchange
7% Debentures due 2029
CUSIP—718507BK1
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☒ Yes ☐ No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☒ No
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. ☒ Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such
files). ☒ Yes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or
an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth
company” in Rule 12b-2 of the Exchange Act.
Large Accelerated Filer
☒
Accelerated filer
☐
Non-accelerated filer
☐
Smaller reporting
company
☐
Emerging growth
company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any
new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal
control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that
prepared or issued its audit report. ☒
If securities are registered pursuant to Section 12(b) of the Act, indicate by checkmark whether the financial statements of the registrant included in the
filing reflect the correction of an error to previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ☐ Yes ☒ No
The aggregate market value of common stock held by non-affiliates of the registrant on June 30, 2024, the last business day of the registrant’s most
recently completed second fiscal quarter, based on the closing price on that date of $103.61, was $132.7 billion.
The registrant had 1,272,380,205 shares of common stock outstanding at January 31, 2025.
Documents incorporated by reference:
Portions of the Proxy Statement for the Annual Meeting of Stockholders to be held on May 13, 2025 (Part III)
dŚŝƐWĂŐĞ/ŶƚĞŶƟŽŶĂůůLJ>ĞŌůĂŶŬ͘
Table of Contents
Page
Commonly Used Abbreviations
1
Item
Part I
1 and 2. Business and Properties
2
Corporate Structure
2
Segment and Geographic Information
2
Alaska
4
Lower 48
6
Canada
7
Europe, Middle East and North Africa
8
Asia Pacific
11
Other International
13
Other
14
Delivery Commitments
15
Competition
15
Human Capital Management
16
General
18
1A. Risk Factors
19
1B. Unresolved Staff Comments
28
1C. Cybersecurity
28
3. Legal Proceedings
30
4. Mine Safety Disclosures
30
Information About our Executive Officers
30
Part II
5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
32
6. [Reserved]
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
34
7A. Quantitative and Qualitative Disclosures About Market Risk
67
8. Financial Statements and Supplementary Data
70
9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
158
9A. Controls and Procedures
158
9B. Other Information
158
9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
158
Part III
10. Directors, Executive Officers and Corporate Governance
159
11. Executive Compensation
159
12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
159
13. Certain Relationships and Related Transactions, and Director Independence
159
14. Principal Accounting Fees and Services
159
Part IV
15. Exhibits, Financial Statement Schedules
160
Signatures
165
Commonly Used Abbreviations
The following industry-specific, accounting and other terms and abbreviations may be commonly used in this report.
Currencies
Accounting
$ or USD
U.S. dollar
ARO
asset retirement obligation
CAD
Canadian dollar
ASC
accounting standards codification
EUR
Euro
ASU
accounting standards update
GBP
British pound
DD&A
depreciation, depletion and
NOK
Norwegian kroner
amortization
FASB
Financial Accounting Standards
Units of Measurement
Board
BBL
barrel
FIFO
first-in, first-out
BCF
billion cubic feet
G&A
general and administrative
BOE
barrels of oil equivalent
GAAP
generally accepted accounting
MBD
thousands of barrels per day
principles
MCF
thousand cubic feet
LIFO
last-in, first-out
MM
million
NPNS
normal purchase normal sale
MMBOE
million barrels of oil equivalent
PP&E
properties, plants and equipment
MBOED
thousand barrels of oil equivalent
VIE
variable interest entity
per day
MMBOED
million barrels of oil equivalent
Miscellaneous
per day
CERCLA
Federal Comprehensive
MMBTU
million British thermal units
Environmental Response
MMCFD
million cubic feet per day
Compensation and Liability Act
MTPA
million tonnes per annum
EPA
Environmental Protection Agency
ESG
environmental, social and governance
Industry
EU
European Union
BLM
Bureau of Land Management
FERC
Federal Energy Regulatory
CBM
coalbed methane
Commission
CCS
carbon capture and storage
GHG
greenhouse gas
E&P
exploration and production
HSE
health, safety and environment
FEED
front-end engineering and design
ICC
International Chamber of Commerce
FID
final investment decision
ICSID
World Bank’s International
FPS
floating production system
Centre for Settlement of
FPSO
floating production, storage and
Investment Disputes
offloading
IRS
Internal Revenue Service
G&G
geological and geophysical
OTC
over-the-counter
JOA
joint operating agreement
NYSE
New York Stock Exchange
LNG
liquefied natural gas
SEC
U.S. Securities and Exchange
NGLs
natural gas liquids
Commission
OPEC
Organization of Petroleum
TSR
total shareholder return
Exporting Countries
U.K.
United Kingdom
PSC
production sharing contract
U.S.
United States of America
PUDs
proved undeveloped reserves
VROC
variable return of cash
SAGD
steam-assisted gravity drainage
WCS
Western Canadian Select
WTI
West Texas Intermediate
Commonly Used Abbreviations
1
ConocoPhillips 2024 10-K
Part I
Unless otherwise indicated, “the company,” “we,” “our,” “us” and “ConocoPhillips” are used in this report to refer to the
businesses of ConocoPhillips and its consolidated subsidiaries. Items 1 and 2—Business and Properties, contain forward-
looking statements including, without limitation, statements relating to our plans, strategies, objectives, expectations and
intentions that are made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.
The words “ambition,” “anticipate,” “believe,” “budget,” “continue,” “could,” “effort,” “estimate,” “expect,” “forecast,”
“goal,” “guidance,” “intend,” “may,” “objective,” “outlook,” “plan,” “potential,” “predict,” “projection,” “seek,” “should,”
“target,” “will,” “would” and similar expressions identify forward-looking statements. The company does not undertake
to update, revise or correct any forward-looking information unless required to do so under the federal securities laws.
Readers are cautioned that such forward-looking statements should be read in conjunction with the company’s
disclosures under the headings “Risk Factors” beginning on page 19 and “CAUTIONARY STATEMENT FOR THE PURPOSES
OF THE ‘SAFE HARBOR’ PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995,” beginning on page
65.
Items 1 and 2. Business and Properties
Corporate Structure
ConocoPhillips is an independent E&P company headquartered in Houston, Texas with operations and activities in 14
countries. Our diverse, low cost of supply portfolio includes resource-rich unconventional plays in North America;
conventional assets in North America, Europe, Africa and Asia; LNG developments; oil sands in Canada; and an inventory
of global exploration prospects. On December 31, 2024, we employed approximately 11,800 people worldwide and had
total assets of about $123 billion. Total company production for the year was 1,987 MBOED.
ConocoPhillips was incorporated in the state of Delaware in 2001, in connection with, and in anticipation of, the merger
between Conoco Inc. and Phillips Petroleum Company. The merger between Conoco and Phillips was consummated on
August 30, 2002. In April 2012, ConocoPhillips completed the separation of the downstream business into an
independent, publicly traded energy company, Phillips 66.
On November 22, 2024, we completed our acquisition of Marathon Oil Corporation (Marathon Oil), an independent oil
and gas exploration and production company with operations in multiple basins in the Lower 48, as well as Equatorial
Guinea internationally. For additional information related to this transaction, see Note 3.
Segment and Geographic Information
Business and Properties
ConocoPhillips 2024 10-K
2
We manage our operations through six operating segments, defined by geographic region: Alaska; Lower 48; Canada;
Europe, Middle East and North Africa; Asia Pacific; and Other International. For operating segment and geographic
information, see Note 23.
We explore for, produce, transport and market crude oil, bitumen, natural gas, NGLs and LNG on a worldwide basis. At
December 31, 2024, our operations were producing in the U.S., Norway, Canada, Australia, Malaysia, Libya, China, Qatar
and Equatorial Guinea.
The information listed below appears in the “Supplementary Data - Oil and Gas Operations” disclosures following the
Notes to Consolidated Financial Statements and is incorporated herein by reference:
•
Proved worldwide crude oil, NGLs, natural gas and bitumen reserves.
•
Net production of crude oil, NGLs, natural gas and bitumen.
•
Average sales prices of crude oil, NGLs, natural gas and bitumen.
•
Average production costs per BOE.
•
Net wells completed, wells in progress and productive wells.
•
Developed and undeveloped acreage.
The following table is a summary of the proved reserves information included in the “Supplementary Data - Oil and Gas
Operations” disclosures following the Notes to Consolidated Financial Statements. Approximately 84 percent of our
proved reserves are in countries that belong to the Organization for Economic Cooperation and Development. Natural gas
reserves are converted to BOE based on a 6:1 ratio: six MCF of natural gas converts to one BOE. See Management’s
Discussion and Analysis of Financial Condition and Results of Operations for a discussion of factors that will enhance the
understanding of the following summary reserves table.
Millions of Barrels of Oil Equivalent
Net Proved Reserves at December 31
2024
2023
2022
Crude oil
Consolidated operations
3,406
3,032
2,975
Equity affiliates
108
89
93
Total Crude Oil
3,514
3,121
3,068
Natural gas liquids
Consolidated operations
1,147
892
845
Equity affiliates
62
48
50
Total Natural Gas Liquids
1,209
940
895
Natural gas
Consolidated operations
1,629
1,408
1,461
Equity affiliates
977
879
959
Total Natural Gas
2,606
2,287
2,420
Bitumen
Consolidated operations
483
410
216
Total Bitumen
483
410
216
Total consolidated operations
6,665
5,742
5,497
Total equity affiliates
1,147
1,016
1,102
Total company
7,812
6,758
6,599
Business and Properties
3
ConocoPhillips 2024 10-K
Alaska
The Alaska segment primarily explores for, produces,
transports and markets crude oil, natural gas and NGLs.
We are the largest crude oil producer in Alaska and have
major ownership interests in the Prudhoe Bay, Kuparuk
and Western North Slope asset areas. Additionally, we
are one of Alaska’s largest owners of state, federal and
fee exploration leases, with approximately one million
net undeveloped acres at year-end 2024. Alaska
operations contributed 14 percent of our consolidated
liquids production and two percent of our consolidated
natural gas production.
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net
Production
Greater Prudhoe Area*
36.5 %
Hilcorp
67
15
36
88
Greater Kuparuk Area*
94.2-99.8
ConocoPhillips
63
—
2
63
Western North Slope
100.0
ConocoPhillips
43
—
1
43
Total Alaska
173
15
39
194
*Acquired additional working interest in the fourth quarter of 2024. See Note 3.
After exercising our preferential rights, we completed our acquisition of additional working interest in the Kuparuk River
Unit and Prudhoe Bay Unit from Chevron U.S.A. Inc and Union Oil Company of California in the fourth quarter of 2024.
This transaction increased our working interest by approximately five percent in the Kuparuk River Unit and
approximately 0.4 percent in the Prudhoe Bay Unit. See Note 3.
Greater Prudhoe Area
The Greater Prudhoe Area includes the Prudhoe Bay Unit, which consists of the Prudhoe Bay Field and five satellite fields,
as well as the Greater Point McIntyre Area fields. Prudhoe Bay, the largest conventional oil field in North America, is the
site of a large waterflood and enhanced oil recovery operation, supported by a large gas and water processing operation.
Field installations include seven production facilities, two gas plants, two seawater plants and a central power station. In
2024, on average, there were two rigs drilling throughout the year.
Greater Kuparuk Area
The Greater Kuparuk Area includes the Kuparuk River Unit, which consists of the Kuparuk Field and six satellite fields.
Field installations include three central production facilities which separate oil, natural gas and water, and a seawater
treatment plant. In 2024, we operated two drilling rigs and two workover rigs. The Nuna project, which targets the
Moraine reservoir, was sanctioned in 2023 and achieved first oil in the fourth quarter of 2024. The Coyote reservoir
discovered in 2021 progressed to development in 2023 with additional wells drilled in 2024 and planned for 2025.
Business and Properties
ConocoPhillips 2024 10-K
4
Western North Slope
The Western North Slope includes the Colville River Unit, the Greater Mooses Tooth Unit and the Bear Tooth Unit. In
2024, we operated one full-time drilling rig and one seasonal drilling rig between the Colville River and Greater Mooses
Tooth Units.
The Colville River Unit includes the Alpine Field and four satellite fields. Field installations include one central production
facility, which separates oil, natural gas and water.
The Greater Mooses Tooth Unit is the first unit established entirely within the National Petroleum Reserve Alaska (NPR-
A). The unit was constructed in two phases: Greater Mooses Tooth #1 (GMT1) and Greater Mooses Tooth #2 (GMT2).
In December 2023, we announced Willow FID. The project will consist of three drill sites, an operations center and camp,
and a processing facility. In 2024, construction included installation of the Willow Access Road, the Willow Operations
Center pad and pipeline segments. Additionally, fabrication and delivery of the Willow Operations Center modules to the
North Slope were completed. First oil is anticipated in 2029.
Transportation
We transport the petroleum liquids produced on the North Slope to Valdez, Alaska through an 800-mile pipeline that is
part of the Trans-Alaska Pipeline System (TAPS). We have a 29.5 percent ownership interest in TAPS, and also have
ownership interests in, and operate the Alpine, Kuparuk and Oliktok pipelines on the North Slope.
We manage the marine transportation of our North Slope production using five company-owned, double-hulled tankers,
and charter third-party vessels, as necessary. The tankers deliver oil from Valdez, Alaska, primarily to refineries on the
west coast of the U.S.
Business and Properties
5
ConocoPhillips 2024 10-K
Lower 48
The Lower 48 segment consists of operations located in
the 48 contiguous U.S. states and the Gulf of Mexico,
with a portfolio mainly consisting of low cost of supply,
short cycle time, resource-rich unconventional plays and
commercial operations. Based on 2024 production
volumes, the Lower 48 is our largest segment and
contributed 63 percent of our consolidated liquids
production and 74 percent of our consolidated natural
gas production.
2024
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net Production
Delaware Basin
301
144
884
593
Eagle Ford
124
66
322
244
Midland Basin
101
44
224
182
Bakken
66
22
164
115
Other
10
3
31
18
Total Lower 48
602
279
1,625
1,152
On November 22, 2024, we completed the acquisition of Marathon Oil, further enhancing our Lower 48 position. This
acquisition adds low cost of supply, complementary acreage in the Delaware, Eagle Ford and Bakken basins. See Note 3.
Delaware Basin
We hold approximately 792,000 unconventional net acres in the Delaware Basin, spanning west Texas through southeast
New Mexico. Current development activity targets prospects in the Avalon, Bone Springs and Wolfcamp formations while
balancing leasehold obligations and permit terms. We operated ten rigs and two frac crews on average during 2024,
resulting in 166 operated wells drilled and 151 operated wells brought online.
Eagle Ford
We hold approximately 484,000 unconventional net acres in the Eagle Ford, located in south Texas. The current focus is
on full-field development, using customized well spacing and stacking patterns adapted through reservoir analysis. We
operated seven rigs and two frac crews on average during 2024, resulting in 182 operated wells drilled and 154 operated
wells brought online.
Midland Basin
We hold approximately 265,000 unconventional net acres in the Midland Basin, located in west Texas. The current
development strategy is focused on full-field development utilizing multi-well pad projects targeting both Spraberry and
Wolfcamp reservoir targets. We operated five rigs and two frac crews on average during 2024, resulting in 119 operated
wells drilled and 111 operated wells brought online.
Bakken
We hold approximately 790,000 unconventional net acres in the Williston Basin, located in North Dakota and eastern
Montana. The primary producing zones are the Middle Bakken and Three Forks formations. We operated four rigs and
one frac crew on average during 2024, resulting in 66 operated wells drilled and 83 operated wells brought online.
Partner-Operated
We participate in partner-operated wells when they align with our investment decision criteria and development
strategies. In 2024, we participated in partner-operated wells with varying working interests across our Lower 48
portfolio.
Facilities
We operate and own, with varying interests, centralized processing facilities in Texas and New Mexico in support of our
Delaware, Eagle Ford and Midland assets.
Business and Properties
ConocoPhillips 2024 10-K
6
Canada
Our Canadian operations consist of the Surmont oil
sands development in Alberta, the liquids-rich Montney
unconventional play in British Columbia and commercial
operations. In 2024, operations in Canada contributed
ten percent of our consolidated liquids production and
five percent of our consolidated natural gas production.
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Bitumen
MBD
Total
MBOED
Average Daily Net
Production
Surmont
100.0 %
ConocoPhillips
—
—
—
122
122
Montney
100.0
ConocoPhillips
17
6
115
—
42
Total Canada
17
6
115
122
164
Our bitumen resources in Canada are produced via SAGD, an enhanced thermal oil recovery method where steam is
injected into the reservoir, effectively liquefying the heavy bitumen, which is recovered and pumped to the surface for
further processing. Operations include two central processing facilities for treatment and blending of bitumen, and a
diluent recovery unit. These facilities have allowed the asset to lower blend ratio and diluent supply costs, while gaining
protection from diluent supply disruptions and increased market access for our product. At December 31, 2024, we held
approximately 684,000 net acres of land in the Athabasca Region of northeastern Alberta.
Surmont
The Surmont oil sands leases are located south of Fort McMurray, Alberta. Surmont is a 100 percent working interest
asset that offers sustained, long-life production. We are focused on keeping facilities full, structurally lowering costs,
reducing GHG intensity and optimizing asset performance. In 2024, we brought all wells at Pad 267 to expected
production, commenced the drilling of Pad 104 and executed the asset's largest re-drill program to date of 29 wells. First
production from Pad 104 is expected in 2026.
Montney
The Montney is a liquids-rich unconventional play located in northeastern British Columbia. At December 31, 2024, we
held approximately 297,000 net acres of land in the Montney. In 2024, we operated two rigs resulting in 33 wells drilled
and 27 operated wells brought online. Early development activities will continue in 2025 with drilling and completions
activity.
Business and Properties
7
ConocoPhillips 2024 10-K
Europe, Middle East and North Africa
The Europe, Middle East and North Africa segment
consists of operations principally located in the
Norwegian sector of the North Sea, the Norwegian Sea,
Qatar, Libya, Equatorial Guinea and commercial and
terminalling operations in the U.K. In 2024, operations
in Europe, Middle East and North Africa contributed
nine percent of our consolidated liquids production and
17 percent of our consolidated natural gas production.
Norway
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net
Production
Greater Ekofisk Area
28.3-35.1 %
ConocoPhillips
43
2
73
57
Heidrun Field
24.0
Equinor
9
1
37
16
Aasta Hansteen Field
10.0
Equinor
—
—
78
13
Troll Field
1.6
Equinor
1
—
69
13
Alvheim Field
20.0
Aker BP
8
—
15
11
Visund Field
9.1
Equinor
1
1
36
8
Other Fields
Various
Equinor
7
—
21
10
Total Norway
69
4
329
128
Greater Ekofisk Area
The Greater Ekofisk Area is located offshore Stavanger, Norway, in the North Sea, and is comprised of five producing
fields. Crude oil is exported to our operated terminal located at Teesside, U.K., and the natural gas is exported to Emden,
Germany. In 2024, the Eldfisk North development, a subsea tieback to Eldfisk, achieved first production.
Heidrun Field
The Heidrun Field is located in the Norwegian Sea. Produced crude oil is stored in a floating storage unit and exported via
shuttle tankers. Most of the gas is transported to Europe via gas processing terminals in Norway with some reinjected for
pressure support if required. A portion of the gas is also transported for use as feedstock in a methanol plant in Norway,
in which we have an 18 percent interest.
Aasta Hansteen Field
The Aasta Hansteen Field is located in the Norwegian Sea. Gas is transported through the Polarled gas pipeline to the
onshore Nyhamna processing plant for final processing prior to export to market. Produced condensate is loaded onto
shuttle tankers and transported to market.
Business and Properties
ConocoPhillips 2024 10-K
8
Troll Field
The Troll Field lies in the northern part of the North Sea and consists of the Troll A, B and C platforms. The natural gas
from Troll A is transported to Kollsnes, Norway. Crude oil from floating platforms Troll B and Troll C is transported to
Mongstad, Norway, for storage and export.
Alvheim Field
The Alvheim Field is located in the northern part of the North Sea and consists of a FPSO vessel and subsea installations.
Produced crude oil is exported via shuttle tankers and natural gas is transported to the Scottish Area Gas Evacuation
(SAGE) Terminal at St. Fergus, U.K., through the SAGE Pipeline.
Visund Field
The Visund Field is located in the northern part of the North Sea and consists of a floating drilling, production and
processing unit and subsea installations. Crude oil is transported by pipeline to a nearby third-party field for storage and
export via tankers. The natural gas is transported to the gas processing plants at Kollsnes and Kårstø, through the Gassled
transportation system.
Other Fields
We also have varying ownership interests in three other producing fields in the Norwegian sector of the North Sea.
Exploration
In 2024, we were awarded three new exploration licenses, PL1205, PL1207 and PL1208 located in the North Sea. In the
first quarter of 2024, we recorded the investment in the suspended Busta discovery well on license PL782S, located in the
North Sea, as dry hole expense. In 2025, we plan to drill the second appraisal well in the 2020 Slagugle discovery on
PL891, located in the Norwegian Sea, and participate in two partner-operated exploration wells in the Bounty Up-dip
prospect on PL886 and in Othello South on PL124B, both located in the Norwegian Sea.
Transportation
We have a 35.1 percent ownership interest in the Norpipe Oil Pipeline System, a 220-mile pipeline which carries crude oil
from Ekofisk to a crude oil stabilization and NGLs processing facility in Teesside, U.K.
Facilities
We operate and have a 40.25 percent ownership interest in a crude oil stabilization and NGLs processing facility at
Teesside, U.K. to support our Norway operations.
Qatar
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net
Production
QatarEnergy LNG N(3)
30.0 %
QatarEnergy LNG
13
8
374
83
QatarEnergy LNG N(3) (N3), is an integrated development jointly owned by QatarEnergy (68.5 percent), ConocoPhillips
(30 percent) and Mitsui & Co., Ltd. (1.5 percent). N3 consists of upstream natural gas production facilities, which produce
approximately 1.4 gross BCF per day of natural gas from Qatar’s North Field over a 25-year life, in addition to a 7.8 million
gross tonnes per year LNG facility. LNG is shipped in leased LNG carriers destined for sale globally, while liquids are sold
into the domestic market or marketed internationally through QatarEnergy Marketing.
N3 executed the development of the onshore and offshore assets as a single integrated development with QatarEnergy
LNG N(4) (N4), a joint venture between QatarEnergy and Shell plc. This included the joint development of offshore
facilities situated in a common offshore block in Qatar's North Field, as well as the construction of two identical LNG
process trains and associated gas treating facilities for both the N3 and N4 joint ventures. Production from the LNG trains
and associated facilities is mutualized between the two joint ventures.
We have a 25 percent interest in both QatarEnergy LNG NFE (4) (NFE4) and QatarEnergy LNG NFS (3) (NFS3) joint
ventures, which are participating in the North Field East (NFE) and North Field South (NFS) LNG projects. See Note 3 and
Note 4.
Business and Properties
9
ConocoPhillips 2024 10-K
Libya
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net Production
Waha Concession
20.4 %
Waha Oil Co.
48
—
28
53
The Waha Concession is made up of multiple concessions and encompasses approximately 13 million acres onshore in the
Sirte Basin for exploration and production activity. Oil is transported by pipeline to the Es Sider terminal for export.
Natural gas is transported and sold domestically. Current production comes from 13 existing fields within the Waha
Concession.
Equatorial Guinea
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net Production
Alba Unit
64.2 %
ConocoPhillips
1
—
14
3
On November 22, 2024, we completed the acquisition of Marathon Oil. With the acquisition, we have increased our
global operations adding oil, natural gas and LNG activity in Equatorial Guinea to our portfolio. See Note 3.
We have varying stages of oil and gas exploration, development and production activities in Equatorial Guinea. We
operate in both the Alba and Block D PSCs that form the Alba Unit located offshore Equatorial Guinea.
Gas Processing
The following facilities located on Bioko Island allow us to further monetize natural gas production from the Alba Unit and
are accounted for as equity method investments and are reflected in the "Equity in earnings of affiliates" line of our
consolidated income statement.
We own a 52.2 percent interest in the Alba Plant LLC, our joint venture with Chevron Corporation (27.8 percent) and
Sociedad Nacional de Gas de Guinea Ecuatorial (SONAGAS) (20.0 percent), which operates an onshore liquified petroleum
gas (LPG) processing plant. Alba Plant LLC processes Alba Unit natural gas under a fixed-rate long-term contract. The LPG
processing plant extracts condensate and LPG from the natural gas stream and sells it at market prices, with our share of
the revenue reflected in the "Equity in earnings of affiliates" line of our consolidated income statement. Processed
natural gas is delivered to Equatorial Guinea LNG Holdings Limited (EG LNG) for liquefaction and storage. We market our
share of LNG to third parties indexed at global LNG prices.
We own a 56.0 percent interest in EG LNG, our joint venture with SONAGAS (37.9 percent) and Marubeni Gas
Development UK Limited (6.1 percent), which operates a 3.7 MTPA LNG production facility. In January 2024, we began a
five-year LNG sales agreement for a portion of our equity gas from the Alba Unit, providing us with additional exposure to
the European LNG market.
We own a 45.0 percent interest in Atlantic Methanol Production Company LLC (AMPCO), our joint venture with Chevron
Corporation (45.0 percent) and SONAGAS (10.0 percent), which operates a methanol plant. The plant is currently offline.
Additionally, Alba Plant LLC and EG LNG process third-party gas from the Alen Field under a combination of tolling fee and
profit-sharing arrangements which are reflected in the "Equity in earnings of affiliates" line of our consolidated income
statement.
Business and Properties
ConocoPhillips 2024 10-K
10
Asia Pacific
The Asia Pacific segment has exploration and
production operations in China, Malaysia, Australia and
commercial operations in China, Singapore and Japan.
In 2024, operations in the Asia Pacific segment
contributed four percent of our consolidated liquids
production and two percent of our consolidated natural
gas production.
Australia
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net
Production
Australia Pacific LNG
47.5 %
ConocoPhillips/
Origin Energy
—
—
859
143
Australia Pacific LNG Pty Ltd. (APLNG), our joint venture with Origin Energy Limited (Origin) and China Petrochemical
Corporation (Sinopec), is focused on producing CBM from the Bowen and Surat basins in Queensland, Australia, to supply
the domestic gas market and convert the CBM into LNG for export. Origin operates APLNG’s upstream production and
pipeline system, and we operate the downstream LNG facility, located on Curtis Island near Gladstone, Queensland, as
well as the LNG export sales business.
We operate two fully subscribed 4.5 MTPA LNG trains. Approximately 3,500 net wells are ultimately expected to supply
both the LNG sales contracts and domestic gas market. The wells are supported by gathering systems, central gas
processing and compression stations, water treatment facilities and an export pipeline connecting the gas fields to the
LNG facilities. The LNG is being sold to Sinopec under a 20-year sales agreement for 7.6 MTPA of LNG, and Japan-based
Kansai Electric Power Co., Inc. under a 20-year sales agreement for approximately one MTPA of LNG.
For additional information, see Note 3, Note 4 and Note 9.
Exploration
We own an 80 percent working interest in both Exploration Permit (T/49P) and (VIC/P79) located in the Otway Basin,
Australia. During 2023, we executed a drilling consortium agreement with other operators in Australia and secured a
contract for a semi-sub drilling rig. The proposed exploration program involves seabed surveys and drilling of exploration
wells planned for 2025.
Business and Properties
11
ConocoPhillips 2024 10-K
China
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net Production
Penglai
49.0 %
CNOOC
33
—
—
33
Penglai
The Penglai 19-3, 19-9 and 25-6 fields are located in the Bohai Bay Block 11/05 and are being developed in stages from
large offshore platforms and a FPSO. Most of the crude oil produced from the block is sold to the domestic market in
China, with the remainder exported to international markets.
Phase 3 consists of three wellhead platforms and a central processing platform. First production was achieved in 2018
and as of December 2024, all 186 wells have been completed and brought online.
Phase 4A consists of one wellhead platform. First production was achieved in 2020 and as of December 2024, all 62 wells
have been completed and brought online.
Phase 4B consists of two wellhead platforms. First production was achieved in the fourth quarter of 2023. This project
could include up to 144 new wells, 41 of which have been completed and brought online as of December 2024.
Phase 5 consists of two new wellhead platforms and four wellhead platform expansions. First production was achieved in
the fourth quarter of 2024. This project could include up to 91 new wells, 10 of which have been completed and brought
online as of December 2024.
Malaysia
2024
Interest
Operator
Crude Oil
MBD
NGL
MBD
Natural Gas
MMCFD
Total
MBOED
Average Daily Net Production
Gumusut
29.5 %
Shell
12
—
—
12
Malikai
35.0
Shell
12
—
—
12
Kebabangan (KBB)
30.0
KPOC
1
—
49
9
Siakap North-Petai
21.0
PTTEP
1
—
1
1
Total Malaysia
26
—
50
34
We have varying stages of exploration, development and production activities across approximately 2.6 million net acres
in Malaysia, with working interests in six PSCs. Four of these PSCs are located in waters off the eastern Malaysian state of
Sabah: Block G, Block J, the Kebabangan Cluster (KBBC) and the Ubah Cluster, acquired in 2024. We also operate another
two exploration blocks, Block WL4-00 and Block SK304, in waters off the eastern Malaysian state of Sarawak.
Block J
Gumusut
We own a 29.5 percent working interest in the unitized Gumusut Field. Development associated with Gumusut Phase 4, a
four-well program targeting the Brunei acreage of the unitized Gumusut Field that straddles Malaysia and Brunei waters,
completed drilling in 2024 with first oil anticipated in early 2025. The unitized Gumusut Field is operated on a FPS with oil
evacuation via a pipeline to the Sabah Oil and Gas Terminal (SOGT) for tanker liftings.
Business and Properties
ConocoPhillips 2024 10-K
12
KBBC
We own a 30 percent working interest in the KBB, Kamunsu East and Kamunsu East Upthrown Canyon gas and
condensate fields. KBBC was previously operated by a joint operating company, Kebabangan Petroleum Operating
Company, and in January 2025, we became the sole operator of KBBC. There was no change to working interest as part of
ConocoPhillips becoming sole operator.
KBB
Gas is transported from the KBB platform via pipeline for sale to the domestic gas market. Since 2019, KBB tied-in to a
nearby third-party floating LNG vessel, which provided additional gas offtake capacity.
Block G
Malikai
We own a 35 percent working interest in Malikai. Malikai Phase 2 development first oil was achieved in February 2021.
Malikai operates on a tension leg platform and pipes oil to the KBB platform for processing. Oil evacuation is via pipeline
to SOGT for tanker liftings.
Siakap North-Petai
We own a 21 percent working interest in the unitized Siakap North-Petai (SNP) oil field. First oil from SNP Phase 2 was
achieved in November 2021. The subsea system in the SNP oil field is tied back to a FPSO operated by PTTEP.
Exploration
We operate three exploration PSCs with 85 percent working interest in Block SK304, 50 percent working interest in Block
WL4-00 and 35 percent working interest in the Ubah Cluster. Off the coast of Sarawak, offshore Malaysia, Block SK304
encompasses 1.8 million net acres and Block WL4-00 encompasses 0.3 million net acres. Off the coast of Sabah, offshore
Malaysia near the KBBC, the Ubah Cluster encompasses 11 thousand net acres. We continue to evaluate these blocks and
are using information from seismic and prior well results to help optimize future plans.
In 2021, we were awarded operatorship and an 85 percent working interest in Block SB405 encompassing 1.2 million net
acres off the coast of Sabah, offshore Malaysia. A 3D seismic survey was acquired in 2022, and processing and evaluation
work was completed in 2024. In the fourth quarter of 2024, we elected not to proceed to the second phase of exploration
for SB405 PSC and relinquished the block.
Other International
The Other International segment includes interests in Colombia as well as contingencies associated with prior operations
in other countries.
Colombia
We have an 80 percent working interest in the Middle Magdalena Basin Block VMM-3 extending over approximately
67,000 net acres. In addition, we have an 80 percent working interest in the VMM-2 Block, which extends over
approximately 58,000 net acres and is contiguous to the VMM-3 Block. The contracts for this project are currently in force
majeure due to the lack of a defined environmental licensing required for the execution of unconventional exploratory
activities. Additionally, the government of Colombia supports a ban on such activities.
Venezuela
For discussion of our contingencies in Venezuela, see Note 10.
Business and Properties
13
ConocoPhillips 2024 10-K
Other
Marketing Activities
Our Commercial organization manages our worldwide commodity portfolio, which includes natural gas, crude oil,
bitumen, NGLs, LNG and power. Marketing activities are performed through offices in the U.S., Canada, Europe and Asia.
In marketing our production, we attempt to minimize flow disruptions, maximize realized prices and manage credit-risk
exposure. Commodity sales are generally made at prevailing market prices at the time of sale. We also purchase and sell
third-party commodity volumes to better position the company to satisfy customer demand while fully utilizing
transportation and storage capacity.
Crude Oil, Bitumen and NGLs
Our crude oil, bitumen and NGL revenues are derived from production in the U.S., Canada, Asia, Africa and Europe. These
commodities are primarily sold under contracts with prices based on market indices, adjusted for location, quality and
transportation.
Natural Gas
Our natural gas production, along with third-party purchased gas, is primarily marketed in the U.S., Canada and Europe.
Our natural gas is sold to a diverse client portfolio, which includes local distribution companies; gas and power utilities;
large industrials; independent, integrated or state-owned oil and gas companies; as well as marketing companies. To
reduce our market exposure and credit risk, we also transport natural gas via firm and interruptible transportation
agreements to major market hubs.
LNG
We have producing equity LNG facilities located in Australia, Qatar and Equatorial Guinea. We also have a 30 percent
direct equity holding in the Port Arthur LNG (PALNG) facility, which is scheduled to start up in 2027. As part of our LNG
strategy to build a dynamic LNG portfolio and expand our footprint across the LNG value chain, in the future we have LNG
offtake due to start up in the U.S. Gulf Coast and the west coast of Mexico with approximately 7.4 MTPA, and currently
have a total regasification capacity of 5.2 MTPA at terminals in Belgium, Germany and the Netherlands. We continue to
progress discussions across all major LNG producing and consuming regions and markets to further add high-quality
positions to our portfolio. See Note 3.
Emergency Response Partnerships
Emergency response partnerships are vital for effective disaster management. By uniting government agencies, non-
profits, private companies and community groups, these partnerships enhance preparedness, response and recovery
efforts. We maintain memberships in several global response and containment partnerships as a key element of our
emergency response preparedness program, complementing our internal response resources.
Oil Spill Response Organizations (OSROs)
We maintain memberships in several OSROs, many of which are not-for-profit cooperatives owned by member
companies. We may actively participate in these organizations as members of the board of directors, steering
committees, work groups or other supporting roles. In North America, our primary OSROs include the Marine Spill
Response Corporation for the continental U.S. and Alaska Clean Seas and Ship Escort/Response Vessel System for the
Alaska North Slope and Prince William Sound, respectively. Internationally, we maintain memberships in various OSROs,
including Oil Spill Response Limited, the Norwegian Clean Seas Association for Operating Companies, the Australian
Marine Oil Spill Center and Petroleum Industry of Malaysia Mutual Aid Group.
Business and Properties
ConocoPhillips 2024 10-K
14
Technology
We have several technology programs that improve our ability to develop unconventional reservoirs, increase recovery
from our legacy fields, improve the efficiency of our exploration program, produce heavy oil economically with lower
emissions and implement sustainability measures.
LNG Liquefaction Technology
We are the second-largest LNG liquefaction technology provider globally. Our Optimized Cascade® LNG liquefaction
technology has been licensed for use in 28 LNG trains around the world, with FEED studies ongoing for additional trains.
Low Carbon Technologies
Our multi-disciplinary Low Carbon Technologies organization's remit includes supporting our operational emissions
reductions objectives, understanding the alternative energy landscape and prioritizing opportunities for future
competitive investment. To help achieve our targets, the Low Carbon Technologies organization works with our business
units to develop and implement Scope 1 and 2 emissions reduction initiatives and identify potential technology solutions
for hard-to-abate emissions. We continue to focus on implementing emissions reduction projects across our global
portfolio, including operational efficiency measures and methane and flaring reductions. For example, since 2021 we
have conducted CCS and electrification studies, initiated zero/low emission equipment design enhancements, installed
mechanisms to continuously monitor and detect methane emissions and implemented operation changes to reduce or
eliminate flaring and methane venting volumes.
We also continue to evaluate low-carbon opportunities for future competitive investment. For example, since 2021:
•
We evaluated carbon dioxide storage sites primarily along the U.S. Gulf Coast, progressed land acquisition efforts
and business development work, drilled two appraisal wells and advanced engineering studies for multiple
opportunities.
•
We evaluated hydrogen opportunities in the U.S. and Asia Pacific regions. As a result of hydrogen and ammonia
markets not developing at a pace required to support further investment, we decided to suspend our evaluation
of a low-carbon ammonia production facility on the U.S. Gulf Coast.
For more information on our targets, see “Contingencies—Company Response to Climate-Related Risks" sections of
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
Delivery Commitments
We sell crude oil and natural gas from our producing operations under a variety of contractual arrangements, some of
which specify the delivery of a fixed and determinable quantity. Our commercial organization also enters into natural gas
sales contracts where the source of the natural gas used to fulfill the contract can be the spot market or a combination of
our reserves and the spot market. Worldwide, we are contractually committed to deliver approximately 675 billion cubic
feet of natural gas and 253 million barrels of crude oil in the future. These contracts have various expiration dates
through the year 2034. We have a variety of options to fulfill our delivery commitments including third-party purchases,
as supported by our gas management and power supply agreements, proved developed reserves and PUDs. See the
disclosure on “Proved Undeveloped Reserves” in the “Supplementary Data - Oil and Gas Operations” section following
the Notes to Consolidated Financial Statements, for information on the development of PUDs.
Competition
ConocoPhillips is one of the world’s leading E&P companies based on both production and reserves, with a globally
diversified asset portfolio. We compete with private, public and state-owned companies in all facets of the E&P business.
Some of our competitors are larger and have greater resources. Each of our segments is highly competitive, with no single
competitor, or small group of competitors, dominating.
We compete with numerous other companies in the industry, including state-owned companies, to locate and obtain
new sources of supply and to produce oil, bitumen, LNG, NGLs and natural gas in an efficient, cost-effective manner. We
deliver our production into the worldwide commodity markets. Principal methods of competing include geological,
geophysical and engineering research and technology; experience and expertise; equipment and personnel; economic
analysis in connection with portfolio management and safely operating oil and gas producing properties.
Business and Properties
15
ConocoPhillips 2024 10-K
Human Capital Management
At ConocoPhillips, our strategy, performance, culture and reputation are fueled by our workforce. Attracting, retaining
and developing a world-class workforce is a competitive imperative within our complex industry. Our human capital
management (HCM) approach is based on our core SPIRIT Values – Safety, People, Integrity, Responsibility, Innovation
and Teamwork – which set the tone for our interactions with all stakeholders. We believe a safe organization is a
successful organization and we prioritize personal and process safety across the company.
Our Executive Leadership Team (ELT) and Board of Directors help to set our HCM strategy and drive accountability for
meaningful progress. Our HCM programs are managed by our human resources function with support from business
leaders across the company and are regularly reviewed by the Board of Directors. Our efforts are built around three
pillars: a compelling culture, attracting a world-class workforce and valuing our people.
At year-end 2024, we had approximately 11,800 employees in 14 countries. Tables of 2024 employees by country and
demographics are shown below:
2024 Employees by Country
Percent of Total
U.S.
67 %
Norway
14
Canada
8
Australia
3
U.K.
3
Other Global Locations
5
100 %
2024 Employees by Demographics
Global
U.S.
Male
Female
White
POC*
All Employees
73 %
27 %
67 %
33 %
All Leadership
74
26
75
25
Top Leadership
74
26
81
19
Junior Leadership
74
26
74
26
*"POC" refers to People of Color or racial and ethnic minorities self-reported in the U.S.
A Compelling Culture
How we do our work is what sets us apart and drives our performance. As our industry evolves, we need a workforce
equipped to address new opportunities and challenges. Our success depends on our people. Effectively engaging,
developing and rewarding our employees is a priority for us. Together, we deliver strong performance while embracing
our core cultural attributes.
Health, Safety and Environment
Our HSE organization sets expectations and provides tools and assurance to our workforce to promote and achieve HSE
excellence. We manage and assure ConocoPhillips HSE policies, standards and practices, to help ensure business activities
are consistently safe, healthy and conducted in an environmentally and socially responsible manner across the globe.
Each business unit manages its local operational risks with particular attention to process safety, occupational safety and
environmental and emergency preparedness risks. Objectives, targets and deadlines are set and tracked annually to drive
strong HSE performance. Progress is tracked and reported to our ELT and the Board of Directors. Corporate HSE audits are
conducted on business units and staff groups to ensure conformance with ConocoPhillips HSE policies, standards and
practices. If improvement actions are identified, they are tracked to completion.
Business and Properties
ConocoPhillips 2024 10-K
16
We continuously look for ways to operate more safely, efficiently and responsibly. We focus on reducing human error by
emphasizing interaction among people, equipment and work processes. We believe our HSE policies such as Life Saving
Rules, Process Safety Fundamentals, safety procedures and our stop work policy can reduce the likelihood and severity of
unexpected incidents. We conduct thorough investigations of all serious incidents to understand the root cause and share
lessons learned globally to improve our facility designs, procedures, training and maintenance programs. It is important
that we drive an HSE culture of continuous learning and improvement, refine our existing HSE processes and tools and
enhance our commitment to safe, efficient and responsible operations.
Attracting a World-Class Workforce
Our continued success requires a skilled global workforce. Our SPIRIT Values help to cultivate an inclusive environment
where everyone can contribute, promoting innovation and leading to better business outcomes. This helps us attract a
workforce equipped to address new opportunities and challenges that we face in a complex industry. We recruit
experienced hires to help us sustain a broad range of expertise and partner with universities and organizations to create a
pipeline of early-career talent. We strive to ensure fair and consistent practices in our recruitment process and conduct
talent assessments to meet our business needs.
We monitor recruitment metrics and track voluntary turnover to guide our retention activities.
2024 Hiring & Attrition Metrics
Percent of Total
U.S. university hire acceptance rate
75 %
U.S. interns acceptance rate
74
Global hiring - Women/Men
25/75
U.S. hiring - U.S. POC/U.S. White
41/59
Total voluntary attrition
4
Valuing our People
Employee Engagement and Development
We engage and develop our workforce through on-the-job learning, formal training, ongoing feedback, coaching and
mentoring. Additionally, we use a performance management program focused on merit, objectivity, credibility and
transparency. The program includes broad stakeholder feedback, real-time monetary and non-monetary recognition and
a formal "how" rating to assess behavior to ensure they align with our SPIRIT Values.
Skills-based Talent Management Teams (TMTs) guide employee development and career progression, help identify
workforce planning needs and assess the availability of critical skill sets. Succession planning is a top priority for
management and the Board of Directors to ensure talent readiness and availability for leadership roles.
We measure and assess employee satisfaction and engagement through periodic employee engagement surveys. Our
leaders review survey feedback to guide priorities and goals.
Compensation, Benefits and Well-Being
We offer competitive, performance-based compensation packages and have global, equitable pay practices. Our
compensation programs generally include base pay, the annual Variable Cash Incentive Program (VCIP) and, for eligible
employees, the Restricted Stock Unit (RSU) program. Our retirement and savings plans support employees' financial
futures and are competitive within local markets.
We routinely benchmark our global compensation and benefits programs to ensure they are competitive and meet the
needs of our employees. We provide flexible work schedules and competitive time off, including parental leave in many
locations. We also provide coverage for disability support, elder care and childcare, including onsite childcare, where
access locally is a challenge.
Our global wellness programs include biometric screenings and fitness challenges. All employees have access to our
employee assistance program, and many of our locations offer custom mental well-being programs.
Business and Properties
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General
The environmental information contained in Management’s Discussion and Analysis of Financial Condition and Results of
Operations beginning on page 55 under the caption "Environmental" and beginning on page 57 under the caption
“Climate Change” is incorporated herein by reference. It includes information on expensed and capitalized environmental
costs for 2024 and those expected for 2025 and 2026.
Website Access to SEC Reports
Our internet website address is www.conocophillips.com. Information contained on our internet website is not part of
this report on Form 10-K.
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments
to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available
on our website, free of charge, as soon as reasonably practicable after such reports are filed with, or furnished to, the
SEC. Alternatively, you may access these reports at the SEC’s website at www.sec.gov.
Business and Properties
ConocoPhillips 2024 10-K
18
Item 1A. Risk Factors
You should carefully consider the following risk factors in addition to the other information included in this Annual Report
on Form 10-K. These risk factors are not the only risks we face. Our business could also be affected by additional risks and
uncertainties not currently known to us or that we currently consider to be immaterial. If any of these risks or other risks
that are yet unknown or currently considered immaterial were to occur, our business, operating results and financial
condition, as well as the value of an investment in our common stock, could be materially and adversely affected.
Risks Related to Our Industry
Our operating results, our ability to execute on our strategy and the carrying value of our assets are exposed to the
effects of volatile commodity prices or prolonged periods of low commodity prices.
Among the most significant factors impacting our revenues, operating results and future rate of growth are the sales
prices for crude oil, bitumen, LNG, natural gas and NGLs. These prices are tied to market prices that can fluctuate widely
due to factors beyond our control. For example, over the course of 2024, WTI crude oil prices ranged from a high of $87
per barrel in April to a low of $66 per barrel in September. Given the volatility in commodity price drivers and the
worldwide political and economic environment, including potential economic slowdowns or recessions, unexpected
shocks to supply and demand resulting from future global health crises, such as those that were experienced in
connection with the COVID-19 pandemic, or increased uncertainty generated by armed hostilities and geopolitical tension
in various oil-producing regions around the globe, prices for crude oil, bitumen, LNG, natural gas and NGLs may continue
to be volatile.
Prolonged periods of low commodity prices could have a material adverse effect on our revenues, operating income, cash
flows and liquidity, and may also affect the amount of dividends we elect to declare and pay on our common stock and
the amount of shares we elect to acquire as part of our share repurchase program and the timing of such repurchases.
Lower prices may also limit the amount of reserves we can produce economically, thus adversely affecting our proved
reserves and reserve replacement ratio and accelerating the reduction in our existing proved reserve levels as we
continue production from upstream fields. Prolonged depressed prices may affect strategic decisions related to our
operations, including decisions to reduce capital investments or curtail operated production.
Significant reductions in crude oil, bitumen, LNG, natural gas and NGLs prices could also require us to reduce our capital
expenditures, impair the carrying value of our assets or discontinue the classification of certain assets as proved reserves.
Although it is not reasonably practicable to quantify the impact of any future impairments or estimated change to our
unit-of-production rates at this time, our results of operations could be adversely affected as a result.
If we do not successfully develop resources, the scope of our business will decline, and our financial condition and
results of operations may be adversely affected.
As we produce crude oil, bitumen, natural gas and NGLs from our existing portfolio, the amount of our remaining
reserves declines. If we do not successfully replace the resources we produce with good prospects for future organic
development or through acquisitions, our business will decline. In addition, our ability to successfully develop our
reserves depends on our achievement of a number of operational and strategic objectives, some aspects of which are
beyond our control, including navigating political and regulatory challenges to obtain and renew rights to develop and
produce hydrocarbons; reservoir optimization; bringing long-lead time, capital intensive projects to completion on budget
and on schedule; and efficiently and profitably operating mature properties. If we are not successful in developing the
resources in our portfolio, our financial condition and results of operations may be adversely affected.
The exploration and production of oil and gas is a highly competitive industry.
The exploration and production of crude oil, bitumen, natural gas and NGLs is a highly competitive business. We compete
with private, public and state-owned companies in all facets of the exploration and production business, including
locating, acquiring and developing new sources of supply and producing crude oil, bitumen, natural gas and NGLs in an
efficient, cost-effective manner. In addition, we anticipate the oil and gas industry will face additional competition from
alternative fuels. We must also compete for the materials, equipment, services, employees and other personnel
(including geologists, geophysicists, engineers and other specialists) necessary to conduct our business. If we are not
successful in any facet of this competition, our financial condition and results of operations may be adversely affected.
Risk Factors
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ConocoPhillips 2024 10-K
Our ability to successfully execute on our plans to reduce operational GHG emissions intensity is subject to a number of
risks and uncertainties and such reductions may be costly and challenging to achieve.
Our framework for managing climate-related business risk is set out in our Climate Risk Strategy, which describes our
strategic flexibility, approach to reducing Scope 1 and 2 emissions intensity, technology choices and engagement efforts.
Among other things, we have set near- and medium-term GHG intensity reduction targets, as well as targets around
flaring and methane. Our ability to achieve the stated targets, goals and ambitions within the Climate Risk Strategy's
framework is subject to a number of risks and uncertainties beyond our control, including government policies and
markets, acceptance of carbon capture technologies, development of markets and potential permitting and regulatory
changes, all of which may impair our ability to execute on current or future plans. In addition, the pace of development of
effective emissions measurement and abatement technologies, and the actual pace of development may be inadequate,
or the technologies actually developed may be insufficient to allow us to achieve our stated targets, goals and ambitions.
Furthermore, executing our Climate Risk Strategy could be costly, is likely to encounter unforeseen obstacles, will
proceed at varying paces and may be accomplished in a manner that we cannot predict at this time. We expect to be
required to purchase emission credits and/or offsets in the future. There may be an insufficient supply of offsets, and we
could incur increasingly greater expenses related to our purchase of such offsets. Even if we are able to acquire an
adequate amount of such offsets at satisfactory prices, investors, regulators or other third parties may not perceive this
practice as an acceptable means of achieving our emission reduction goals. As advanced technologies are developed to
accurately measure emissions, we may be required to revise our emissions estimates and reduction goals or otherwise
revise aspects of our Climate Risk Strategy. We may be adversely affected and potentially need to reduce economic end-
of-field life of certain assets and impair associated net book value due to the emissions intensity of some of our assets.
Even if we meet our goals, our efforts may be characterized as insufficient.
In early 2021, we established a multidisciplinary Low Carbon Technologies organization with the remit of supporting our
emissions reduction objectives, understanding the alternative energy landscape and prioritizing opportunities for future
competitive investment. Such potential investments may expose us to numerous financial, legal, operational,
reputational and other risks. While we perform a thorough analysis on these investments, the related technologies and
markets are at early stages of development and we do not yet know what rate of return we will achieve, if any, and we
may suspend our evaluation or investment if we determine that applicable markets have not developed at the pace
required to support further investment. For example, as a result of the hydrogen and ammonia markets not developing at
a pace required to support further investment, in 2024 we decided to suspend our evaluation of a low-carbon ammonia
production facility on the U.S. Gulf Coast. Furthermore, we may not be able to scale potential investments. The success of
our low-carbon strategy will depend in part upon the cooperation of government agencies, the support of stakeholders,
the development of relevant markets for low carbon fuels, our ability to research and forecast potential investments,
willingness of industry partners to collaborate and our ability to apply our existing strengths and expertise to new
technologies, projects and markets.
Estimates of crude oil, bitumen, natural gas and NGL reserves are imprecise and may be subject to revision, and any
material change in the factors and assumptions underlying our estimates of crude oil, bitumen, natural gas and NGL
reserves could impair the quantity and value of those reserves.
Our proved reserve information included in this annual report represents management’s best estimates based on
assumptions, as of a specified date, of the volumes to be recovered from underground accumulations of crude oil,
bitumen, natural gas and NGLs. Such volumes cannot be directly measured, and the estimates and underlying
assumptions used by management are subject to substantial risk and uncertainty. Any material changes in the factors and
assumptions underlying our estimates of these items could result in a material negative impact to the volume of reserves
reported or could cause us to incur impairment expenses on property associated with the production of those reserves.
Future reserve revisions could also result from changes in, among other things, governmental regulation and commodity
prices. For more information on estimates used, see the "Critical Accounting Estimates" section of Management's
Discussion and Analysis of Financial Condition and Results of Operations.
Risk Factors
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20
Our business may be adversely affected by price controls; government-imposed limitations on production or exports of
crude oil, bitumen, LNG, natural gas and NGLs; or the unavailability of adequate gathering, processing, compression,
transportation, and pipeline facilities and equipment for our production of crude oil, bitumen, natural gas and NGLs.
As discussed herein, our operations are subject to extensive governmental regulations across numerous jurisdictions.
From time to time, regulatory agencies have imposed price controls and limitations on production by restricting the rate
of flow of crude oil, bitumen, natural gas and NGLs wells below actual production capacity. Similarly, in response to
increased domestic energy costs, circumstances determined to be in the economic or other interest of the country, or a
declared national emergency, governments could restrict the export or import of our products which would adversely
impact our business. For example, in January 2024, in response to concerns from environmental groups, the U.S.
announced a temporary pause on new authorizations of certain LNG exports. The pause was subsequently lifted in
January 2025. This pause and other difficulties in the regulatory approval processes may have an extended adverse
impact on our global LNG business. Furthermore, because legal requirements are frequently changed and subject to
interpretation, we cannot predict whether future restrictions on our business may be enacted or become applicable to
us.
Our ability to sell and deliver the crude oil, bitumen, LNG, natural gas and NGLs that we produce also depends on the
availability, proximity and capacity of gathering, processing, compression, transportation and pipeline facilities and
equipment, as well as any necessary diluents to prepare our crude oil, bitumen, LNG, natural gas and NGLs for transport.
The facilities, equipment and diluents we rely on may be temporarily unavailable to us due to market conditions, extreme
weather events, permitting delays and other regulatory matters, mechanical reasons or other factors or conditions, many
of which are beyond our control. In addition, in certain newer plays, the capacity of necessary facilities, equipment and
diluents may not be sufficient to accommodate production from existing and new wells, and construction and permitting
delays, permitting costs and regulatory or other constraints could limit or delay the construction, manufacture or other
acquisition of new facilities and equipment. If any facilities, equipment or diluents, or any of the transportation methods
and channels that we rely on become unavailable for any period of time, we may incur increased costs to transport our
crude oil, bitumen, LNG, natural gas and NGLs for sale; we may be forced to curtail our production of crude oil, bitumen,
natural gas or NGLs, or we may not be able to meet all the objectives in our Climate Risk Strategy, such as reducing
routine flaring.
Our ability to manage risk or influence outcomes in joint ventures may be constrained.
We conduct many of our operations through joint ventures in which another joint venture partner is the operator or we
may not have majority control. In these cases, the economic, business, or legal interests or goals of the operator or the
voting majority may be inconsistent with ours, and we may not be able to influence the decision making or outcomes to
align with our interests or goals. Failure by an operator or a voting majority, with whom we have a joint venture interest,
to adequately manage the risks associated with any operations could have an adverse effect on the financial condition or
results of operations of our joint ventures and, in turn, our business and operations.
Our operations are subject to hazards and risks that require significant and continuous oversight.
Our operations are subject to a variety of hazards and risks that require significant and continuous oversight, such as the
monitoring, prevention or mitigation of or protection from explosions, fires, product spills, severe weather, geological
events, global health crises, such as epidemics and pandemics, labor disputes, geopolitical tensions, armed hostilities,
terrorist or piracy attacks, sabotage, civil unrest or cyberattacks. Our operations are subject to additional hazards
concerning exposure to and potential release of pollutants and toxic substances, as well as other environmental hazards
and risks. For example, offshore activities may pose incrementally greater technological challenges, operating risks and
potential for adverse consequences from operational failures because of complex subsurface conditions such as higher
reservoir pressures, water depths and metocean conditions. All such hazards could result in loss of human life, significant
property and equipment damage, environmental pollution, impairment of operations, substantial losses to us and
damage to our reputation. Our business and operations may be disrupted if we do not respond, or are perceived not to
respond, in an appropriate manner to any of these hazards and risks or any other major crisis or if we are unable to
efficiently restore or replace affected operational components and capacity. Countermeasures to address global health
crises, epidemics or pandemics may result in reduced demand for our products; disruptions to our supply chain, the
global economy or financial or commodity markets; disruptions in our contractual arrangements with our service
providers, suppliers and other counterparties; failures by our suppliers, contract manufacturers, contractors, joint
venture partners and external business partners, to meet their obligations to us; reduced workforce productivity; and
voluntary or involuntary curtailments. Further, our insurance may not be adequate to compensate us for all resulting
losses described above, and the cost to obtain adequate coverage may increase for us in the future or may not be
available.
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In addition, although we design and operate our business operations to accommodate expected climatic conditions, to
the extent there are significant changes in the earth's climate, such as more severe or frequent weather conditions in the
markets where we operate or the areas where our assets reside, we could incur increased expenses, our operations and
supply chain could be adversely impacted and demand for our products could fall.
Any of these factors, or other cascading effects of such factors, could materially increase our costs; negatively impact our
revenues or ability to implement and advance our Climate Risk Strategy; and damage our financial condition, results of
operations, cash flows and liquidity position. The full extent and duration of any such impacts cannot be predicted at this
time because of the lack of certainty surrounding their sources, causes and outcomes.
Legal and Regulatory Risks
We expect to continue to incur substantial capital expenditures and operating costs as a result of our compliance with
existing and future environmental laws and regulations.
Our business is subject to numerous laws and regulations relating to the protection of the environment, which are
expected to continue to have an increasing impact on our operations. For a description of the most significant of these
environmental laws and regulations, see the “Contingencies—Environmental”, “—Climate Change” and "—Company
Response to Climate-Related Risks" sections of Management’s Discussion and Analysis of Financial Condition and Results
of Operations. These laws and regulations continue to increase in both number and complexity and affect our operations
with respect to, among other things:
•
Permits required in connection with exploration, drilling, production and other activities, including those issued
by national, subnational and local authorities;
•
The discharge of pollutants into the environment;
•
Emissions into the atmosphere, such as nitrogen oxides, sulfur dioxide, mercury and GHG emissions, including
methane and carbon dioxide;
•
Carbon taxes;
•
The handling, use, storage, transportation, disposal and cleanup of hazardous materials and hazardous and
nonhazardous wastes;
•
The dismantlement, abandonment and restoration of historic properties and facilities at the end of their useful
lives; and
•
Exploration and production activities in certain areas, such as offshore environments, arctic fields, oil sands
reservoirs and unconventional plays.
We have incurred and will continue to incur substantial capital, operating and maintenance, and remediation
expenditures as a result of these laws and regulations. In addition, to the extent these expenditures are assumed by a
buyer as a result of a disposition, it may result in our incurring substantial costs if the buyer is unable to satisfy these
obligations. Any actual or perceived failure by us to comply with existing or future laws, regulations and other
requirements could result in administrative or civil penalties, criminal fines, other enforcement actions or third-party
litigation against us. To the extent these expenditures, as with all costs, are not ultimately reflected in the prices of our
products, our business, financial condition, results of operations and cash flows in future periods, as well as our ability to
implement and advance our Climate Risk Strategy could be adversely affected.
Existing and future laws, regulations and internal initiatives relating to global climate change, such as limitations on
GHG emissions or provisions aimed at reducing such emissions, may impact or limit our business plans, result in
significant expenditures, promote alternative uses of energy or reduce demand for our products.
Continuing political and societal attention to the issue of global climate change has resulted in both existing and pending
international agreements and national, regional or local legislation and regulatory measures to limit GHG emissions, such
as cap and trade regimes, specific emission standards, carbon taxes, restrictive permitting, increased fuel efficiency
standards and incentives or mandates for renewable and alternative energy. Although we may support the intent of
legislative and regulatory measures aimed at addressing climate-related risks, the specifics of how and when they are
enacted could result in a material adverse effect to our business, financial condition, results of operations and cash flows
in future periods as well as our ability to implement and advance our Climate Risk Strategy.
Risk Factors
ConocoPhillips 2024 10-K
22
For example, in 2024, New York and Vermont passed legislation seeking to hold certain energy companies financially
responsible for state climate change mitigation and adaptation measures, following the "polluter pays" model of existing
Superfund laws. This responsibility may include paying into a fund for infrastructure repairs and recovery from extreme
weather events that would otherwise be covered by the government. While only two U.S. states have enacted such laws
to date, other states have introduced similar measures, and it is likely that more states will consider a similar approach.
Compliance with such legislation may expose us to significant additional liabilities.
Furthermore, in December 2023, the EPA published a final rule that revises the regulations governing, among other
things, the emission of methane and volatile organic compounds from new oil and gas production facilities and emission
guidelines for states to use when revising Clean Air Act implementation plans to limit methane emissions from existing oil
and gas facilities. Also pursuant to the Inflation Reduction Act of 2022, the EPA published certain rules in 2024 to facilitate
the determination and payment of a charge on methane emissions from selected facilities in the oil and natural gas
industry, including many of the facilities operated by ConocoPhillips. These final rules could result in additional capital
expenditures and compliance, operating and maintenance costs, any of which may have an adverse effect on our
business and results of operations.
Additionally, in 2023, at the international community at the 28th Conference of the Parties (COP28), nearly 200 countries,
including most of the countries in which we operate, renewed their commitment to deliver on the aims of the 2015 Paris
Agreement. COP28 included a decision on the world's first 'global stocktake' to ratchet up climate action before the end
of the decade — including a goal to triple renewable energy capacity by 2030 — and for the first time its final agreement
explicitly recommended "transitioning away from fossil fuels in the energy system."
The implementation of current agreements and regulatory or judicial measures, as well as any future agreements or
measures addressing climate change and GHG emissions, may adversely increase our capital and operating expenses,
impact the demand for our products, impose taxes on our products or operations, or require us to purchase emission
credits or reduce emissions of GHGs from our operations. As a result, we may incur substantial capital expenditures and
compliance, operating, maintenance and remediation costs, any of which may have an adverse effect on our business and
results of operations.
For more information on legislation or precursors for possible regulation relating to global climate change that affect or
could affect our operations and a description of the company's response, see the "Contingencies—Climate Change” and
"—Company Response to Climate-Related Risks" sections of Management’s Discussion and Analysis of Financial Condition
and Results of Operations.
Broader investor and societal attention to and efforts to address global climate change may limit who can do business
with us or our access to financial markets and could subject us to litigation.
Increasing attention to global climate change has also resulted in pressure from and upon stockholders, financial
institutions and other financial market participants to potentially limit or discontinue investments, insurance and funding
to oil and gas companies. For example, a significant number of financial institutions have pledged to meet the goal of net
zero by 2050, as well as setting interim targets for 2030 or earlier. While these targets do not prohibit financial sector
stakeholders from doing business with oil and gas companies, stakeholders may self-impose limits. Conversely, we also
face pressure from some in the investment community and certain public interest groups to limit the focus on ESG in our
decision-making, arguing that ESG considerations do not relate to financial outcomes. As public pressure continues to
mount on the financial sector, our costs of capital may increase.
Furthermore, increasing attention to global climate change has resulted in an increased likelihood of governmental
investigations and private litigation, which could increase our costs or otherwise adversely affect our business. Beginning
in 2017 and continuing through 2024, cities, counties, governments and other entities in several states/territories in the
U.S. have filed lawsuits against oil and gas companies, including ConocoPhillips, seeking compensatory damages and
equitable relief to abate alleged climate change impacts. Additional lawsuits with similar allegations are expected to be
filed. The amounts claimed by plaintiffs are unspecified and the legal and factual issues involved in these cases are
unprecedented. We believe these lawsuits are factually and legally meritless and are an inappropriate vehicle to address
the challenges associated with climate change, and we will vigorously defend against such lawsuits. The ultimate
outcome and impact to us cannot be predicted with certainty, and we expect to incur substantial legal costs associated
with defending these and similar lawsuits in the future. We could also receive lawsuits alleging a failure or lack of
diligence to meet our publicly stated ESG goals or alleging misrepresentation related to our ESG activity.
Risk Factors
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ConocoPhillips 2024 10-K
Political and economic developments could damage our operations and materially reduce our profitability and cash
flows.
Actions of the U.S., state, local and foreign governments, through sanctions, tax, tariffs and other legislation, executive
orders and commercial restrictions, could reduce our operating profitability both in the U.S. and abroad. In certain
locations, restrictions on our operations; leasing restrictions; special taxes or tax assessments; tariffs; and payment
transparency regulations that could require us to disclose competitively sensitive information or might cause us to violate
non-disclosure laws of other countries have been imposed or proposed by governments or certain interest groups. In
addition, we may face regulatory changes in the U.S. including, but not limited to, the enactment of tax law changes that
adversely affect the fossil fuel industry, new methane emissions standards, requirements restricting or prohibiting flaring
and subsurface water disposal, more stringent environmental impact studies and reviews and policies inhibiting or
curtailing LNG or crude oil exports. Similar regulatory shifts, including attendant higher costs and market access
constraints, may also occur in international jurisdictions in which we currently operate or seek to operate.
Hydraulic fracturing, an essential completion technique that facilitates production of oil and natural gas otherwise
trapped in lower permeability rock formations, has historically attracted political and regulatory scrutiny. A range of local,
state, federal and national laws and regulations currently govern, constrain or prohibit hydraulic fracturing in some
jurisdictions. New or more stringent permitting, disclosure or other regulatory requirements on hydraulic fracturing or
other oil and natural gas operations, including subsurface water disposal, could result in increased costs, operating
restrictions or operational delays or could limit the ability to develop oil and natural gas resources.
In addition, certain interest groups have also proposed ballot initiatives, contested lease sales and challenged project
permits, for example, to restrict oil and natural gas development generally as well as specific projects, including the
Willow project in Alaska. In the event that ballot initiatives, local, state, or national restrictions or prohibitions are
adopted and result in more stringent limitations on the production and development of oil and natural gas in areas where
we conduct operations, we may incur significant costs to comply with such requirements or may experience delays or
curtailment in the permitting or pursuit of exploration, development or production activities. Such compliance costs and
delays, curtailments, limitations or prohibitions could have a material adverse effect on our business, prospects, results of
operations, financial condition, liquidity and ability to implement and advance the Climate Risk Strategy.
Political and economic factors in international markets could have a material adverse effect on us.
Approximately 32 percent of our hydrocarbon production was derived from production outside the U.S. in 2024, and 32
percent of our proved reserves, as of December 31, 2024, were located outside the U.S. We are subject to risks
associated with our operations in foreign jurisdictions and international markets, including changes in foreign
governmental policies relating to crude oil, bitumen, LNG, natural gas or NGLs pricing and taxation; other regulatory or
economic developments (including the macro effects of international trade policies and disputes); disruptive geopolitical
conditions such as the escalation of geopolitical tension in the Middle East in late 2023 and through 2024; and
international monetary and currency rate fluctuations. Restrictions on production of oil and gas could increase to the
extent governments view such measures as a viable approach for pursuing national and global energy security and
climate policies. In addition, some countries where we operate lack a fully independent judiciary system. This, coupled
with changes in foreign law or policy, results in a lack of legal certainty that exposes our operations to increased risks,
including increased difficulty in enforcing our agreements in those jurisdictions and increased risks of adverse actions by
local government authorities, such as expropriations. Actions by host governments, such as the expropriation of our oil
assets by the Venezuelan government, have affected operations significantly in the past and may continue to do so in the
future.
In addition, the U.S. government has the authority to prevent or restrict us from doing business in foreign jurisdictions or
with certain parties. These restrictions and similar restrictions imposed by foreign governments have in the past limited
our ability to operate in, or gain access to, opportunities in various jurisdictions. Diplomatic relations or policies between
the U.S. government and one or more foreign jurisdictions may increase our expenses or impair our ability to collect
awards in legal actions against such foreign jurisdictions. Changes in domestic and international policies and regulations
may also restrict our ability to obtain or maintain licenses or permits necessary to operate in foreign jurisdictions,
including those necessary for drilling and development of wells. Similarly, the declaration of a “climate emergency” could
result in actions to limit exports of our products and other restrictions.
Any of these actions could adversely affect our business or operating results, including our ability to implement and
advance the Climate Risk Strategy.
Risk Factors
ConocoPhillips 2024 10-K
24
Risks Related to Our Acquisition of Marathon Oil
Integrating Marathon Oil's business may be more difficult, costly or time-consuming than expected, and we may fail to
achieve the expected benefits and synergies of the Marathon Oil acquisition, which may adversely affect our business
results and negatively affect the value of our common stock.
The success of our acquisition of Marathon Oil will depend on, among other things, our ability to integrate Marathon Oil
with our business in a manner that facilitates development opportunities and realizes expected synergies. We may
encounter difficulties in integrating our and Marathon Oil’s businesses and realizing the expected benefits and synergies
of the acquisition of Marathon Oil. If we are not able to successfully achieve our objectives, the anticipated benefits of
the acquisition of Marathon Oil may not be realized fully, or at all, or may take longer to realize than expected.
Prior to the completion of our acquisition of Marathon Oil, each of ConocoPhillips and Marathon Oil operated as an
independent public company. There can be no assurances that Marathon Oil’s business can be integrated successfully
into ours. It is possible that the integration process could result in the loss of commercial and vendor partners; the
disruption of our, Marathon Oil’s or both companies’ ongoing businesses; inconsistencies in standards, controls,
procedures and policies; unexpected integration issues; higher than expected integration costs; and an overall post-
completion integration process that takes longer than originally anticipated. We will be required to devote management
attention and resources to integrating Marathon Oil’s business practices and operations.
An inability to realize the full extent of the anticipated benefits of the acquisition of Marathon Oil, as well as any delays
encountered in the integration process, could have an adverse effect upon our revenues, level of expenses and operating
results, which may adversely affect the value of our common stock.
In addition, the actual integration may result in additional and unforeseen expenses, and the anticipated benefits of the
integration plan may not be realized. There are numerous processes, policies, procedures, operations and technologies
and systems that must be integrated in connection with our acquisition of Marathon Oil and the integration of Marathon
Oil’s business. Any efficiencies related to the integration of Marathon Oil’s business may not offset incremental
transaction and acquisition-related costs in the near term or at all. If we are not able to adequately address integration
challenges, we may be unable to successfully integrate operations or realize the anticipated benefits of the acquisition.
The market value of our common stock could decline if large amounts of our common stock are sold now that the
Marathon Oil acquisition has been consummated.
We issued shares of ConocoPhillips common stock to former Marathon Oil stockholders. Former Marathon Oil
stockholders may decide not to hold the shares of ConocoPhillips common stock that they received in the acquisition of
Marathon Oil, and ConocoPhillips stockholders may decide to reduce their investment in ConocoPhillips due to the
changes to ConocoPhillips’ investment profile as a result of the acquisition of Marathon Oil. Other Marathon Oil
stockholders, such as funds with limitations on their permitted holdings of stock in individual issuers, may be required to
sell the shares of ConocoPhillips common stock that they received in the acquisition of Marathon Oil. Such sales of
ConocoPhillips common stock could have the effect of depressing the market price for ConocoPhillips common stock.
Other Risk Factors Facing our Business or Operations
We may need additional capital in the future, and it may not be available on acceptable terms or at all.
We have historically relied primarily upon cash generated by our business to fund our operations and strategy; however,
we have also relied from time to time on access to the capital markets for funding. There can be no assurance that
additional financing will be available in the future on acceptable terms or at all. In addition, although we anticipate we
will be able to repay our existing indebtedness when it matures or in accordance with our stated plans, there can be no
assurance we will be able to do so. Our ability to obtain additional financing or refinance our existing indebtedness when
it matures or in accordance with our plans, will be subject to a number of factors, including market conditions, our
operating performance, investor sentiment, risks impacting financial institutions and the credit markets more broadly and
financial institution policies regarding the oil and gas industry. If we are unable to generate sufficient funds from
operations or raise additional capital for any reason, our business could be adversely affected.
Risk Factors
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ConocoPhillips 2024 10-K
In addition, we are regularly evaluated by the major rating agencies based on a number of factors, including our financial
strength and conditions affecting the oil and gas industry generally. We and other industry companies have had our
ratings reduced in the past due to negative commodity price outlooks. These major rating agencies are now considering
ESG attributes when assessing credit profiles. While these assessments have limited impact today, they have the
potential to pressure credit ratings over time. Any downgrade in our credit rating or announcement that our credit rating
is under review for possible downgrade could increase the cost associated with any additional indebtedness we incur.
Our business may be adversely affected by deterioration in the credit quality of, or defaults under our contracts with,
third parties with whom we do business.
The operation of our business requires us to engage in transactions with numerous counterparties operating in a variety
of industries, including other companies operating in the oil and gas industry. These counterparties may default on their
obligations to us as a result of operational failures or a lack of liquidity, or for other reasons, including bankruptcy. Market
speculation about the credit quality of these counterparties, or their ability to continue performing on their existing
obligations, may also exacerbate any operational difficulties or liquidity issues they are experiencing. Any default by any
of our counterparties may result in our inability to perform our obligations under agreements we have made with third
parties or may otherwise adversely affect our business or results of operations. In addition, our rights against any of our
counterparties as a result of a default may not be adequate to compensate us for the resulting harm caused or may not
be enforceable at all in some circumstances. We may also be forced to incur additional costs as we attempt to enforce
any rights we have against a defaulting counterparty, which could further adversely impact our results of operations.
Our ability to execute our capital return program is subject to certain considerations.
Ordinary dividends are authorized and determined by our Board of Directors in its sole discretion and depend upon a
number of factors, including:
•
Cash available for distribution;
•
Our results of operations and anticipated future results of operations;
•
Our financial condition, especially in relation to anticipated future capital needs;
•
The level of distributions paid by comparable companies;
•
Our operating expenses; and
•
Other factors our Board of Directors deems relevant.
We paid a quarterly VROC to our shareholders in the first three quarters of 2024. In the fourth quarter of 2024, we
declared an ordinary dividend that incorporated the prior VROC equivalent per share payment and did not make a
separate VROC payment. VROC distributions remain an option in elevated price environments, to be authorized and
determined by our Board of Directors in its sole discretion and depending on factors it deems relevant. Our Board may
determine not to pay a dividend in a quarter or may cease declaring a dividend at any time.
Additionally, as of December 31, 2024, $30.7 billion of repurchase authority remained. In October 2024, our Board of
Directors approved an increase from our prior authorization of $45 billion by a total of the lesser of $20 billion or the
number of shares issued in our acquisition of Marathon Oil, such that the company is not to exceed $65 billion in
aggregate purchases. Our share repurchase program does not obligate us to acquire a specific number of shares during
any period, and our decision to commence, discontinue or resume repurchases in any period will depend on the same
factors that our Board of Directors may consider when declaring dividends, among other factors. In the past, we have
suspended our share repurchase program in response to market downturns, including as a result of the oil market
downturn that began in early 2020, and we may do so again in the future.
Any downward revision in the amount of our ordinary dividend or the volume of shares we purchase under our share
repurchase program could have an adverse effect on the market price of our common stock.
Risk Factors
ConocoPhillips 2024 10-K
26
There are substantial risks with any acquisitions or divestitures we have completed or that we may choose to
undertake.
We regularly review our portfolio and pursue growth through acquisitions and seek to divest noncore assets or
businesses. We may not be able to complete these transactions on favorable terms, on a timely basis, or at all. Even if we
do complete such transactions, our cash flow from operations may be adversely impacted or otherwise the transactions
may not result in the benefits anticipated due to various risks, including, but not limited to (i) the failure of the acquired
assets or businesses to meet or exceed expected returns, including risk of impairment; (ii) the inability to dispose of
noncore assets and businesses on satisfactory terms and conditions; and (iii) the discovery of unknown and unforeseen
liabilities or other issues related to any acquisition for which contractual protections are inadequate or we lack insurance
or indemnities, including environmental liabilities, or with regard to divested assets or businesses, claims by purchasers to
whom we have provided contractual indemnification. In addition, we may face difficulties in integrating the operations,
technologies, products and personnel of any acquired assets or businesses.
Our technologies, systems and networks are subject to cybersecurity threats.
Our business is faced with growing cybersecurity threats as we increasingly rely on digital technologies across our
business. Cybersecurity risks to our business, including our suppliers, third-party service providers, contractors, joint
venture partners and external business partners, include but are not limited to:
•
Unauthorized access to, or control of or disclosure of sensitive information about our business and our
employees;
•
Compromise of our data or systems, including corruption, sabotage, encryption or acts that otherwise render
our data or systems unusable (or those of third parties with whom we do business, including third-party cloud
and information technology (IT) service providers);
•
Theft or manipulation of our proprietary information;
•
Ransom;
•
Extortion;
•
Threats to the security of our facilities and infrastructure; and
•
Cyber terrorism.
In addition, we have exposure to cybersecurity risks where our data and proprietary information are collected, hosted,
and/or processed by third-party cloud and service providers. In addition, many of our vendors, including suppliers that
are closely integrated into our business, have been victims of cybersecurity attacks that have accessed and exfiltrated
information from their systems. Our risks may be exacerbated by a delay or failure to detect a cybersecurity incident or
understand the full extent of such incident notwithstanding our risk management processes and controls. We face risks
associated with new and ever-increasing phishing techniques, hidden malware, as well as risks associated with electronic
data proliferation and technology digitization. We also face increased risk with the increased sophistication of generative
artificial intelligence capabilities, which may improve or expand the existing capabilities of cybercriminals described
above in a manner we cannot predict at this time.
Our increasing reliance on IT in our production, distribution and marketing systems may allow cybersecurity threats to
disrupt our oil and gas operations, both domestically and abroad.
If our data, IT, operational technology (OT), including industrial control and supervisory control and data acquisition
(SCADA) systems were to be breached, damaged or disrupted due to a cybersecurity incident or cyber-attack (directly,
indirectly through third parties or through the IT networks, servers, software, or infrastructure on which they rely), we
could be subject to serious negative consequences. These consequences could include physical damage to production,
distribution or storage assets; delay or prevention of delivery to markets; disruption or prevention of accurate accounting
for production and settlement of transactions; negative impacts on public health, safety, the environment, economic
security, or national security; financial impacts; business interruption; reputational damage; loss of employee, supplier,
contractor, partner and/or public trust; reimbursement or other costs; increased compliance costs; regulatory
investigations; litigation exposure and legal liability or regulatory fines; penalties or other external intervention.
Although we have business continuity plans in place, our operations may be adversely affected by significant and
widespread disruption to our systems and infrastructure that support our business. If we seek insurance against
cybersecurity risks, it may be limited by the availability and increasing expense of sufficient coverage.
For additional information regarding our cybersecurity risk management, strategy and governance, see Item 1C.
Cybersecurity.
Risk Factors
27
ConocoPhillips 2024 10-K
Item 1B. Unresolved Staff Comments
None.
Item 1C. Cybersecurity
Cybersecurity Risk Management and Strategy
Cybersecurity Risk Assessment and Management
We take a multilayered approach to cybersecurity risk management and strategy. Our IT/OT Security Program integrates
administrative, technical, and physical controls against evolving cybersecurity threats, and includes enterprise IT and OT
security architecture, cybersecurity operations, data privacy and governance, supply chain security, and governance, risk,
and compliance. Additionally, it is designed to identify, assess, and manage cybersecurity risks and protect the
confidentiality, integrity, and availability of our data, IT, and OT.
Cybersecurity is a component of our IT/OT Security Program, which we periodically review and adapt to respond to new
and evolving circumstances, cybersecurity threats and regulations. We evaluate security, privacy, and resiliency risks,
including those related to cybersecurity, in our overall Enterprise Risk Management (ERM) program's annual risk
assessment process. This annual risk assessment process takes into account broader risks based on likelihood, potential
consequences, and mitigations, such as operational and economic impact; health, safety and environmental impact; and
reputational and financial implications. This risk assessment is discussed with members of the ELT, Audit and Finance
Committee (AFC) of the Board of Directors, and Board of Directors on at least an annual basis.
We consult recognized security frameworks, such as the National Institute of Standards and Technology Cybersecurity
Framework to organize, improve, and assess our IT/OT Security Program to manage and reduce cybersecurity risk. We
deploy, configure, and maintain various technologies designed to enforce security policies, detect and protect against
cybersecurity threats, and help safeguard IT and OT assets. We operate a Cybersecurity Operation Center (CSOC) to
ingest threat intelligence, monitor cybersecurity threats, coordinate incident response resources and manage response
times.
Our Global Computer Security Incident Response Plan (CSIRP) establishes the framework for our response to
cybersecurity incidents. Under the CSIRP, cybersecurity incidents are escalated based on a defined incident categorization
to the Chief Information Security Officer (CISO) and senior leaders, including the Chief Digital & Information Officer
(CD&IO), General Counsel, Chief Financial Officer, and other cybersecurity program stakeholders, such as the AFC and/or
the full Board of Directors. We also conduct incident response exercises at least annually, which are facilitated by internal
team members and, in some instances, with assistance from third-party experts.
Physical controls are designed to work in conjunction with digital and cybersecurity controls to help protect the
company’s IT and OT assets from physical threats. Our Chief Security Officer is responsible for a physical security program
including site plans, cameras, security systems monitoring, and access control and badging systems to manage physical
security risks.
Our governing policies, standards and procedures create a structured approach to managing cybersecurity risk.
Information security requirements for employees, contractors and partners are detailed in the ConocoPhillips
Information Security & Protection Policy. Our workforce is required to complete information security training annually,
and we periodically communicate ways to recognize and avoid cybersecurity threats to our workforce.
ConocoPhillips 2024 10-K
28
Engagement of Third Parties
We engage third-party cybersecurity consultants and experts to supplement staffing of our CSOC, as well as to help us
assess, validate, and enhance our security practices, including conducting cybersecurity maturity assessments,
vulnerability assessments and penetration tests.
As part of the cybersecurity incident response process described above, we engage third-party experts as needed to
support incident response, such as external legal advisors, cybersecurity forensic firms and other specialists.
Third-Party Service Provider Risk Management
Our third-party risk management process is designed to identify, assess, and mitigate risks associated with third-party
service providers, including cybersecurity risks. An initial assessment is conducted to assess the cybersecurity risks
associated with a third-party provider based on various criteria, such as whether the third-party provider has access to
our network, data, and information systems. Third-party providers that are identified through the initial assessment as
warranting further review are subject to additional risk assessment. In parallel, we have designed a contracting process to
mitigate cybersecurity risks by specifying the rights and responsibilities of the parties.
Risks from Material Cybersecurity Threats
While we are subject to ongoing cybersecurity threats, we do not believe that the risks from previous threats have
materially affected or are reasonably likely to materially affect the company, including our business strategy, results of
operations or financial condition. Nevertheless, we recognize cybersecurity threats are on-going and evolving, and our
program is designed to identify and manage those threats. See item 1A. Risk Factors—Our technologies, systems and
networks are subject to cybersecurity threats for more information on our risks relating to our technologies, systems, and
networks.
Cybersecurity Governance
Management's Role
A dedicated CISO leads the IT/OT Security Team and is responsible for our cybersecurity risk management and strategy.
The CISO has over 20 years of experience in security, of which 15 years is specific to cybersecurity and has served as a
CISO since 2013, having joined ConocoPhillips as CISO in 2022. The CISO holds a master’s degree and is a Certified
Information Security Professional. The CISO reports to the CD&IO, who holds a master’s degree in information technology
and has served as Chief Information Officer/Chief Technology Officer and various roles in information technology for over
28 years. The CD&IO reports to the Executive Vice President and Chief Financial Officer. This management team assesses
and manages risks associated with cybersecurity.
Board of Directors' Oversight
While our cybersecurity management team is responsible for the day-to-day assessment and management of material
risks from cybersecurity threats, the ConocoPhillips Board of Directors has oversight responsibility for our ERM program
and the individual risk management programs comprising our ERM program, including cybersecurity risk management. To
help maintain effective Board of Directors' oversight across the entire enterprise, the Board of Directors delegates certain
elements of its oversight function to individual committees. The AFC assists the Board of Directors in fulfilling its oversight
of our ERM program and cybersecurity.
The Board of Directors receives a report on cybersecurity annually, and the AFC receives reports on cybersecurity
multiple times a year. For meetings where cybersecurity is not on the formal agenda, the AFC will receive a pre-read that
includes cybersecurity updates or discussion topics. During these reviews, management discusses various topics,
including information relating to IT/OT Security strategy, program management, cybersecurity risks and threats, and
provides briefings on notable cybersecurity attacks, including those relating to third-party service providers, if known. In
addition to this regular reporting, significant cybersecurity risks or threats may also be escalated on an as needed basis to
the AFC and Board of Directors.
29
ConocoPhillips 2024 10-K
Item 3. Legal Proceedings
We are a defendant in a number of legal and administrative proceedings arising in the ordinary course of business,
including those involving governmental authorities under federal, state and local laws regulating the discharge of
materials into the environment. While it is not possible to accurately predict the final outcome of these pending
proceedings, if any one or more of such proceedings were to be decided adversely to ConocoPhillips, we expect there
would not be a material effect to our consolidated financial position.
ConocoPhillips has elected to use a $1 million threshold for disclosing certain proceedings arising under federal, state or
local environmental laws when a governmental authority is a party. ConocoPhillips believes proceedings under this
threshold are not material to ConocoPhillips' business and financial condition. Applying this threshold, there are no such
proceedings to disclose for the year ended December 31, 2024. See Note 10 for information regarding other legal and
administrative proceedings.
Item 4. Mine Safety Disclosures
Not applicable.
Information about our Executive Officers
Name
Position Held
Age*
William L. Bullock, Jr.
Executive Vice President and Chief Financial Officer
60
Christopher P. Delk
Vice President, Controller and General Tax Counsel
55
Heather G. Hrap
Senior Vice President, Human Resources and Real Estate and Facilities Services
52
Kirk L. Johnson
Senior Vice President, Global Operations
49
Ryan M. Lance
Chairman of the Board of Directors and Chief Executive Officer
62
Andrew D. Lundquist
Senior Vice President, Government Affairs
64
Andrew M. O'Brien
Senior Vice President, Strategy, Commercial, Sustainability and Technology
50
Nicholas G. Olds
Executive Vice President, Lower 48
55
Kelly B. Rose
Senior Vice President, Legal, General Counsel and Corporate Secretary
58
_____________________
*On February 18, 2025.
There are no family relationships among any of the officers named above. Each officer of the company is elected by the
Board of Directors at its first meeting after the Annual Meeting of Stockholders and thereafter as appropriate. Each
officer of the company holds office from the date of election until the first meeting of the directors held after the next
Annual Meeting of Stockholders or until a successor is elected. The date of the next annual meeting is May 13, 2025. Set
forth below is information about the executive officers.
William L. Bullock, Jr. was appointed Executive Vice President and Chief Financial Officer as of September 2020, having
previously served as President, Asia Pacific & Middle East since April 2015. Prior to that, he was Vice President, Corporate
Planning & Development since May 2012.
Christopher P. Delk was appointed Vice President, Controller and General Tax Counsel in November 2022, having
previously served as Vice President and General Tax Counsel since July 2015.
ConocoPhillips 2024 10-K
30
Heather G. Hrap was appointed Senior Vice President, Human Resources and Real Estate and Facilities Services in March
2022, having previously served as Vice President, Human Resources from January 2019. Prior to that, she served as
Human Resources General Manager from October 2015 to January 2019.
Kirk L. Johnson was appointed Senior Vice President, Global Operations in 2024, having previously served as Senior Vice
President, Lower 48 Assets and Operations since May 2022. Prior to that he served as Vice President, Corporate Planning
and Development since June 2021, President Canada from June 2018 to May 2021 and Manager, Strategy, Planning and
Portfolio Management from July 2017 to June 2018.
Ryan M. Lance was appointed Chairman of the Board of Directors and Chief Executive Officer in May 2012, having
previously served as Senior Vice President, Exploration and Production—International since May 2009.
Andrew D. Lundquist was appointed Senior Vice President, Government Affairs in February 2013. Prior to that, he served
as managing partner of BlueWater Strategies LLC, since 2002.
Andrew M. O'Brien was appointed Senior Vice President, Strategy, Commercial, Sustainability and Technology in 2024,
having previously served as Senior Vice President, Global Operations since November 2022. Prior to that, he served as
Vice President and Treasurer since May 2021, Vice President of Corporate Planning and Development from August 2020
to May 2021, Lower 48 Finance Manager from August 2018 to August 2020, and Manager of Investor Relations from
November 2016 to August 2018.
Nicholas G. Olds was appointed Executive Vice President, Lower 48 in November 2022, having previously served as
Executive Vice President, Global Operations since September 2021. Prior to that, he served as Senior Vice President,
Global Operations from August 2020 to September 2021, Vice President, Corporate Planning & Development from June
2018 to August 2020, Vice President, Mid-Continent Business Unit, Lower 48 from September 2016 to June 2018, and
Vice President, North Slope Operations and Development in Alaska from August 2012 to September 2016.
Kelly B. Rose was appointed Senior Vice President, Legal, General Counsel and Corporate Secretary in September 2018.
Prior to that, she was a senior partner in the Houston office of an international law firm, Baker Botts L.L.P., where she
counseled clients on corporate and securities matters. She began her career at the firm in 1991.
31
ConocoPhillips 2024 10-K
Part II
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and
Issuer Purchases of Equity Securities
ConocoPhillips’ common stock is traded on the NYSE under the symbol “COP.”
Cash Dividends Per Share
2024
2023
Ordinary
VROC
Ordinary
VROC
First
$
0.58
0.20
0.51
0.60
Second
0.58
0.20
0.51
0.60
Third
0.58
0.20
0.51
0.60
Fourth
0.78
—
0.58
—
Number of Stockholders of Record at January 31, 2025*
48,051
Dividends shown above reflect the quarter in which the dividend was declared.
*In determining the number of stockholders, we consider clearing agencies and security position listings as one stockholder for each agency listing.
In the fourth quarter of 2024, we incorporated the prior VROC equivalent payment into our ordinary dividend. The
declaration of ordinary dividends and VROC are subject to the discretion and approval of our Board of Directors. The
Board has adopted a dividend declaration policy providing that the declaration of any dividends will be determined
quarterly. For more information on factors considered when determining the level of these distributions, see “Item 1A —
Risk Factors – Our ability to execute our capital return program is subject to certain considerations.”
Issuer Purchases of Equity Securities
Millions of Dollars
Period
Total Number of
Shares Purchased*
Average
Price Paid
Per Share
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
Approximate Dollar
Value of Shares
that May Yet Be
Purchased Under the
Plans or Programs
October 1-31, 2024
6,052,176 $
107.40
6,052,176 $
32,028
November 1-30, 2024
5,853,754
111.04
5,853,754
31,378
December 1-31, 2024
6,462,609
100.58
6,462,609
30,728
18,368,539
18,368,539
*There were no repurchases of common stock from company employees in connection with the company's broad-based employee incentive plans.
In late 2016, we initiated our current share repurchase program. In October 2024, our Board of Directors approved an
increase from our previous authorization of $45 billion by a total of the lesser of $20 billion or the number of shares
issued in our acquisition of Marathon Oil, such that the company is not to exceed $65 billion in aggregate repurchases. As
of December 31, 2024, we had repurchased $34.3 billion of shares since 2016. Repurchases are made at management’s
discretion, at prevailing prices, subject to market conditions and other factors. Except as limited by applicable legal
requirements, repurchases may be increased, decreased or discontinued at any time without prior notice. Shares of stock
repurchased under the plan are held as treasury shares. For more information, see “Item 1A—Risk Factors – Our ability to
execute our capital return program is subject to certain considerations.”
ConocoPhillips 2024 10-K
32
Stock Performance Graph
The following graph shows the cumulative TSR for ConocoPhillips’ common stock in each of the five years from December
31, 2019 to December 31, 2024. The graph also compares the cumulative total returns for the same five-year period with
the S&P 500 Index and our performance peer group consisting of APA Corporation, Chevron, Devon Energy, Diamondback
Energy, EOG Resources, ExxonMobil, Hess, and Occidental Petroleum weighted according to the respective peer’s stock
market capitalization at the beginning of each annual period. In 2024, we updated our performance peer group, adding
Diamondback Energy, to better align with our business and market capitalization, and removing Pioneer. Due to
ExxonMobil’s acquisition of Pioneer completed in 2024, Pioneer’s performance has been excluded from all five years of
the previous peer group performance.
The comparison assumes $100 was invested on December 31, 2019, in ConocoPhillips stock, the S&P 500 Index and
ConocoPhillips’ peer group and assumes that all dividends were reinvested. The cumulative total returns of the peer
group companies' common stock do not include the cumulative total return of ConocoPhillips’ common stock. The stock
price performance included in this graph is not necessarily indicative of future stock price performance.
Five-Year Cumulative Total Shareholder Return (USD)
ConocoPhillips
Current Peer Group
Previous Peer Group
S&P 500
Initial
2020
2021
2022
2023
2024
50
100
150
200
250
33
ConocoPhillips 2024 10-K
Item 7. Management’s Discussion and Analysis of Financial Condition and
Results of Operations
Management’s Discussion and Analysis is the company’s analysis of its financial performance and of significant trends and
uncertainties that may affect future performance. It should be read in conjunction with the financial statements and
notes, and supplemental oil and gas disclosures included elsewhere in this report. It contains forward-looking statements
including, without limitation, statements relating to the company’s plans, strategies, objectives, expectations and
intentions that are made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995.
The words “ambition,” “anticipate,” “believe,” “budget,” “continue,” “could,” “effort,” “estimate,” “expect,” “forecast,”
“goal,” “guidance,” “intend,” “may,” “objective,” “outlook,” “plan,” “potential,” “predict,” “projection,” “seek,” “should,”
“target,” “will,” “would” and similar expressions identify forward-looking statements. The company does not undertake to
update, revise or correct any of the forward-looking information unless required to do so under the federal securities laws.
Readers are cautioned that such forward-looking statements should be read in conjunction with the company’s disclosures
under the heading: “CAUTIONARY STATEMENT FOR THE PURPOSES OF THE ‘SAFE HARBOR’ PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995,” beginning on page 65.
The terms “earnings” and “loss” as used in Management’s Discussion and Analysis refer to net income (loss).
Business Environment and Executive Overview
ConocoPhillips is one of the world’s leading E&P companies based on both production and reserves with operations and
activities in 14 countries. Our diverse, low cost of supply portfolio includes resource-rich unconventional plays in North
America; conventional assets in North America, Europe, Africa and Asia; global LNG developments; oil sands in Canada;
and an inventory of global exploration prospects. Headquartered in Houston, Texas, at December 31, 2024, we employed
approximately 11,800 people worldwide and had total assets of $123 billion.
Completed Acquisition of Marathon Oil Corporation
On November 22, 2024, we completed our acquisition of Marathon Oil, an independent oil and gas exploration and
production company. The acquisition adds high-quality, low cost of supply, development opportunities to our existing
Lower 48 portfolio and additional LNG capacity to our global LNG portfolio through Equatorial Guinea.
At closing, the acquisition was valued at approximately $16.5 billion, in which 0.255 shares of ConocoPhillips common
stock was exchanged for each outstanding share of Marathon Oil common stock, resulting in the issuance of
approximately 143 million shares of ConocoPhillips common stock. We also assumed $4.6 billion in aggregate principal
amount of outstanding debt for Marathon Oil, which was recorded at fair value of $4.7 billion as of the closing date. We
expect to capture approximately $1 billion in synergies on a run rate basis within the first full year following the close of
the transaction. See Note 3 and Note 8.
Overview
At ConocoPhillips, we anticipate that commodity prices will continue to be cyclical and volatile, and our view is that a
successful business strategy in the E&P industry must be resilient in lower price environments while also retaining upside
during periods of higher prices. As such, we are unhedged, remain committed to our disciplined investment framework
and continually monitor market fundamentals, including the impacts associated with geopolitical tensions and conflicts,
global demand for our products, oil and gas inventory levels, governmental policies, inflation and supply chain
disruptions.
The macro-environment of the global energy industry continues to evolve. We believe ConocoPhillips plays an essential
role in responsibly meeting the global demand for energy, while continuing to deliver competitive returns on and of
capital and working to meet our previously established emissions-reduction targets. We call this our Triple Mandate, and
it represents our commitment to create long-term value for stockholders. Our value proposition to deliver competitive
returns to stockholders through price cycles is guided by our foundational principles which consist of maintaining balance
sheet strength, providing peer-leading distributions, making disciplined investments, and demonstrating responsible and
reliable ESG performance.
Management’s Discussion and Analysis
ConocoPhillips 2024 10-K
34
Total company production in 2024 was 1,987 MBOED, yielding cash provided by operating activities of $20.1 billion. We
invested $12.1 billion into the business in the form of capital expenditures and investments, inclusive of $0.4 billion of
spend related to fourth-quarter acquisitions, and provided returns of capital to shareholders of $9.1 billion through our
ordinary dividend, VROC and share repurchases. In 2024, we returned $3.6 billion through the ordinary dividend and
VROC, including in December when we increased our ordinary dividend by 34 percent to 78 cents per share, effectively
incorporating the amount of the prior quarter VROC into the ordinary dividend. In addition, we returned $5.5 billion to
shareholders through share repurchases. As of December 31, 2024, we have repurchased $34.3 billion of our authorized
share repurchase program since 2016. In February 2025, we announced our 2025 planned return of capital to
shareholders of $10 billion, at current commodity prices, through our return of capital framework. We also declared a
first-quarter ordinary dividend of 78 cents per share.
In 2024, we continued to optimize our portfolio geared towards our return focused value proposition. In the third
quarter, we added to our global LNG portfolio through agreements that provide additional access to European and Asian
natural gas markets by entering into an 18-year agreement securing regasification capacity at Zeebrugge LNG terminal in
Belgium which includes regasification services for approximately 0.75 MTPA of LNG beginning in 2027. Additionally, in the
third quarter, we entered into a long-term LNG sales agreement for approximately 0.5 MTPA into Asia starting in 2027.
After exercising our preferential rights, we completed our acquisition of additional working interest in the Kuparuk River
Unit and Prudhoe Bay Unit in our Alaska segment in the fourth quarter of 2024. In conjunction with the announcement of
our acquisition of Marathon Oil, we communicated a disposition target of approximately $2 billion of assets across the
portfolio. We recently entered into agreements to sell noncore assets within our Lower 48 segments that are expected to
close in the first half of 2025 for approximately $600 million, subject to customary closing adjustments. See Note 3.
In the fourth quarter of 2024, we completed strategic debt transactions, which simplified our capital structure, extended
the debt portfolio's weighted average maturity, lowered its weighted average coupon and reduced near-term maturities.
See Note 3 and Note 8.
Operationally, we remain focused on safely executing the business. Production for 2024 was 1,987 MBOED, representing
an increase of 161 MBOED or nine percent compared to 2023. After adjusting for closed acquisitions and dispositions,
production increased by 69 MBOED or three percent. Our Lower 48 segment achieved record production of 1,152 MBOED
in 2024. Our international projects reached several key operational milestones; including first production ahead of
schedule at Eldfisk North in Norway, Nuna in Alaska and Bohai Bay in China; and we celebrated the one thousandth cargo
lift at both APLNG and Bohai Bay in China.
Business Environment
The energy industry has historically been subject to volatility in commodity prices, which fluctuate with the global
economy's supply and demand for energy. Our profitability, reserves base, reinvestment of cash flows and distributions
to shareholders are influenced by these fluctuations. Our foundational principles guide our differential value proposition
to deliver competitive returns on and of capital to stockholders through price cycles. Our foundational principles consist
of maintaining balance sheet strength, providing peer-leading distributions, making disciplined investments and
demonstrating responsible and reliable ESG performance, all of which support strong financial returns and mitigate
uncertainty associated with volatile commodity prices.
Balance sheet strength. A strong balance sheet is a strategic asset that provides flexibility through price cycles. We strive
to maintain our ‘A’-rating, as we did throughout 2024. In 2024, we initiated and completed strategic debt transactions to
extend the weighted average maturity of our portfolio and reduce near-term debt maturities. We ended the year with
cash and cash equivalents and restricted cash of $5.9 billion, short-term investments of $0.5 billion and long-term
investments in debt securities of $1.1 billion, maintaining balance sheet strength.
Peer leading distributions. We believe in delivering value to our shareholders via our return of capital framework, which
consists of a growing, sustainable ordinary dividend, share repurchases and the discretion to utilize VROC in an elevated
price environment. This framework is how we plan to return greater than 30 percent of our net cash provided by
operating activities to shareholders. In 2024, we returned $3.6 billion to shareholders through our ordinary dividend and
VROC and $5.5 billion through share repurchases. Our combined dividends and share repurchases of $9.1 billion
represented 45 percent of our net cash provided by operating activities. In February 2025, we announced our 2025
planned return of capital to shareholders of $10 billion, at current commodity prices, through our return of capital
framework.
Management’s Discussion and Analysis
35
ConocoPhillips 2024 10-K
Disciplined investments. Our goal is to optimize free cash flow by exercising capital discipline, controlling our costs, and
safely and reliably delivering production. We expect to make capital investments sufficient to at least sustain production
throughout the price cycles. Free cash flow is defined as cash from operations net of capital expenditures and
investments and provides funds that are available to return to shareholders, strengthen the balance sheet or reinvest
back into the business for future cash flow expansion.
•
Exercise capital discipline. Our global portfolio is deep, diverse and durable. As we consider our capital
investment opportunities, we apply a rigorous framework that we believe allows for competitive free cash flow
to be available to return to shareholders. By allocating to our low cost of supply resource base, we are allocating
to high return assets and driving resiliency to low prices. We also balance our investments between short and
longer cycle projects. For example, in 2024, we invested in short-cycle projects in the Lower 48 segment, as well
as longer-cycle projects such as Willow in Alaska and LNG projects in Qatar and Port Arthur. This capital
allocation framework seeks to maximize free cash flow through price cycles. Cost of supply is the WTI equivalent
price that generates a 10 percent after-tax return on a point-forward and fully burdened basis. Fully burdened
basis includes capital infrastructure, foreign currency exchange rates, cost of carbon, price-related inflation and
G&A.
•
Control our costs. Controlling our costs, without compromising safety or environmental stewardship, is a high
priority. Using various methodologies, we monitor costs monthly, on an absolute-dollar basis and a per-unit
basis and report to management. Managing costs is critical to maintaining a competitive position in our cyclical
industry and positively impacts our ability to deliver strong cash from operations.
•
Optimize our portfolio. We continue to evaluate our assets to determine whether they compete for capital
within our portfolio and optimize as necessary, directing capital towards the most competitive investments and
disposing of assets that do not compete.
In 2024, we completed our acquisition of Marathon Oil and additional working interest in Alaska, as well as
signed additional LNG regasification and sales agreements. In 2024, we also signed an agreement to divest
certain noncore assets in our Lower 48 segment. See Note 3.
•
Add to our proved reserve base. We primarily add to our proved reserve base in three ways:
•
Acquire interests in existing or new fields.
•
Apply new technologies and processes to improve recovery from existing fields.
•
Successfully explore, develop and exploit new and existing fields.
Reserve replacement represents the net change in proved reserves, net of production, divided by our current
year production. Our reserve replacement was 244 percent in 2024, reflecting a net increase from development
drilling activity; extensions and discoveries; and purchases, including our acquisition of Marathon Oil; partially
offset by lower prices. Our organic reserve replacement, which excludes a net increase of 886 MMBOE from
sales and purchases, was 123 percent in 2024.
In the three years ended December 31, 2024, our reserve replacement was 183 percent. Our organic
reserve replacement during the three years ended December 31, 2024, which excludes a net increase of 1,064
MMBOE related to sales and purchases, was 131 percent.
See "Supplementary Data - Oil and Gas Operations" for more information.
Environmental, Social and Governance performance. We are committed to the efficient and effective exploration and
production of oil and natural gas. We seek to deliver energy to the world through an integrated management system that
assesses sustainability-related business risks and opportunities as part of our decision-making process and remain
committed to our targets. Recognizing the importance of ESG performance to our stakeholders and company success, we
have a governance structure that extends from the board of directors to executive leadership and business unit
managers.
For more information on our commitment to responsible and reliable ESG performance, see "Contingencies—Company
Response to Climate-Related Risks" section of Management's Discussion and Analysis of Financial Condition and Results of
Operation.
Management’s Discussion and Analysis
ConocoPhillips 2024 10-K
36
Commodity Prices
Our earnings and operating cash flows generally correlate with crude oil and natural gas commodity prices. Commodity
price levels are subject to factors external to the company and over which we have no control, including but not limited
to global economic health, supply or demand disruptions or fears thereof caused by civil unrest, global pandemics,
military conflicts, actions taken by OPEC Plus and other major oil producing countries, environmental laws, tax
regulations, governmental policies and weather-related disruptions. The following graph depicts the average benchmark
prices for WTI crude oil, Brent crude oil and U.S. Henry Hub natural gas since 2022:
WTI/Brent
$/Bbl
U.S. Henry Hub
$/MMBTU
WTI Crude Oil, Brent Crude Oil and U.S. Henry Hub Natural Gas Prices Averages
WTI-$/Bbl
Brent-$/Bbl
HH-$/MMBTU
Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'24 Q3'24 Q4'24 Jan'25
40
50
60
70
80
90
100
110
120
—
2
4
6
8
10
Brent crude oil prices decreased two percent from $82.62 per barrel in 2023 to $80.76 per barrel in 2024. Similarly,
average WTI crude oil prices decreased two percent from $77.62 per barrel in 2023 to $75.72 per barrel in 2024. Prices
were lower through 2024 due to slower global demand growth in 2024 relative to 2023 and higher supplies from non-
OPEC Plus counties.
U.S. Henry Hub natural gas prices decreased 17 percent from an average of $2.74 per MMBTU in 2023 to $2.27 per
MMBTU in 2024. Natural gas prices decreased due to excess North American natural gas storage levels following a mild
2023-2024 winter. Lower 48 segment realized gas prices decreased to $0.18 in the third quarter of 2024 driven by lower
regional prices related to pipeline capacity constraints. In the fourth quarter of 2024 prices increased as constraints were
relieved and realizations ended the year at an average of $0.87.
Our realized bitumen price increased 14 percent from an average of $42.15 per barrel in 2023 to $47.92 per barrel in
2024. The increase was driven by narrowing WCS differentials due to Trans Mountain Expansion project egress, tightening
Russian sanctions impacting global heavy oil supply and improving heavy oil demand in Asia. We continue to optimize
bitumen price realizations through optimizing diluent recovery unit operation, blending and transportation strategies.
Our worldwide annual average realized price decreased six percent from $58.39 per BOE in 2023 to $54.83 per BOE in
2024 primarily due to lower crude and natural gas prices.
Management’s Discussion and Analysis
37
ConocoPhillips 2024 10-K
Key Operating and Financial Summary
Significant items during 2024 and recent announcements included the following:
•
Completed the acquisition of Marathon Oil, adding high-quality, low cost of supply inventory adjacent to the
company's leading U.S. unconventional position;
•
Reported fourth-quarter 2024 earnings per share of $1.90;
•
Delivered 2024 reserve replacement ratio of 244 percent and organic reserve replacement ratio of 123 percent;
•
Announced planned 2025 return of capital target of $10 billion at current commodity prices and declared first-
quarter 2025 ordinary dividend of $0.78 per share;
•
Provided 2025 guidance including full-year capital of approximately $12.9 billion;
•
Generated cash provided by operating activities of $20.1 billion;
•
Distributed $9.1 billion to shareholders, including $5.5 billion through share repurchases and $3.6 billion through
the ordinary dividend and VROC;
•
Ended the year with cash, cash equivalents and restricted cash of $5.9 billion, short-term investments of $0.5
billion and long-term investments in debt securities of $1.1 billion;
•
Advanced previously announced $2 billion disposition target by signing agreements to divest noncore Lower 48
assets of $0.6 billion, subject to customary closing adjustments and expected to close in the first half of 2025;
•
Delivered full-year total company and Lower 48 production of 1,987 MBOED and 1,152 MBOED, respectively.
Excluding one month of Marathon Oil production, the company and Lower 48 produced 1,955 MBOED and 1,124
MBOED, respectively;
•
Reached first production at Nuna in Alaska and Bohai Phase 5 in China in the fourth quarter and at Eldfisk North
in Norway in the second quarter;
•
Progressed global LNG strategy with a long-term regasification agreement at Zeebrugge LNG terminal in Belgium
and a long-term sales agreement in Asia;
•
Exercised preferential rights and acquired additional working interests in Alaska's Kuparuk River and Prudhoe
Bay Units in the fourth quarter;
•
Completed debt transactions to simplify the company's capital structure post the acquisition of Marathon Oil,
extending the weighted average maturity and improving the weighted average coupon of the portfolio; and
•
Achieved the Oil and Gas Methane Partnership 2.0 Gold Standard designation in 2024.
Outlook
Production, DD&A and Capital
2025 production guidance is 2.34 to 2.38 MMBOED which includes 20 MBOED from planned turnarounds. First-quarter
2025 production is expected to be 2.34 to 2.38 MMBOED, which includes impacts of 20 MBOED from January weather
and 5 MBOED from turnarounds.
Guidance for 2025 includes DD&A of $11.3 to $11.5 billion and capital expenditures of approximately $12.9 billion.
Operating Segments
We manage our operations through six operating segments, which are primarily defined by geographic region: Alaska;
Lower 48; Canada; Europe, Middle East and North Africa; Asia Pacific; and Other International.
Corporate and Other represents income and costs not directly associated with an operating segment, such as most
interest income and expense; impacts from certain debt transactions; corporate overhead and certain technology
activities, including licensing revenues; and unrealized holding gains or losses on equity securities. All cash and cash
equivalents and short-term investments are included in Corporate and Other.
Our key performance indicators, shown in the statistical tables provided at the beginning of the operating segment
sections that follow, reflect results from our operations, including commodity prices and production.
Management’s Discussion and Analysis
ConocoPhillips 2024 10-K
38
Results of Operations
This section of the Form 10-K discusses year-to-year comparisons between 2024 and 2023. For discussion of year-to-year
comparisons between 2023 and 2022, see "Management's Discussion and Analysis of Financial Condition and Results of
Operations" in Part II, Item 7 of our 2023 10-K.
Consolidated Results
Summary Operating Statistics
2024
2023
2022
Average Net Production
Crude oil (MBD)
Consolidated Operations
969
923
885
Equity affiliates
13
13
13
Total crude oil
982
936
898
Natural gas liquids (MBD)
Consolidated Operations
304
279
244
Equity affiliates
8
8
8
Total natural gas liquids
312
287
252
Bitumen (MBD)
122
81
66
Natural gas (MMCFD)
Consolidated Operations
2,200
1,916
1,939
Equity affiliates
1,233
1,219
1,191
Total natural gas
3,433
3,135
3,130
Total Production (MBOED)
1,987
1,826
1,738
Total Production (MMBOE)
727
666
634
Dollars Per Unit
Average Sales Prices
Crude oil (per bbl)
Consolidated Operations
$
76.74
78.97
97.23
Equity affiliates
76.76
78.45
97.31
Total crude oil
76.74
78.96
97.23
Natural gas liquids (per bbl)
Consolidated Operations
22.43
22.12
35.67
Equity affiliates
51.53
47.09
61.22
Total natural gas liquids
23.19
22.82
36.50
Bitumen (per bbl)
47.92
42.15
55.56
Natural gas (per mcf)
Consolidated Operations
2.61
3.89
10.56
Equity affiliates
8.22
8.46
10.67
Total natural gas
4.69
5.69
10.60
Results of Operations
39
ConocoPhillips 2024 10-K
Millions of Dollars
Worldwide Exploration Expenses
General and administrative; geological and geophysical, lease rental, and
other
$
309
236
224
Leasehold impairment
6
53
89
Dry holes
40
109
251
Total Exploration Expenses
$
355
398
564
Total Company Production
We explore for, produce, transport and market crude oil, bitumen, natural gas, NGLs and LNG on a worldwide basis. At
December 31, 2024, our operations were producing in the U.S., Norway, Canada, Australia, China, Malaysia, Qatar, Libya
and Equatorial Guinea.
Total production of 1,987 MBOED increased 161 MBOED or nine percent in 2024 compared with 2023. Production
increases include:
•
New wells online in the Lower 48, Alaska, Australia, Canada, China, Libya and Norway.
•
Our acquisition of the remaining working interest in Surmont in the fourth quarter of 2023.
•
Our acquisition of Marathon Oil in the fourth quarter of 2024.
The increase in production during 2024 was partly offset by normal field decline.
After adjusting for closed acquisitions and dispositions, production increased by 69 MBOED or three percent.
Results of Operations
ConocoPhillips 2024 10-K
40
Income Statement Analysis
Unless otherwise indicated, all results in Income Statement Analysis are before-tax.
Below is select financial data provided on a consolidated basis. The full Income Statement can be found in Item 8.
Financial Statements and Supplementary Data.
Millions of Dollars
Years Ended December 31
2024
2023
2022
Sales and other operating revenues
$
54,745
56,141
78,494
Gain (loss) on dispositions
51
228
1,077
Purchased commodities
20,012
21,975
33,971
Production and operating expenses
8,751
7,693
7,006
Selling, general and administrative expenses
1,158
705
623
Depreciation, depletion and amortization
9,599
8,270
7,504
Foreign currency transaction (gain) loss
(50)
92
(100)
Other expenses
181
2
(47)
Income tax provision (benefit)
4,427
5,331
9,548
Sales and other operating revenues decreased $1,396 million in 2024, primarily due to lower realized natural gas and
crude prices of $1,031 million and $791 million, respectively, and the timing of sales as compared to 2023. These
decreases were partially offset by higher volumes of $2,659 million, inclusive of sales volumes from our acquisitions of
Surmont and Marathon Oil, and higher realized bitumen prices of $258 million. See Note 3.
Gain (loss) on dispositions decreased $177 million in 2024, primarily due to the absence of gains associated with the
divestitures of an equity investment and noncore assets in Lower 48 segment.
Purchased commodities decreased $1,963 million in 2024, primarily driven by lower natural gas and crude prices, partially
offset by higher crude volumes.
Production and operating expenses increased $1,058 million in 2024, due to higher lease operating expenses and
transportation costs in our Lower 48 and Alaska segments, higher volumes primarily in our Canada and Lower 48
segments, as well as higher expenses associated with the Surmont turnaround in our Canada segment. See Note 3.
Selling, general and administrative expenses increased $453 million in 2024, primarily due to transaction expenses of
$545 million associated with our acquisition of Marathon Oil, partially offset by lower compensation and benefits costs,
including mark-to-market impacts of certain key employee compensation programs. See Note 15.
DD&A increased $1,329 million in 2024 primarily due to higher volumes in our Lower 48 and Canada segments, higher
rates in our Alaska and Lower 48 segments and the impact of our acquisition of Marathon Oil. See Note 3.
Foreign currency transaction (gain) loss for the year was improved by $142 million, primarily due to the absence of losses
of $112 million associated with forward contracts in support of our Surmont acquisition. See Note 3.
Other expenses increased $179 million primarily related to a loss of $173 million associated with the extinguishment of
debt in the fourth quarter of 2024. See Note 8.
See Note 16—Income Taxes for information regarding our income tax provision and effective tax rate.
Results of Operations
41
ConocoPhillips 2024 10-K
Segment Results
Unless otherwise indicated, discussion of Segment Results is after-tax.
A summary of the company’s net income (loss) by business segment follows:
Millions of Dollars
Years Ended December 31
2024
2023
2022
Alaska
$
1,326
1,778
2,352
Lower 48
5,175
6,461
11,015
Canada
712
402
714
Europe, Middle East and North Africa
1,189
1,189
2,244
Asia Pacific
1,724
1,961
2,736
Other International
(1)
(13)
(51)
Corporate and Other
(880)
(821)
(330)
Net income (loss)
$
9,245
10,957
18,680
For further discussion of segment results, see the following pages.
Results of Operations
ConocoPhillips 2024 10-K
42
Alaska
2024
2023
2022
Select financial data by segment before-tax ($MM)
Sales and other operating revenues ($MM)
$
6,553
7,098
7,905
Production and operating expenses ($MM)
1,951
1,829
1,703
Depreciation, depletion and amortization ($MM)
1,299
1,061
939
Taxes other than income taxes ($MM)
470
497
1,323
Net Income (Loss) ($MM)
$
1,326
1,778
2,352
Average Net Production
Crude oil (MBD)
173
173
177
Natural gas liquids (MBD)
15
16
17
Natural gas (MMCFD)
39
38
34
Total Production (MBOED)
194
195
200
Total Production (MMBOE)
71
71
73
Average Sales Prices
Crude oil ($ per bbl)
$
81.73
83.05
101.72
Natural gas ($ per mcf)
3.90
4.47
3.64
The Alaska segment primarily explores for, produces, transports and markets crude oil, NGLs and natural gas. In 2024,
Alaska contributed 14 percent of our consolidated liquids production and two percent of our consolidated natural gas
production.
Net Income (Loss)
Alaska reported earnings of $1,326 million in 2024, compared with earnings of $1,778 million in 2023.
Decreases to earnings included lower revenues resulting from lower commodity prices of $73 million and the timing of
sales as compared with 2023. Additional decreases to earnings included higher DD&A expenses of $175 million, driven by
higher rates as a result of 2023 year-end downward reserve revisions as well as higher production and operating
expenses of $90 million, driven by higher well work activity of $56 million and transportation related costs of $26 million.
Production
Average production decreased one MBOED in 2024 compared with 2023, primarily due to normal field decline.
The production decrease was partly offset by new wells online at our Western North Slope and Greater Kuparuk Area
assets.
Acquisition of Additional Working Interest in Kuparuk River Unit and Prudhoe Bay Unit
After exercising our preferential rights, we completed an acquisition of additional working interest in both the Kuparuk
River Unit and the Prudhoe Bay Unit in the fourth quarter of 2024. Production from the additional working interest
averaged approximately five MBOED each month for November and December 2024. See Note 3.
Results of Operations
43
ConocoPhillips 2024 10-K
Lower 48
2024
2023
2022
Select financial data by segment before-tax ($MM)
Sales and other operating revenues ($MM)
$
37,026
38,237
52,903
Production and operating expenses ($MM)
4,751
4,199
3,627
Depreciation, depletion and amortization ($MM)
6,442
5,722
4,865
Taxes other than income taxes ($MM)
1,378
1,352
1,693
Net Income (Loss) ($MM)
$
5,175
6,461
11,015
Average Net Production
Crude oil (MBD)
602
569
534
Natural gas liquids (MBD)
279
256
221
Natural gas (MMCFD)
1,625
1,457
1,402
Total Production (MBOED)
1,152
1,067
989
Total Production (MMBOE)
422
389
361
Average Sales Prices
Crude oil ($ per bbl)
$
74.17
76.19
94.46
Natural gas liquids ($ per bbl)
22.02
21.73
35.36
Natural gas ($ per mcf)
0.87
2.12
5.92
The Lower 48 segment consists of operations located in the contiguous U.S. and the Gulf of Mexico and commercial
operations. During 2024, the Lower 48 contributed 63 percent of our consolidated liquids production and 74 percent of
our consolidated natural gas production.
Net Income (Loss)
Lower 48 reported earnings of $5,175 million in 2024, compared with earnings of $6,461 million in 2023.
Decreases to earnings included lower revenues resulting from lower overall commodity prices of $904 million and the
timing of sales as compared with 2023, partly offset by higher volumes of $1,003 million, which includes volumes added
from our acquisition of Marathon Oil. Additional decreases to earnings included higher DD&A of $562 million, driven by
higher production of $250 million, higher rates of $181 million and impacts from our acquisition of Marathon Oil of
$139 million; higher production and operating expenses of $431 million, driven by higher transportation related costs of
$132 million, expenses associated with our acquisition of Marathon Oil of $110 million and higher lease operating
expenses of $100 million; as well as the absence of gains associated with the divestiture of an equity investment of $100
million. See Note 3.
Production
Total average production increased 85 MBOED in 2024 compared with 2023, primarily due to new wells online from our
development programs in Delaware Basin, Eagle Ford, Midland Basin and Bakken and the impact from assets acquired
from Marathon Oil. See Note 3.
The production increase was partly offset by normal field decline and higher unplanned downtime across all basins.
Acquisition of Marathon Oil
On November 22, 2024, we completed our acquisition of Marathon Oil. The transaction added additional assets to our
Lower 48 segment across several basins. Production from Lower 48 assets acquired from Marathon Oil averaged
approximately 334 MBOED in the month of December 2024. See Note 3.
Planned Dispositions
We recently entered into agreements to sell noncore assets within our Lower 48 segment that are expected to close in
the first half of 2025 for approximately $600 million, subject to customary closing adjustments. See Note 3.
Results of Operations
ConocoPhillips 2024 10-K
44
Canada
2024
2023
2022
Select financial data by segment before-tax ($MM)
Sales and other operating revenues ($MM)
$
3,514
3,006
3,714
Production and operating expenses ($MM)
902
619
591
Depreciation, depletion and amortization ($MM)
639
420
402
Taxes other than income taxes ($MM)
31
26
21
Net Income (Loss) ($MM)
$
712
402
714
Average Net Production
Crude oil (MBD)
17
9
6
Natural gas liquids (MBD)
6
3
3
Bitumen (MBD)
122
81
66
Natural gas (MMCFD)
115
65
61
Total Production (MBOED)
164
104
85
Total Production (MMBOE)
60
38
31
Average Sales Prices
Crude oil ($ per bbl)
$
64.47
66.19
79.94
Natural gas liquids ($ per bbl)
29.59
26.13
37.70
Bitumen ($ per bbl)
47.92
42.15
55.56
Natural gas ($ per mcf)*
0.54
1.80
3.62
*Average sales prices include unutilized transportation costs.
The Canada segment operations include the Surmont oil sands development in Alberta, the Montney unconventional play
in British Columbia and commercial operations. In 2024, Canada contributed ten percent of our consolidated liquids
production and five percent of our consolidated natural gas production.
Net Income (Loss)
Canada reported earnings of $712 million in 2024 compared with earnings of $402 million in 2023.
Earnings included higher revenues resulting from higher volumes of $676 million; driven by our increased working
interest in Surmont of $584 million and new wells online in the Montney of $180 million, partially offset by planned
turnaround activity at Surmont impacting revenues by $157 million. Additionally, revenues increased from higher overall
commodity prices of $153 million, driven primarily by higher bitumen prices. See Note 3.
Decreases to earnings included higher production and operating expenses of $215 million; driven by an impact of
$175 million related to higher overall production, including our increased working interest in Surmont; as well as
expenses of $55 million related to turnaround activity at Surmont. Additional decreases to earnings included higher
DD&A expenses of $166 million resulting from higher volumes and the absence of a $92 million tax benefit recognized
upon the closing of a Canada Revenue Agency audit in 2023.
Production
Total average production increased 60 MBOED in 2024 compared with 2023. Increases to production resulted from our
increased working interest in Surmont as well as new wells online in the Montney and Surmont. See Note 3.
These production increases were partly offset by higher downtime resulting from a planned turnaround activity at a
Surmont central processing facility and normal field decline.
Results of Operations
45
ConocoPhillips 2024 10-K
Europe, Middle East and North Africa
2024
2023
2022
Select financial data by segment before-tax ($MM)
Sales and other operating revenues ($MM)
$
5,788
5,854
11,270
Production and operating expenses ($MM)
671
593
590
Depreciation, depletion and amortization ($MM)
761
587
736
Taxes other than income taxes ($MM)
41
39
39
Net Income (Loss) ($MM)
$
1,189
1,189
2,244
Consolidated Operations
Average Net Production
Crude oil (MBD)
118
112
107
Natural gas liquids (MBD)
4
4
3
Natural gas (MMCFD)
371
308
328
Total Production (MBOED)
184
168
165
Total Production (MMBOE)
67
61
60
Average Sales Prices
Crude oil ($ per bbl)
$
80.92
83.96
99.20
Natural gas liquids ($ per bbl)
40.29
41.13
54.52
Natural gas ($ per mcf)
10.70
12.68
33.39
The Europe, Middle East and North Africa segment consists of operations principally located in the Norwegian sector of
the North Sea, the Norwegian Sea, Qatar, Libya, Equatorial Guinea and commercial and terminalling operations in the
U.K. In 2024, our Europe, Middle East and North Africa operations contributed nine percent of our consolidated liquids
production and 17 percent of our consolidated natural gas production.
Net Income (Loss)
The Europe, Middle East and North Africa segment reported earnings of $1,189 million in 2024 compared with earnings
of $1,189 million in 2023.
Earnings in 2024 included lower revenues resulting from lower overall commodity prices of $118 million and the timing of
sales as compared with 2023, partly offset by higher volumes of $144 million, which includes $49 million from volumes
added from our acquisition of Marathon Oil. Additional decreases to earnings included higher DD&A of $51 million.
Consolidated Production
Average consolidated production increased 16 MBOED in 2024, compared with 2023. The consolidated production
increase was primarily due to new wells online and improved performance in Norway, as well as the impact from assets
acquired from Marathon Oil. See Note 3.
The production increase was partly offset by normal field decline.
Acquisition of Marathon Oil
On November 22, 2024, we completed our acquisition of Marathon Oil. The transaction added Equatorial Guinea to our
global portfolio which resides in our Europe, Middle East and North Africa segment. Production from Equatorial Guinea
averaged approximately 40 MBOED in the month of December 2024. See Note 3.
Exploration Activity
In 2024, we charged approximately $40 million before-tax as dry hole expenses primarily for two partner operated
exploration wells in the Alvheim area in the Norwegian sector of the North Sea and the Busta suspended discovery well
on license PL782S. See Note 6.
Results of Operations
ConocoPhillips 2024 10-K
46
Asia Pacific
2024
2023
2022
Select financial data by segment before-tax ($MM)
Sales and other operating revenues ($MM)
$
1,847
1,913
2,606
Production and operating expenses ($MM)
384
391
365
Depreciation, depletion and amortization ($MM)
425
455
518
Taxes other than income taxes ($MM)
109
117
243
Net Income (Loss) ($MM)
$
1,724
1,961
2,736
Consolidated Operations
Average Net Production
Crude oil (MBD)
59
60
61
Natural gas (MMCFD)
50
48
114
Total Production (MBOED)
67
68
80
Total Production (MMBOE)
25
25
29
Average Sales Prices
Crude oil ($ per bbl)
$
82.42
84.79
105.52
Natural gas ($ per mcf)
3.74
3.95
5.84
The Asia Pacific segment consists of operations in China, Malaysia, and Australia, and commercial operations in China,
Singapore and Japan. During 2024, Asia Pacific contributed four percent of our consolidated liquids production and two
percent of our consolidated natural gas production.
Net Income (Loss)
Asia Pacific reported earnings of $1,724 million in 2024, compared with $1,961 million in 2023.
Decreases to earnings included lower revenues resulting from lower commodity prices of $49 million and lower volumes
of $20 million. Additional decreases to earnings included the absence of a tax benefit recognized in 2023 from the
reversal of a tax reserve. See Note 16. Earnings also decreased due to lower equity in earnings of affiliates of $57 million.
Increases to earnings included lower DD&A expenses of $27 million resulting from lower volumes.
Consolidated Production
Average consolidated production decreased one MBOED in 2024, compared with 2023. The decrease was primarily due
to normal field decline.
These production decreases were partly offset by development activity at Bohai Bay in China.
Results of Operations
47
ConocoPhillips 2024 10-K
Other International
2024
2023
2022
Net Income (Loss) ($MM)
$
(1)
(13)
(51)
The Other International segment consists of activities associated with prior operations in other countries.
Earnings from our Other International operations improved $12 million in 2024, compared with 2023.
Corporate and Other
Millions of Dollars
2024
2023
2022
Net Income (Loss)
Net interest expense
$
(379)
(360)
(600)
Corporate G&A expenses
(716)
(357)
(244)
Technology
(137)
(34)
32
Other income (expense)
352
(70)
482
$
(880)
(821)
(330)
Net interest consists of interest and financing expense, net of interest income and capitalized interest.
Corporate G&A expenses include compensation programs and staff costs. These expenses increased by $359 million in
2024 compared with 2023, primarily due to transaction expenses of $432 million associated with our acquisition of
Marathon Oil, partially offset by lower compensation and benefits costs, including mark-to-market impacts of certain key
employee compensation programs. See Note 15.
Technology includes our investments in low-carbon technology opportunities as well as other new technologies or
businesses and licensing revenues. Other new technologies or businesses and LNG licensing activities are focused on both
conventional and tight oil reservoirs, shale gas, oil sands, enhanced oil recovery as well as LNG. Earnings in Technology
decreased due to increased costs in low-carbon and other new technologies and lower licensing revenues.
Other income (expense) or "Other" includes certain foreign currency transaction gains and losses, environmental costs
associated with sites no longer in operation, other costs not directly associated with an operating segment, gains or
losses on early retirement of debt, holding gains or losses on equity securities and pension settlement expense. Earnings
in “Other” increased by $422 million in 2024 compared with 2023. This was primarily due to a tax benefit of $455 million
as a result of the acquisition of Marathon Oil and the subsequent utilization of foreign tax credits, and the absence of $89
million loss associated with forward foreign exchange contracts to buy CAD, in support of our acquisition of additional
working interest in Surmont in 2023. Decreases to earnings in "Other" were driven by a loss of $147 million associated
with the extinguishment of debt in the fourth quarter of 2024. See Note 3, Note 8 and Note 16.
Results of Operations
ConocoPhillips 2024 10-K
48
Capital Resources and Liquidity
Financial Indicators
Millions of Dollars
Except as Indicated
2024
2023
2022
Net cash provided by operating activities
$
20,124
19,965
28,314
Cash and cash equivalents
5,607
5,635
6,458
Short-term investments
507
971
2,785
Short-term debt
1,035
1,074
417
Total debt
24,324
18,937
16,643
Total equity
64,796
49,279
48,003
Percent of total debt to capital*
27 %
28
26
Percent of floating-rate debt to total debt
1 %
2
2
Balance Sheet related line items are shown as of December 31st.
*Capital includes total debt and total equity.
To meet our short- and long-term liquidity requirements, we look to a variety of funding sources, including cash
generated from operating activities, our commercial paper and credit facility programs and our ability to sell securities
using our shelf registration statement. In 2024, the primary uses of our available cash were $12.1 billion to support our
ongoing capital expenditures and investments program, which included $0.4 billion of spend related to fourth-quarter
acquisitions; $5.5 billion to repurchase common stock; and $3.6 billion to pay the ordinary dividend and VROC. In addition
to cash from operating activities, the other primary sources of capital were $5.6 billion in proceeds from long-term debt
issuances, of which $4.1 billion was used to repurchase certain existing Marathon Oil debt assumed in the acquisition and
ConocoPhillips debt; and $0.4 billion net sales of short-term investments. In 2024, cash and cash equivalents remained
flat with 2023 at $5.6 billion. See Note 8.
At December 31, 2024, we had cash and cash equivalents of $5.6 billion, short-term investments of $0.5 billion, and
available borrowing capacity under our credit facility of $5.5 billion, totaling approximately $11.6 billion of liquidity. We
believe current cash balances and cash generated by operations, together with access to external sources of funds as
described below in the “Significant Changes in Capital” section, will be sufficient to meet our funding requirements in the
near- and long-term, including our capital spending program, capital return program and required debt payments.
Significant Changes in Capital
Operating Activities
Cash provided by operating activities in 2024 totaled $20.1 billion, compared with $20.0 billion for 2023, and $28.3 billion
for 2022. In 2024, cash provided by operating activities improved from 2023 due to increased production primarily from
Canada and the Lower 48, including the Surmont 50 percent working interest acquired in the fourth quarter of 2023 and
our acquisition of Marathon Oil in late 2024. The increase in production was partly offset by lower commodity prices and
lower distributions from equity affiliates. See Note 3.
The decrease in cash provided by operating activities from 2023 compared to 2022 is primarily due to lower realized
commodity prices across all products, partly offset by higher sales volumes, net of associated production and operating
costs.
Our short- and long-term operating cash flows are highly dependent upon prices for crude oil, bitumen, natural gas, LNG
and NGLs. Prices and margins in our industry have historically been volatile and are driven by market conditions over
which we have no control. Absent other mitigating factors, as these prices and margins fluctuate, we would expect a
corresponding change in our operating cash flows.
Capital Resources and Liquidity
49
ConocoPhillips 2024 10-K
The level of absolute production volumes, as well as product and location mix, is another significant factor impacting our
cash flows. Full-year production averaged 1,987 MBOED in 2024, an increase of 161 MBOED or nine percent compared to
2023. First-quarter 2025 production is expected to be 2.34 MMBOED to 2.38 MMBOED. Future production is subject to
numerous uncertainties, including, among others, the volatile crude oil and natural gas price environment, which may
impact investment decisions; the effects of price changes on production sharing and variable-royalty contracts;
acquisition and disposition of fields; field production decline rates; new technologies; operating efficiencies; timing of
startups and major turnarounds; political instability; weather-related disruptions; and the addition of proved reserves
through exploratory success and their timely and cost-effective development. While we actively monitor and manage
these factors, changes in production levels can cause variability in cash flows, although we generally experience less
variability in our cash flows due to changes in production levels than due to changes in commodity prices.
Investing Activities
In 2024, we invested $12.1 billion in capital expenditures and investments; $0.8 billion of which was primarily payments
towards our equity investments in LNG projects, including Port Arthur Liquefaction Holdings, LLC (PALNG), QatarEnergy
LNG NFE(4) (NFE4) and QatarEnergy LNG NFS(3) (NFS3); and $0.4 billion of spend related to fourth-quarter acquisitions.
See Note 3. The remaining $10.9 billion funded our operating capital program. Capital expenditures invested in 2023 and
2022 were $11.2 billion and $10.2 billion, respectively. See the “Capital Expenditures and Investments” section.
In conjunction with the announcement of our acquisition of Marathon Oil, we communicated a disposition target of
approximately $2 billion of assets across the portfolio. We recently entered into agreements to sell noncore assets within
our Lower 48 segments that are expected to close in the first half of 2025 for approximately $600 million, subject to
customary closing adjustments. See Note 3.
After exercising our preferential rights, we completed an acquisition that increased our working interest by approximately
five percent in the Kuparuk River Unit and approximately 0.4 percent in the Prudhoe Bay Unit in Alaska from Chevron
U.S.A. Inc. and Union Oil Company of California in the fourth quarter of 2024 for $296 million before customary
adjustments. See Note 3.
In October 2023, we acquired the remaining 50 percent working interest in Surmont from TotalEnergies EP Canada Ltd.
for approximately $2.7 billion of cash after customary adjustments. We funded this transaction by issuing new long-term
debt. See Note 3 and Note 8.
Proceeds from asset sales were $0.3 billion in 2024, $0.6 billion in 2023 and $3.5 billion in 2022. In 2022, we received
proceeds of $1.4 billion for the sale of our remaining 91 million common shares of Cenovus Energy (CVE), proceeds of
approximately $1.5 billion, primarily from asset divestitures in our Asia Pacific and Lower 48 segments, and $0.5 billion in
contingent payments associated with prior divestitures. See Note 3 and Note 5.
We invest in short-term investments as part of our cash investment strategy, the primary objective of which is to protect
principal, maintain liquidity and provide yield and total returns; these investments include time deposits, commercial
paper, as well as debt securities classified as available for sale. Funds for short-term investments needs to support our
operating plan and provide resiliency to react to short-term price volatility are invested in highly liquid instruments with
maturities within the year. Funds we consider available to maintain resiliency in longer term price downturns and to
capture opportunities outside a given operating plan may be invested in instruments with maturities greater than one
year. See Note 11 and Note 19.
Investing activities in 2024 included net sales of $415 million of investments. We had net sales of $961 million of short-
term investments and net purchases of $546 million of long-term investments. See Note 18.
Capital Resources and Liquidity
ConocoPhillips 2024 10-K
50
Financing Activities
In November 2024, we acquired Marathon Oil. At closing, the acquisition was valued at $16.5 billion and was allocated to
assets acquired and liabilities assumed. ConocoPhillips common stock was issued and exchanged for outstanding
Marathon Oil shares. With the acquisition, we also assumed Marathon Oil's debt of approximately $4.6 billion. See Note 3
and Note 8.
Our debt balance at December 31, 2024 was $24.3 billion compared with $18.9 billion at December 31, 2023. The current
portion of debt, including payments for finance leases, is $1.0 billion. In 2024, the company retired $726 million principal
amount of Notes at maturity consisting of $265 million of our 3.35% Notes and $461 million of our 2.125% Notes. In
addition, we completed concurrent debt transactions consisting of new long-term debt issuances of $5.2 billion; a $4.1
billion repurchase of certain existing Marathon Oil and ConocoPhillips debt (with priority for Marathon Oil debt
assumed); a non-cash obligor exchange offer to retire $0.9 billion of Marathon Oil debt in exchange for new
ConocoPhillips debt; and remarketing of $0.4 billion in available municipal bonds. The debt transactions simplified our
capital structure, extended the debt portfolio's weighted average maturity, lowered its weighted average coupon and
reduced near-term maturities. See Note 8.
In 2023, we issued $2.7 billion principal amount of new debt to fund our acquisition of the remaining 50 percent working
interest in Surmont and completed refinancing transactions consisting of $1.1 billion in tender offers to repurchase
existing debt with cash and a $1.1 billion new debt issuance to fund the repurchases, extending the weighted average
maturity of our portfolio from 15 to 17 years and reducing near-term debt maturities. See Note 8.
In 2022, we repurchased notes, retired floating rate debt and executed a debt refinancing comprised of concurrent
transactions including new debt issuances, a cash tender offer and debt exchange offers. In aggregate, these transactions
along with naturally maturing debt, reduced the company's total debt by $3.3 billion.
In 2022, we refinanced our revolving credit facility from a total aggregate principal amount of $6.0 billion to $5.5 billion
with an expiration date of February 2027. Our revolving credit facility may be used for direct bank borrowings, the
issuance of letters of credit totaling up to $500 million, or as support for our commercial paper program. The revolving
credit facility is broadly syndicated among financial institutions and does not contain any material adverse change
provisions or any covenants requiring maintenance of specified financial ratios or credit ratings. The facility agreement
contains a cross-default provision relating to the failure to pay principal or interest on other debt obligations of $200
million or more by ConocoPhillips, or any of its consolidated subsidiaries. The amount of the facility is not subject to
redetermination prior to its expiration date.
Credit facility borrowings may bear interest at a margin above the Secured Overnight Financing Rate (SOFR). The
agreement calls for commitment fees on available, but unused, amounts. The agreement also contains early termination
rights if our current directors or their approved successors cease to be a majority of the Board of Directors.
The revolving credit facility supports ConocoPhillips Company’s ability to issue up to $5.5 billion of commercial paper,
which is primarily a funding source for short-term working capital needs. Commercial paper maturities are generally
limited to 90 days. With no commercial paper outstanding and no direct borrowings or letters of credit, we had access to
$5.5 billion in available borrowing capacity under our revolving credit facility at December 31, 2024.
In November 2024, Fitch affirmed our long-term credit rating. The current credit ratings on our long-term debt are:
•
Fitch: “A” with a “stable” outlook
•
S&P: “A-” with a “stable” outlook
•
Moody's: "A2" with a "stable" outlook
See Note 8 for additional information on debt and the revolving credit facility.
We do not have any ratings triggers on any of our corporate debt that would cause an automatic default, and thereby
impact our access to liquidity, upon downgrade of our credit ratings. If our credit ratings are downgraded from their
current levels, it could increase the cost of corporate debt available to us and restrict our access to the commercial paper
markets. If our credit rating were to deteriorate to a level prohibiting us from accessing the commercial paper market, we
would still be able to access funds under our revolving credit facility.
Capital Resources and Liquidity
51
ConocoPhillips 2024 10-K
Certain of our project-related contracts, commercial contracts and derivative instruments contain provisions requiring us
to post collateral. Many of these contracts and instruments permit us to post either cash or letters of credit as collateral.
At December 31, 2024 and December 31, 2023, we had direct bank letters of credit of $278 million and $340 million,
respectively, which secured performance obligations related to various purchase commitments incident to the ordinary
conduct of business. In the event of a credit rating downgrade, we may be required to post additional letters of credit.
Shelf Registration
We have a universal shelf registration statement on file with the SEC under which we have the ability to issue and sell an
indeterminate amount of various types of debt and equity securities.
Capital Requirements
For information about our capital expenditures and investments, see the “Capital Expenditures and Investments” section.
Our debt balance at December 31, 2024, was $24.3 billion, an increase of $5.4 billion from the balance at December 31,
2023 of $18.9 billion. In 2024, the company assumed $4.6 billion principal of debt with our acquisition of Marathon Oil
and retired $726 million principal amount of Notes at maturity. In addition, we completed concurrent debt transactions
consisting of new long-term debt issuances of $5.2 billion; a $4.1 billion repurchase of certain existing Marathon Oil and
ConocoPhillips debt; a non-cash obligor exchange offer to retire $0.9 billion of Marathon Oil debt in exchange for new
ConocoPhillips debt; and the remarketing of $0.4 billion in available municipal bonds. The debt transactions simplified our
capital structure, extended the debt portfolio's weighted average maturity, lowered its weighted average coupon and
reduced near-term maturities. See Note 8.
In February 2025, we announced our 2025 planned return of capital to shareholders of $10 billion, at current commodity
prices, through our return of capital framework. We plan to deliver a compelling, growing ordinary dividend and through-
cycle share repurchases. We anticipate returning greater than 30 percent of cash from operating activities during periods
where commodity prices are meaningfully higher than our planning price range. Our 2024 total capital returned was
$9.1 billion.
In 2023, we issued $2.7 billion principal amount of new debt to fund our acquisition of the remaining 50 percent working
interest in Surmont and completed refinancing transactions consisting of $1.1 billion in tender offers to repurchase
existing debt with cash and a $1.1 billion new debt issuance to fund the repurchases. In 2022, we executed concurrent
debt refinancing transactions, repurchased existing notes, and retired floating rate notes upon natural maturity, that in
aggregate reduced our total debt by $3.3 billion, while also lowering our annual cash interest expense and extending the
weighted average maturity of our debt portfolio. See Note 8 for information regarding debt and Note 18 for information
regarding non-cash consideration of the Surmont transaction.
Consistent with our commitment to deliver value to shareholders, for the full year of 2024, we paid ordinary dividends of
$2.52 per common share and VROC payments of $0.60 per common share. In the fourth quarter of 2024, we
incorporated the equivalent amount of prior quarter VROC into the ordinary dividend. In 2023 we paid ordinary dividends
of $2.11 and VROC payments of $2.50 per common share and in 2022 we paid an ordinary dividend of $1.89 and VROC
payments of $2.60. In February 2025, we declared a first-quarter ordinary dividend of $0.78 per common share payable
March 3, 2025, to shareholders of record on February 17, 2025.
VROC remains a discretionary option in elevated price environments. The ordinary dividend and VROC are subject to
numerous considerations and are determined and approved each quarter by the Board of Directors. Beginning in the first
quarter of 2024, we announced and paid quarterly dividends and VROC payments concurrently. VROC payments had
been paid in the subsequent quarter of announcement in 2023 and 2022.
In late 2016, we initiated our current share repurchase program. In October 2024, our Board of Directors approved an
increase from our prior authorization of $45 billion by a total of the lesser of $20 billion or the number of shares issued in
our acquisition of Marathon Oil, such that the company is not to exceed $65 billion in aggregate repurchases. Share
repurchases were $5.5 billion, $5.4 billion, and $9.3 billion in 2024, 2023, and 2022, respectively. As of December 31,
2024, share repurchases since the inception of our current program totaled 432.6 million shares and $34.3 billion since
2016. Repurchases are made at management’s discretion, at prevailing prices, subject to market conditions and other
factors.
For more information on factors considered when determining the levels of returns of capital see “Item 1A—Risk Factors
– Our ability to execute our capital return program is subject to certain considerations.”
Capital Resources and Liquidity
ConocoPhillips 2024 10-K
52
As of December 31, 2024, in addition to the priorities described above, we have contractual obligations to purchase
goods and services of approximately $31.6 billion. We expect to fulfill $7.5 billion of these obligations in 2025. These
figures exclude purchase commitments for jointly owned fields and facilities where we are not the operator. Purchase
obligations of $13.0 billion are related to agreements to access and utilize the capacity of third-party equipment and
facilities, including pipelines and LNG product terminals, to transport, process, treat and store commodities. Purchase
obligations of $16.8 billion are related to market-based contracts for commodity product purchases with third parties.
The remainder is primarily our net share of purchase commitments for materials and services for jointly owned fields and
facilities where we are the operator.
Capital Expenditures and Investments
Millions of Dollars
2024
2023
2022
Alaska
$
3,194
1,705
1,091
Lower 48
6,510
6,487
5,630
Canada
551
456
530
Europe, Middle East and North Africa
1,021
1,111
998
Asia Pacific
370
354
1,880
Other International
—
—
—
Corporate and Other
472
1,135
30
Capital Program*
$
12,118
11,248
10,159
* Excludes capital related to acquisitions of businesses, net of cash acquired.
Our capital expenditures and investments for the three-year period ended December 31, 2024, totaled $33.5 billion. The
2024 capital expenditures and investments supported key operating activities and acquisitions, primarily:
•
Appraisal and development activities in Alaska related to the Western North Slope, inclusive of Willow, and
development activities in the Greater Kuparuk Area.
•
Development activities in the Lower 48, primarily in the Delaware Basin, Eagle Ford, Midland Basin and Bakken.
•
Appraisal and development activities in the Montney as well as development and optimization of Surmont in
Canada.
•
Development activities across assets in Norway.
•
Continued development activities in Malaysia and China.
•
Investments in PALNG, NFE4 and NFS3.
2025 Capital Budget
In February 2025, we announced our 2025 operating plan capital is expected to be $12.9 billion. The plan includes
funding for ongoing development drilling programs, major projects, exploration and appraisal activities and base
maintenance.
Capital Resources and Liquidity
53
ConocoPhillips 2024 10-K
Guarantor Summarized Financial Information
We have various cross guarantees among ConocoPhillips, ConocoPhillips Company and Burlington Resources LLC with
respect to publicly held debt securities. ConocoPhillips Company is 100 percent owned by ConocoPhillips. Burlington
Resources LLC is 100 percent owned by ConocoPhillips Company. ConocoPhillips and/or ConocoPhillips Company have
fully and unconditionally guaranteed the payment obligations of Burlington Resources LLC with respect to its publicly held
debt securities. Similarly, ConocoPhillips has fully and unconditionally guaranteed the payment obligations of
ConocoPhillips Company with respect to its publicly held debt securities. In addition, ConocoPhillips Company has fully
and unconditionally guaranteed the payment obligations of ConocoPhillips with respect to its publicly held debt
securities. All guarantees are joint and several.
The following tables present summarized financial information for the Obligor Group, as defined below:
•
The Obligor Group will reflect guarantors and issuers of guaranteed securities consisting of ConocoPhillips,
ConocoPhillips Company and Burlington Resources LLC.
•
Consolidating adjustments for elimination of investments in and transactions between the collective guarantors
and issuers of guaranteed securities are reflected in the balances of the summarized financial information.
•
Non-Obligated Subsidiaries are excluded from this presentation.
Transactions and balances reflecting activity between the Obligors and Non-Obligated Subsidiaries are presented
separately below:
Summarized Income Statement Data
Millions of Dollars
2024
Revenues and Other Income
$
35,033
Income (loss) before income taxes*
8,252
Net Income (Loss)
9,245
*Includes approximately $8.6 billion of purchased commodities expense for transactions with Non-Obligated Subsidiaries.
Summarized Balance Sheet Data
Millions of Dollars
December 31, 2024
Current assets
$
6,077
Amounts due from Non-Obligated Subsidiaries, current
319
Noncurrent assets
120,845
Amounts due from Non-Obligated Subsidiaries, noncurrent
11,719
Current liabilities
4,504
Amounts due to Non-Obligated Subsidiaries, current
935
Noncurrent liabilities
64,088
Amounts due to Non-Obligated Subsidiaries, noncurrent
41,826
Capital Resources and Liquidity
ConocoPhillips 2024 10-K
54
Contingencies
We are subject to legal proceedings, claims and liabilities that arise in the ordinary course of business. We accrue for
losses associated with legal claims when such losses are considered probable and the amounts can be reasonably
estimated. See “Critical Accounting Estimates” and Note 10 for information on contingencies.
Legal and Tax Matters
We are subject to various lawsuits and claims, including but not limited to matters involving oil and gas royalty and
severance tax payments, gas measurement and valuation methods, contract disputes, environmental damages, climate
change, personal injury and property damage. Our primary exposures for such matters relate to alleged royalty and tax
underpayments on certain federal, state and privately owned properties, claims of alleged environmental contamination
and damages from historic operations and climate change. We will continue to defend ourselves vigorously in these
matters.
Our legal organization applies its knowledge, experience and professional judgment to the specific characteristics of our
cases, employing a litigation management process to manage and monitor the legal proceedings against us. Our process
facilitates the early evaluation and quantification of potential exposures in individual cases. This process also enables us
to track those cases that have been scheduled for trial and/or mediation. Based on professional judgment and experience
in using these litigation management tools and available information about current developments in all our cases, our
legal organization regularly assesses the adequacy of current accruals and determines if adjustment of existing accruals,
or establishment of new accruals, is required. See Note 16.
Environmental
We are subject to the same numerous international, federal, state and local environmental laws and regulations as other
companies in our industry. The most significant of these environmental laws and regulations include, among others, the:
•
U.S. Federal Clean Air Act, which governs air emissions;
•
U.S. Federal Clean Water Act, which governs discharges to water bodies;
•
EU Regulation for Registration, Evaluation, Authorization and Restriction of Chemicals (REACH);
•
U.S. Federal Comprehensive Environmental Response, Compensation and Liability Act (CERCLA or Superfund),
which imposes liability on generators, transporters and arrangers of hazardous substances at sites where
hazardous substance releases have occurred or are threatening to occur;
•
U.S. Federal Resource Conservation and Recovery Act (RCRA), which governs the treatment, storage, and
disposal of solid waste;
•
U.S. Federal Oil Pollution Act of 1990 (OPA90), under which owners and operators of onshore facilities and
pipelines, lessees or permittees of an area in which an offshore facility is located, and owners and operators of
vessels are liable for removal costs and damages that result from a discharge of oil into navigable waters of the
U.S.;
•
U.S. Federal Emergency Planning and Community Right-to-Know Act (EPCRA), which requires facilities to report
toxic chemical inventories with local emergency planning committees and response departments;
•
U.S. Federal Safe Drinking Water Act, which governs the disposal of wastewater in underground injection wells;
•
U.S. Department of the Interior regulations, which relate to offshore oil and gas operations in U.S. waters and
impose liability for the cost of pollution cleanup resulting from operations, as well as potential liability for
pollution damages; and
•
EU Trading Directive resulting in EU Emissions Trading Scheme (EU ETS).
These laws and their implementing regulations set limits on emissions and, in the case of discharges to water, establish
water quality limits. They also establish standards and impose obligations for the remediation of releases of hazardous
substances and hazardous wastes. In most cases, these regulations require permits in association with new or modified
operations. These permits can require an applicant to collect substantial information in connection with the application
process, which can be expensive and time-consuming. In addition, there can be delays associated with notice and
comment periods and the agency’s processing of the application. Many of the delays associated with the permitting
process are beyond the control of the applicant.
Many states and foreign countries where we operate also have or are developing, similar environmental laws and
regulations governing these same types of activities. While similar, in some cases these regulations may impose
additional, or more stringent, requirements that can add to the cost and difficulty of marketing or transporting products
across state and international borders.
Capital Resources and Liquidity
55
ConocoPhillips 2024 10-K
The ultimate financial impact arising from environmental laws and regulations is neither clearly known nor easily
determinable as new standards, such as air emission standards and water quality standards, continue to evolve. However,
environmental laws and regulations, including those that may arise to address concerns about global climate change, are
expected to continue to have an increasing impact on our operations in the U.S. and in other countries in which we
operate. Notable areas of potential impacts include air emission compliance and remediation obligations in the U.S. and
Canada.
An example is the use of hydraulic fracturing, an essential completion technique that facilitates production of oil and
natural gas otherwise trapped in lower permeability rock formations. A range of local, state, federal, or national laws and
regulations currently govern hydraulic fracturing operations, with hydraulic fracturing currently prohibited in some
jurisdictions. Although hydraulic fracturing has been conducted for many decades, potential new laws, regulations and
permitting requirements from various state environmental agencies, and others could result in increased costs, operating
restrictions, operational delays and/or limit the ability to develop oil and natural gas resources. Governmental restrictions
on hydraulic fracturing could impact the overall profitability or viability of certain of our oil and natural gas investments.
We have adopted operating principles that incorporate established industry standards designed to meet or exceed
government requirements. Our practices continually evolve as technology improves and regulations change.
We also are subject to certain laws and regulations relating to environmental remediation obligations associated with
current and past operations. Such laws and regulations include CERCLA and RCRA and their equivalents in their respective
jurisdictions. Longer-term expenditures are subject to considerable uncertainty and may fluctuate significantly.
We occasionally receive requests for information or notices of potential liability from the EPA and state environmental
agencies alleging that we are a potentially responsible party under CERCLA or an equivalent state statute. On occasion,
we also have been made a party to cost recovery litigation by those agencies or by private parties. These requests,
notices and lawsuits assert potential liability for remediation costs at various sites that typically are not owned by us, but
allegedly contain waste attributable to our past operations. As of December 31, 2024, there were 15 sites around the U.S.
in which we were identified as a potentially responsible party under CERCLA and comparable state laws.
For most Superfund sites, our potential liability will be significantly less than the total site remediation costs because the
percentage of waste attributable to us, versus that attributable to all other potentially responsible parties, is relatively
low. Although liability of those potentially responsible is generally joint and several for federal sites and frequently so for
state sites, other potentially responsible parties at sites where we are a party typically have had the financial strength to
meet their obligations, and where they have not, or where potentially responsible parties could not be located, our share
of liability has not increased materially. Many of the sites at which we are potentially responsible are still under
investigation by the EPA or the state agencies concerned. Prior to actual cleanup, those potentially responsible normally
assess site conditions, apportion responsibility and determine the appropriate remediation. In some instances, we may
have no liability or attain a settlement of liability. Actual cleanup costs generally occur after the parties obtain EPA or
equivalent state agency approval. There are relatively few sites where we are a major participant, and given the timing
and amounts of anticipated expenditures, neither the cost of remediation at those sites nor such costs at all CERCLA sites,
in the aggregate, is expected to have a material adverse effect on our competitive or financial condition.
Expensed environmental costs were $914 million in 2024 and are expected to be approximately $1.1 billion in 2025 and
2026. Capitalized environmental costs were $535 million in 2024 and are expected to be about $720 million and $656
million in 2025 and 2026, respectively.
Accrued liabilities for remediation activities are not reduced for potential recoveries from insurers or other third parties
and are not discounted (except those assumed in a purchase business combination, which we do record on a discounted
basis).
Many of these liabilities result from CERCLA, RCRA, and similar state or international laws that require us to undertake
certain investigative and remedial activities at sites where we conduct or once conducted operations or at sites where
ConocoPhillips-generated waste was disposed. The accrual also includes a number of sites we identified that may require
environmental remediation but which are not currently the subject of CERCLA, RCRA, or other agency enforcement
activities. The laws that require or address environmental remediation may apply retroactively and regardless of fault,
the legality of the original activities or the current ownership or control of sites. If applicable, we accrue receivables for
probable insurance or other third-party recoveries. In the future, we may incur significant costs under both CERCLA and
RCRA.
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Remediation activities vary substantially in duration and cost from site to site, depending on the mix of unique site
characteristics, evolving remediation technologies, diverse regulatory agencies and enforcement policies, and the
presence or absence of potentially liable third parties. Therefore, it is difficult to develop reasonable estimates of future
site remediation costs.
At December 31, 2024, our balance sheet included total accrued environmental costs of $206 million, compared with
$184 million at December 31, 2023, for remediation activities in the U.S. and Canada. We expect to incur a substantial
amount of these expenditures within the next 30 years.
Notwithstanding any of the foregoing, and as with other companies engaged in similar businesses, environmental costs
and liabilities are inherent concerns in our operations and products, and there can be no assurance that material costs
and liabilities will not be incurred. However, we currently do not expect any material adverse effect upon our results of
operations or financial position as a result of compliance with current environmental laws and regulations.
See Item 1A. Risk Factors—We expect to continue to incur substantial capital expenditures and operating costs as a result
of our compliance with existing and future environmental laws and regulations and Note 10 for information on
environmental litigation.
Climate Change
Continuing political and social attention to the issue of global climate change has resulted in a broad range of proposed or
promulgated state, national and international laws focusing on GHG emissions reduction. These laws apply or could apply
in countries where we have interests or may have interests in the future. Laws in this field continue to evolve and while it
is not possible to accurately estimate either a timetable for implementation or our future compliance costs relating to
implementation, such laws, if enacted, could have a material impact on our operational results and financial condition.
Examples of legislation and precursors for possible regulation that do or could affect our operations include:
Emissions trading schemes.
•
EU ETS is the program through which many of the EU member states aim to reduce emissions. Our cost of
compliance with the EU ETS in 2024 was approximately $20 million (net share before-tax).
•
The U.K. Emissions Trading Scheme (U.K. ETS) is the program with which the U.K. has replaced the EU ETS. Our
cost of compliance with the U.K. ETS in 2024 was approximately $0.8 million (net share before-tax).
GHG regulations for emissions reductions.
•
The Alberta Technology Innovation and Emissions Reduction (TIER) regulation requires any existing facility with
emissions equal to or greater than 100,000 metric tonnes of carbon dioxide, or equivalent, per year to meet a
facility benchmark intensity. The total cost of compliance related to this regulation in 2024 was approximately
$4.5 million (net share before-tax) after savings from using our existing bank of offsets and performance credits
($7.7 million before savings).
•
As of April 2024, the British Columbia Output Based Pricing System (BC OBPS) regulation requires facilities or
linear operations (such as oil and gas gathering systems) with emissions equal to or greater than 10,000 metric
tonnes of carbon dioxide or equivalent per year to remit payments on the difference between actual emissions
and allowable emissions based on product and activity benchmarks. The benchmarks and guidance for these
emissions have yet to be finalized, and compliance payments are not due until later in 2025. Based on interim
benchmarks, our BC OBPS obligation is expected to total $1.5 million (net share before-tax) for Montney in 2024.
•
In 2024, the EU passed regulation on the reduction of methane emissions in the energy sector that will apply a
methane limit on oil and gas imports to the EU, as well as mandate the monitoring, reporting, verification and
reduction of methane emissions.
•
Our APLNG assets in Australia are subject to the Safeguard Mechanism, enacted through the National
Greenhouse and Energy Reporting Act 2007. In the previous Australian financial year of July 1, 2023, to June 30,
2024, our operated downstream APLNG facility was in excess of its baseline emissions, while the upstream
partner-operated facilities were below their baseline emissions. As we expect there to be a surplus of eligible
carbon units across the joint venture, there is no expense expected to be incurred by ConocoPhillips for the 2024
Australian financial year.
•
In 2024 the U.S. EPA published final rulemaking for New Source Performance Standards (OOOOb) and Emissions
Guidelines (OOOOc). Implementing this regulation across our U.S. portfolio will result in additional compliance
costs.
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•
In connection with OOOOb and OOOOc rulemaking, the U.S. EPA established the Methane Super Emitter
Program whereby certified third parties can use EPA-approved technology to identify and report super-emitter
events for EPA review. An operator must initiate an investigation within five days of receiving notification from
the EPA regarding a super-emitter event.
•
In November 2024, the U.S. EPA finalized the Waste Emissions Charge (WEC) as part of the Methane Emission
Reduction Program (MERP) within the Inflation Reduction Act of 2022. The implementation of the WEC will
require payments to the EPA, accounting for methane emissions subject to the rule. The filing deadline for the
2024 WEC is August 2025.
Carbon taxes in certain jurisdictions.
•
We incurred carbon tax cost in our Montney operations in the first three months of 2024, before the BC OBPS
came into force. We may also incur a carbon tax for any emissions in Montney that falls outside the scope of our
BC OBPS activities. We also incur a nominal carbon tax for emissions from fossil fuel combustion at some of our
Surmont operations in Alberta that occur outside of TIER facilities. Carbon tax costs in our Canada operations
totaled $1.7 million (net share before-tax).
•
Our cost of compliance with Norwegian carbon legislation in 2024 was approximately $37 million (net share
before-tax).
Other environmental regulations.
•
The White House Council on Environmental Quality (CEQ) issued final National Environmental Policy Act
implementation regulations (NEPA Phase 2) in 2024. Since then, the DC Circuit Court has suggested that CEQ
lacks authority to adopt any binding regulations, introducing potential uncertainty into the regulatory process.
•
Climate Superfund laws. In 2024, New York and Vermont passed legislation seeking to hold certain energy
companies financially responsible for state climate change mitigation and adaptation measures, following the
“polluter pays” model of existing Superfund laws. This responsibility may include paying into a fund for
infrastructure repairs and recovery from extreme weather events that would otherwise be covered by the
government. While only two U.S. states have enacted such laws to date, it is likely that more states will consider
a similar approach. Compliance with such legislation may expose us to significant additional liabilities.
•
Climate Private Action laws. In 2025, California, New Hampshire, and Oregon introduced bills seeking to create a
private right of action for individuals to bring strict liability claims for alleged damages related to climate change
impacts (including non-economic, actual and punitive damages). These bills also authorize insurance companies
to pursue subrogation claims to recover damages for amounts paid to insureds for climate change impacts.
Non-regulatory initiatives or agreements.
•
The U.S. government announced on September 17, 2021 the Global Methane Pledge, a global initiative to reduce
global methane emissions by at least 30 percent from 2020 levels by 2030.
•
The agreement reached in Paris in December 2015 at the 21st Conference of the Parties to the United Nations
Framework Convention on Climate Change set out a process for achieving global emissions reductions.
Accordingly, parties to the Paris Agreement have set targets to reduce emissions by 2030. While the current
administration has officially withdrawn the U.S. from the Paris Agreement, some states have indicated that they
plan to remain committed to the goals of the agreement.
Regulated sustainability disclosures.
Governments and financial regulators are developing new reporting rules requiring increased disclosure around a range
of sustainability topics. The patchwork of reporting standards that is developing may require significant increases in
disclosures, which may be costly to implement. In March 2022 the U.S. SEC proposed rule changes that would require
registrants to include certain climate-related disclosures in their registration statements and periodic reports; In January
2023 the EU finalized the Corporate Sustainability Reporting Directive that will require more detailed sustainability
reporting; in June 2023 the International Sustainability Standards Board issued inaugural sustainability reporting
standards; in October 2023 in California multiple bills were signed into law requiring climate-related disclosures for
companies that conduct business in the state; and in September 2024, the Australian Government passed legislation
which mandated a new standard for climate-related disclosures.
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Compliance with changes in laws and regulations that create a GHG tax, emission trading scheme or GHG reduction
policies could significantly increase our costs, reduce demand for fossil energy derived products, impact the cost and
availability of capital and increase our exposure to litigation. Such laws and regulations could also increase demand for
less carbon intensive energy sources, including natural gas. The ultimate impact on our financial performance, either
positive or negative, will depend on a number of factors, including but not limited to:
•
Whether and to what extent legislation or regulation is enacted;
•
The timing of the introduction of such legislation or regulation;
•
The nature of the legislation (such as a cap and trade system or a tax on emissions) or regulation;
•
The price placed on GHG emissions (either by the market or through a tax);
•
The GHG emissions reductions required;
•
The price and availability of offsets;
•
The amount and allocation of allowances;
•
Technological and scientific developments leading to new products or services;
•
Any potential significant physical effects of climate change (such as increased severe weather events, changes in
sea levels and changes in temperature); and
•
Whether, and the extent to which, increased compliance costs are ultimately reflected in the prices of our
products and services.
See Item 1A. Risk Factors—Existing and future laws, regulations and internal initiatives relating to global climate changes,
such as limitations on GHG emissions may impact or limit our business plans, result in significant expenditures, promote
alternative uses of energy or reduce demand for our products and Note 10 for information on climate change litigation.
Company Response to Climate-Related Risks
The objective of our Climate Risk Strategy is to manage climate-related risk, optimize opportunities and equip the
company to respond to changes in key uncertainties, including government policies around the world, technologies for
emissions reduction, alternative energy technologies and changes in consumer trends. The strategy sets out our choices
around portfolio composition, emissions reductions, targets and incentives, emissions-related technology development,
and our climate-related policy and finance sector engagement.
Our Climate Risk Strategy is intended to enable us to responsibly meet the global demand for energy, deliver competitive
returns on and of capital and work to meet our previously established emissions-reduction targets. First, meeting global
energy demand requires a focus on delivering production that will best compete in any energy mix scenario. This
production will be delivered from resources with a competitive cost of supply and low GHG intensity, as well as portfolio
diversity by market and asset type. Next, in delivering competitive returns, ConocoPhillips has been a leader in shifting
the exploration and production sector’s value proposition away from one focused on production toward one focused on
returns. Finally, to drive accountability for the emissions that are within our control, we are progressing toward our Scope
1 and Scope 2 emissions intensity targets.
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Key elements of the Climate Risk Strategy include:
•
Strategic flexibility and portfolio composition
◦
Building a resilient asset portfolio with a focus on low cost of supply and low GHG intensity to meet
global energy demand.
◦
Committing to capital discipline through use of a fully burdened cost of supply, including cost of carbon,
as the basis for capital allocation.
◦
Testing our portfolio against future energy demand scenarios through a comprehensive scenario
planning process that helps us assess the resilience of our corporate strategy to climate risk.
•
Scope 1 and 2 emissions targets and reductions
◦
Setting targets for emissions over which we have ownership and control.
◦
Reducing emissions through the marginal abatement cost curve process.
•
LNG and technology
◦
Building an attractive LNG portfolio as an important component of responsibly meeting global energy
demand due to LNG's opportunity to displace higher-emissions fuels such as coal for electricity
generation.
◦
Evaluating potential investments in emerging alternative energy sources and low-carbon technologies.
•
External engagement
◦
Advocating for a well-designed, economy-wide price on carbon and engaging in development of other
policy and legislation to address end-use emissions.
◦
Working with our suppliers and commercial partners to reduce emissions along the value chain.
Our Climate Risk Strategy does not include a Scope 3 emissions target. We recognize that end-use emissions must be
reduced to meet global climate objectives. However, it is our view that supply-side constraints through Scope 3 targets
for North American and European upstream oil and gas producers would be counterproductive to climate goals. In the
absence of policy measures that address global demand, Scope 3 targets would shift production to other global
operators, potentially eroding energy security and increasing emissions. This is why we have consistently taken a
prominent role in advocating for a well-designed, economy wide price on carbon and engaged in development of other
policies or legislation that could address end-use emissions from high-carbon intensity energy use. We have also
expanded policy advocacy beyond carbon pricing to include energy efficiency, end-use emissions policy and regulatory
action, such as support for the direct federal regulation of methane.
In support of addressing our Scope 1 and 2 emissions, we have made recent progress in several key areas.
•
Completed our 2024 scope 1 and 2 emissions reduction projects within the allotted capital and cost budget.
These projects will support our GHG emissions intensity reduction target of 50-60 percent by 2030 from a 2016
baseline for both gross operated and net equity emissions.
•
Achieved the Gold Standard Reporting for emissions reporting in the Oil and Gas Methane Partnership 2.0
Initiative, one of only three U.S. companies to earn this distinction.
•
Remained on schedule to meet a target of zero routine flaring by the end of 2025 for heritage ConocoPhillips
assets.
Our emissions reduction efforts are supported by our multi-disciplinary Low Carbon Technologies organization. See Item
1A. Risk Factors—Our ability to successfully execute on our plans to reduce our operational GHG emissions intensity is
subject to a number of risks and uncertainties, and such reductions may be costly and challenging to achieve.
New Accounting Standards
For discussion of new accounting standards, see Note 24.
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60
Critical Accounting Estimates
The preparation of financial statements in conformity with GAAP requires management to select appropriate accounting
policies and to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and
expenses. See Note 1 for descriptions of our significant accounting policies. Certain of these accounting policies involve
judgments and uncertainties to such an extent there is a reasonable likelihood materially different amounts would have
been reported under different conditions, or if different assumptions had been used. These critical accounting estimates
are discussed with the Audit and Finance Committee of the Board of Directors at least annually. We believe the following
discussions of critical accounting estimates address all important accounting areas where the nature of accounting
estimates or assumptions is material due to the levels of subjectivity and judgment necessary to account for highly
uncertain matters or the susceptibility of such matters to change.
Oil and Gas Accounting
Accounting for oil and gas activity is subject to special accounting rules unique to the oil and gas industry. The acquisition
of G&G seismic information, prior to the discovery of proved reserves, is expensed as incurred, similar to accounting for
research and development costs. However, leasehold acquisition costs and exploratory well costs are capitalized on the
balance sheet pending determination of whether proved oil and gas reserves have been recognized.
Property Acquisition Costs
For individually significant leaseholds, management periodically assesses for impairment based on exploration and drilling
efforts to date. For insignificant individual leasehold acquisition costs, management exercises judgment and determines a
percentage probability that the prospect ultimately will fail to find proved oil and gas reserves, including estimates of
future expirations, and pools that leasehold information with others in similar geographic areas. For prospects in areas
with limited, or no, previous exploratory drilling, the percentage probability of ultimate failure is normally judged to be
quite high. This judgmental percentage is multiplied by the leasehold acquisition cost, and that product is divided by the
contractual period of the leasehold to determine a periodic leasehold impairment charge that is reported in exploration
expense. This judgmental probability percentage is reassessed and adjusted throughout the contractual period of the
leasehold based on favorable or unfavorable exploratory activity on the leasehold or on adjacent leaseholds, and
leasehold impairment amortization expense is adjusted prospectively.
At year-end 2024, we held $14.7 billion of net capitalized unproved property costs, $10.8 billion of which was added this
year through our acquisition of Marathon Oil. These capitalized costs consist primarily of individually significant and
pooled leaseholds, mineral rights held in perpetuity by title ownership, exploratory wells currently being drilled,
suspended exploratory wells and capitalized interest. Of this amount, approximately $13.4 billion is concentrated in the
Lower 48 Basins, primarily the Delaware, Eagle Ford and Bakken Basins, where we have an ongoing significant and active
development program. Outside of the Lower 48 Basins, the remaining $1.3 billion is primarily concentrated in Canada.
Management periodically assesses our unproved property for impairment based on the results of exploration and drilling
efforts and the outlook for commercialization.
Exploratory Costs
For exploratory wells, drilling costs are temporarily capitalized, or “suspended,” on the balance sheet, pending a
determination of whether potentially economic oil and gas reserves have been discovered by the drilling effort to justify
development.
If exploratory wells encounter potentially economic quantities of oil and gas, the well costs remain capitalized on the
balance sheet as long as sufficient progress assessing the reserves and the economic and operating viability of the project
is being made. The accounting notion of “sufficient progress” is a judgmental area, but the accounting rules do prohibit
continued capitalization of suspended well costs on the expectation future market conditions will improve or new
technologies will be found that would make the development economically profitable. Often, the ability to move into the
development phase and record proved reserves is dependent on obtaining permits and government or coventurer
approvals, the timing of which is ultimately beyond our control. Exploratory well costs remain suspended as long as we
are actively pursuing such approvals and permits and believe they will be obtained. Once all required approvals and
permits have been obtained, the projects are moved into the development phase, and the oil and gas reserves are
designated as proved reserves.
At year-end 2024, total suspended well costs were $196 million, compared with $184 million at year-end 2023. For
additional information on suspended wells, including an aging analysis, see Note 6.
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Proved Reserves
Engineering estimates of the quantities of proved reserves are inherently imprecise and represent only approximate
amounts because of the judgments involved in developing such information. Reserve estimates are based on geological
and engineering assessments of in-place hydrocarbon volumes, the production plan, historical extraction recovery and
processing yield factors, installed plant operating capacity and approved operating limits. The reliability of these
estimates at any point in time depends on both the quality and quantity of the technical and economic data and the
efficiency of extracting and processing the hydrocarbons.
Despite the inherent imprecision in these engineering estimates, accounting rules require disclosure of “proved” reserve
estimates due to the importance of these estimates to better understand the perceived value and future cash flows of a
company’s operations. There are several authoritative guidelines regarding the engineering criteria that must be met
before estimated reserves can be designated as “proved.” Our geosciences and reservoir engineering organization has
policies and procedures in place consistent with these authoritative guidelines. We have trained and experienced internal
engineering personnel who estimate our proved reserves held by consolidated companies, as well as our share of equity
affiliates. See “Supplementary Data - Oil and Gas Operations” for additional information.
Proved reserve estimates are adjusted annually in the fourth quarter and during the year if significant changes occur and
take into account recent production and subsurface information about each field. Also, as required by current
authoritative guidelines, the estimated future date when an asset will reach the end of its economic life is based on
historical 12-month first-of-month average prices and current costs. This date estimates when production will end and
affects the amount of estimated reserves. Therefore, as prices and cost levels change from year to year, the estimate of
proved reserves also changes. Generally, our proved reserves decrease as prices decline and increase as prices rise.
Our proved reserves include estimated quantities related to PSCs, reported under the “economic interest” method, as
well as variable-royalty regimes, and are subject to fluctuations in commodity prices, recoverable operating expenses and
capital costs. If costs remain stable, reserve quantities attributable to recovery of costs will change inversely to changes in
commodity prices. We would expect reserves from these contracts to decrease when product prices rise and increase
when prices decline.
The estimation of proved reserves is also important to the income statement because the proved reserve estimate for a
field serves as the denominator in the unit-of-production calculation of the DD&A of the capitalized costs for that asset.
At year-end 2024, the net book value of productive PP&E subject to a unit-of-production calculation was approximately
$77 billion and the DD&A recorded on these assets in 2024 was approximately $9.4 billion. The estimated proved
developed reserves for our consolidated operations were 4.4 billion BOE at the end of 2023 and 5.1 billion BOE at the end
of 2024. If the estimates of proved reserves used in the unit-of-production calculations had been lower by 10 percent
across all calculations, before-tax DD&A in 2024 would have increased by an estimated $1,040 million.
Business Combination—Valuation of Oil and Gas Properties
For business combinations, management applies the principles of acquisition accounting under FASB ASC Topic 805 –
“Business Combinations” and allocates the purchase price to assets acquired and liabilities assumed, based on their
estimated fair values as of the acquisition date. Estimating the fair values involves making various assumptions, of which
the most significant assumptions relate to the fair values assigned to proved and unproved oil and gas properties. For
significant business combinations, management generally utilizes a discounted cash flow approach, based on market
participant assumptions, and considers engaging third party valuation experts in preparing fair value estimates.
Significant inputs incorporated within the valuation include future commodity price assumptions and production profiles
of reserve estimates, future operating and development costs, inflation rates, and discount rates using a market-based
weighted average cost of capital determined at the time of the acquisition. When estimating the fair value of unproved
properties, additional risk-weighting adjustments are applied to probable and possible reserves.
The assumptions and inputs incorporated within the fair value estimates are subject to considerable management
judgement and are based on industry, market and economic conditions prevalent at the time of the acquisition. Although
we based these estimates on assumptions believed to be reasonable, these estimates are inherently unpredictable and
uncertain and actual results could differ. If the initial accounting for the business combination is incomplete by the end of
the reporting period in which the acquisition occurs, an estimate is recorded. Subsequent to the acquisition date, and not
later than one year from the acquisition date, we record any material adjustments to the initial estimate based on new
information obtained that would have existed as of the date of the acquisition. Any adjustment that arises from
information obtained that did not exist as of the date of acquisition is recorded in the period the adjustment arises. See
Note 3.
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Impairments
Long-lived assets used in operations are assessed for impairment whenever changes in facts and circumstances indicate a
possible significant deterioration in the future cash flows expected to be generated by an asset group. If there is an
indication the carrying amount of an asset may not be recovered, a recoverability test is performed using management’s
assumptions for prices, volumes and future development plans. If the sum of the undiscounted cash flows before income-
taxes is less than the carrying value of the asset group, the carrying value is written down to estimated fair value and
reported as an impairment in the periods in which the determination is made. Individual assets are grouped for
impairment purposes at the lowest level for which there are identifiable cash flows that are largely independent of the
cash flows of other groups of assets—generally on a field-by-field basis for E&P assets. Because there usually is a lack of
quoted market prices for long-lived assets, the fair value of impaired assets is typically determined based on the present
values of expected future cash flows using discount rates and prices believed to be consistent with those used by
principal market participants, or based on a multiple of operating cash flow validated with historical market transactions
of similar assets where possible.
The expected future cash flows used for impairment reviews and related fair value calculations are based on estimated
future production volumes, commodity prices, operating costs and capital decisions, considering all available evidence at
the date of review. Differing assumptions could affect the timing and the amount of an impairment in any period.
Investments in nonconsolidated entities accounted for under the equity method are assessed for impairment whenever
changes in the facts and circumstances indicate a loss in value has occurred. Such evidence of a loss in value might
include our inability to recover the carrying amount, the lack of sustained earnings capacity which would justify the
current investment amount, or a current fair value less than the investment’s carrying amount. When such a condition is
judgmentally determined to be other than temporary, an impairment charge is recognized for the difference between the
investment’s carrying value and its estimated fair value. When determining whether a decline in value is other than
temporary, management considers factors such as the length of time and extent of the decline, the investee’s financial
condition and near-term prospects and our ability and intention to retain our investment for a period that will be
sufficient to allow for any anticipated recovery in the market value of the investment. Since quoted market prices are
usually not available, the fair value is typically based on the present value of expected future cash flows using discount
rates and prices believed to be consistent with those used by principal market participants, plus market analysis of
comparable assets owned by the investee, if appropriate. Differing assumptions could affect the timing and the amount
of an impairment of an investment in any period.
Asset Retirement Obligations and Environmental Costs
Under various contracts, permits and regulations, we have material legal obligations to remove tangible equipment and
restore the land or seabed at the end of operations at operational sites. Our largest asset removal obligations involve
plugging and abandonment of wells, removal and disposal of offshore oil and gas platforms around the world, as well as
oil and gas production facilities and pipelines in Alaska. Fair value is estimated using a present value approach,
incorporating assumptions about estimated amounts and timing of settlements and impacts of the use of technologies.
Estimating future asset removal costs requires significant judgement. Most of these removal obligations are many years,
or decades, in the future and the contracts and regulations often have vague descriptions of what removal practices and
criteria must be met when the removal event actually occurs. The carrying value of our asset retirement obligation
estimate is sensitive to inputs such as asset removal technologies and costs, regulatory and other compliance
considerations, expenditure timing, and other inputs into valuation of the obligation, including discount and inflation
rates, which are all subject to change between the time of initial recognition of the liability and future settlement of our
obligation.
Normally, changes in asset removal obligations are reflected in the income statement as increases or decreases to DD&A
over the remaining life of the assets. However, for assets at or nearing the end of their operations, as well as previously
sold assets for which we retained the asset removal obligation, an increase in the asset removal obligation can result in
an immediate charge to earnings, because any increase in PP&E due to the increased obligation would immediately be
subject to impairment, due to the low fair value of these properties.
In addition to asset removal obligations, under the above or similar contracts, permits and regulations, we have certain
environmental-related projects. These are primarily related to remediation activities required by Canada and various
states within the U.S. at exploration and production sites. Future environmental remediation costs are difficult to
estimate because they are subject to change due to such factors as the uncertain magnitude of cleanup costs, the
unknown time and extent of such remedial actions that may be required, and the determination of our liability in
proportion to that of other responsible parties. See Note 7.
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Projected Benefit Obligations
The actuarial determination of projected benefit obligations and company contribution requirements involves judgment
about uncertain future events, including estimated retirement dates, salary levels at retirement, mortality rates, lump-
sum election rates, rates of return on plan assets, future health care cost-trend rates and rates of utilization of health
care services by retirees. Due to the specialized nature of these calculations, we engage outside actuarial firms to assist in
the determination of these projected benefit obligations and company contribution requirements. Ultimately, we will be
required to fund all vested benefits under pension and postretirement benefit plans not funded by plan assets or
investment returns, but the judgmental assumptions used in the actuarial calculations significantly affect periodic
financial statements and funding patterns over time. Projected benefit obligations are particularly sensitive to the
discount rate assumption. A 100 basis-point decrease in the discount rate assumption would increase projected benefit
obligations by $500 million. Benefit expense is sensitive to the discount rate and return on plan assets assumptions. A
100 basis-point decrease in the discount rate assumption would increase annual benefit expense by $40 million, while a
100 basis-point decrease in the return on plan assets assumption would increase annual benefit expense by $70 million.
In determining the discount rate, we use yields on high-quality fixed income investments matched to the estimated
benefit cash flows of our plans. We are also exposed to the possibility that lump sum retirement benefits taken from
pension plans during the year could exceed the total of service and interest components of annual pension expense and
trigger accelerated recognition of a portion of unrecognized net actuarial losses and gains. These benefit payments are
based on decisions by plan participants and are therefore difficult to predict. In the event there is a significant reduction
in the expected years of future service of present employees or the elimination of the accrual of defined benefits for
some or all of their future services for a significant number of employees, we could recognize a curtailment gain or loss.
See Note 15.
Contingencies
A number of claims and lawsuits are made against the company arising in the ordinary course of business. Management
exercises judgment related to accounting and disclosure of these claims which includes losses, damages and
underpayments associated with environmental remediation, tax, contracts and other legal disputes. As we learn new
facts concerning contingencies, we reassess our position both with respect to amounts recognized and disclosed
considering changes to the probability of additional losses and potential exposure; however, actual losses can and do vary
from estimates for a variety of reasons including legal, arbitration or other third-party decisions; settlement discussions;
evaluation of scope of damages; interpretation of regulatory or contractual terms; expected timing of future actions; and
proportion of liability shared with other responsible parties. Estimated future costs related to contingencies are subject to
change as events evolve and as additional information becomes available during the administrative and litigation
processes. For additional information on contingent liabilities, see the “Contingencies” section within “Capital Resources
and Liquidity” and Note 10.
Income Taxes
We are subject to income taxation in numerous jurisdictions worldwide. We record deferred tax assets and liabilities to
account for the expected future tax consequences of events that have been recognized in our financial statements and
our tax returns. We routinely assess our deferred tax assets and reduce such assets by a valuation allowance if we deem
it is more likely than not that some portion, or all, of the deferred tax assets will not be realized. In assessing the need for
adjustments to existing valuation allowances, we consider all available positive and negative evidence. Positive evidence
includes reversals of temporary differences, forecasts of future taxable income, assessment of future business
assumptions and applicable tax planning strategies that are prudent and feasible. Negative evidence includes losses in
recent years as well as the forecasts of future net income (loss) in the realizable period. In making our assessment
regarding valuation allowances, we weigh the evidence based on objectivity. Numerous judgments and assumptions are
inherent in the determination of future taxable income, including factors such as future operating conditions and the
assessment of the effects of foreign taxes on our U.S. federal income taxes (particularly as related to prevailing oil and gas
prices). See Note 16.
We regularly assess and, if required, establish accruals for uncertain tax positions that could result from assessments of
additional tax by taxing jurisdictions in countries where we operate. We recognize a tax benefit from an uncertain tax
position when it is more likely than not the position will be sustained upon examination, based on the technical merits of
the position. These accruals for uncertain tax positions are subject to a significant amount of judgment and are reviewed
and adjusted on a periodic basis in light of changing facts and circumstances considering the progress of ongoing tax
audits, court proceedings, changes in applicable tax laws, including tax case rulings and legislative guidance, or expiration
of the applicable statute of limitations. See Note 16.
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Cautionary Statement for the Purposes of the “Safe Harbor” Provisions of the Private
Securities Litigation Reform Act of 1995
This report includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical fact included or
incorporated by reference in this report, including, without limitation, statements regarding our future financial position,
business strategy, budgets, projected revenues, costs and plans, objectives of management for future operations, the
anticipated benefits of our acquisition of Marathon Oil, the anticipated impact of our acquisition of Marathon Oil on the
combined company’s business and future financial and operating results and the expected amount and timing of
synergies from our acquisition of Marathon Oil are forward-looking statements. Examples of forward-looking statements
contained in this report include our expected production growth and outlook on the business environment generally, our
expected capital budget and capital expenditures, and discussions concerning development or replacement of reserves
and future dividends. You can often identify our forward-looking statements by the words “ambition,” “anticipate,”
“believe,” “budget,” “continue,” “could,” “effort,” “estimate,” “expect,” “forecast,” “goal,” “guidance,” “intend,” “may,”
“objective,” “outlook,” “plan,” “potential,” “predict,” “projection,” “seek,” “should,” “target,” “will,” “would” and similar
expressions.
We based the forward-looking statements on our current expectations, estimates and projections about ourselves and
the industries in which we operate in general. We caution you these statements are not guarantees of future
performance as they involve assumptions that, while made in good faith, may prove to be incorrect or inaccurate, and
involve risks and uncertainties we cannot predict. Accordingly, our actual outcomes and results may differ materially from
what we have expressed or forecast in the forward-looking statements. Any differences could result from a variety of
factors and uncertainties, including, but not limited to, the following:
•
Effects of volatile commodity prices, including prolonged periods of low commodity prices, which may adversely
impact our operating results and our ability to execute on our strategy and could result in recognition of
impairment charges on our long-lived assets, leaseholds and nonconsolidated equity investments.
•
Global and regional changes in the demand, supply, prices, differentials or other market conditions affecting oil
and gas, including changes as a result of any ongoing military conflict and the global response to such conflict;
security threats on facilities and infrastructure; global health crises; the imposition or lifting of crude oil
production quotas or other actions that might be imposed by OPEC and other producing countries; or the
resulting company or third-party actions in response to such changes.
•
The potential for insufficient liquidity or other factors, such as those described herein, that could impact our
ability to repurchase shares and declare and pay dividends, whether fixed or variable.
•
Potential failures or delays in achieving expected reserve or production levels from existing and future oil and
gas developments, including due to operating hazards, drilling risks and the inherent uncertainties in predicting
reserves and reservoir performance.
•
Reductions in our reserve replacement rates, whether as a result of significant declines in commodity prices or
otherwise.
•
Unsuccessful exploratory drilling activities or the inability to obtain access to exploratory acreage.
•
Failure to progress or complete announced and future development plans related to constructing, modifying or
operating E&P and LNG facilities, or unexpected changes in costs, inflationary pressures or technical equipment
related to such plans.
•
Significant operational or investment changes imposed by legislative and regulatory initiatives and international
agreements addressing environmental concerns, including initiatives addressing the impact of global climate
change, such as limiting or reducing GHG emissions; regulations concerning hydraulic fracturing, methane
emissions, flaring or water disposal; and prohibitions on commodity exports.
•
Broader societal attention to and efforts to address climate change may cause substantial investment in and
increased adoption of competing or alternative energy sources.
•
Risks, uncertainties and high costs that may prevent us from successfully executing on our Climate Risk Strategy.
•
Lack or inadequacy of, or disruptions in, reliable transportation for our crude oil, bitumen, natural gas, LNG and
NGLs.
•
Inability to timely obtain or maintain permits, including those necessary for construction, drilling and/or
development, or inability to make capital expenditures required to maintain compliance with any necessary
permits or applicable laws or regulations.
•
Potential disruption or interruption of our operations and any resulting consequences due to accidents;
extraordinary weather events; supply chain disruptions; civil unrest; political events; war; terrorism;
cybersecurity threats or information technology failures, constraints or disruptions.
65
ConocoPhillips 2024 10-K
•
Liability for remedial actions, including removal and reclamation obligations, under existing or future
environmental regulations and litigation.
•
Liability resulting from pending or future litigation or our failure to comply with applicable laws and regulations.
•
General domestic and international economic, political and diplomatic developments, including deterioration of
international trade relationships; the imposition of trade restrictions or tariffs relating to commodities and
material or products (such as aluminum and steel) used in the operation of our business; expropriation of assets;
changes in governmental policies relating to commodity pricing, including the imposition of price caps;
sanctions; or other adverse regulations or taxation policies.
•
Competition and consolidation in the oil and gas E&P industry, including competition for sources of supply,
services, personnel and equipment.
•
Any limitations on our access to capital or increase in our cost of capital or insurance, including as a result of
illiquidity, changes or uncertainty in domestic or international financial markets, foreign currency exchange rate
fluctuations or investment sentiment.
•
Challenges or delays to our execution of, or successful implementation of the acquisition of Marathon Oil or any
future asset dispositions or acquisitions we elect to pursue; potential disruption of our operations, including the
diversion of management time and attention; our inability to realize anticipated cost savings or capital
expenditure reductions; difficulties integrating acquired businesses and technologies; or other unanticipated
changes.
•
Our inability to deploy the net proceeds from any asset dispositions that are pending or that we elect to
undertake in the future in the manner and timeframe we anticipate, if at all.
•
The operation, financing and management of risks of our joint ventures.
•
The ability of our customers and other contractual counterparties to satisfy their obligations to us, including our
ability to collect payments when due from the government of Venezuela or PDVSA.
•
Uncertainty as to the long-term value of our common stock.
•
The factors generally described in Part I—Item 1A in this 2024 Annual Report on Form 10-K and any additional
risks described in our other filings with the SEC.
ConocoPhillips 2024 10-K
66
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Financial Instrument Market Risk
We and certain of our subsidiaries hold and issue derivative contracts and financial instruments that expose our cash
flows or earnings to changes in commodity prices, foreign currency exchange rates or interest rates. We may use financial
and commodity-based derivative contracts to manage the risks produced by changes in the prices of natural gas, crude oil
and related products; fluctuations in interest rates and foreign currency exchange rates; or to capture market
opportunities.
Our use of derivative instruments is governed by an “Authority Limitations” document approved by our Board of
Directors that prohibits the use of highly leveraged derivatives or derivative instruments without sufficient liquidity. The
Authority Limitations document also establishes the Value at Risk (VaR) limits for the company, and compliance with
these limits is monitored daily. The Commercial organization manages our commercial marketing, optimizes our
commodity flows and positions, and monitors risks. The Executive Vice President and Chief Financial Officer, who reports
to the Chief Executive Officer, monitors commodity price risk and risks resulting from foreign currency exchange rates
and interest rates.
Commodity Price Risk
Our Commercial organization uses futures, forwards, swaps and options in various markets to accomplish the following
objectives:
•
Consistent with our policy to generally remain exposed to market prices, we use swap contracts to convert fixed-
price sales contracts, which are often requested by natural gas consumers, to floating market prices.
•
Enable us to use market knowledge to capture opportunities such as moving physical commodities to more
profitable locations and storing commodities to capture seasonal or time premiums. We may use derivatives to
optimize these activities.
We use a VaR model to estimate the loss in fair value that could potentially result on a single day from the effect of
adverse changes in market conditions on the derivative financial instruments and derivative commodity contracts we
hold or issue, including commodity purchases and sales contracts recorded on the balance sheet at December 31, 2024.
Using Monte Carlo simulation, a 95 percent confidence level and a one-day holding period, the VaR for those instruments
issued or held for trading purposes or held for purposes other than trading at December 31, 2024 and 2023, was
immaterial to our consolidated cash flows and net income.
67
ConocoPhillips 2024 10-K
Interest Rate Risk
The following table provides information about our debt instruments that are sensitive to changes in U.S. interest rates.
The table presents principal cash flows and related weighted-average interest rates by expected maturity dates.
Weighted-average variable rates are based on effective rates at the reporting date. The carrying amount of our floating-
rate debt approximates its fair value. A hypothetical 10 percent change in prevailing interest rates would not have a
material impact on interest expense associated with our floating-rate debt. The fair value of the fixed-rate debt is
measured using prices available from a pricing service that is corroborated by market data. Changes to prevailing interest
rates would not impact our cash flows associated with fixed-rate debt, unless we elect to repurchase or retire such debt
prior to maturity.
Millions of Dollars Except as Indicated
Debt
Expected Maturity Date
Fixed
Rate
Maturity
Average
Interest
Rate
Floating
Rate
Maturity
Average
Interest
Rate
Year-End 2024
2025
$
735
3.87 % $
—
— %
2026
704
3.40
—
—
2027
778
4.82
—
—
2028
664
3.78
—
—
2029
997
6.78
—
—
Remaining years
19,924
5.23
283
2.97 %
Total
$
23,802
$
283
Fair value
$
22,714
$
283
Year-End 2023
2024
$
759
2.70 % $
—
— %
2025
735
3.87
—
—
2026
104
6.41
—
—
2027
438
5.79
—
—
2028
265
4.50
—
—
Remaining years
15,829
5.45
283
4.06 %
Total
$
18,130
$
283
Fair value
$
18,338
$
283
ConocoPhillips 2024 10-K
68
Foreign Currency Exchange Risk
We have foreign currency exchange rate risk resulting from international operations. We do not comprehensively hedge
the exposure to currency exchange rate changes although we may choose to selectively hedge certain foreign currency
exchange rate exposures, such as firm commitments for capital projects or local currency tax payments, dividends and
cash returns from net investments in foreign affiliates to be remitted within the coming year and acquisitions.
At December 31, 2024 and 2023, we had outstanding foreign currency exchange forward contracts hedging cross-border
commercial activity and for purposes of mitigating our cash-related exposures. Although these forwards hedge exposures
to fluctuations in exchange rates, we elected not to utilize hedge accounting. As a result, the change in the fair value of
these foreign currency exchange derivatives is recorded directly in earnings. Since the gain or loss on the exchange
contracts is offset by the gain or loss from remeasuring cash related balances, and since our aggregate position in the
forwards was not material, there would be no material impact to our income from an adverse hypothetical 10 percent
change in the December 2024 or December 2023 exchange rates.
The gross notional and fair value of these positions at December 31, 2024 and 2023, were as follows:
Foreign Currency Exchange Derivatives
In Millions
Notional
Fair Value*
2024
2023
2024
2023
Buy Canadian dollar, sell U.S. dollar
CAD
10
5
—
—
Sell British pound, buy Euro
GBP
13
52
—
(2)
Buy British pound, sell Euro
GBP
17
58
—
—
*Denominated in USD.
69
ConocoPhillips 2024 10-K
Item 8. Financial Statements and Supplementary Data
ConocoPhillips
Index to Financial Statements
Page
Reports of Management
71
Reports of Independent Registered Public Accounting Firm (PCAOB ID #42)
72
Financial Statements
Consolidated Income Statement for the years ended December 31, 2024, 2023 and 2022
77
Consolidated Statement of Comprehensive Income for the years ended
December 31, 2024, 2023 and 2022
78
Consolidated Balance Sheet at December 31, 2024 and 2023
79
Consolidated Statement of Cash Flows for the years ended December 31, 2024, 2023 and 2022
80
Consolidated Statement of Changes in Equity for the years ended
December 31, 2024, 2023 and 2022
81
Notes to Consolidated Financial Statements
Note 1—Accounting Policies
82
Note 2—Inventories
86
Note 3—Acquisitions and Dispositions
86
Note 4—Investments, Loans and Long-Term Receivables
91
Note 5—Investment in Cenovus Energy
93
Note 6—Suspended Wells and Exploration Expenses
93
Note 7—Asset Retirement Obligations and Accrued Environmental Costs
95
Note 8—Debt
96
Note 9—Guarantees
100
Note 10—Contingencies and Commitments
101
Note 11—Derivatives and Financial Instruments
104
Note 12—Fair Value Measurement
108
Note 13—Equity
110
Note 14—Non-Mineral Leases
111
Note 15—Employee Benefit Plans
114
Note 16—Income Taxes
125
Note 17—Accumulated Other Comprehensive Income (Loss)
128
Note 18—Cash Flow Information
128
Note 19—Other Financial Information
129
Note 20—Related Party Transactions
130
Note 21—Sales and Other Operating Revenues
130
Note 22—Earnings Per Share
132
Note 23—Segment Disclosures and Related Information
132
Note 24—New Accounting Standards
136
Supplementary Information
Oil and Gas Operations
137
ConocoPhillips 2024 10-K
70
Reports of Management
Management prepared, and is responsible for, the consolidated financial statements and the other information appearing
in this annual report. The consolidated financial statements present fairly the company’s financial position, results of
operations and cash flows in conformity with accounting principles generally accepted in the United States. In preparing
its consolidated financial statements, the company includes amounts that are based on estimates and judgments
management believes are reasonable under the circumstances. The company’s financial statements have been audited by
Ernst & Young LLP, an independent registered public accounting firm appointed by the Audit and Finance Committee of
the Board of Directors and ratified by stockholders. Management has made available to Ernst & Young LLP all of the
company’s financial records and related data, as well as the minutes of stockholders’ and directors’ meetings.
Assessment of Internal Control Over Financial Reporting
Management is also responsible for establishing and maintaining adequate internal control over financial reporting.
ConocoPhillips’ internal control system was designed to provide reasonable assurance to the company’s management
and directors regarding the preparation and fair presentation of published financial statements.
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems
determined to be effective can provide only reasonable assurance with respect to financial statement preparation and
presentation.
Management assessed the effectiveness of the company’s internal control over financial reporting as of December 31,
2024. In making this assessment, it used the criteria set forth by the Committee of Sponsoring Organizations of the
Treadway Commission in Internal Control—Integrated Framework (2013). Our assessment of, and conclusion on, the
effectiveness of internal control over financial reporting did not include the internal controls of Marathon Oil
Corporation, acquired in 2024, which is included in our consolidated financial statements and represented approximately
22% of our total assets as of December 31, 2024, approximately 1% of our revenues and other income and less than 1% of
our net income for the year ended December 31, 2024.
Based on our assessment, we believe the company’s internal control over financial reporting was effective as of
December 31, 2024.
Ernst & Young LLP has issued an audit report on the company’s internal control over financial reporting as of
December 31, 2024, and their report is included herein.
/s/ Ryan M. Lance
/s/ William L. Bullock, Jr.
Ryan M. Lance
William L. Bullock, Jr.
Chairman and
Chief Executive Officer
Executive Vice President and
Chief Financial Officer
71
ConocoPhillips 2024 10-K
ConocoPhillips 2024 10-K
72
Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of ConocoPhillips
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of ConocoPhillips (the Company) as of December 31,
2024 and 2023, the related consolidated income statement, consolidated statements of comprehensive income, changes
in equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notes
(collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements
present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the
results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in
conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria
established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (2013 framework), and our report dated February 18, 2025 expressed an unqualified opinion
thereon.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an
opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the
PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities
laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material
misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to
those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the
financial statements. Our audits also included evaluating the accounting principles used and significant estimates made
by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial
statements that were communicated or required to be communicated to the Audit and Finance Committee and that: (1)
relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,
subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on
the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters
below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Depreciation, depletion and amortization of proved oil and gas properties, plants and equipment
Description of the
Matter
At December 31, 2024, the net book value of the Company’s proved oil and gas properties, plants
and equipment (PP&E) was $77 billion, and depreciation, depletion and amortization (DD&A)
expense was $9.4 billion for the year then ended. As described in Note 1, under the successful
efforts method of accounting, DD&A of PP&E on producing hydrocarbon properties and steam-
assisted gravity drainage facilities and certain pipeline and liquified natural gas assets (those which
are expected to have a declining utilization pattern) are determined by the unit-of-production
method. The unit-of-production method uses proved oil and gas reserves, as estimated by the
Company’s internal reservoir engineers.
Proved oil and gas reserves estimates are based on geological and engineering assessments of in-
place hydrocarbon volumes, the production plan, historical extraction recovery and processing yield
factors, installed plant operating capacity and approved operating limits. Significant judgment is
required by the Company’s internal reservoir engineers in evaluating the data used to estimate
proved oil and gas reserves. Estimating proved oil and gas reserves also requires the selection of
inputs, including historical production, oil and gas price assumptions and future operating costs
assumptions, among others.
Auditing the Company’s DD&A calculation is complex because of the use of the work of the internal
reservoir engineers and the evaluation of management’s determination of the inputs described
above used by the internal reservoir engineers in estimating proved oil and gas reserves.
How We
Addressed the
Matter in Our
Audit
We obtained an understanding, evaluated the design and tested the operating effectiveness of the
Company’s internal controls over its processes to calculate DD&A, including management’s controls
over the completeness and accuracy of significant data provided to the internal reservoir
engineers for use in estimating proved oil and gas reserves.
Our audit procedures included, among others, evaluating the professional qualifications and
objectivity of the Company’s internal reservoir engineers primarily responsible for overseeing the
preparation of the proved oil and gas reserves estimates. In addition, in assessing whether we can
use the work of the internal reservoir engineers, we evaluated the completeness and accuracy of the
significant data and inputs described above used by the internal reservoir engineers in estimating
proved oil and gas reserves by agreeing them to source documentation and we identified and
evaluated corroborative and contrary evidence. We also tested the accuracy of the DD&A
calculation, including comparing the proved oil and gas reserves amounts used in the calculation to
the Company’s reserve report.
73
ConocoPhillips 2024 10-K
Valuation and recognition of proved and unproved oil and gas properties acquired in a business
combination
Description of the
Matter
During 2024, the Company closed its acquisition of Marathon Oil Corporation resulting in the
recognition of a provisional fair value of proved and unproved oil and gas properties within net
properties, plants and equipment of $13.2 billion and $10.8 billion, respectively. As described in
Note 3, the transaction was accounted for as a business combination using the acquisition method,
which requires assets acquired and liabilities assumed to be measured at their acquisition date fair
values. As also described in Note 3, the Company has not finalized its allocation of fair value to
unproved properties. Oil and gas properties were valued by specialists using a discounted cash flow
approach based on market participant assumptions. Significant inputs to the valuation of proved and
unproved oil and gas properties include estimates of future commodity prices and production,
future operating costs and discount rates using a market-based weighted average cost of capital.
Auditing the Company's accounting for its provisional valuation of proved and unproved oil and gas
properties within the Lower 48 segment is complex and judgmental due to the significant estimation
required by management of reserves associated with the acquired assets and the sensitivity of
significant assumptions used in determining the fair value. In evaluating the reasonableness of
management’s estimates and assumptions used, the audit testing procedures performed required a
high degree of auditor judgment and additional effort, including involving internal valuation
specialists.
How We
Addressed the
Matter in Our
Audit
We obtained an understanding, evaluated the design and tested the operating effectiveness of the
Company’s internal controls over its process to estimate the provisional fair value of the acquired
proved and unproved oil and gas properties, including management’s review of the significant
assumptions used as inputs to the fair value calculations and recording of the provisional valuation.
To test the provisional fair value of the acquired proved and unproved oil and gas properties, our
audit procedures included, among others, evaluating the significant assumptions used and testing
the completeness and accuracy of the underlying data supporting the significant assumptions. For
example, we compared certain significant assumptions to current industry and third-party data and
historical results for reasonableness. We also performed sensitivity analyses of significant
assumptions, to evaluate the extent of their impact to the provisional fair value calculation. In
addition, we involved internal valuation specialists to assist with certain significant assumptions
included in the provisional fair value estimate. Furthermore, we evaluated the professional
qualifications and objectivity of the Company’s internal reservoir engineers primarily responsible for
overseeing the oil and gas reserves estimates and the valuation specialists used by the Company to
prepare the provisional fair value of the acquired proved and unproved oil and gas properties. In
addition, in assessing whether we can use the work of the internal reservoir engineers, we evaluated
the completeness and accuracy of the significant data and inputs used by the internal reservoir
engineers in estimating oil and gas reserves by agreeing them to source documentation, as
applicable, and we identified and evaluated corroborative and contrary evidence. As noted above,
the Company has not finalized its allocation of fair value to unproved properties
/s/ Ernst & Young LLP
We have served as the Company's auditor since 1949.
Houston, Texas
February 18, 2025
ConocoPhillips 2024 10-K
74
Report of Independent Registered Public Accounting Firm
To the Stockholders and the Board of Directors of ConocoPhillips
Opinion on Internal Control Over Financial Reporting
We have audited ConocoPhillips’ internal control over financial reporting as of December 31, 2024, based on criteria
established in Internal Control–Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (2013 framework) (the COSO criteria). In our opinion, ConocoPhillips (the Company) maintained, in
all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO
criteria.
As indicated under the heading “Assessment of Internal Control Over Financial Reporting” in the accompanying “Reports
of Management”, management’s assessment of and conclusion on the effectiveness of internal control over financial
reporting did not include the internal controls of Marathon Oil Corporation, which is included in the 2024 consolidated
financial statements of the Company and constituted approximately 22% of consolidated total assets as of December 31,
2024, approximately 1% of revenues and other income and less than 1% of net income for the year ended December 31,
2024. Our audit of internal control over financial reporting of ConocoPhillips also did not include an evaluation of the
internal control over financial reporting of Marathon Oil Corporation.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and 2023, the related
consolidated income statement, consolidated statements of comprehensive income, changes in equity and cash flows for
each of the three years in the period ended December 31, 2024, and the related notes and our report dated February 18,
2025 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its
assessment of the effectiveness of internal control over financial reporting included under the heading “Assessment of
Internal Control Over Financial Reporting” in the accompanying "Reports of Management." Our responsibility is to
express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public
accounting firm registered with the PCAOB and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was
maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the
assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that
our audit provides a reasonable basis for our opinion.
75
ConocoPhillips 2024 10-K
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are
recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting
principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of
management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the
financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
/s/ Ernst & Young LLP
Houston, Texas
February 18, 2025
ConocoPhillips 2024 10-K
76
Consolidated Income Statement
ConocoPhillips
Years Ended December 31
Millions of Dollars
2024
2023
2022
Revenues and Other Income
Sales and other operating revenues
$
54,745
56,141
78,494
Equity in earnings of affiliates
1,705
1,720
2,081
Gain (loss) on dispositions
51
228
1,077
Other income
452
485
504
Total Revenues and Other Income
56,953
58,574
82,156
Costs and Expenses
Purchased commodities
20,012
21,975
33,971
Production and operating expenses
8,751
7,693
7,006
Selling, general and administrative expenses
1,158
705
623
Exploration expenses
355
398
564
Depreciation, depletion and amortization
9,599
8,270
7,504
Impairments
80
14
(12)
Taxes other than income taxes
2,087
2,074
3,364
Accretion on discounted liabilities
325
283
250
Interest and debt expense
783
780
805
Foreign currency transaction (gain) loss
(50)
92
(100)
Other expenses
181
2
(47)
Total Costs and Expenses
43,281
42,286
53,928
Income (loss) before income taxes
13,672
16,288
28,228
Income tax provision (benefit)
4,427
5,331
9,548
Net Income (Loss)
$
9,245
10,957
18,680
Net Income (Loss) Per Share of Common Stock (dollars)
Basic
$
7.82
9.08
14.62
Diluted
7.81
9.06
14.57
Average Common Shares Outstanding (in thousands)
Basic
1,178,920
1,202,757
1,274,028
Diluted
1,180,871
1,205,675
1,278,163
See Notes to Consolidated Financial Statements.
Financial Statements
77
ConocoPhillips 2024 10-K
Consolidated Statement of Comprehensive Income
ConocoPhillips
Years Ended December 31
Millions of Dollars
2024
2023
2022
Net Income (Loss)
$
9,245
10,957
18,680
Other comprehensive income (loss)
Defined benefit plans
Prior service credit (cost) arising during the period
(57)
—
(10)
Reclassification adjustment for amortization of prior service cost
(credit) included in net income (loss)
(38)
(38)
(39)
Net change
(95)
(38)
(49)
Net actuarial gain (loss) arising during the period
81
37
(623)
Reclassification adjustment for amortization of net actuarial losses
(gains) included in net income (loss)
65
82
72
Net change
146
119
(551)
Nonsponsored plans*
1
(3)
5
Income taxes on defined benefit plans
(49)
(23)
178
Defined benefit plans, net of tax
3
55
(417)
Unrealized holding gain (loss) on securities
3
20
(13)
Reclassification adjustment for (gain) loss included in net income
(2)
(4)
(1)
Income taxes on unrealized holding gain (loss) on securities
—
(3)
3
Unrealized holding gain (loss) on securities, net of tax
1
13
(11)
Foreign currency translation adjustments
(760)
195
(623)
Income taxes on foreign currency translation adjustments
—
2
1
Foreign currency translation adjustments, net of tax
(760)
197
(622)
Unrealized gain (loss) on hedging activities
(56)
78
—
Income taxes on unrealized gain (loss) on hedging activities
12
(16)
—
Unrealized gain (loss) on hedging activities, net of tax
(44)
62
—
Other Comprehensive Income (Loss), Net of Tax
(800)
327
(1,050)
Comprehensive Income (Loss)
$
8,445
11,284
17,630
*Plans for which ConocoPhillips is not the primary obligor—primarily those administered by equity affiliates.
See Notes to Consolidated Financial Statements.
Financial Statements
ConocoPhillips 2024 10-K
78
Consolidated Balance Sheet
ConocoPhillips
At December 31
Millions of Dollars
2024
2023
Assets
Cash and cash equivalents
$
5,607
5,635
Short-term investments
507
971
Accounts and notes receivable (net of allowance of $7 and $3, respectively)
6,621
5,461
Accounts and notes receivable—related parties
74
13
Inventories
1,809
1,398
Prepaid expenses and other current assets
1,029
852
Total Current Assets
15,647
14,330
Investments and long-term receivables
9,869
9,130
Net properties, plants and equipment (net of accumulated DD&A of $81,072 and
$74,361, respectively)
94,356
70,044
Other assets
2,908
2,420
Total Assets
$
122,780
95,924
Liabilities
Accounts payable
$
5,987
5,083
Accounts payable—related parties
57
34
Short-term debt
1,035
1,074
Accrued income and other taxes
2,460
1,811
Employee benefit obligations
1,087
774
Other accruals
1,498
1,229
Total Current Liabilities
12,124
10,005
Long-term debt
23,289
17,863
Asset retirement obligations and accrued environmental costs
8,089
7,220
Deferred income taxes
11,426
8,813
Employee benefit obligations
1,022
1,009
Other liabilities and deferred credits
2,034
1,735
Total Liabilities
57,984
46,645
Equity
Common stock (2,500,000,000 shares authorized at $0.01 par value) Issued
(2024—2,250,672,734 shares; 2023—2,103,772,516 shares)
Par value
23
21
Capital in excess of par
77,529
61,303
Treasury stock (at cost: 2024—974,806,010 shares; 2023—925,670,961 shares)
(71,152)
(65,640)
Accumulated other comprehensive income (loss)
(6,473)
(5,673)
Retained earnings
64,869
59,268
Total Equity
64,796
49,279
Total Liabilities and Equity
$
122,780
95,924
See Notes to Consolidated Financial Statements.
Financial Statements
79
ConocoPhillips 2024 10-K
Consolidated Statement of Cash Flows
ConocoPhillips
Years Ended December 31
Millions of Dollars
2024
2023
2022
Cash Flows From Operating Activities
Net income (loss)
$
9,245
10,957
18,680
Adjustments to reconcile net income (loss) to net cash provided by operating
activities
Depreciation, depletion and amortization
9,599
8,270
7,504
Impairments
80
14
(12)
Dry hole costs and leasehold impairments
46
162
340
Accretion on discounted liabilities
325
283
250
Deferred taxes
367
1,145
2,086
Distributions more (less) than income from equity affiliates
564
964
942
(Gain) loss on dispositions
(51)
(228)
(1,077)
(Gain) loss on investment in Cenovus Energy
—
—
(251)
Other
130
(220)
86
Working capital adjustments
Decrease (increase) in accounts and notes receivable
(262)
1,333
(963)
Decrease (increase) in inventories
(68)
(103)
(38)
Decrease (increase) in prepaid expenses and other current assets
79
337
(173)
Increase (decrease) in accounts payable
(543)
(1,118)
901
Increase (decrease) in taxes and other accruals
613
(1,831)
39
Net Cash Provided by Operating Activities
20,124
19,965
28,314
Cash Flows From Investing Activities
Capital expenditures and investments
(12,118)
(11,248)
(10,159)
Working capital changes associated with investing activities
302
30
520
Acquisition of businesses, net of cash acquired
(24)
(2,724)
(60)
Proceeds from asset dispositions
261
632
3,471
Net sales (purchases) of investments
415
1,373
(2,629)
Collection of advances/loans—related parties
—
—
114
Other
14
(63)
2
Net Cash Used in Investing Activities
(11,150)
(12,000)
(8,741)
Cash Flows From Financing Activities
Issuance of debt
5,591
3,787
2,897
Repayment of debt
(4,981)
(1,379)
(6,267)
Issuance of company common stock
(78)
(52)
362
Repurchase of company common stock
(5,463)
(5,400)
(9,270)
Dividends paid
(3,646)
(5,583)
(5,726)
Other
(258)
(34)
(49)
Net Cash Used in Financing Activities
(8,835)
(8,661)
(18,053)
Effect of Exchange Rate Changes on Cash, Cash Equivalents and Restricted Cash
(133)
(99)
(224)
Net Change in Cash, Cash Equivalents and Restricted Cash
6
(795)
1,296
Cash, cash equivalents and restricted cash at beginning of period
5,899
6,694
5,398
Cash, Cash Equivalents and Restricted Cash at End of Period
$
5,905
5,899
6,694
Restricted cash of $298 million and $264 million is included in the “Other assets” line of our Consolidated Balance Sheet as of December 31, 2024 and
December 31, 2023, respectively.
See Notes to Consolidated Financial Statements.
Financial Statements
ConocoPhillips 2024 10-K
80
Consolidated Statement of Changes in Equity
ConocoPhillips
Millions of Dollars
Common Stock
Par Value
Capital in
Excess of
Par
Treasury
Stock
Accum. Other
Comprehensive
Income (Loss)
Retained
Earnings
Total
Balances at December 31, 2021
$
21
60,581
(50,920)
(4,950)
40,674
45,406
Net income (loss)
18,680
18,680
Other comprehensive income (loss)
(1,050)
(1,050)
Dividends declared
Ordinary ($1.89 per share of common stock)
(2,419)
(2,419)
Variable return of cash ($3.10 per share of common
stock)
(3,908)
(3,908)
Repurchase of company common stock
(9,270)
(9,270)
Distributed under benefit plans
561
561
Other
1
2
3
Balances at December 31, 2022
$
21
61,142
(60,189)
(6,000)
53,029
48,003
Net income (loss)
10,957
10,957
Other comprehensive income (loss)
327
327
Dividends declared
Ordinary ($2.11 per share of common stock)
(2,550)
(2,550)
Variable return of cash ($1.80 per share of common
stock)
(2,170)
(2,170)
Repurchase of company common stock
(5,400)
(5,400)
Excise tax on share repurchases
(50)
(50)
Distributed under benefit plans
161
161
Other
(1)
2
1
Balances at December 31, 2023
$
21
61,303
(65,640)
(5,673)
59,268
49,279
Net income (loss)
9,245
9,245
Other comprehensive income (loss)
(800)
(800)
Dividends declared
Ordinary ($2.52 per share of common stock)
(2,942)
(2,942)
Variable return of cash ($0.60 per share of common
stock)
(704)
(704)
Acquisition of Marathon Oil
2
16,037
16,039
Repurchase of company common stock
(5,463)
(5,463)
Excise tax on share repurchases
(50)
(50)
Distributed under benefit plans
189
189
Other
1
2
3
Balances at December 31, 2024
$
23
77,529
(71,152)
(6,473)
64,869
64,796
See Notes to Consolidated Financial Statements.
Financial Statements
81
ConocoPhillips 2024 10-K
Notes to Consolidated Financial Statements
Note 1—Accounting Policies
•
Consolidation Principles and Investments—Our consolidated financial statements include the accounts of
majority-owned, controlled subsidiaries and, if applicable, variable interest entities where we are the primary
beneficiary. The equity method is used to account for investments in affiliates in which we have the ability to
exert significant influence over the affiliates’ operating and financial policies. When we do not have the ability to
exert significant influence, the investment is measured at fair value except when the investment does not have a
readily determinable fair value. For those exceptions, it will be measured at cost minus impairment, plus or
minus observable price changes in orderly transactions for an identical or similar investment of the same issuer.
Undivided interests in oil and gas joint ventures, pipelines, natural gas plants and terminals are consolidated on a
proportionate basis. Other securities and investments are generally carried at cost. We manage our operations
through six operating segments, defined by geographic region: Alaska; Lower 48; Canada; Europe, Middle East
and North Africa; Asia Pacific; and Other International. See Note 23.
•
Foreign Currency Translation—Adjustments resulting from the process of translating foreign functional currency
financial statements into U.S. dollars are included in accumulated other comprehensive income (loss) in common
stockholders’ equity. Foreign currency transaction gains and losses are included in current earnings. Some of our
foreign operations use their local currency as the functional currency.
•
Use of Estimates—The preparation of financial statements in conformity with U.S. GAAP requires management
to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and
expenses and the disclosures of contingent assets and liabilities. Actual results could differ from these estimates.
•
Revenue Recognition—Revenues associated with the sales of crude oil, bitumen, natural gas, NGLs, LNG and
other items are recognized at the point in time when the customer obtains control of the asset. In evaluating
when a customer has control of the asset, we primarily consider whether the transfer of legal title and physical
delivery has occurred, whether the customer has significant risks and rewards of ownership and whether the
customer has accepted delivery and a right to payment exists. These products are typically sold at prevailing
market prices. We allocate variable market-based consideration to deliveries (performance obligations) in the
current period as that consideration relates specifically to our efforts to transfer control of current period
deliveries to the customer and represents the amount we expect to be entitled to in exchange for the related
products. Payment is typically due within 30 days or less.
Transactions commonly called buy/sell contracts, in which the purchase and sale of inventory with the same
counterparty are entered into “in contemplation” of one another, are combined and reported net (i.e., on the
same income statement line).
•
Shipping and Handling Costs—We typically incur shipping and handling costs prior to control transferring to the
customer and account for these activities as fulfillment costs. Accordingly, we include shipping and handling
costs in production and operating expenses for production activities. Transportation costs related to marketing
activities are recorded in purchased commodities. Freight costs billed to customers are treated as a component
of the transaction price and recorded as a component of revenue when the customer obtains control.
•
Cash Equivalents—Cash equivalents are highly liquid, short-term investments that are readily convertible to
known amounts of cash and have original maturities of 90 days or less from their date of purchase. They are
carried at cost plus accrued interest, which approximates fair value.
•
Short-Term Investments—Short-term investments include investments in bank time deposits and marketable
securities (commercial paper and government obligations) which are carried at cost plus accrued interest and
have original maturities of greater than 90 days but within one year or when the remaining maturities are within
one year. We also invest in financial instruments classified as available for sale debt securities which are carried
at fair value. Those instruments are included in short-term investments when they have remaining maturities of
one year or less, as of the balance sheet date.
•
Long-Term Investments in Debt Securities—Long-term investments in debt securities includes financial
instruments classified as available for sale debt securities with remaining maturities greater than one year as of
the balance sheet date. They are carried at fair value and presented within the “Investments and long-term
receivables” line of our consolidated balance sheet.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
82
•
Inventories—We have several valuation methods for our various types of inventories and consistently use the
following methods for each type of inventory. The majority of our commodity-related inventories are recorded
at cost using the LIFO basis. We measure these inventories at the lower-of-cost-or-market in the aggregate. Any
necessary lower-of-cost-or-market write-downs at year end are recorded as permanent adjustments to the LIFO
cost basis. LIFO is used to better match current inventory costs with current revenues. Costs include both direct
and indirect expenditures incurred in bringing an item or product to its existing condition and location, but not
unusual/nonrecurring costs or research and development costs. Materials, supplies and other miscellaneous
inventories, such as tubular goods and well equipment, are valued using various methods, including the
weighted-average-cost method and the FIFO method, consistent with industry practice.
•
Fair Value Measurements—Assets and liabilities measured at fair value and required to be categorized within
the fair value hierarchy are categorized into one of three different levels depending on the observability of the
inputs employed in the measurement. Level 1 inputs are quoted prices in active markets for identical assets or
liabilities. Level 2 inputs are observable inputs other than quoted prices included within Level 1 for the asset or
liability, either directly or indirectly through market-corroborated inputs. Level 3 inputs are unobservable inputs
for the asset or liability reflecting significant modifications to observable related market data or our assumptions
about pricing by market participants.
•
Derivative Instruments—Derivative instruments are recorded on the balance sheet at fair value. If the right of
offset exists and certain other criteria are met, derivative assets and liabilities with the same counterparty are
netted on the balance sheet and the collateral payable or receivable is netted against derivative assets and
derivative liabilities, respectively.
Recognition and classification of the gain or loss that results from recording and adjusting a derivative to fair
value depends on the purpose for issuing or holding the derivative. Gains and losses from derivatives not
accounted for as hedges are recognized immediately in earnings. We do not apply hedge accounting to our
commodity derivative instruments.
•
Oil and Gas Exploration and Development—Oil and gas exploration and development costs are accounted for
using the successful efforts method of accounting.
Property Acquisition Costs—Oil and gas leasehold acquisition costs are capitalized and included in the
balance sheet caption PP&E. Leasehold impairment is recognized based on exploratory experience and
management’s judgment. Upon achievement of all conditions necessary for reserves to be classified as
proved, the associated leasehold costs are reclassified to proved properties.
Exploratory Costs—Geological and geophysical costs and the costs of carrying and retaining undeveloped
properties are expensed as incurred. Exploratory well costs are capitalized, or “suspended,” on the balance
sheet pending further evaluation of whether economically recoverable reserves have been found. If
economically recoverable reserves are not found, exploratory well costs are expensed as dry holes. If
exploratory wells encounter potentially economic quantities of oil and gas, the well costs remain capitalized
on the balance sheet as long as sufficient progress assessing the reserves and the economic and operating
viability of the project is being made. For complex exploratory discoveries, it is not unusual to have
exploratory wells remain suspended on the balance sheet for several years while we perform additional
appraisal drilling and seismic work on the potential oil and gas field or while we seek government or
coventurer approval of development plans or seek environmental permitting. Once all required approvals
and permits have been obtained, the projects are moved into the development phase, and the oil and gas
resources are designated as proved reserves.
Management reviews suspended well balances quarterly, continuously monitors the results of the
additional appraisal drilling and seismic work, and expenses the suspended well costs as dry holes when it
judges the potential field does not warrant further investment in the near term. See Note 6.
Development Costs—Costs incurred to drill and equip development wells, including unsuccessful
development wells, are capitalized.
Depletion and Amortization—Leasehold costs of producing properties are depleted using the unit-of-
production method based on estimated proved developed and proved undeveloped oil and gas reserves.
Amortization of development costs is based on the unit-of-production method using estimated proved
developed oil and gas reserves.
Notes to Consolidated Financial Statements
83
ConocoPhillips 2024 10-K
•
Capitalized Interest—Interest from external borrowings is capitalized on major projects with an expected
construction period of one year or longer. Capitalized interest is added to the cost of the underlying asset and is
amortized over the useful lives of the assets in the same manner as the underlying assets.
•
Depreciation and Amortization—Depreciation and amortization of PP&E on producing hydrocarbon properties
and SAGD facilities and certain pipeline and LNG assets (those which are expected to have a declining utilization
pattern), are determined by the unit-of-production method. Depreciation and amortization of all other PP&E are
determined by either the individual-unit-straight-line method or the group-straight-line method (for those
individual units that are highly integrated with other units).
•
Impairment of Properties, Plants and Equipment—Long-lived assets used in operations are assessed for
impairment whenever changes in facts and circumstances indicate a possible significant deterioration in the
future cash flows expected to be generated by an asset group. If there is an indication the carrying amount of an
asset may not be recovered, a recoverability test is performed using management’s assumptions for prices,
volumes and future development plans. If the sum of the undiscounted cash flows before income-taxes is less
than the carrying value of the asset group, the carrying value is written down to estimated fair value and
reported as an impairment in the period in which the determination is made. Individual assets are grouped for
impairment purposes at the lowest level for which there are identifiable cash flows that are largely independent
of the cash flows of other groups of assets—generally on a field-by-field basis for E&P assets. Because there
usually is a lack of quoted market prices for long-lived assets, the fair value of impaired assets is typically
determined based on the present values of expected future cash flows using discount rates and prices believed
to be consistent with those used by principal market participants, or based on a multiple of operating cash flow
validated with historical market transactions of similar assets where possible.
The expected future cash flows used for impairment reviews and related fair value calculations are based on
estimated future production volumes, commodity prices, operating costs and capital decisions, considering all
available evidence at the date of review. The impairment review includes cash flows from proved developed and
undeveloped reserves, including any development expenditures necessary to achieve that production.
Additionally, when probable and possible reserves exist, an appropriate risk-adjusted amount of these reserves
may be included in the impairment calculation.
Long-lived assets committed by management for disposal within one year are accounted for at the lower of
amortized cost or fair value, less cost to sell, with fair value determined using a binding negotiated price, if
available, or present value of expected future cash flows as previously described.
•
Maintenance and Repairs—Costs of maintenance and repairs, which are not significant improvements, are
expensed when incurred.
•
Property Dispositions—When complete units of depreciable property are sold, the asset cost and related
accumulated depreciation are eliminated, with any gain or loss reflected in the “Gain (loss) on dispositions” line
of our consolidated income statement. When partial units of depreciable property are sold or retired which do
not significantly alter the DD&A rate, the asset cost and accumulated depreciation are eliminated such that no
gain or loss is recorded.
•
Asset Retirement Obligations and Environmental Costs—The fair value of legal obligations to retire and remove
long-lived assets are recorded in the period in which the obligation is incurred (typically when the asset is
installed at the production location). Fair value is estimated using a present value approach, incorporating
assumptions about estimated amounts and timing of settlements and impacts of the use of technologies. See
Note 7.
Environmental expenditures are expensed or capitalized, depending upon their future economic benefit.
Expenditures relating to an existing condition caused by past operations, and those having no future economic
benefit, are expensed. Liabilities for environmental expenditures are recorded on an undiscounted basis (unless
acquired through a business combination, which we record on a discounted basis) when environmental
assessments or cleanups are probable and the costs can be reasonably estimated. Recoveries of environmental
remediation costs from other parties are recorded as assets when their receipt is probable and estimable.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
84
•
Impairment of Investments in Nonconsolidated Entities—Investments in nonconsolidated entities are assessed
for impairment whenever changes in the facts and circumstances indicate a loss in value has occurred. When
such a condition is judgmentally determined to be other than temporary, the carrying value of the investment is
written down to fair value. The fair value of the impaired investment is based on quoted market prices, if
available, or upon the present value of expected future cash flows using discount rates and prices believed to be
consistent with those used by principal market participants, plus market analysis of comparable assets owned by
the investee, if appropriate.
•
Guarantees—The fair value of a guarantee is determined and recorded as a liability at the time the guarantee is
given. The initial liability is subsequently reduced as we are released from exposure under the guarantee. We
amortize the guarantee liability over the relevant time period, if one exists, based on the facts and circumstances
surrounding each type of guarantee. In cases where the guarantee term is indefinite, we reverse the liability
when we have information indicating the liability is essentially relieved or amortize it over an appropriate time
period as the fair value of our guarantee exposure declines over time. We amortize the guarantee liability to the
related income statement line item based on the nature of the guarantee. When it becomes probable that we
will have to perform on a guarantee, we accrue a separate liability if it is reasonably estimable, based on the
facts and circumstances at that time. We reverse the fair value liability only when there is no further exposure
under the guarantee.
•
Share-Based Compensation—We recognize share-based compensation expense over the shorter of the service
period (i.e., the stated period of time required to earn the award) or the period beginning at the start of the
service period and ending when an employee first becomes eligible for retirement. We have elected to recognize
expense on a straight-line basis over the service period for the entire award, whether the award was granted
with ratable or cliff vesting.
•
Income Taxes—Deferred income taxes are computed using the liability method and are provided on all
temporary differences between the financial reporting basis and the tax basis of our assets and liabilities, except
for deferred taxes on income and temporary differences related to the cumulative translation adjustment
considered to be permanently reinvested in certain foreign subsidiaries and foreign corporate joint ventures.
Allowable tax credits are applied currently as reductions of the provision for income taxes. Interest related to
unrecognized tax benefits is reflected in interest and debt expense, and penalties related to unrecognized tax
benefits are reflected in production and operating expenses.
•
Taxes Collected from Customers and Remitted to Governmental Authorities—Sales and value-added taxes are
recorded net.
•
Net Income (Loss) Per Share of Common Stock—Basic net income (loss) per share (EPS) is calculated using the
two-class method. Under the two-class method, all earnings (distributed and undistributed) are allocated to
common stock (including fully vested stock and unit awards that have not yet been issued as common stock) and
participating securities. ConocoPhillips grants Restricted Stock Units (RSUs) under its share-based compensation
programs, the majority of which entitle recipients to receive non-forfeitable dividends during the vesting period
on a basis equivalent to dividends paid to holders of the company’s common stock. See Note 15. These unvested
RSUs meet the definition of participating securities based on their respective rights to receive non-forfeitable
dividends and are treated as a separate class of securities in computing basic EPS. Participating securities are not
included as incremental shares in computing diluted EPS. Diluted EPS includes the potential impact of
contingently issuable shares, including awards which require future service as a condition of delivery of the
underlying common stock. Diluted EPS is calculated under both the two-class and treasury stock methods, and
the more dilutive amount is reported. Diluted net loss per share does not assume conversion or exelrcise of
securities that would have an antidilutive effect. Treasury stock is excluded from the daily weighted-average
number of common shares outstanding in both calculations. See Note 22.
Notes to Consolidated Financial Statements
85
ConocoPhillips 2024 10-K
Note 2—Inventories
Inventories at December 31 were:
Millions of Dollars
2024
2023
Crude oil and natural gas
$
907
676
Materials and supplies
902
722
Total inventories
$
1,809
1,398
Inventories valued on the LIFO basis
$
578
401
The estimated excess of current replacement cost over LIFO cost of inventories was approximately $113 million and $91
million at December 31, 2024 and 2023, respectively.
Note 3—Acquisitions and Dispositions
All gains or losses on asset dispositions are reported before-tax and are included net in the “Gain (loss) on dispositions”
line on our consolidated income statement. Cash proceeds and payments are included in the “Cash Flows From Investing
Activities” section of our consolidated statement of cash flows except for cash payments associated with a contingent
consideration arrangement that are included in the "Cash Flows From Financing Activities" section.
2024
Acquisition of Marathon Oil Corporation (Marathon Oil)
In November 2024, we completed our acquisition of Marathon Oil, an independent oil and gas exploration and
production company with operations across the Lower 48 and in Equatorial Guinea. At close, the transaction was valued
at $16.5 billion, which primarily represented 0.255 shares of ConocoPhillips common stock exchanged for each
outstanding share of Marathon Oil common stock.
Total Fair Value
Millions of Dollars
Value of ConocoPhillips common stock issued*
15,972
Cash transferred at close**
451
Value attributable to Marathon Oil share-based awards
67
Other liabilities incurred***
17
Total Fair Value (Millions)
$
16,507
*Represents the fair value of approximately 143 million shares of ConocoPhillips common stock issued to Marathon Oil stockholders. The fair value is
based on the number of eligible shares of Marathon Oil common stock at a 0.255 exchange ratio and ConocoPhillips' average stock price on
November 22, 2024, which was $111.93.
**Cash transferred at close primarily represents funds contributed to Marathon Oil for repayment of Marathon Oil's estimated commercial paper
liabilities as of the closing date.
***Liabilities incurred are related to cash settled share-based awards and payment of cash in lieu of fractional Marathon Oil shares outstanding. These
liabilities were settled prior to the end of 2024.
The transaction was accounted for as a business combination under FASB Topic ASC 805 using the acquisition method,
which requires assets acquired and liabilities assumed to be measured at their acquisition date fair values. Fair value
measurements were made for acquired assets and liabilities, and adjustments to those measurements may be made in
subsequent periods, up to one year from the acquisition date, as we identify new information about facts and
circumstances that existed as of the acquisition date to consider. At December 31, 2024, remaining items to finalize
include allocation of fair value to unproved properties. The impact of finalizing the fair value allocation is not expected to
have a material impact to our consolidated financial statements.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
86
Oil and gas properties were valued using a discounted cash flow approach incorporating market participant and internally
generated price assumptions; production profiles; and operating and development cost assumptions. Debt assumed in
the acquisition was valued based on observable market prices. The fair values of accounts receivable, accounts payable,
and most other current assets and current liabilities were determined to be equivalent to the carrying value due to their
short-term nature. The acquisition, valued at $16.5 billion, was allocated to the identifiable assets and liabilities based on
their estimated fair values as of the acquisition date of November 22, 2024.
Assets Acquired
Millions of Dollars
Cash and cash equivalents
$
385
Accounts receivable, net
969
Inventories
360
Investments and long-term receivables
550
Net properties, plants and equipment
24,178
Other assets
201
Total assets acquired
$
26,643
Liabilities Assumed
Accounts payable
$
1,180
Accrued income and other taxes
200
Employee benefit obligations
187
Long-term debt
4,719
Asset retirement obligations
781
Deferred income taxes
2,486
Other liabilities
583
Total liabilities assumed
$
10,136
Net assets acquired
$
16,507
With the completion of the transaction, we acquired proved properties of approximately $13.2 billion, with $12.1 billion
in Lower 48 and $1.1 billion in Equatorial Guinea, and unproved properties of $10.8 billion in Lower 48.
We recognized approximately $545 million of transaction-related costs, the majority of which were expensed in the
fourth quarter of 2024. These non-recurring costs related primarily to employee severance and related benefits, fees paid
to advisors and the settlement of share-based awards for certain Marathon Oil employees based on the terms of the
Merger Agreement. These transaction-related costs included $328 million of employee severance expense. See Note 15.
For the year ended December 31, 2024, "Total Revenues and Other Income" and "Net Income (Loss)" associated with the
acquired assets were $677 million and income of $66 million, respectively.
Alaska Acquisition
In the fourth quarter of 2024, after exercising our preferential rights, we completed an acquisition that increased our
working interest by approximately 5 percent in the Kuparuk River Unit and approximately 0.4 percent in the Prudhoe Bay
Unit from Chevron U.S.A. Inc. and Union Oil Company of California for $296 million, before customary adjustments. The
transaction was accounted for as an asset acquisition, with the consideration allocated primarily to PP&E.
Assets Held For Sale
In December 2024, we entered into an agreement to sell our interests in certain noncore assets in the Lower 48 segment
for $235 million, before customary adjustments. These assets have a net carrying value of approximately $235 million,
which consists primarily of $251 million of PP&E and $16 million of liabilities, primarily noncurrent AROs. These assets
met held for sale criteria in the fourth quarter of 2024, and as of December 31, 2024, we reclassified the PP&E to
“Prepaid expenses and other current assets” and the noncurrent liabilities to “Other accruals” on our consolidated
balance sheet. This transaction is anticipated to close in the first quarter of 2025.
Notes to Consolidated Financial Statements
87
ConocoPhillips 2024 10-K
Planned Dispositions
In January 2025, we entered into an agreement to sell our interests in certain noncore assets in the Lower 48 segment for
approximately $400 million, before customary adjustments. This transaction is expected to close in the first half of 2025.
2023
Surmont Acquisition
In October 2023, we completed our acquisition of the remaining 50 percent working interest in Surmont, an asset in our
Canada segment, from TotalEnergies EP Canada Ltd. Following the acquisition, we own 100 percent working interest in
Surmont. The final consideration for the all-cash transaction was $3.0 billion (CAD $4.1 billion) after customary
adjustments:
Fair value of consideration
Millions of
Dollars
Cash paid
$
2,635
Contingent consideration
320
Total consideration
$
2,955
The contingent consideration arrangement requires additional consideration to be paid to TotalEnergies EP Canada Ltd.
up to $0.4 billion CAD over a five-year term. The contingent payments represent $2 million for every dollar that WCS
pricing exceeds $52 per barrel during the month, subject to certain production targets being achieved. The undiscounted
amounts we could pay under this arrangement was up to $0.3 billion USD at closing. The fair value of the contingent
consideration on the acquisition date was $320 million and estimated by applying the income approach. For the year
ended December 31, 2024, we have made payments of $158 million USD under this arrangement, reflected in the
"Other" line within the Financing Activities section of our Consolidated Statement of Cash Flows. See Note 12.
The transaction was accounted for as a business combination under FASB Topic ASC 805 using the acquisition method,
which requires assets acquired and liabilities assumed to be measured at their acquisition date fair values. By the end of
the first quarter of 2024, we finalized the allocation of the purchase price to specific assets and liabilities. It was based on
the fair value of the final consideration and the conclusion of the fair value determination of long-lived assets and all
other assets acquired and liabilities assumed.
Oil and gas properties were valued using a discounted cash flow approach incorporating market participant and internally
generated price assumptions, production profiles and operating and development cost assumptions. The fair values of
other assets acquired and liabilities assumed, which included accounts receivable, accounts payable, and most other
current assets and current liabilities, were determined to be equivalent to the carrying value due to their short-term
nature. The total consideration of $3.0 billion was allocated to the identifiable assets and liabilities based on their fair
values as of the acquisition date of October 4, 2023.
Recognized amounts of identifiable assets acquired and liabilities assumed
Millions of Dollars
Oil and gas properties
3,082
Asset retirement obligations
(112)
Other
(15)
Total identifiable net assets
$
2,955
With the completion of the transaction, we acquired proved and unproved properties of approximately $2.9 billion and
$0.2 billion, respectively.
In anticipation of the acquisition, we entered into, and settled, various foreign exchange forward contracts to purchase
CAD. For the year ended December 31, 2023, we recognized a loss of $112 million in the "Foreign currency transaction
(gain) loss" line on our consolidated income statement associated with these forward contracts. The related cash flows
are included within "Cash Flows From Investing Activities" on our consolidated statement of cash flows.
From the acquisition date through December 31, 2023, "Total Revenues and Other Income" and "Net Income (Loss)"
associated with the acquired assets were $572 million and $119 million, respectively.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
88
Supplemental Pro Forma (unaudited)
The following tables summarize the unaudited supplemental pro forma financial information combining the consolidated
income statement of ConocoPhillips with assets acquired as shown for the year ended December 31, 2024, 2023, and
2022, as if we had completed the acquisition of Marathon Oil on January 1, 2023 and the remaining working interest in
Surmont on January 1, 2022, respectively.
Millions of Dollars
Year Ended December 31, 2024
As reported
Pro forma
Marathon Oil Pro forma Combined
Total Revenues and Other Income
$
56,953
6,168
63,121
Net Income (Loss)
9,245
1,312
10,557
Earnings per share:
Basic net income (loss)
$
7.82
8.06
Diluted net income (loss)
7.81
8.05
Millions of Dollars
Year Ended December 31, 2023
As reported
Pro forma
Surmont
Pro forma
Marathon Oil Pro forma Combined
Total Revenues and Other Income
$
58,574
2,561
6,705
67,840
Net Income (Loss)
10,957
501
1,657
13,115
Earnings per share:
Basic net income (loss)
$
9.08
9.72
Diluted net income (loss)
9.06
9.70
Millions of Dollars
Year Ended December 31, 2022
As reported
Pro forma
Surmont
Pro forma Combined
Total Revenues and Other Income
$
82,156
3,582
85,738
Net Income (Loss)
18,680
720
19,400
Earnings per share:
Basic net income (loss)
$
14.62
15.18
Diluted net income (loss)
14.57
15.13
The unaudited supplemental pro forma financial information is presented for illustration purposes only and is not
necessarily indicative of the operating results that would have occurred had the transaction been completed on January
1, 2022, and January 1, 2023, respectively, nor is it necessarily indicative of future operating results of the combined
entity. The pro forma results do not include cost savings anticipated as a result of the transaction. The pro forma results
include adjustments which relate primarily to DD&A, which is based on the unit-of-production method, resulting from the
purchase price allocated to oil and gas properties as well as adjustments for the timing of transaction costs and tax
impacts. We believe the estimates and assumptions are reasonable, and the relative effects of the transaction are
properly reflected.
QatarEnergy LNG NFS(3) (NFS3)
During 2022, we were awarded a 25 percent interest in NFS3, a new joint venture with QatarEnergy, to participate in the
North Field South (NFS) LNG project. Formation of NFS3 closed during 2023. NFS3 has a 25 percent interest in the NFS
project and is reported as an equity method investment in our Europe, Middle East and North Africa segment. See Note 4.
Notes to Consolidated Financial Statements
89
ConocoPhillips 2024 10-K
Port Arthur Liquefaction Holdings, LLC (PALNG)
During 2023, we acquired a 30 percent interest in PALNG, a joint venture for the development of a large-scale LNG facility
for the first phase of the Port Arthur LNG project ("Phase 1"). Sempra PALNG Holdings, LLC owns the remaining 70
percent interest in the joint venture. PALNG is reported as an equity method investment in our Corporate and Other
segment. See Note 4.
Contingent Payments
We recorded contingent payments related to the previous dispositions of our working interests in the Foster Creek
Christina Lake Partnership and western Canada gas assets, and our San Juan assets. Contingent payments were recorded
as (gain) loss on disposition on our consolidated income statement and reflected within our Canada and Lower 48
segments. In our Canada segment, the contingent payment, calculated and paid quarterly, was $6 million CAD for every
$1 CAD by which the WCS quarterly average crude oil price exceeded $52 CAD per barrel. In our Lower 48 segment, the
contingent payment, paid annually, was calculated monthly at $7 million per month when the U.S. Henry Hub natural gas
price was at or above $3.20 per MMBTU. The term of contingent payments in our Canada segment ended in the second
quarter of 2022 and the term of contingent payments in our Lower 48 segment ended at the end of 2023. Contingent
payments recorded in the years 2023 and 2022 were $7 million and $451 million, respectively.
2022
Acquisition of Additional Shareholding Interest in Australia Pacific LNG (APLNG)
In February 2022, we completed the acquisition of an additional 10 percent interest in APLNG from Origin Energy for
approximately $1.4 billion, after customary adjustments, in an all-cash transaction resulting from the exercise of our
preemption right. This increased our ownership in APLNG to 47.5 percent, with Origin Energy and Sinopec owning
27.5 percent and 25.0 percent, respectively. APLNG is reported as an equity investment in our Asia Pacific segment.
QatarEnergy LNG NFE(4) (NFE4)
During 2022, we were awarded a 25 percent interest in NFE4, a new joint venture with QatarEnergy to participate in the
North Field East (NFE) LNG project. NFE4 has a 12.5 percent interest in the NFE project and is reported as an equity
method investment in our Europe, Middle East and North Africa segment. See Note 4.
Asset Acquisition
In September 2022, we completed the acquisition of an additional working interest in certain Eagle Ford acreage in the
Lower 48 segment for cash consideration of $236 million after customary adjustments. This agreement was accounted for
as an asset acquisition, with the consideration allocated primarily to PP&E.
Assets Sold
During 2022, we sold our interests in certain noncore assets in our Lower 48 segment for net proceeds of $680 million,
with no gain or loss recognized on sale. At the time of disposition, our interest in these assets had a net carrying value of
$680 million, consisting of $825 million of assets, primarily related to $818 million of PP&E, and $145 million of liabilities,
primarily related to AROs.
In March 2022, we completed the divestiture of our subsidiaries that held our Indonesia assets and operations, and based
on an effective date of January 1, 2021, we received net proceeds of $731 million after customary adjustments and
recognized a $534 million before-tax and $462 million after-tax gain related to this transaction. Together, the subsidiaries
sold indirectly held our 54 percent interest in the Indonesia Corridor Block PSC and 35 percent shareholding in the
Transasia Pipeline Company. At the time of the disposition, the net carrying value was approximately $0.2 billion,
excluding $0.2 billion of cash and restricted cash. The net book value consisted primarily of $0.3 billion of PP&E and $0.1
billion of ARO. The before-tax earnings associated with the subsidiaries sold, excluding the gain on disposition noted
above, was $138 million for the year ended December 31, 2022. Results of operations for the Indonesia interests sold
were reported in our Asia Pacific segment.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
90
Note 4—Investments, Loans and Long-Term Receivables
Components of investments and long-term receivables at December 31 were:
Millions of Dollars
2024
2023
Equity investments
$
8,611
7,905
Long-term receivables
113
143
Long-term investments in debt securities
1,055
989
Other investments
90
93
$
9,869
9,130
Equity Investments
Affiliated companies in which we had a significant equity investment at December 31, 2024, included:
•
APLNG—47.5 percent owned joint venture with Origin Energy (27.5 percent) and Sinopec (25 percent)—to
produce CBM from the Bowen and Surat basins in Queensland, Australia, as well as process and export LNG.
•
PALNG—30 percent owned joint venture with Sempra PALNG Holdings, LLC for the development of a large-scale
LNG facility for the first phase of the Port Arthur LNG project ("Phase 1"). See Note 3.
•
N3—30 percent owned joint venture with an affiliate of QatarEnergy (68.5 percent) and Mitsui & Co., Ltd. (1.5
percent)—produces and liquefies natural gas from Qatar’s North Field, as well as exports LNG.
•
NFE4—25 percent owned joint venture with affiliates of QatarEnergy (70 percent) and China National Petroleum
Corporation (5 percent)—participant in the North Field East (NFE) LNG project. See Note 3.
•
NFS3—25 percent owned joint venture with an affiliate of QatarEnergy (75 percent)—participant in the North
Field South LNG project. See Note 3.
Summarized 100 percent earnings information for equity method investments in affiliated companies, combined, was as
follows:
Millions of Dollars
2024
2023
2022
Revenues
$
15,286
15,314
18,356
Income (loss) before income taxes
6,446
6,301
8,234
Net income (loss)
4,389
4,214
5,507
Summarized 100 percent balance sheet information for equity method investments in affiliated companies, combined,
was as follows:
Millions of Dollars
2024
2023
Current assets
$
4,608
3,827
Noncurrent assets
41,417
39,299
Current liabilities
3,829
3,462
Noncurrent liabilities
16,947
16,665
Our share of income taxes incurred directly by an equity method investee is reported in equity in earnings of affiliates,
and as such is not included in income taxes on our consolidated financial statements.
At December 31, 2024, retained earnings included $96 million related to the undistributed earnings of affiliated
companies. Dividends received from affiliates were $2,283 million, $2,684 million and $3,045 million in 2024, 2023 and
2022, respectively.
Notes to Consolidated Financial Statements
91
ConocoPhillips 2024 10-K
APLNG
APLNG is a joint venture focused on producing CBM from the Bowen and Surat basins in Queensland, Australia. Natural
gas is sold to domestic customers and LNG is processed and exported to Asia Pacific markets. Our investment in APLNG
gives us access to CBM resources in Australia and enhances our LNG position. The majority of APLNG LNG is sold under
two long-term sales and purchase agreements, supplemented with sales of additional LNG cargoes targeting the Asia
Pacific markets. Origin Energy, an integrated Australian energy company, is the operator of APLNG’s production and
pipeline system, while we operate the LNG facility.
In 2012, APLNG executed an $8.5 billion project finance facility that became non-recourse following financial completion
in 2017. The facility is currently composed of a financing agreement with the Export-Import Bank of the United States, a
commercial bank facility and two United States Private Placement note facilities. APLNG principal and interest payments
commenced in March 2017 and are scheduled to occur bi-annually until September 2030. At December 31, 2024, a
balance of $4.0 billion was outstanding on the facilities. See Note 9.
At December 31, 2024, the carrying value of our equity method investment in APLNG was approximately $5.0 billion.
PALNG
PALNG is a joint venture for the development of a large-scale LNG facility. At December 31, 2024, the carrying value of
our equity method investment in PALNG was approximately $1.5 billion. See Note 3.
N3
N3 is a joint venture that owns an integrated large-scale LNG project located in Qatar. We have terminal and pipeline use
agreements with Golden Pass LNG Terminal and affiliated Golden Pass Pipeline near Sabine Pass, Texas, intended to
provide us with terminal and pipeline capacity for the receipt, storage and regasification of LNG purchased from N3.
Currently, the LNG from N3 is being sold to markets outside of the U.S.
NFE4
NFE4 is a joint venture participating in the NFE LNG project. NFE4 has a 12.5 percent interest in the NFE project. See Note
3.
During the second quarter of 2024, we were notified that an affiliate of QatarEnergy transferred a 5 percent joint venture
interest in NFE4 to an affiliate of China National Petroleum Corporation. As a result, we have concluded NFE4 is a VIE as it
currently requires advances from the joint venture participants to fund the project. We are not the primary beneficiary of
the VIE because we do not have the power to direct the activities that most significantly impact economic performance of
NFE4, which involve activities related to the production and commercialization of natural gas, as well as LNG processing
and export marketing. As a result, we do not consolidate NFE4, and it is accounted for under the equity method. As of
December 31, 2024, the carrying value of our equity is included in the total carrying value of our equity method
investments in Qatar. This equity together with the guarantee is the only financial support that we have provided NFE4.
See Note 9.
NFS3
NFS3 is a joint venture participating in the NFS LNG project. NFS3 has a 25 percent interest in the NFS project. See Note 3.
At December 31, 2024, the carrying value of our equity method investments in Qatar was approximately $1.4 billion.
Loans
As part of our normal ongoing business operations and consistent with industry practice, we enter into numerous
agreements with other parties to pursue business opportunities. Included in such activity are loans to certain affiliated
and non-affiliated companies.
At December 31, 2024, there were no outstanding loans to affiliated companies.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
92
Note 5—Investment in Cenovus Energy
In 2022, we sold our remaining 91 million shares of Cenovus Energy (CVE), recognizing proceeds of $1.4 billion and a net
gain of $251 million. All gains and losses were recognized within "Other income" on our consolidated income statement.
Proceeds related to the sale of our CVE shares were included within "Cash Flows From Investing Activities" on our
consolidated statement of cash flows.
Note 6—Suspended Wells and Exploration Expenses
The following table reflects the net changes in suspended exploratory well costs during 2024, 2023 and 2022:
Millions of Dollars
2024
2023
2022
Beginning balance
$
184
527
660
Additions pending the determination of proved reserves
32
—
5
Reclassifications to proved properties
(2)
(285)
(7)
Charged to dry hole expense
(18)
(58)
(131)
Ending balance
$
196
184
527
The following table provides an aging of suspended well balances at December 31:
Millions of Dollars
2024
2023
2022
Exploratory well costs capitalized for a period of one year or less
$
33
—
15
Exploratory well costs capitalized for a period greater than one year
163
184
512
Ending balance
$
196
184
527
Number of projects with exploratory well costs capitalized for a period
greater than one year
13
14
17
The following table provides a further aging of those exploratory well costs that have been capitalized for more than one
year since the completion of drilling as of December 31, 2024:
Millions of Dollars
Suspended Since
Total
2021-2023
2018-2020
2017 and Prior
WL4-00—Malaysia(1)
36
12
24
—
West Willow—Alaska(2)
30
—
30
—
PL891—Norway(2)
28
—
28
—
Narwhal Trend—Alaska(1)
25
—
25
—
Montney—Canada(2)
14
7
7
—
Other of $10 million or less each(1)(2)
30
—
—
30
Total
$
163
19
114
30
(1) Appraisal drilling complete; costs being incurred to assess development.
(2) Additional appraisal wells planned.
Notes to Consolidated Financial Statements
93
ConocoPhillips 2024 10-K
Exploration Expenses
The charges discussed below are included in the “Exploration expenses” line on our consolidated income statement.
2024
In our Europe, Middle East and North Africa segment, we recorded approximately $40 million before-tax as dry hole
expenses, which included $22 million for two partner operated exploration wells in the Alvheim area in the Norwegian
sector of the North Sea, and $18 million for the Busta suspended discovery well on license PL782S in the North Sea.
2023
In our Europe, Middle East and North Africa segment, after further evaluation we recognized a before-tax expense of $37
million for dry hole costs associated with the suspended Warka discovery well, drilled in 2020, on license PL1009 in the
Norwegian Sea.
In our Alaska segment, we recorded a before-tax expense of approximately $31 million for dry hole costs associated with
the Bear-1 exploration well.
2022
In the fourth quarter, we recorded a before-tax expense of $129 million for impairment of certain aged, suspended wells
associated with Surmont in our Canada segment.
In our Europe, Middle East and North Africa segment, we recorded a before-tax expense of $102 million for dry hole costs
associated with four operated exploration and appraisal wells and one partner-operated well that were drilled in Norway
in 2022.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
94
Note 7—Asset Retirement Obligations and Accrued Environmental Costs
Asset retirement obligations and accrued environmental costs at December 31 were:
Millions of Dollars
2024
2023
Asset retirement obligations
$
8,215
7,227
Accrued environmental costs
206
184
Total asset retirement obligations and accrued environmental costs
8,421
7,411
Asset retirement obligations and accrued environmental costs due within one year*
(332)
(191)
Long-term asset retirement obligations and accrued environmental costs
$
8,089
7,220
*Classified as a current liability on the balance sheet under “Other accruals.”
Asset Retirement Obligations
We record the fair value of a liability for an ARO when it is incurred (typically when the asset is installed at the production
location). When the liability is initially recorded, we capitalize the associated asset retirement cost by increasing the
carrying amount of the related PP&E. Over time, the liability increases for the change in its present value, while the
capitalized cost depreciates over the useful life of the related asset. If in subsequent periods, our estimate of this liability
changes, we will record an adjustment to both the liability and PP&E. Changes to estimated liabilities for assets that are
no longer producing are recorded as impairment.
We have numerous AROs we are required to perform under law or contract once an asset is permanently taken out of
service. Most of these obligations are not expected to be paid until several years, or decades, in the future and will be
funded from general company resources at the time of removal. Our largest individual obligations involve plugging and
abandonment of wells and removal and disposal of offshore oil and gas platforms around the world, as well as oil and gas
production facilities and pipelines in Alaska.
During 2024 and 2023, our overall ARO changed as follows:
Millions of Dollars
2024
2023
Balance at January 1
$
7,227
6,380
Accretion of discount
319
278
New obligations, including acquisitions
926
257
Changes in estimates of existing obligations
140
484
Spending on existing obligations
(182)
(119)
Property dispositions
(6)
(27)
Foreign currency translation
(209)
(26)
Balance at December 31
$
8,215
7,227
Accrued Environmental Costs
Total accrued environmental costs at December 31, 2024 and 2023, were $206 million and $184 million, respectively.
We had accrued environmental costs of $139 million and $112 million at December 31, 2024 and 2023, respectively,
related to remediation activities in the U.S. and Canada. We had also accrued in Corporate and Other $56 million and $55
million of environmental costs associated with sites no longer in operation at December 31, 2024 and 2023, respectively.
In addition, December 31, 2024 and 2023, included a $11 million and $17 million accrual, respectively, where the
company has been named a potentially responsible party under the CERCLA, or similar state laws. Accrued environmental
liabilities are expected to be paid over periods extending up to 30 years.
Expected expenditures for environmental obligations acquired in various business combinations are discounted using a
weighted-average 5 percent discount factor, resulting in an accrued balance for acquired environmental liabilities of $112
million at December 31, 2024. The total expected future undiscounted payments related to the portion of the accrued
environmental costs that have been discounted are $158 million.
Notes to Consolidated Financial Statements
95
ConocoPhillips 2024 10-K
Note 8—Debt
Long-term debt at December 31 was:
Millions of Dollars
2024
2023
2.125% Notes due 2024
—
461
3.35% Notes due 2024
—
265
2.4% Notes due 2025
366
366
8.2% Debentures due 2025
134
134
3.35% Notes due 2025
199
199
6.875% Debentures due 2026
67
67
7.8% Debentures due 2027
120
203
4.4% Notes due 2027
424
—
3.75% Notes due 2027
196
196
4.3% Notes due 2028
223
223
7.375% Debentures due 2029
66
92
7.0% Debentures due 2029
95
112
5.3% Notes due 2029
86
—
6.95% Notes due 2029
705
1,195
4.7% Notes due 2030
1,350
—
8.125% Notes due 2030
207
390
2.4% Notes due 2031
227
227
7.2% Notes due 2031
447
447
7.25% Notes due 2031
268
400
7.4% Notes due 2031
232
382
4.85% Notes due 2032
650
—
6.8% Notes due 2032
180
—
5.9% Notes due 2032
505
505
5.05% Notes due 2033
1,000
1,000
5.70% Notes due 2034
103
—
4.15% Notes due 2034
246
246
5.00% Notes due 2035
1,250
—
5.95% Notes due 2036
326
326
5.951% Notes serially maturing 2022 through 2037
573
603
6.6% Notes due 2037
335
—
5.9% Notes due 2038
350
350
6.5% Notes due 2039
1,588
1,588
3.758% Notes due 2042
785
785
4.3% Notes due 2044
750
750
5.20% Notes due 2045
186
—
5.95% Notes due 2046
329
329
7.9% Debentures due 2047
60
60
4.875% Notes due 2047
319
319
4.85% Notes due 2048
219
219
3.8% Notes due 2052
1,100
1,100
5.3% Notes due 2053
1,100
1,100
5.55% Notes due 2054
1,000
1,000
5.500% Notes due 2055
1,300
—
4.025% Notes due 2062
1,770
1,770
5.70% Notes due 2063
700
700
5.65% Notes due 2065
650
—
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
96
Marine Terminal Revenue Refunding Bonds due 2031 at 1.78% – 4.80% during 2024 and
1.65% – 4.70% during 2023
265
265
Industrial Development Bonds due 2035 at 1.78% – 4.22% during 2024 and 1.85% – 4.70%
during 2023
18
18
St. John the Baptist Parish, State of Louisiana—Revenue Refunding Bonds due 20371: $200
at 2.20%, $200 at 2.375%, $200 at 4.05%, $400 at 3.30%1
1,000
—
Other
16
21
Debt at face value
24,085
18,413
Finance leases
940
1,129
Net unamortized premiums, discounts and debt issuance costs
(701)
(605)
Total debt
24,324
18,937
Short-term debt
(1,035)
(1,074)
Long-term debt
$
23,289
17,863
1Future mandatory purchase dates for these bonds: July 1, 2026 for the 2.20% bonds of $200 million, 2.375% bonds of $200 million, 4.05% bonds of
$200 million and July 3, 2028 for the 3.30% bonds of $400 million. Subsequent to the mandatory purchase dates, we will also have the right to remarket
these bonds any time up to the 2037 maturity date.
The principal amounts of long-term debt, excluding finance lease obligations, maturing in 2025 through 2029 are:
$735 million, $704 million, $778 million, $664 million and $997 million, respectively.
2024
In the fourth quarter of 2024, we acquired Marathon Oil and assumed its outstanding debt upon close. Shortly thereafter,
we launched and completed concurrent debt transactions consisting of: tender offers to repurchase certain existing
Marathon Oil and ConocoPhillips debt for cash (with priority for Marathon Oil debt assumed), an obligor exchange offer
to retire certain Marathon Oil debt in exchange for new ConocoPhillips debt, new debt issuances to fund the repurchase
tender offers and the remarketing of available municipal bonds. See Note 3.
Marathon Oil Debt Assumed at Fair Value
In November 2024, we completed the acquisition of Marathon Oil. As part of the acquisition, we assumed Marathon Oil's
publicly traded debt, with an outstanding principal balance of $4.6 billion, which was recorded at fair value of $4.7 billion.
See Note 3.
•
4.4% Notes due 2027 with principal amount of $1,000 million
•
5.3% Notes due 2029 with principal amount of $600 million
•
6.8% Notes due 2032 with principal amount of $550 million
•
5.7% Notes due 2034 with principal amount of $600 million
•
6.6% Notes due 2037 with principal amount of $750 million
•
5.2% Notes due 2045 with principal amount of $500 million
•
St. John the Baptist Parish, State of Louisiana—Revenue Refunding Bonds due 2037 with future mandatory
purchase dates of July 1, 2026:
◦
2.20% Bonds with principal amount of $200 million
◦
2.375% Bonds with principal amount of $200 million
◦
4.05% Bonds with principal amount of $200 million
Notes to Consolidated Financial Statements
97
ConocoPhillips 2024 10-K
Repurchase Offers
In December 2024, we completed tender offers through which we repurchased a total of $3,768 million in aggregate
principal amount of debt as listed below. We paid premiums above face value of $283 million to repurchase these debt
instruments.
Marathon Oil Debt Repurchased:
•
4.4% Notes due 2027 partial repurchase of $576 million
•
5.3% Notes due 2029 partial repurchase of $514 million
•
6.8% Notes due 2032 partial repurchase of $370 million
•
5.7% Notes due 2034 partial repurchase of $497 million
•
6.6% Notes due 2037 partial repurchase of $415 million
•
5.2% Notes due 2045 partial repurchase of $314 million
ConocoPhillips Debt Repurchased:
•
7.8% Debentures due 2027 with principal amount of $203 million (partial repurchase of $83 million)
•
7.0% Debentures due 2029 with principal amount of $112 million (partial repurchase of $17 million)
•
7.375% Debentures due 2029 with principal amount of $92 million (partial repurchase of $26 million)
•
6.95% Notes due 2029 with principal amount of $1,195 million (partial repurchase of $490 million)
•
8.125% Notes due 2030 with principal amount of $390 million (partial repurchase of $183 million)
•
7.4% Notes due 2031 with principal amount of $382 million (partial repurchase of $151 million)
•
7.25% Notes due 2031 with principal amount of $400 million (partial repurchase of $132 million)
Exchange Offer
Concurrently in December 2024, we completed a debt exchange offer through which $863 million in aggregate principal
of existing Marathon Oil notes were tendered and accepted in exchange for $862 million of new ConocoPhillips notes.
The debt exchange offers were treated as debt modifications for accounting purposes resulting in a portion of the
unamortized debt discount and premiums of the existing notes being allocated to the new notes on the settlement dates
of the exchange offers. No premiums were paid to bondholders in this exchange offer.
The notes tendered and accepted in the exchange offers were:
•
4.4% Notes due 2027 partial exchange of $228 million
•
5.3% Notes due 2029 partial exchange of $59 million
•
6.8% Notes due 2032 partial exchange of $102 million
•
5.7% Notes due 2034 partial exchange of $63 million
•
6.6% Notes due 2037 partial exchange of $259 million
•
5.2% Notes due 2045 partial exchange of $151 million
New Debt Issuance
In December 2024, we issued new debt of $5.2 billion through our universal shelf registration statement and prospectus
supplement consisting of the following new notes and used the proceeds to repurchase existing debt as discussed:
•
4.7% Notes due 2030 with principal of $1,350 million
•
4.85% Notes due 2032 with principal of $650 million
•
5.0% Notes due 2035 with principal of $1,250 million
•
5.5% Notes due 2055 with principal of $1,300 million
•
5.65% Notes due 2065 with principal of $650 million
Municipal Bonds Reoffering and Issuance
We completed a $400 million remarketing of sub-series 2017C bonds that are part of the $1 billion St. John the Baptist
Parish, State of Louisiana—Revenue Refunding Bonds Series 2017. The bonds are subject to an interest rate of 3.30% and
a mandatory purchase date of July 3, 2028.
As a result of the concurrent debt transactions as described above, we recognized a net loss on debt extinguishments of
$173 million which is included in the "Other expenses" line on our consolidated income statement.
Other Debt Activity
Apart from the concurrent debt transactions discussed above, in November 2024, the company retired $265 million
principal amount of our 3.35% Notes at maturity and in March 2024, the company retired $461 million principal amount
of our 2.125% Notes at maturity.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
98
2023
In December 2023, the company retired $78 million principal amount of our 7.65 percent Notes at maturity. In the third
quarter of 2023, we issued $2.7 billion in new Notes through our universal shelf registration statement and prospectus
supplement. The net proceeds were used to fund the acquisition of the remaining 50 percent working interest in Surmont
which closed in October 2023. See Note 3. The following Notes were issued:
•
5.05% Notes due 2033 with principal of $1.0 billion
•
5.55% Notes due 2054 with principal of $1.0 billion
•
5.70% Notes due 2063 with principal of $0.7 billion
In the second quarter of 2023, as described further below, we initiated and completed two concurrent transactions as
part of our debt refinancing strategy. We issued $1.1 billion in new Notes through our universal shelf registration
statement and prospectus supplement and used the proceeds to repurchase $1.1 billion of existing debt.
Debt Issuance
On May 23, 2023, we issued 5.3% Notes due 2053 with principal of $1.1 billion.
Repurchase Tender Offers
On May 25, 2023, we repurchased a total of $1,133 million aggregate principal amount of debt as listed below. We paid
$33 million below face value to repurchase these debt instruments and recognized a gain on debt extinguishment of
$27 million, which is included in the "Other expenses" line on our consolidated income statement.
•
2.125% Notes due 2024 with principal of $900 million (partial repurchase of $439 million)
•
3.350% Notes due 2024 with principal of $426 million (partial repurchase of $160 million)
•
2.400% Notes due 2025 with principal of $900 million (partial repurchase of $534 million)
Revolving Credit Facility and Credit Rating Information
We have a revolving credit facility totaling $5.5 billion with an expiration date of February 2027. Our revolving credit
facility may be used for direct bank borrowings, the issuance of letters of credit totaling up to $500 million, or as support
for our commercial paper program. The revolving credit facility is broadly syndicated among financial institutions and
does not contain any material adverse change provisions or any covenants requiring maintenance of specified financial
ratios or credit ratings. The facility agreement contains a cross-default provision relating to the failure to pay principal or
interest on other debt obligations of $200 million or more by ConocoPhillips, or any of its consolidated subsidiaries. The
amount of the facility is not subject to redetermination prior to its expiration date.
Credit facility borrowings may bear interest at a margin above the Secured Overnight Financing Rate (SOFR). The facility
agreement calls for commitment fees on available, but unused, amounts. The facility agreement also contains early
termination rights if our current directors or their approved successors cease to be a majority of the Board of Directors.
The revolving credit facility supports our ability to issue up to $5.5 billion of commercial paper. Commercial paper is
generally limited to maturities of 90 days and is included in short-term debt on our consolidated balance sheet. With no
commercial paper outstanding and no direct borrowings or letters of credit, we had access to $5.5 billion in available
borrowing capacity under our revolving credit facility at December 31, 2024 and December 31, 2023.
For information on Finance Leases, see Note 14.
The current credit ratings on our long-term debt are:
•
Fitch: “A” with a “stable” outlook
•
S&P: “A-” with a “stable” outlook
•
Moody's: "A2" with a "stable" outlook
We do not have any ratings triggers on any of our corporate debt that would cause an automatic default, and thereby
impact our access to liquidity upon downgrade of our credit ratings. If our credit ratings are downgraded from their
current levels, it could increase the cost of corporate debt available to us and restrict our access to the commercial paper
markets. If our credit ratings were to deteriorate to a level prohibiting us from accessing the commercial paper market,
we would still be able to access funds under our revolving credit facility.
Notes to Consolidated Financial Statements
99
ConocoPhillips 2024 10-K
At both December 31, 2024 and 2023, we had $283 million of certain variable rate demand bonds (VRDBs) outstanding
with maturities ranging through 2035. The VRDBs are redeemable at the option of the bondholders on any business day.
If they are ever redeemed, we have the ability and intent to refinance on a long-term basis, therefore, the VRDBs are
included in the “Long-term debt” line on our consolidated balance sheet.
Note 9—Guarantees
At December 31, 2024, we were liable for certain contingent obligations under various contractual arrangements as
described below. We recognize a liability, at inception, for the fair value of our obligation as a guarantor for newly issued
or modified guarantees. Unless the carrying amount of the liability is noted below, we have not recognized a liability
because the fair value of the obligation is immaterial. In addition, unless otherwise stated, we are not currently
performing with any significance under the guarantee and expect future performance to be either immaterial or have
only a remote chance of occurrence.
APLNG Guarantees
At December 31, 2024, we had outstanding multiple guarantees in connection with our 47.5 percent ownership interest
in APLNG. The following is a description of the guarantees with values calculated utilizing December 2024 exchange rates:
•
During the third quarter of 2016, we issued a guarantee to facilitate the withdrawal of our pro-rata portion of
the funds in a project finance reserve account. We estimate the remaining term of this guarantee to be six years.
Our maximum exposure under this guarantee is approximately $210 million and may become payable if an
enforcement action is commenced by the project finance lenders against APLNG. At December 31, 2024, the
carrying value of this guarantee was approximately $14 million.
•
In conjunction with our original purchase of an ownership interest in APLNG from Origin Energy Limited in
October 2008, we agreed to reimburse Origin Energy Limited for our share of the existing contingent liability
arising under guarantees of an existing obligation of APLNG to deliver natural gas under several sales
agreements. The final guarantee expires in the fourth quarter of 2041. Our maximum potential liability for future
payments, or cost of volume delivery, under these guarantees is estimated to be $610 million ($1.0 billion in the
event of intentional or reckless breach) and would become payable if APLNG fails to meet its obligations under
these agreements and the obligations cannot otherwise be mitigated. Future payments are considered unlikely,
as the payments, or cost of volume delivery, would only be triggered if APLNG does not have enough natural gas
to meet these sales commitments and if the co-venturers do not make necessary equity contributions into
APLNG.
•
We have guaranteed the performance of APLNG with regard to certain other contracts executed in connection
with the project’s continued development. The guarantees have remaining terms of 12 to 21 years or the life of
the venture. Our maximum potential amount of future payments related to these guarantees is approximately
$480 million and would become payable if APLNG does not perform. At December 31, 2024, the carrying value of
these guarantees was approximately $34 million.
QatarEnergy LNG Limited Guarantee
We have guaranteed our portion of certain fiscal and other joint venture obligations as a shareholder in NFE4 and NFS3.
This guarantee has an approximate 30-year term with no maximum limit. At December 31, 2024, the carrying value of this
guarantee was approximately $14 million.
Equatorial Guinea Guarantees
We have guaranteed payment obligations as a shareholder in both Equatorial Guinea LNG Operations, S.A., a fully owned
subsidiary of Equatorial Guinea LNG Holdings Limited, and Alba Plant LLC with regard to certain agreements to process
third-party gas. These guarantees have three years remaining, and the maximum potential future payments related to
these guarantees is approximately $116 million. At December 31, 2024, the carrying value of these guarantees was
approximately $4 million.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
100
Other Guarantees
We have other guarantees with maximum future potential payment amounts totaling approximately $570 million, which
consist primarily of guarantees of the residual value of leased office buildings and guarantees of the residual value of
corporate aircraft. These guarantees have remaining terms of one to five years and would become payable if certain asset
values are lower than guaranteed amounts at the end of the lease or contract term, business conditions decline at
guaranteed entities, or as a result of nonperformance of contractual terms by guaranteed parties. At December 31, 2024,
there was no carrying value associated with these guarantees.
Indemnifications
Over the years, we have entered into agreements to sell ownership interests in certain legal entities, joint ventures and
assets that gave rise to qualifying indemnifications. These agreements include indemnifications for taxes and
environmental liabilities. The carrying amount recorded for these indemnifications at December 31, 2024, was
approximately $20 million. Those related to environmental issues have terms that are generally indefinite and the
maximum amounts of future payments are generally unlimited. Although it is reasonably possible future payments may
exceed amounts recorded, due to the nature of the indemnifications, it is not possible to make a reasonable estimate of
the maximum potential amount of future payments. See Note 10 for additional information about environmental
liabilities.
Note 10—Contingencies and Commitments
A number of lawsuits involving a variety of claims arising in the ordinary course of business have been filed against
ConocoPhillips. We also may be required to remove or mitigate the effects on the environment of the placement,
storage, disposal or release of certain chemical, mineral and petroleum substances at various active and inactive sites.
We regularly assess the need for accounting recognition or disclosure of these contingencies. In the case of all known
contingencies (other than those related to income taxes), we accrue a liability when the loss is probable and the amount
is reasonably estimable. If a range of amounts can be reasonably estimated and no amount within the range is a better
estimate than any other amount, then the low end of the range is accrued. We do not reduce these liabilities for potential
insurance or third-party recoveries. We accrue receivables for insurance or other third-party recoveries when applicable.
With respect to income tax-related contingencies, we use a cumulative probability-weighted loss accrual in cases where
sustaining a tax position is less than certain. See Note 16, for additional information about income tax-related
contingencies.
Based on currently available information, we believe it is remote that future costs related to known contingent liability
exposures will exceed current accruals by an amount that would have a material adverse impact on our consolidated
financial statements. As we learn new facts concerning contingencies, we reassess our position both with respect to
accrued liabilities and other potential exposures. Estimates particularly sensitive to future changes include contingent
liabilities recorded for environmental remediation, tax and legal matters. Estimated future environmental remediation
costs are subject to change due to such factors as the uncertain magnitude of cleanup costs, the unknown time and
extent of such remedial actions that may be required, and the determination of our liability in proportion to that of other
responsible parties. Estimated future costs related to tax and legal matters are subject to change as events evolve and as
additional information becomes available during the administrative and litigation processes.
Environmental
We are subject to international, federal, state and local environmental laws and regulations and record accruals for
environmental liabilities based on management’s best estimates. These estimates are based on currently available facts,
existing technology, and presently enacted laws and regulations, taking into account stakeholder and business
considerations. When measuring environmental liabilities, we also consider our prior experience in remediation of
contaminated sites, other companies’ cleanup experience, and data released by the U.S. EPA or other organizations. We
consider unasserted claims in our determination of environmental liabilities, and we accrue them in the period they are
both probable and reasonably estimable.
Notes to Consolidated Financial Statements
101
ConocoPhillips 2024 10-K
Although liability of those potentially responsible for environmental remediation costs is generally joint and several for
federal sites and frequently so for other sites, we are usually only one of many companies cited at a particular site. Due to
the joint and several liabilities, we could be responsible for all cleanup costs related to any site at which we have been
designated as a potentially responsible party. We have been successful to date in sharing cleanup costs with other
financially sound companies. Many of the sites at which we are potentially responsible are still under investigation by the
U.S. EPA or the agency concerned. Prior to actual cleanup, those potentially responsible normally assess the site
conditions, apportion responsibility and determine the appropriate remediation. In some instances, we may have no
liability or may attain a settlement of liability. Where it appears that other potentially responsible parties may be
financially unable to bear their proportional share, we consider this inability in estimating our potential liability, and we
adjust our accruals accordingly. As a result of various acquisitions in the past, we assumed certain environmental
obligations. Some of these environmental obligations are mitigated by indemnifications made by others for our benefit,
and some of the indemnifications are subject to dollar limits and time limits.
We are currently participating in environmental assessments and cleanups at numerous federal Superfund and
comparable state and international sites. After an assessment of environmental exposures for cleanup and other costs,
we make accruals on an undiscounted basis (except those acquired in a purchase business combination, which we record
on a discounted basis) for planned investigation and remediation activities for sites where it is probable future costs will
be incurred and these costs can be reasonably estimated. We have not reduced these accruals for possible insurance
recoveries. In the future, we may be involved in additional environmental assessments, cleanups and proceedings.
See Note 7 for a summary of our accrued environmental liabilities.
Litigation and Other Contingencies
We are subject to various lawsuits and claims including but not limited to matters involving oil and gas royalty and
severance tax payments, gas measurement and valuation methods, contract disputes, environmental damages, climate
change, personal injury and property damage. Our primary exposures for such matters relate to alleged royalty and tax
underpayments on certain federal, state and privately owned properties, claims of alleged environmental contamination
and damages from historic operations, and climate change. We will continue to defend ourselves vigorously in these
matters.
Our legal organization applies its knowledge, experience and professional judgment to the specific characteristics of our
cases, employing a litigation management process to manage and monitor the legal proceedings against us. Our process
facilitates the early evaluation and quantification of potential exposures in individual cases. This process also enables us
to track those cases that have been scheduled for trial and/or mediation. Based on professional judgment and experience
in using these litigation management tools and available information about current developments in all our cases, our
legal organization regularly assesses the adequacy of current accruals and determines if adjustment of existing accruals,
or establishment of new accruals, is required.
We have contingent liabilities resulting from throughput agreements with pipeline and processing companies not
associated with financing arrangements. Under these agreements, we may be required to provide any such company with
additional funds through advances and penalties for fees related to throughput capacity not utilized. In addition, at
December 31, 2024, we had performance obligations secured by letters of credit of $278 million (issued as direct bank
letters of credit) related to various purchase commitments for materials, supplies, commercial activities and services
incident to the ordinary conduct of business.
In 2007, the government of Venezuela expropriated ConocoPhillips’ interests in the Petrozuata and Hamaca heavy oil
ventures, as well as the offshore Corocoro development project. In response, ConocoPhillips initiated international
arbitration proceedings before the ICSID. In March 2019, an ICSID tribunal unanimously ordered the government of
Venezuela to pay ConocoPhillips approximately $8.7 billion (later reduced to $8.5 billion) plus interest for the unlawful
expropriation of the projects. On January 22, 2025, an ICSID annulment committee dismissed Venezuela’s application to
annul the tribunal’s decision and upheld the $8.5 billion award plus interest in full. Separate arbitrations before the ICC
resulted in additional awards against PDVSA and three of its affiliates, including an award for approximately $2 billion
plus interest, for the Hamaca and Petrozuata projects, and a $33 million award, for the Corocoro project, plus interest. As
of December 31, 2024, the company has received approximately $787 million in connection with the first ICC award.
Collection actions for all three awards are ongoing.
ConocoPhillips has ensured that all actions related to these arbitration awards meet all appropriate U.S. regulatory
requirements, including those related to any applicable sanctions imposed by the U.S. against Venezuela.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
102
Beginning in 2017, governmental and other entities in several states/territories in the U.S. have filed lawsuits against oil
and gas companies, including ConocoPhillips, seeking compensatory damages and equitable relief to abate alleged
climate change impacts. Additional lawsuits with similar allegations are expected to be filed. The legal and factual issues
are unprecedented, therefore, there is significant uncertainty about the scope of the claims and alleged damages and any
potential impact on the company’s financial condition. ConocoPhillips believes these lawsuits are factually and legally
meritless and are an inappropriate vehicle to address the challenges associated with climate change and will vigorously
defend against such lawsuits.
Several Louisiana parishes and the State of Louisiana have filed numerous lawsuits under Louisiana’s State and Local
Coastal Resources Management Act (SLCRMA) against oil and gas companies, including ConocoPhillips, seeking
compensatory damages for contamination and erosion of the Louisiana coastline allegedly caused by historical oil and gas
operations. ConocoPhillips entities are defendants in several of the lawsuits and will vigorously defend against them. On
October 17, 2022, the Fifth Circuit affirmed remand of the lead case to state court and the subsequent request for
rehearing was denied. Accordingly, the federal district courts have issued remands to state court. Because Plaintiffs’
SLCRMA theories are unprecedented, there is uncertainty about these claims (both as to scope and damages) and we
continue to evaluate our exposure in these lawsuits.
In October 2020, the Bureau of Safety and Environmental Enforcement (BSEE) ordered the prior owners of Outer
Continental Shelf (OCS) Lease P-0166, including ConocoPhillips, to decommission the lease facilities, including two
offshore platforms located near Carpinteria, California. This order was sent after the current owner of OCS Lease P-0166
relinquished the lease and abandoned the lease platforms and facilities. BSEE’s order to ConocoPhillips is premised on its
connection to Phillips Petroleum Company, a legacy company of ConocoPhillips, which held a historical 25 percent
interest in this lease and operated these facilities but sold its interest over 30 years ago. ConocoPhillips continues to
evaluate its exposure in this matter.
In July 2021, a federal securities class action was filed against Concho, certain of Concho’s officers, and ConocoPhillips as
Concho’s successor in the United States District Court for the Southern District of Texas. On October 21, 2021, the court
issued an order appointing Utah Retirement Systems and the Construction Laborers Pension Trust for Southern California
as lead plaintiffs (Lead Plaintiffs). On January 7, 2022, the Lead Plaintiffs filed their consolidated complaint alleging that
Concho made materially false and misleading statements regarding its business and operations in violation of the federal
securities laws and seeking unspecified damages, attorneys’ fees, costs, equitable/injunctive relief and such other relief
that may be deemed appropriate. The defendants filed a motion to dismiss the consolidated complaint on March 8, 2022.
On June 23, 2023, the court denied defendants’ motion as to most defendants including Concho/ConocoPhillips. We
believe the allegations in the action are without merit and are vigorously defending this litigation.
ConocoPhillips is involved in pending disputes with commercial counterparties relating to the propriety of its force
majeure notices following Winter Storm Uri in 2021. We believe these claims are without merit and are vigorously
defending them.
Long-Term Unconditional Purchase Obligations and Commitments, Including Throughput and Take-or-Pay Agreements
We have certain throughput agreements and take-or-pay agreements in support of financing arrangements. The
agreements typically provide for natural gas or crude oil transportation and LNG purchase commitments. The fixed and
determinable portion of the remaining estimated payments under these various agreements as of December 31, 2024
are: 2025—$6 million; 2026—$6 million; 2027—$6 million; 2028—$397 million; 2029—$558 million; and 2030 and after
—$10.3 billion. Generally, variable components of these obligations include commodity futures prices and inflation rates.
Purchases of LNG under these commitments are expected to be offset in the same or approximately same periods by
cash received from the related sales transactions. Total payments under these agreements were $24 million in 2024, $26
million in 2023 and $26 million in 2022.
Notes to Consolidated Financial Statements
103
ConocoPhillips 2024 10-K
Note 11—Derivative and Financial Instruments
We use futures, forwards, swaps and options in various markets to meet our customer needs, capture market
opportunities and manage foreign exchange currency risk.
Commodity Derivative Instruments
Our commodity business primarily consists of natural gas, crude oil, bitumen, NGLs, LNG and power.
Commodity derivative instruments are held at fair value on our consolidated balance sheet. Where these balances have
the right of setoff, they are presented on a net basis. Related cash flows are recorded as operating activities on our
consolidated statement of cash flows. On our consolidated income statement, gains and losses are recognized either on a
gross basis if directly related to our physical business or a net basis if held for trading. Gains and losses related to
contracts that meet and are designated with the NPNS exception are recognized upon settlement. We generally apply
this exception to eligible crude contracts and certain gas contracts. We do not apply hedge accounting for our commodity
derivatives.
The following table presents the gross fair values of our commodity derivatives, excluding collateral, on our consolidated
balance sheet:
Millions of Dollars
2024
2023
Assets
Prepaid expenses and other current assets
$
394
611
Other assets
94
113
Liabilities
Other accruals
397
567
Other liabilities and deferred credits
83
80
The gains (losses) from commodity derivatives included in our consolidated income statement are presented in the
following table:
Millions of Dollars
2024
2023
2022
Sales and other operating revenues
$
133
86
(88)
Other income
(4)
(6)
(5)
Purchased commodities
(133)
(90)
(91)
The table below summarizes our net exposures resulting from outstanding commodity derivative contracts:
Open Position
Long/(Short)
2024
2023
Commodity
Natural gas and power (BCF equivalent)
Fixed price
(17)
(12)
Basis
—
(2)
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
104
Interest Rate Derivative Instruments
In 2023, PALNG executed interest rate swaps that had the effect of converting 60 percent of the projected term loans
outstanding to finance the cost of development and construction of Phase 1 from floating to fixed rate. These swaps were
designated and qualified for hedge accounting under ASC Topic 815, “Derivatives and Hedging,” as a cash flow hedge with
changes in the fair value of the designated hedging instruments reported as a component of other comprehensive
income and to be reclassified into earnings in the same periods that the hedged transactions will affect earnings.
In 2024, PALNG de-designated a portion of the interest rate swaps as a cash flow hedge. Changes in the fair value of the
de-designated hedging instruments are reported in the "Equity in earnings of affiliates" line on our consolidated income
statement.
For the years ended December 31, 2024, and 2023, we recognized an unrealized loss of $56 million and an unrealized
gain of $78 million in other comprehensive income, respectively, related to the hedge accounted swaps. For the year
ended December 31, 2024, we recognized $35 million in "Equity in earnings of affiliates" related to the de-designated
swaps.
Financial Instruments
We invest in financial instruments with maturities based on our cash forecasts for the various accounts and currency
pools we manage. The types of financial instruments in which we currently invest include:
•
Time deposits: Interest bearing deposits placed with financial institutions for a predetermined amount of time.
•
Demand deposits: Interest bearing deposits placed with financial institutions. Deposited funds can be withdrawn
without notice.
•
Commercial paper: Unsecured promissory notes issued by a corporation, commercial bank or government
agency purchased at a discount to mature at par.
•
U.S. government or government agency obligations: Securities issued by the U.S. government or U.S.
government agencies.
•
Foreign government obligations: Securities issued by foreign governments.
•
Corporate bonds: Unsecured debt securities issued by corporations.
•
Asset-backed securities: Collateralized debt securities.
The following investments are carried on our consolidated balance sheet at cost, plus accrued interest and the table
reflects remaining maturities at December 31, 2024 and 2023:
Millions of Dollars
Carrying Amount
Cash and Cash
Equivalents
Short-Term
Investments
2024
2023
2024
2023
Cash
$
770
474
Demand Deposits
3,211
1,424
Time Deposits
1 to 90 days
1,364
3,713
1
511
91 to 180 days
5
22
Within one year
6
3
U.S. Government Obligations
1 to 90 days
260
24
—
—
$
5,605
5,635
12
536
Notes to Consolidated Financial Statements
105
ConocoPhillips 2024 10-K
The following investments in debt securities classified as available for sale are carried at fair value on our consolidated
balance sheet at December 31, 2024 and 2023:
Millions of Dollars
Carrying Amount
Cash and Cash
Equivalents
Short-Term
Investments
Investments and Long-Term
Receivables
2024
2023
2024
2023
2024
2023
Major Security Type
Corporate Bonds
$
—
—
338
201
612
606
Commercial Paper
2
—
77
131
U.S. Government Obligations
—
—
43
89
218
189
U.S. Government Agency
Obligations
—
5
7
7
Foreign Government
Obligations
4
7
12
4
Asset-backed Securities
33
2
205
183
$
2
—
495
435
1,054
989
Cash and cash equivalents and Short-term investments have remaining maturities within one year. Investments and long-
term receivables have remaining maturities that vary from greater than one year through four years.
The following table summarizes the amortized cost basis and fair value of investments in debt securities classified as
available for sale at December 31:
Millions of Dollars
Amortized Cost Basis
Fair Value
2024
2023
2024
2023
Major Security Type
Corporate Bonds
$
947
806
950
807
Commercial Paper
79
131
79
131
U.S. Government Obligations
262
278
261
278
U.S. Government Agency Obligations
7
12
7
12
Foreign Government Obligations
16
11
16
11
Asset-backed Securities
237
184
238
185
$
1,548
1,422
1,551
1,424
As of December 31, 2024, total unrealized gains for debt securities classified as available for sale with net gains were
$5 million and total unrealized losses for debt securities classified as available for sale with net losses were $1 million. As
of December 31, 2023, total unrealized gains for debt securities classified as available for sale with net unrealized gains
were $5 million. No allowance for credit losses has been recorded on investments in debt securities which are in an
unrealized loss position.
For the years ended December 31, 2024 and 2023, proceeds from sales and redemptions of investments in debt
securities classified as available for sale were $868 million and $983 million, respectively. Gross realized gains and losses
included in earnings from those sales and redemptions were negligible. The cost of securities sold and redeemed is
determined using the specific identification method.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
106
Credit Risk
Financial instruments potentially exposed to concentrations of credit risk consist primarily of cash equivalents, short-term
investments, long-term investments in debt securities, OTC derivative contracts and trade receivables. Our cash
equivalents and short-term investments are placed in high-quality commercial paper, government money market funds,
U.S. government and government agency obligations, time deposits with major international banks and financial
institutions, high-quality corporate bonds, foreign government obligations and asset-backed securities. Our long-term
investments in debt securities are placed in high-quality corporate bonds, asset-backed securities, U.S. government and
government agency obligations, foreign government obligations, and time deposits with major international banks and
financial institutions.
The credit risk from our OTC derivative contracts, such as forwards, swaps and options, derives from the counterparty to
the transaction. Individual counterparty exposure is managed within predetermined credit limits and includes the use of
cash-call margins when appropriate, thereby reducing the risk of significant nonperformance. We also use futures, swaps
and option contracts that have a negligible credit risk because these trades are cleared primarily with an exchange
clearinghouse and subject to mandatory margin requirements until settled; however, we are exposed to the credit risk of
those exchange brokers for receivables arising from daily margin cash calls, as well as for cash deposited to meet initial
margin requirements.
Our trade receivables result primarily from our petroleum operations and reflect a broad national and international
customer base, which limits our exposure to concentrations of credit risk. The majority of these receivables have
payment terms of 30 days or less, and we continually monitor this exposure and the creditworthiness of the
counterparties. We may require collateral to limit the exposure to loss, including letters of credit, prepayments and
surety bonds, as well as master netting arrangements to mitigate credit risk with counterparties that both buy from and
sell to us, as these agreements permit the amounts owed by us or owed to others to be offset against amounts due to us.
Certain of our derivative instruments contain provisions that require us to post collateral if the derivative exposure
exceeds a threshold amount. We have contracts with fixed threshold amounts and other contracts with variable
threshold amounts that are contingent on our credit rating. The variable threshold amounts typically decline for lower
credit ratings, while both the variable and fixed threshold amounts typically revert to zero if we fall below investment
grade. Cash is the primary collateral in all contracts; however, many also permit us to post letters of credit as collateral,
such as transactions administered through the New York Mercantile Exchange.
The aggregate fair value of all derivative instruments with such credit risk-related contingent features that were in a
liability position at December 31, 2024 and December 31, 2023, was $70 million and $181 million, respectively. For these
instruments, no collateral was posted at December 31, 2024 and December 31, 2023. If our credit rating had been
downgraded below investment grade at December 31, 2024, we would have been required to post $49 million of
additional collateral, either with cash or letters of credit.
Notes to Consolidated Financial Statements
107
ConocoPhillips 2024 10-K
Note 12—Fair Value Measurement
We carry a portion of our assets and liabilities at fair value that are measured at the reporting date using an exit price
(i.e., the price that would be received to sell an asset or paid to transfer a liability) and disclosed according to the quality
of valuation inputs under the fair value hierarchy.
The classification of an asset or liability is based on the lowest level of input significant to its fair value. Those that are
initially classified as Level 3 are subsequently reported as Level 2 when the fair value derived from unobservable inputs is
inconsequential to the overall fair value, or if corroborated market data becomes available. Assets and liabilities initially
reported as Level 2 are subsequently reported as Level 3 if corroborated market data is no longer available. There were
no material transfers into or out of Level 3 during 2024 or 2023.
Recurring Fair Value Measurement
Financial assets and liabilities reported at fair value on a recurring basis include our investments in debt securities
classified as available for sale, commodity derivatives, and our contingent consideration arrangement related to the
Surmont acquisition. See Note 3.
•
Level 1 derivative assets and liabilities primarily represent exchange-traded futures and options that are valued using
unadjusted prices available from the underlying exchange. Level 1 financial assets also include our investments in
U.S. government obligations classified as available for sale debt securities, which are valued using exchange prices.
•
Level 2 derivative assets and liabilities primarily represent OTC swaps, options and forward purchase and sale
contracts that are valued using adjusted exchange prices, prices provided by brokers or pricing service companies
that are all corroborated by market data. Level 2 financial assets also include our investments in debt securities
classified as available for sale including investments in corporate bonds, commercial paper, asset-backed securities,
U.S. government agency obligations and foreign government obligations that are valued using pricing provided by
brokers or pricing service companies that are corroborated with market data.
•
Level 3 derivative assets and liabilities consist of OTC swaps, options and forward purchase and sale contracts where
a significant portion of fair value is calculated from underlying market data that is not readily available. The derived
value uses industry standard methodologies that may consider the historical relationships among various
commodities, modeled market prices, time value, volatility factors and other relevant economic measures. The use of
these inputs results in management’s best estimate of fair value. Level 3 commodity derivative activity was not
material for all periods presented.
•
Level 3 liabilities include the fair value of future quarterly contingent payments to Total Energies EP Canada Ltd. in
connection with the acquisition of the remaining 50 percent working interest in Surmont. Contingent consideration
consists of payments up to approximately $0.4 billion CAD over a five-year term ending in the fourth quarter of 2028.
The contingent payments represent $2.0 million for every dollar that the monthly WCS average pricing exceeds $52
per barrel. The terms include adjustments related to not achieving certain production targets. The fair value of the
contingent consideration as of December 31, 2024 is calculated using the income approach and is largely based on
the estimated commodity price outlook using a combination of external pricing service companies' and our internal
price outlook (unobservable input) and a discount rate consistent with those used by principal market participants
(observable input). Impact of other unobservable inputs on the fair value as of December 31, 2024 was not
significant.
The following table summarizes the fair value hierarchy for gross financial assets and liabilities (i.e., unadjusted where the
right of setoff exists for commodity derivatives accounted for at fair value on a recurring basis):
Millions of Dollars
December 31, 2024
December 31, 2023
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
Assets
Investments in debt securities
$
261
1,290
—
1,551
278
1,146
—
1,424
Commodity derivatives
201
252
35
488
308
301
115
724
Total assets
$
462
1,542
35
2,039
586
1,447
115
2,148
Liabilities
Commodity derivatives
$
275
160
45
480
350
283
14
647
Contingent consideration
—
—
145
145
—
—
312
312
Total liabilities
$
275
160
190
625
350
283
326
959
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
108
The range and arithmetic average of the significant unobservable input used in the Level 3 fair value measurement was as
follows:
Fair Value
(Millions of
Dollars)
Valuation
Technique
Unobservable Input
Range
(Arithmetic Average)
Contingent Consideration -
Surmont as of:
December 31, 2024
$
145
Discounted
cash flow
Commodity price outlook*
($/BOE)
$48.63 - $57.53 ($53.38)
December 31, 2023
312
$45.48 - $63.04 ($57.45)
*Commodity price outlook based on a combination of external pricing service companies' outlooks and our internal outlook.
The following table summarizes those commodity derivative balances subject to the right of setoff as presented on our
consolidated balance sheet. We have elected to offset the recognized fair value amounts for multiple derivative
instruments executed with the same counterparty in our financial statements when a legal right of setoff exists.
Millions of Dollars
Amounts Subject to Right of Setoff
Gross
Amounts
Recognized
Amounts
Not
Subject to
Right of
Setoff
Gross
Amounts
Gross
Amounts
Offset
Net
Amounts
Presented
Cash
Collateral
Net
Amounts
December 31, 2024
Assets
$
488
—
488
278
210
—
210
Liabilities
480
—
480
278
202
73
129
December 31, 2023
Assets
$
724
39
685
375
310
4
306
Liabilities
647
34
613
375
238
47
191
At December 31, 2024 and December 31, 2023, we did not present any amounts gross on our consolidated balance sheet
where we had the right of setoff.
Reported Fair Values of Financial Instruments
We used the following methods and assumptions to estimate the fair value of financial instruments:
•
Cash and cash equivalents and short-term investments: The carrying amount reported on the balance sheet
approximates fair value. For those investments classified as available for sale debt securities, the carrying
amount reported on the balance sheet is fair value.
•
Accounts and notes receivable (including long-term and related parties): The carrying amount reported on the
balance sheet approximates fair value.
•
Investments in debt securities classified as available for sale: The fair value of investments in debt securities
categorized as Level 1 in the fair value hierarchy is measured using exchange prices. The fair value of
investments in debt securities categorized as Level 2 in the fair value hierarchy is measured using pricing
provided by brokers or pricing service companies that are corroborated with market data. See Note 11.
•
Accounts payable (including related parties) and floating-rate debt: The carrying amount of accounts payable
and floating-rate debt reported on the balance sheet approximates fair value.
•
Fixed-rate debt: The estimated fair value of fixed-rate debt is measured using prices available from a pricing
service that is corroborated by market data; therefore, these liabilities are categorized as Level 2 in the fair value
hierarchy.
•
Commercial paper: The carrying amount of our commercial paper instruments approximates fair value and is
reported on the balance sheet as short-term debt.
Notes to Consolidated Financial Statements
109
ConocoPhillips 2024 10-K
The following table summarizes the net fair value of financial instruments (i.e., adjusted where the right of setoff exists
for commodity derivatives):
Millions of Dollars
Carrying Amount
Fair Value
2024
2023
2024
2023
Financial assets
Commodity derivatives
210
345
210
345
Investments in debt securities
1,551
1,424
1,551
1,424
Financial liabilities
Total debt, excluding finance leases
23,384
17,808
22,997
18,621
Commodity derivatives
129
225
129
225
Note 13—Equity
Common Stock
The changes in our shares of common stock, as categorized in the equity section of the balance sheet, were:
Shares
2024
2023
2022
Issued
Beginning of year
2,103,772,516 2,100,885,134 2,091,562,747
Acquisition of Marathon Oil
142,941,624
—
—
Distributed under benefit plans
3,958,594
2,887,382
9,322,387
End of year
2,250,672,734 2,103,772,516 2,100,885,134
Held in Treasury
Beginning of year
925,670,961 877,029,062 789,319,875
Repurchase of common stock
49,135,049
48,641,899
87,709,187
End of year
974,806,010 925,670,961 877,029,062
Preferred Stock
We have authorized 500 million shares of preferred stock, par value $0.01 per share, none of which was issued or
outstanding at December 31, 2024 or 2023.
Repurchase of Common Stock
In late 2016, we initiated our current share repurchase program. In October 2024, our Board of Directors approved an
increase from our prior authorization of $45 billion by a total of the lesser of $20 billion or the number of shares issued in
our acquisition of Marathon Oil, such that the company is not to exceed $65 billion in aggregate purchases. Since
inception of our current program, shares repurchased totaled 433 million shares at a cost of $34.3 billion through the end
of December 2024.
In 2021, we began a paced monetization of our CVE common shares, the proceeds of which have been applied to share
repurchases. In 2022, we sold our remaining 91 million CVE common shares.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
110
Note 14—Non-Mineral Leases
The company primarily leases office buildings and drilling equipment, as well as ocean transport vessels, tugboats,
corporate aircraft, and other facilities and equipment. Certain leases include escalation clauses for adjusting rental
payments to reflect changes in price indices, and other leases include payment provisions that vary based on the nature
of usage of the leased asset. Additionally, the company has executed certain leases that provide it with the option to
extend or renew the term of the lease, terminate the lease prior to the end of the lease term, or purchase the leased
asset as of the end of the lease term. In other cases, the company has executed lease agreements that require it to
guarantee the residual value of certain leased office buildings. For additional information about guarantees, see Note 9.
There are no significant restrictions imposed on us by the lease agreements with regard to dividends, asset dispositions or
borrowing ability.
We determine if an arrangement is or contains a lease at contract inception. Certain contractual arrangements may
contain both lease and non-lease components. Only the lease components of these contractual arrangements are subject
to the provisions of ASC Topic 842, and any non-lease components are subject to other applicable accounting guidance;
however, we have elected to adopt the optional practical expedient not to separate lease components apart from non-
lease components for existing asset classes, except for crude oil and LNG Vessels. For contractual arrangements involving
a new leased asset class, we determine at contract inception whether it will apply the optional practical expedient to the
new leased asset class.
Leases are evaluated for classification as operating or finance leases at the commencement date of the lease and right-of-
use assets and corresponding liabilities are recognized on our consolidated balance sheet based on the present value of
future lease payments relating to the use of the underlying asset during the lease term. Future lease payments include
variable lease payments that depend upon an index or rate using the index or rate at the commencement date and
probable amounts owed under residual value guarantees. The amount of future lease payments may be increased to
include additional payments related to lease extension, termination, and/or purchase options when the company has
determined, at or subsequent to lease commencement, generally due to limited asset availability or operating
commitments, it is reasonably certain of exercising such options. We use our incremental borrowing rate as the discount
rate in determining the present value of future lease payments, unless the interest rate implicit in the lease arrangement
is readily determinable. Lease payments that vary subsequent to the commencement date based on future usage levels,
the nature of leased asset activities, or certain other contingencies are not included in the measurement of lease right-of-
use assets and corresponding liabilities. We have elected not to record assets and liabilities on our consolidated balance
sheet for lease arrangements with terms of 12 months or less.
We often enter into leasing arrangements acting in the capacity as operator for and/or on behalf of certain oil and gas
joint ventures of undivided interests. If the lease arrangement can be legally enforced only against us as operator and
there is no separate arrangement to sublease the underlying leased asset to our coventurers, we recognize at lease
commencement a right-of-use asset and corresponding lease liability on our consolidated balance sheet on a gross basis.
While we record lease costs on a gross basis in our consolidated income statement and statement of cash flows, such
costs are offset by the reimbursement we receive from our coventurers for their share of the lease cost as the underlying
leased asset is utilized in joint venture activities. As a result, lease cost is presented in our consolidated income statement
and statement of cash flows on a proportional basis. If we are a nonoperating coventurer, we recognize a right-of-use
asset and corresponding lease liability only if we were a specified contractual party to the lease arrangement and the
arrangement could be legally enforced against us. In this circumstance, we would recognize both the right-of-use asset
and corresponding lease liability on our consolidated balance sheet on a proportional basis consistent with our undivided
interest ownership in the related joint venture.
The company has historically recorded finance lease assets and liabilities associated with certain oil and gas joint ventures
on a proportional basis pursuant to accounting guidance applicable prior to the adoption date of ASC 842. In accordance
with the transition provisions of ASC Topic 842, and since we have elected to adopt the package of optional transition-
related practical expedients, the historical accounting treatment for these leases has been carried forward and is subject
to reconsideration upon the modification or other required reassessment of the arrangements prior to lease term
expiration.
Notes to Consolidated Financial Statements
111
ConocoPhillips 2024 10-K
The following table summarizes the right-of-use assets and lease liabilities for both the operating and finance leases on
our consolidated balance sheet as of December 31:
Millions of Dollars
2024
2023
Operating
Leases
Finance
Leases
Operating
Leases
Finance
Leases
Right-of-Use Assets
Properties, plants and equipment
Gross
1,983
2,010
Accumulated DD&A
(1,336)
(1,185)
Net PP&E*
647
825
Other assets
1,017
691
Lease Liabilities
Short-term debt**
292
291
Other accruals
329
193
Long-term debt***
648
838
Other liabilities and deferred credits
695
504
Total lease liabilities
$
1,024
940
697
1,129
* Includes proportionately consolidated finance lease assets of $107 million at December 31, 2024 and $134 million at December 31, 2023.
** Includes proportionately consolidated finance lease liabilities of $181 million at December 31, 2024 and $175 million at December 31, 2023.
*** Includes proportionately consolidated finance lease liabilities of $259 million at December 31, 2024 and $326 million at December 31, 2023.
The following table summarizes our lease costs:
Millions of Dollars
2024
2023
2022
Lease Cost*
Operating lease cost
$
325
229
212
Finance lease cost
Amortization of right-of-use assets
173
180
189
Interest on lease liabilities
29
35
32
Short-term lease cost**
49
40
94
Total lease cost***
$
576
484
527
* The amounts presented in the table above have not been adjusted to reflect amounts recovered or reimbursed from oil and gas coventurers.
** Short-term leases are not recorded on our consolidated balance sheet.
*** Variable lease cost and sublease income are immaterial for the periods presented and therefore are not included in the table above.
The following table summarizes the lease terms and discount rates as of December 31:
Lease Term and Discount Rate
2024
2023
Weighted-average term (years)
Operating leases
4.41
5.83
Finance leases
4.86
5.73
Weighted-average discount rate (percent)
Operating leases
4.62
4.13
Finance leases
3.40
3.39
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
112
The following table summarizes other lease information:
Millions of Dollars
2024
2023
2022
Other Information*
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases
$
248
173
148
Operating cash flows from finance leases
29
33
30
Financing cash flows from finance leases
172
169
166
Right-of-use assets obtained in exchange for operating lease liabilities
$
628
355
114
Right-of-use assets obtained in exchange for finance lease liabilities
—
9
256
*The amounts presented in the table above have not been adjusted to reflect amounts recovered or reimbursed from oil and gas coventurers. In addition,
pursuant to other applicable accounting guidance, lease payments made in connection with preparing another asset for its intended use are reported in
the "Cash Flows From Investing Activities" section of our consolidated statement of cash flows.
The following table summarizes future lease payments for operating and finance leases at December 31, 2024:
Millions of Dollars
Operating
Leases
Finance
Leases
Maturity of Lease Liabilities
2025
$
382
354
2026
292
200
2027
160
159
2028
96
177
2029
55
88
Remaining years
121
84
Total
1,106
1,062
Less: portion representing imputed interest
(82)
(122)
Total lease liabilities
$
1,024 $
940
Notes to Consolidated Financial Statements
113
ConocoPhillips 2024 10-K
Note 15—Employee Benefit Plans
Pension and Postretirement Plans
An analysis of the projected benefit obligations for our pension plans and accumulated benefit obligations for our
postretirement health and life insurance plans follows:
Millions of Dollars
Pension Benefits
Other Benefits
2024
2023
2024
2023
U.S.
Int’l.
U.S.
Int’l.
Change in Benefit Obligation
Benefit obligation at January 1
$
1,525
2,866
1,478
2,776
107
102
Service cost
49
38
51
38
1
1
Interest cost
76
114
77
113
5
5
Plan participant contributions
—
—
—
—
12
14
Plan amendments
—
57
—
—
—
—
Business combinations
237
42
Actuarial (gain) loss
(4)
(202)
40
11
5
22
Benefits paid
(98)
(134)
(121)
(124)
(27)
(37)
Curtailment
8
—
—
—
—
—
Recognition of termination benefits
13
—
—
—
—
—
Foreign currency exchange rate change
—
(148)
—
52
—
—
Benefit obligation at December 31*
$
1,806
2,591
1,525
2,866
145
107
*Accumulated benefit obligation portion of
above at December 31:
$
1,703
2,392
1,414
2,642
Change in Fair Value of Plan Assets
Fair value of plan assets at January 1
$
1,306
3,085
1,179
2,879
—
—
Actual return on plan assets
66
18
129
199
—
—
Company contributions
83
88
119
58
15
23
Plan participant contributions
—
—
—
—
12
14
Business combinations
199
Benefits paid
(98)
(134)
(121)
(124)
(27)
(37)
Foreign currency exchange rate change
—
(150)
—
73
—
—
Fair value of plan assets at December 31
$
1,556
2,907
1,306
3,085
—
—
Funded Status
$
(250)
316
(219)
219
(145)
(107)
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
114
Millions of Dollars
Pension Benefits
Other Benefits
2024
2023
2024
2023
U.S.
Int’l.
U.S.
Int’l.
Amounts Recognized in the Consolidated
Balance Sheet at December 31
Noncurrent assets
$
1
553
—
491
—
—
Current liabilities
(28)
(10)
(16)
(9)
(26)
(24)
Noncurrent liabilities
(223)
(227)
(203)
(263)
(119)
(83)
Total recognized
$
(250)
316
(219)
219
(145)
(107)
Weighted-Average Assumptions Used to
Determine Benefit Obligations at
December 31
Discount rate
5.70 %
4.90
5.35
4.10
5.60
5.30
Rate of compensation increase
5.00
4.05
5.00
3.65
Interest crediting rate for applicable benefits
4.30
4.20
Weighted-Average Assumptions Used to
Determine Net Periodic Benefit Cost for
Years Ended December 31
Discount rate
5.35 %
4.10
5.65
4.20
5.35
5.65
Expected return on plan assets
5.30
5.40
5.30
5.20
Rate of compensation increase
5.00
3.65
5.00
3.65
Interest crediting rate for applicable benefits
4.20
3.55
For both U.S. and international pension plans, the overall expected long-term rate of return is developed from the
expected future return of each asset class, weighted by the expected allocation of pension assets to that asset class. We
rely on a variety of independent market forecasts in developing the expected rate of return for each class of assets.
During 2024, the actuarial gains related to the benefit obligations for international plans were primarily related to an
increase in the discount rates. During 2023, the actuarial losses related to the benefit obligations for U.S. and
international plans were primarily related to a decrease in the discount rates.
The following tables summarize information related to the company's pension plans with projected and accumulated
benefit obligations in excess of the fair value of the plans' assets:
Millions of Dollars
Pension Benefits
2024
2023
U.S.
Int’l.
U.S.
Int’l.
Pension Plans with Projected Benefit Obligation in Excess
of Plan Assets
Projected benefit obligation
$
450
242
1,525
279
Fair value of plan assets
199
6
1,306
6
Pension Plans with Accumulated Benefit Obligation in
Excess of Plan Assets
Accumulated benefit obligation
$
425
210
165
243
Fair value of plan assets
199
6
—
6
Notes to Consolidated Financial Statements
115
ConocoPhillips 2024 10-K
Included in accumulated other comprehensive income (loss) at December 31 were the following before-tax amounts that
had not been recognized in net periodic benefit cost:
Millions of Dollars
Pension Benefits
Other Benefits
2024
2023
2024
2023
U.S.
Int’l.
U.S.
Int’l.
Unrecognized net actuarial loss (gain)
$
112
445
123
585
2
3
Unrecognized prior service cost (credit)
—
58
—
1
(21)
(60)
Millions of Dollars
Pension Benefits
Other Benefits
2024
2023
2024
2023
U.S.
Int’l.
U.S.
Int’l.
Sources of Change in Other Comprehensive
Income (Loss)
Net gain (loss) arising during the period
$
3
83
30
29
(5)
(22)
Amortization of actuarial loss included in
income (loss)*
8
57
18
67
—
(3)
Net change during the period
$
11
140
48
96
(5)
(25)
Prior service credit (cost) arising during the
period
$
—
(57)
—
—
—
—
Amortization of prior service (credit)
included in income (loss)
—
—
—
—
(38)
(38)
Net change during the period
$
—
(57)
—
—
(38)
(38)
*Includes settlement (gains) losses recognized in 2024 and 2023.
The components of net periodic benefit cost of all defined benefit plans are presented in the following table:
Millions of Dollars
Pension Benefits
Other Benefits
2024
2023
2022
2024
2023
2022
U.S.
Int’l.
U.S.
Int’l.
U.S.
Int’l.
Components of Net Periodic
Benefit Cost
Service cost
$
49
38
51
38
58
47
1
1
1
Interest cost
76
114
77
113
62
77
5
5
4
Expected return on plan
assets
(66)
(163)
(58)
(148)
(50)
(124)
—
—
—
Amortization of prior service
credit
—
—
—
—
—
(1)
(38)
(38)
(38)
Recognized net actuarial loss
(gain)
8
58
12
67
24
11
—
(3)
—
Settlements loss (gain)
—
(1)
6
—
37
—
—
—
—
Curtailment loss (gain)
8
—
—
—
—
—
—
—
—
Net periodic benefit cost
$
75
46
88
70
131
10
(32)
(35)
(33)
The components of net periodic benefit cost, other than the service cost component, are included in the “Other
expenses” line item on our consolidated income statement.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
116
We recognized pension settlement losses of $6 million in 2023 and $37 million in 2022 as lump-sum benefit payments
from certain U.S. and international pension plans exceeded the sum of service and interest costs for those plans and led
to recognition of settlement losses.
In determining net pension and other postretirement benefit costs, we amortize prior service costs on a straight-line basis
over the average remaining service period of employees expected to receive benefits under the plan. For net actuarial
gains and losses, we amortize 10 percent of the unamortized balance each year.
We have multiple non-pension postretirement benefit plans for health and life insurance. The health care plans are
contributory and subject to various cost sharing features, most with participant and company contributions adjusted
annually; the life insurance plans are noncontributory. The measurement of the U.S. pre-65 retiree medical accumulated
postretirement benefit obligation assumes a health care cost trend rate of 6.5 percent in 2025 that declines to 5 percent
by 2032. The measurement of the U.S. post-65 retiree medical accumulated postretirement benefit obligation assumes a
health care cost trend rate of 4.6 percent in 2025 that increases to 5 percent by 2030.
Plan Assets
We follow a policy of broadly diversifying pension plan assets across asset classes and individual holdings. As a result, our
plan assets have no significant concentrations of credit risk. Asset classes that are considered appropriate include U.S.
equities, non-U.S. equities, U.S. fixed income, non-U.S. fixed income, real estate and private equity investments. Plan
fiduciaries may consider and add other asset classes to the investment program from time to time. The target allocations
for plan assets, aggregated across U.S. and international plans, are 26 percent in equity securities, 69 percent in debt
securities, 4 percent in real estate and 1 percent in other. Generally, the plan investments are publicly traded; therefore,
minimizing liquidity risk in the portfolio.
The following is a description of the valuation methodologies used for the pension plan assets. There have been no
changes in the methodologies used at December 31, 2024 and 2023.
•
Fair values of equity securities and government debt securities categorized in Level 1 are primarily based on
quoted market prices in active markets for identical assets and liabilities.
•
Fair values of corporate debt securities, agency and mortgage-backed securities and government debt securities
categorized in Level 2 are estimated using recently executed transactions and quoted market prices for similar
assets and liabilities in active markets and for identical assets and liabilities in markets that are not active. If
there have been no market transactions in a particular fixed income security, its fair value is calculated by pricing
models that benchmark the security against other securities with actual market prices. When observable quoted
market prices are not available, fair value is based on pricing models that use something other than actual
market prices (e.g., observable inputs such as benchmark yields, reported trades and issuer spreads for similar
securities), and these securities are categorized in Level 3 of the fair value hierarchy.
•
Fair values of investments in common/collective trusts are determined by the issuer of each fund based on the
fair value of the underlying assets.
•
Fair values of mutual funds are based on quoted market prices, which represent the net asset value of shares
held.
•
Time deposits are valued at cost, which approximates fair value.
•
Cash is valued at cost, which approximates fair value. Fair values of international cash equivalents categorized in
Level 2 are valued using observable yield curves, discounting and interest rates. U.S. cash balances held in the
form of short-term fund units that are redeemable at the measurement date are categorized as Level 2.
•
Fair values of exchange-traded derivatives classified in Level 1 are based on quoted market prices. For other
derivatives classified in Level 2, the values are generally calculated from pricing models with market input
parameters from third-party sources.
•
Fair values of insurance contracts are valued at the present value of the future benefit payments owed by the
insurance company to the plans’ participants.
•
Fair values of real estate investments are valued using real estate valuation techniques and other methods that
include reference to third-party sources and sales comparables where available.
Notes to Consolidated Financial Statements
117
ConocoPhillips 2024 10-K
•
A portion of U.S. pension plan assets is held as a participating interest in an insurance annuity contract, which is
calculated as the market value of investments held under this contract, less the accumulated benefit obligation
covered by the contract. The participating interest is classified as Level 3 in the fair value hierarchy as the fair
value is determined via a combination of quoted market prices, recently executed transactions, and an actuarial
present value computation for contract obligations. At December 31, 2024, the participating interest in the
annuity contract was valued at $42 million and consisted of $113 million in debt securities, less $71 million for
the accumulated benefit obligation covered by the contract. At December 31, 2023, the participating interest in
the annuity contract was valued at $46 million and consisted of $130 million in debt securities, less $84 million
for the accumulated benefit obligation covered by the contract. The participating interest is not available for
meeting general pension benefit obligations in the near term. No future company contributions are required and
no new benefits are being accrued under this insurance annuity contract.
The fair values of our pension plan assets at December 31, by asset class were as follows:
Millions of Dollars
U.S.
International
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
2024
Equity securities
U.S.
$
5
—
—
5
—
—
—
—
International
38
—
—
38
—
—
—
—
Mutual funds
17
—
—
17
445
77
—
522
Debt securities
Corporate
—
1
—
1
—
—
—
—
Mutual funds
—
—
—
—
451
—
—
451
Private equity funds
3
3
Cash and cash equivalents
—
—
—
—
25
—
—
25
Insurance contracts
4
4
Real estate
—
—
3
3
—
—
136
136
Total in fair value hierarchy
$
60
1
10
71
921
77
136
1,134
Investments measured at net asset
value*
Equity securities
Common/collective trusts
479
194
Debt securities
Common/collective trusts
938
1,575
Cash and cash equivalents
3
—
Real estate
22
—
Total**
$
60
1
10
1,513
921
77
136
2,903
*In accordance with FASB ASC Topic 715, “Compensation—Retirement Benefits,” certain investments that are to be measured at fair value using the net
asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in
this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Change in Fair Value of Plan Assets.
**Excludes the participating interest in the insurance annuity contract with a net asset of $42 million and net receivables related to security transactions
of $5 million.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
118
The fair values of our pension plan assets at December 31, by asset class were as follows:
Millions of Dollars
U.S.
International
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
2023
Equity securities
U.S.
$
6
—
—
6
—
—
—
—
International
35
—
—
35
—
—
—
—
Mutual funds
15
—
—
15
244
276
—
520
Debt securities
Corporate
—
1
—
1
—
—
—
—
Mutual funds
—
—
—
—
421
—
—
421
Cash and cash equivalents
—
—
—
—
25
—
—
25
Derivatives
Real estate
—
—
—
—
—
—
126
126
Total in fair value hierarchy
$
56
1
—
57
690
276
126
1,092
Investments measured at net asset
value*
Equity securities
Common/collective trusts
300
198
Debt securities
Common/collective trusts
868
1,791
Cash and cash equivalents
6
—
Real estate
28
—
Total**
$
56
1
—
1,259
690
276
126
3,081
*In accordance with FASB ASC Topic 715, “Compensation—Retirement Benefits,” certain investments that are to be measured at fair value using the
net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented
in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Change in Fair Value of Plan Assets.
**Excludes the participating interest in the insurance annuity contract with a net asset of $46 million and net receivables related to security transactions
of $5 million.
Level 3 activity was not material for all periods.
Our funding policy for U.S. plans is to contribute at least the minimum required by the Employee Retirement Income
Security Act of 1974 and the Internal Revenue Code of 1986, as amended. Contributions to foreign plans are dependent
upon local laws and tax regulations. In 2025, we expect to contribute approximately $190 million to our domestic
qualified and nonqualified pension and postretirement benefit plans and $55 million to our international qualified and
nonqualified pension and postretirement benefit plans.
Notes to Consolidated Financial Statements
119
ConocoPhillips 2024 10-K
The following benefit payments, which are exclusive of amounts to be paid from the insurance annuity contract and
which reflect expected future service, as appropriate, are expected to be paid:
Millions of Dollars
Pension
Benefits
Other
Benefits
U.S.
Int’l.
2025
$
386
120
21
2026
224
124
19
2027
213
126
17
2028
199
128
16
2029
195
132
15
2030–2034
769
710
63
The following table summarizes our severance accrual activity:
Millions of Dollars
2024
2023
2022
Balance at January 1
$
12
31
78
Accruals
328
1
1
Benefit payments
(9)
(20)
(48)
Balance at December 31
$
331
12
31
In 2024, accruals included severance costs associated with contractual termination benefits applicable to officers and
employees of Marathon Oil as of the acquisition date. Of the remaining balance at December 31, 2024, $323 million is
classified as short-term. See Note 3.
Defined Contribution Plans
Most U.S. employees are eligible to participate in a defined contribution plan. Company contributions can vary based on
employee compensation and contribution elections, whether the employee is accruing benefits in a defined benefit plan
and company discretion. Company contributions charged to expense for U.S. defined contribution plans were $152
million in 2024, $151 million in 2023 and $140 million in 2022.
We have several defined contribution plans for our international employees, each with its own terms and eligibility
depending on location. Total compensation expense recognized for these international plans was approximately
$25 million in 2024, $23 million in 2023 and $24 million in 2022.
Share-Based Compensation Plans
The 2023 Omnibus Stock and Performance Incentive Plan of ConocoPhillips (Omnibus Plan) was approved by
shareholders in May 2023, replacing similar prior plans and providing that no new awards shall be granted under the
prior plans. Over its 10-year life, the Omnibus Plan allows the issuance of up to 36 million shares of our common stock for
compensation to our employees and directors, but the available shares (i) are reduced by awards granted under the prior
plan between the board adoption date (February 15, 2023) and the shareholder approval date (May 16, 2023) and (ii) are
increased by any shares of common stock represented by awards granted under the Omnibus Plan or the prior plans that
are forfeited, expire or are cancelled without delivery of shares of common stock or which result in the forfeiture of
shares of common stock back to the company, excluding shares surrendered in payment of the exercise of a stock option
or stock appreciation right, shares not issued in connection with the stock settlement of a stock appreciation right, or
shares reacquired by the company using cash proceeds from the exercise of a stock option. The Human Resources and
Compensation Committee of our Board of Directors is authorized to determine the types, terms, conditions and
limitations of awards granted. Awards may be granted in the form of, but not limited to, stock options, RSUs and
performance share units (PSU) to employees and non-employee directors who contribute to the company’s continued
success and profitability.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
120
Total share-based compensation expense is measured using the grant date fair value for our equity-classified awards and
the settlement date fair value for our liability-classified awards. We recognize share-based compensation expense over
the shorter of the service period (i.e., the stated period of time required to earn the award) or, for awards that provide
for retirement-based vesting, the period beginning at the start of the service period and ending upon the date when an
employee first becomes eligible for retirement vesting under award terms. Other than certain retention awards, our
share-based compensation programs generally provide accelerated vesting in whole or in part (i.e., a waiver of the
remaining period of service required to earn an award) for awards held by employees at the time of their retirement.
Some of our share-based awards vest ratably (i.e., portions of the award vest at different times) while some of our
awards cliff vest (i.e., all of the award vests at the same time). We recognize expense on a straight-line basis over the
service period for the entire award, whether the award was granted with ratable or cliff vesting.
Compensation Expense—Total share-based compensation expense recognized in net income (loss) and the associated
tax benefit were:
Millions of Dollars
2024
2023
2022
Compensation cost
$
268
334
377
Tax benefit
67
84
95
Stock Options—Stock options granted under the provisions of the Omnibus Plan and prior plans permit purchase of our
common stock at exercise prices equivalent to the average fair market value of ConocoPhillips common stock on the date
the options were granted. The options have terms of 10 years and generally vest ratably on the first, second and third
anniversaries of the date of grant. Options awarded to certain employees already eligible for retirement vest within six
months of the grant date, but those options do not become exercisable until the end of the normal vesting period.
Beginning in 2018, stock option grants were discontinued.
The following summarizes our stock option activity for the year ended December 31, 2024:
Millions of Dollars
Options
Weighted-Average
Exercise Price
Aggregate
Intrinsic Value
Outstanding at December 31, 2023
3,264,675 $
52.55 $
209
Exercised
(1,213,600)
68.42
63
Expired or cancelled
—
—
Outstanding at December 31, 2024
2,051,075 $
43.16 $
113
Vested at December 31, 2024
2,051,075 $
43.16 $
113
Exercisable at December 31, 2024
2,051,075 $
43.16 $
113
The weighted-average remaining contractual term of outstanding options, vested options and exercisable options at
December 31, 2024, were all 1.47 years. The aggregate intrinsic value of options exercised was $58 million in 2023 and
$308 million in 2022.
During 2024, we received $83 million in cash and realized a tax benefit of $13 million from the exercise of options. At
December 31, 2024, all outstanding stock options were fully vested and there was no remaining compensation cost to be
recorded.
Stock Unit Programs—RSUs granted annually under the provisions of the Omnibus Plan and the general and executive
RSU programs vest in one installment on the third anniversary of the grant date. RSUs granted under the Omnibus Plan
for a variable long-term incentive retention program vest ratably on the first, second and third anniversaries of the grant
date. RSUs are also granted ad hoc to attract or retain key personnel, or assumed as a result of an acquisition, and the
terms and conditions under which these RSUs vest vary by award.
Notes to Consolidated Financial Statements
121
ConocoPhillips 2024 10-K
Stock-Settled
Upon vesting, these RSUs are settled by issuing one share of ConocoPhillips common stock per unit. Units awarded to
retirement eligible employees under the general and executive RSU programs may vest earlier; however, those units are
not settled through the issuance of common stock until after the earlier of separation from the company or the end of
the regularly scheduled vesting period. Until issued as stock, most recipients of the RSUs receive a cash payment of a
dividend equivalent or an accrued reinvested dividend equivalent that is charged to retained earnings. The grant date fair
market value of these RSUs is deemed equal to the average ConocoPhillips stock price on the grant date. The grant date
fair market value of RSUs that do not receive a dividend equivalent while unvested is deemed equal to the average
ConocoPhillips stock price on the grant date, less the net present value of the estimated dividends that will not be
received.
The following summarizes our stock-settled stock RSU activity for the year ended December 31, 2024:
Stock Units
Weighted-Average
Grant Date Fair Value
Millions of Dollars
Total Fair Value
Outstanding at December 31, 2023
7,093,690 $
76.78
Granted
3,161,899
109.79
Forfeited
(113,163)
104.34
Issued
(3,670,653)
54.79 $
410
Outstanding at December 31, 2024
6,471,773 $
104.89
Not Vested at December 31, 2024
4,508,368 $
105.31
At December 31, 2024, the remaining unrecognized compensation cost from the unvested stock-settled RSUs was $212
million, which will be recognized over a weighted-average period of 1.63 years, the longest period being 3 years. The
weighted-average grant date fair value of stock-settled RSUs granted during 2023 and 2022 was $110.91 and 90.57,
respectively. The total fair value of stock-settled RSUs issued during 2023 and 2022 was $284 million and $193 million,
respectively.
Cash-Settled
Cash-settled executive RSUs granted in 2018 and 2019 replaced the stock option program. These RSUs, subject to
elections to defer, were settled in cash equal to the fair market value of a share of ConocoPhillips common stock per unit
on the settlement date and are classified as liabilities on the balance sheet. Executive RSUs awarded to retirement eligible
employees may vest earlier; however, those units were not settled until after the earlier of separation from the company
or the end of the regularly scheduled vesting period. Compensation expense was initially measured using the average fair
market value of ConocoPhillips common stock and was subsequently adjusted, based on changes in the ConocoPhillips
stock price through the end of each subsequent reporting period, through the settlement date. Recipients received an
accrued reinvested dividend equivalent that was charged to compensation expense. The accrued reinvested dividend was
paid at the time of settlement, subject to the terms and conditions of the award.
There was no cash-settled stock unit activity and no remaining unrecognized compensation cost to be recorded for the
unvested cash-settled units for the year ended December 31, 2024 and December 31, 2023. The total fair value of cash-
settled executive RSUs issued during 2022 was $21 million.
Performance Share Program—Under the Omnibus Plan, we also annually grant restricted PSUs to senior management.
These PSUs are authorized three years prior to their effective grant date (the performance period). Compensation
expense is initially measured using the average fair market value of ConocoPhillips common stock and is subsequently
adjusted, based on changes in the ConocoPhillips stock price through the end of each subsequent reporting period,
through the grant date for stock-settled awards and the settlement date for cash-settled awards.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
122
Stock-Settled
Stock-settled PSUs are settled by issuing one share of ConocoPhillips common stock per unit. For performance periods
beginning before 2009, PSUs do not vest until the employee becomes eligible for retirement by reaching age 55 with five
years of service, and restrictions do not lapse until the employee separates from the company. With respect to awards for
performance periods beginning in 2009 through 2012, PSUs do not vest until the earlier of the date the employee
becomes eligible for retirement by reaching age 55 with five years of service or five years after the grant date of the
award, and restrictions do not lapse until the earlier of the employee’s separation from the company or five years after
the grant date (although recipients can elect to defer the lapsing of restrictions until separation). We recognize
compensation expense for these awards beginning on the grant date and ending on the date the PSUs are scheduled to
vest. Because these awards are authorized three years prior to the effective grant date, for employees eligible for
retirement by or shortly after the grant date, we recognize compensation expense over the period beginning on the date
of authorization and ending on the date of grant. Until issued as stock, recipients of the stock-settled PSUs issued prior to
2013 receive a cash payment of a dividend equivalent that is charged to retained earnings. Beginning in 2013, stock-
settled PSUs authorized for future grants will vest upon settlement following the conclusion of the three-year
performance period. We recognize compensation expense over the period beginning on the date of authorization and
ending on the conclusion of the performance period. Until issued as stock, recipients of these PSUs receive an accrued
reinvested dividend equivalent that is charged to compensation expense.
The following summarizes our stock-settled Performance Share Program activity for the year ended December 31, 2024:
Weighted-Average
Grant Date Fair Value
Millions of Dollars
Stock Units
Total Fair Value
Outstanding at December 31, 2023
962,818 $
50.79
Granted
10,722
110.39
Forfeited
—
—
Issued
(199,037)
54.17 $
23
Outstanding at December 31, 2024
774,503 $
50.75
At December 31, 2024, there was no remaining unrecognized compensation cost to be recorded on the unvested stock-
settled performance shares. The weighted-average grant date fair value of stock-settled PSUs granted during 2023 and
2022 was $112.50 and $91.58, respectively. The total fair value of stock-settled PSUs issued during 2023 and 2022 was
$29 million and $21 million, respectively.
Cash-Settled
In connection with and immediately following the separation of our Downstream businesses in 2012, grants of new cash-
settled PSUs, subject to a shortened performance period, were authorized. Once granted, these PSUs vest, absent
employee election to defer, on the earlier of five years after the grant date of the award or the date the employee
becomes eligible for retirement. For employees eligible for retirement by or shortly after the grant date, we recognize
compensation expense over the period beginning on the date of authorization and ending on the date of grant.
Otherwise, we recognize compensation expense beginning on the grant date and ending on the date the PSUs are
scheduled to vest. These PSUs are settled in cash equal to the fair market value of a share of ConocoPhillips common
stock per unit on the settlement date and thus are classified as liabilities on the balance sheet. Until settlement occurs,
recipients of the PSUs receive a cash payment of a dividend equivalent that is charged to compensation expense.
Beginning in 2013, cash-settled PSUs vest upon settlement following the conclusion of the three-year performance
period. We recognize compensation expense over the period beginning on the date of authorization and ending at the
conclusion of the performance period. These PSUs will be settled in cash equal to the fair market value of a share of
ConocoPhillips common stock per unit on the settlement date and are classified as liabilities on the balance sheet. For
performance periods beginning before 2018, during the performance period, recipients of the PSUs do not receive a cash
payment of a dividend equivalent, but after the performance period ends, until settlement in cash occurs, recipients of
the PSUs receive a cash payment of a dividend equivalent that is charged to compensation expense. For the performance
periods beginning in 2018 or later, recipients of the PSUs receive an accrued reinvested dividend equivalent that is
charged to compensation expense. The accrued reinvested dividend is paid at the time of settlement, subject to the
terms and conditions of the award.
Notes to Consolidated Financial Statements
123
ConocoPhillips 2024 10-K
The following summarizes our cash-settled Performance Share Program activity for the year ended December 31, 2024:
Weighted-Average
Grant Date Fair Value
Millions of Dollars
Stock Units
Total Fair Value
Outstanding at December 31, 2023
100,870 $
116.68
Granted
1,535,539
110.39
Settled
(1,546,826)
110.41 $
171
Outstanding at December 31, 2024
89,583 $
98.20
At December 31, 2024, all outstanding cash-settled performance awards were fully vested and there was no remaining
compensation cost to be recorded. The weighted-average grant date fair value of cash-settled PSUs granted during 2023
and 2022 was $112.50 and $91.58, respectively. The total fair value of cash-settled performance share awards settled
during 2023 and 2022 was $111 million and $88 million, respectively.
From inception of the Performance Share Program through 2013, approved PSU awards were granted after the
conclusion of performance periods. Beginning in February 2014, initial target PSU awards are issued near the beginning of
new performance periods. These initial target PSU awards will terminate at the end of the performance periods and will
be settled after the performance periods have ended. Also in 2014, initial target PSU awards were issued for open
performance periods that began in prior years. For the open performance period beginning in 2012, the initial target PSU
awards terminated at the end of the three-year performance period and were replaced with approved PSU awards. For
the open performance period beginning in 2013, the initial target PSU awards terminated at the end of the three-year
performance period and were settled after the performance period ended. There is no effect on recognition of
compensation expense.
Other—In addition to the above active programs, we have outstanding shares of restricted stock and RSUs that were
either issued as part of our non-employee director compensation program for current and former members of the
company’s Board of Directors or as part of an executive compensation program that has been discontinued or assumed
as a result of an acquisition. Generally, the recipients of the restricted shares or units receive a dividend or dividend
equivalent.
The following summarizes the aggregate activity of these restricted shares and units for the year ended December 31,
2024:
Weighted-Average
Grant Date Fair Value
Millions of Dollars
Stock Units
Total Fair Value
Outstanding at December 31, 2023
894,268 $
54.76
Granted
39,750
111.91
Cancelled
—
—
Issued
(304,337)
50.91 $
35
Outstanding at December 31, 2024
629,681 $
60.22
At December 31, 2024, all outstanding restricted stock and RSUs were fully vested and there was no remaining
compensation cost to be recorded. The weighted-average grant date fair value of awards granted during 2023 and 2022
was $115.88 and $96.20, respectively. The total fair value of awards issued during 2023 and 2022 was $46 million and $40
million, respectively.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
124
Note 16—Income Taxes
Components of income tax provision (benefit) were:
Millions of Dollars
2024
2023
2022
Income Taxes
Federal
Current
$
629
1,054
1,263
Deferred
247
825
1,629
Foreign
Current
3,249
2,931
5,813
Deferred
71
254
387
State and local
Current
182
202
386
Deferred
49
65
70
Total tax provision (benefit)
$
4,427
5,331
9,548
Deferred income taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for tax purposes. Major components of deferred tax
liabilities and assets at December 31 were:
Millions of Dollars
2024
2023
Deferred Tax Liabilities
PP&E and intangibles
$
15,609
11,992
Inventory
91
46
Other
155
216
Total deferred tax liabilities
15,855
12,254
Deferred Tax Assets
Benefit plan accruals
432
413
Asset retirement obligations and accrued environmental costs
2,799
2,608
Investments in joint ventures
2,269
2,133
Other financial accruals and deferrals
497
448
Loss and credit carryforwards
4,910
5,629
Other
187
121
Total deferred tax assets
11,094
11,352
Less: valuation allowance
(6,435)
(7,656)
Total deferred tax assets net of valuation allowance
4,659
3,696
Net deferred tax liabilities
$
11,196
8,558
At December 31, 2024, noncurrent assets and liabilities included deferred taxes of $230 million and $11,426 million,
respectively. At December 31, 2023, noncurrent assets and liabilities included deferred taxes of $255 million and
$8,813 million, respectively.
Our deferred tax liability increased during 2024 by $2.5 billion due to the acquisition of Marathon Oil.
At December 31, 2024, the loss and credit carryforward deferred tax assets were primarily related to U.S. foreign tax
credit carryforwards of $3.3 billion and various jurisdictions net operating loss and credit carryforwards of $1.6 billion. In
2024, $1.2 billion of U.S. foreign tax credits expired. This reduction was partly offset by an increase of $700 million in our
U.S. net operating loss, foreign tax credit carryforwards, and other credit carryforwards due to our acquisition of
Marathon Oil. See Note 3.
At December 31, 2023, the loss and credit carryforward deferred tax assets were primarily related to U.S. foreign tax
credit carryforwards of $4.7 billion and various jurisdictions net operating loss and credit carryforwards of $0.9 billion.
Notes to Consolidated Financial Statements
125
ConocoPhillips 2024 10-K
The following table shows a reconciliation of the beginning and ending deferred tax asset valuation allowance for 2024,
2023 and 2022:
Millions of Dollars
2024
2023
2022
Balance at January 1
$
7,656
8,049
8,342
Charged to expense (benefit)
(409)
(2)
5
Other*
(812)
(391)
(298)
Balance at December 31
$
6,435
7,656
8,049
*Represents changes due to deferred tax assets that have no impact to our effective tax rate, acquisitions/dispositions/revisions and the effect of
translating foreign financial statements.
Valuation allowances have been established to reduce deferred tax assets to an amount that will, more likely than not, be
realized. At December 31, 2024, we have maintained a valuation allowance with respect to substantially all U.S. foreign
tax credit carryforwards, basis differences in our APLNG investment, and certain net operating loss carryforwards for
various jurisdictions. During 2024, the valuation allowance movement charged to earnings primarily relates to the ability
to utilize a portion of ConocoPhillips foreign tax credit carryforwards due to the acquisition of Marathon Oil. During 2022,
the valuation allowance movement charged to earnings primarily related to the impact of 2022 changes to Norway’s
Petroleum Tax System which is partly offset by the U.S. tax impact of the disposition of our CVE common shares. Other
movements are primarily related to valuation allowances on expiring tax attributes. Based on our historical taxable
income, expectations for the future and available tax-planning strategies, management expects deferred tax assets, net
of valuation allowances, will primarily be realized as offsets to reversing deferred tax liabilities. See Note 3.
As a result of the acquisition of Marathon Oil, we utilized foreign tax credits previously offset by a valuation allowance.
During the fourth quarter of 2024, a tax benefit of $394 million was recorded as a result of the acquisition and the
subsequent utilization of the foreign tax credits. See Note 3.
During the second quarter of 2022, Norway enacted changes to the Petroleum Tax System. As a result of the enactment,
a valuation allowance of $58 million was recorded during the second quarter to reflect changes to our ability to realize
certain deferred tax assets under the new law.
At December 31, 2024, unremitted income considered to be permanently reinvested in certain foreign subsidiaries and
foreign corporate joint ventures totaled approximately $5,226 million. Deferred income taxes have not been provided on
this amount, as we do not plan to initiate any action that would require the payment of income taxes. The estimated
amount of additional tax, primarily local withholding tax, that would be payable on this income if distributed is
approximately $261 million.
The following table shows a reconciliation of the beginning and ending unrecognized tax benefits for 2024, 2023 and
2022:
Millions of Dollars
2024
2023
2022
Balance at January 1
$
387
710
1,345
Additions based on tax positions related to the current year
3
5
6
Additions for tax positions of prior years
127
1
6
Reductions for tax positions of prior years
—
(9)
(62)
Settlements
(121)
(96)
(510)
Lapse of statute
(19)
(224)
(75)
Balance at December 31
$
377
387
710
Included in the balance of unrecognized tax benefits for 2024, 2023 and 2022 were $368 million, $378 million and $701
million, respectively, which, if recognized, would impact our effective tax rate.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
126
The balance of the unrecognized tax benefits decreased in 2024 due to the resolution of certain items with U.S. and
Norwegian taxing authorities. The balance of our unrecognized tax benefits increased in 2024 primarily due to U.S. tax
credits acquired through our acquisition of Marathon Oil. See Note 3.
The balance of the unrecognized tax benefits decreased in 2023 due to the lapsing of the statute of limitations on certain
of our foreign subsidiaries of $224 million as well as the closing of our 2018 Canadian domestic audit that resulted in a
reduction of $92 million.
The balance of the unrecognized tax benefits decreased in 2022 due to the closing of the 2017 audit of our federal
income tax return. As a result, we recognized federal and state tax benefits totaling $515 million relating to the recovery
of outside tax basis previously offset by a full reserve.
At December 31, 2024, 2023 and 2022, accrued liabilities for interest and penalties totaled $26 million, $45 million and
$35 million, respectively, net of accrued income taxes. Interest and penalties resulted in an increase to earnings of
$19 million in 2024, a reduction to earnings of $10 million in 2023 and an increase to earnings of $12 million in 2022.
We file tax returns in the U.S. federal jurisdiction and in many foreign and state jurisdictions. Audits in major jurisdictions
are generally complete as follows: Canada (2016), Norway (2023) and U.S. (2019). Issues in dispute for audited years and
audits for subsequent years are ongoing and in various stages of completion in the many jurisdictions in which we
operate around the world. Consequently, the balance in unrecognized tax benefits can be expected to fluctuate from
period to period. Within the next twelve months, we may have audit periods close that could significantly impact our
total unrecognized tax benefits. It is reasonably possible such changes could be significant when compared with our total
unrecognized tax benefits, but the amount of change is not estimable.
The amounts of U.S. and foreign income (loss) before income taxes, with a reconciliation of tax at the federal statutory
rate to the provision for income taxes, were:
Millions of Dollars
Percent of Pre-Tax Income (Loss)
2024
2023
2022
2024
2023
2022
Income (loss) before income taxes
United States
$
6,731
9,472
16,739
49.2 %
58.2
59.3
Foreign
6,941
6,816
11,489
50.8
41.8
40.7
$
13,672
16,288
28,228
100.0 %
100.0
100.0
Federal statutory income tax
$
2,871
3,421
5,928
21.0 %
21.0
21.0
Non-U.S. effective tax rates
1,822
2,063
3,866
13.3
12.7
13.7
Recovery of outside basis
(5)
(4)
(30)
—
—
(0.1)
Adjustment to tax reserves
(57)
(317)
(551)
(0.4)
(1.9)
(2.0)
Adjustment to valuation allowance
(409)
(2)
5
(3.0)
—
—
State income tax
187
214
405
1.4
1.3
1.4
Other
18
(44)
(75)
0.1
(0.3)
(0.2)
Total
$
4,427
5,331
9,548
32.4 %
32.7
33.8
Our effective tax rate for 2024 was driven by our jurisdictional tax rates for this profit mix with a favorable impact from
the acquisition of Marathon Oil enabling the utilization of foreign tax credits previously offset by a valuation allowance.
See Note 3.
Our effective tax rate for 2023 was driven by our jurisdictional tax rates for this profit mix with a favorable impact from
routine tax credits. The adjustment to tax reserves primarily relates to the lapsing of the statute of limitations on certain
of our foreign subsidiaries and the closing of the 2018 Canadian domestic audit.
Our effective tax rate for 2022 was driven by our jurisdictional tax rates for this profit mix with net favorable impacts
from routine tax credits and valuation allowance adjustments. The adjustment to tax reserves primarily relates to the
closing of the audit of our 2017 U.S. federal tax return and the recognition of the U.S. federal and state tax benefits
described above.
Notes to Consolidated Financial Statements
127
ConocoPhillips 2024 10-K
On August 16, 2022, the U.S. enacted the Inflation Reduction Act of 2022, which among other things, implemented a 15
percent minimum tax on book income of certain large corporations, a one percent excise tax on net stock repurchased
and several tax incentives to promote lower carbon energy. These law changes did not have a material impact to our
consolidated financial statements.
Note 17—Accumulated Other Comprehensive Income (Loss)
Accumulated other comprehensive income (loss) in the equity section of the balance sheet included:
Millions of Dollars
Defined
Benefit Plans
Net Unrealized
Holding Gain/
(Loss)
on Securities
Foreign
Currency
Translation
Unrealized
Gain/(Loss)
on Hedging
Activities
Accumulated
Other
Comprehensive
Income/(Loss)
December 31, 2021
$
(31)
—
(4,919)
—
(4,950)
Other comprehensive income (loss)
(417)
(11)
(622)
—
(1,050)
December 31, 2022
(448)
(11)
(5,541)
—
(6,000)
Other comprehensive income (loss)
55
13
197
62
327
December 31, 2023
(393)
2
(5,344)
62
(5,673)
Other comprehensive income (loss)
3
1
(760)
(44)
(800)
December 31, 2024
$
(390)
3
(6,104)
18
(6,473)
The following table summarizes reclassifications out of accumulated other comprehensive income (loss) during the years
ended December 31:
Millions of Dollars
2024
2023
Defined Benefit Plans*
$
19
33
*Included in the computation of net periodic benefit cost and are presented net of tax
expense of:
$
8
11
See Note 15.
Note 18—Cash Flow Information
Millions of Dollars
2024
2023
2022
Noncash Investing and Financing Activities
Increase (decrease) in PP&E related to an increase (decrease) in asset
retirement obligations, excluding acquisitions
$
268
727
825
Fair value of contingent consideration on acquisition
—
320
Cash Payments
Interest
$
806
701
873
Income taxes
3,621
5,406
7,368
Net Sales (Purchases) of Investments
Short-term investments purchased
$
(2,606)
(1,463)
(5,046)
Short-term investments sold
3,567
3,574
3,102
Long-term Investments purchased
(747)
(867)
(775)
Long-term Investments sold
201
129
90
$
415
1,373
(2,629)
For additional information on cash and non-cash changes to our consolidated balance sheet, see Note 3 and Note 12 for
our acquisition of Marathon Oil and acquisition of the remaining working interest in Surmont.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
128
Note 19—Other Financial Information
Millions of Dollars
2024
2023
2022
Interest and Debt Expense
Incurred
Debt
$
941
824
791
Other
90
109
72
1,031
933
863
Capitalized
(248)
(153)
(58)
Expensed
$
783
780
805
Other Income
Interest income
$
402
412
195
Gain (loss) on investment in Cenovus Energy*
—
—
251
Other, net
50
73
58
$
452
485
504
*See Note 5.
Research and Development Expenditures—expensed
$
81
81
71
Shipping and Handling Costs
$
1,958
1,695
1,595
Foreign Currency Transaction (Gains) Losses—after-tax
Alaska
$
—
—
—
Lower 48
—
—
—
Canada
(35)
11
(20)
Europe, Middle East and North Africa
(37)
(39)
(110)
Asia Pacific
(1)
12
30
Other International
—
—
(1)
Corporate and Other
36
86
21
$
(37)
70
(80)
Millions of Dollars
2024
2023
Properties, Plants and Equipment
Proved properties
$
155,364
134,394
Unproved properties
15,490
5,206
Other
4,574
4,805
Gross properties, plants and equipment
175,428
144,405
Less: Accumulated depreciation, depletion and amortization
(81,072)
(74,361)
Net properties, plants and equipment
$
94,356
70,044
Notes to Consolidated Financial Statements
129
ConocoPhillips 2024 10-K
Note 20—Related Party Transactions
Our related parties primarily include equity method investments and certain trusts for the benefit of employees. For
disclosures on trusts for the benefit of employees, see Note 15.
Significant transactions with our equity affiliates were:
Millions of Dollars
2024
2023
2022
Operating revenues and other income
$
88
90
88
Purchases
—
—
1
Operating expenses and selling, general and administrative expenses
246
282
189
Net interest (income)/loss*
—
—
(1)
*We paid interest to, or received interest from, various affiliates. See Note 4 for additional information on loans to affiliated companies.
Note 21—Sales and Other Operating Revenues
Revenue from Contracts with Customers
The following table provides further disaggregation of our consolidated sales and other operating revenues:
Millions of Dollars
2024
2023
2022
Revenue from contracts with customers
$
49,418
48,522
61,049
Revenue from contracts outside the scope of ASC Topic 606
Physical contracts meeting the definition of a derivative
5,483
8,203
17,150
Financial derivative contracts
(156)
(584)
295
Consolidated sales and other operating revenues
$
54,745
56,141
78,494
Revenues from contracts outside the scope of ASC Topic 606 relate primarily to physical gas contracts at market prices,
which qualify as derivatives accounted for under ASC Topic 815, “Derivatives and Hedging,” and for which we have not
elected NPNS. There is no significant difference in contractual terms or the policy for recognition of revenue from these
contracts and those within the scope of ASC Topic 606. The following disaggregation of revenues is provided in
conjunction with Note 23—Segment Disclosures and Related Information:
Millions of Dollars
2024
2023
2022
Revenue from Contracts Outside the Scope of ASC Topic 606
by Segment
Lower 48
$
4,174
6,607
13,919
Canada
522
1,248
2,717
Europe, Middle East and North Africa
787
348
514
Physical contracts meeting the definition of a derivative
$
5,483
8,203
17,150
Millions of Dollars
2024
2023
2022
Revenue from Contracts Outside the Scope of ASC Topic 606
by Product
Crude oil
$
376
143
495
Natural gas
3,753
6,622
15,368
Other
1,354
1,438
1,287
Physical contracts meeting the definition of a derivative
$
5,483
8,203
17,150
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
130
Practical Expedients
Typically, our commodity sales contracts are less than 12 months in duration; however, in certain specific cases may
extend longer, which may be out to the end of field life. We have long-term commodity sales contracts which use
prevailing market prices at the time of delivery, and under these contracts, the market-based variable consideration for
each performance obligation (i.e., delivery of commodity) is allocated to each wholly unsatisfied performance obligation
within the contract. Accordingly, we have applied the practical expedient allowed in ASC Topic 606 and do not disclose
the aggregate amount of the transaction price allocated to performance obligations or when we expect to recognize
revenues that are unsatisfied as of the end of the reporting period.
Receivables and Contract Liabilities
Receivables from Contracts with Customers
At December 31, 2024, the “Accounts and notes receivable” line on our consolidated balance sheet included trade
receivables of $5,398 million compared with $4,414 million at December 31, 2023, and included both contracts with
customers within the scope of ASC Topic 606 and those that are outside the scope of ASC Topic 606. We typically receive
payment within 30 days or less (depending on the terms of the invoice) once delivery is made. Revenues that are outside
the scope of ASC Topic 606 relate primarily to physical natural gas sales contracts at market prices for which we do not
elect NPNS and are therefore accounted for as a derivative under ASC Topic 815. There is little distinction in the nature of
the customer or credit quality of trade receivables associated with natural gas sold under contracts for which NPNS has
not been elected compared with trade receivables where NPNS has been elected.
Contract Liabilities from Contracts with Customers
We have entered into certain agreements under which we license our proprietary technology, including the Optimized
Cascade® process technology, to customers to maximize the efficiency of LNG plants. These agreements typically provide
for milestone payments to be made during and after the construction phases of the LNG plant. The payments are not
directly related to our performance obligations under the contract and are recorded as deferred revenue to be
recognized when the customer is able to benefit from their right to use the applicable licensed technology. Revenue
recognized during the year ended December 31, 2024 was immaterial. We expect to recognize the outstanding contract
liabilities of $45 million as of December 31, 2024, as revenue during the years 2026, 2028 and 2029.
Notes to Consolidated Financial Statements
131
ConocoPhillips 2024 10-K
Note 22—Earnings Per Share
The following table presents the calculation of net income (loss) available to common shareholders and basic and diluted
EPS for the years ended December 31, 2024, 2023, and 2022. For each of the periods with net income presented in the
table below, diluted EPS calculated under the two-class method was more dilutive.
Millions of Dollars (except per share amounts)
Years Ended December 31
2024
2023
2022
Basic earnings per share
Net Income (Loss)
$
9,245
10,957
18,680
Less: Dividends and undistributed earnings
allocated to participating securities
27
35
60
Net Income (Loss) available to common shareholders
$
9,218
10,922
18,620
Average common shares outstanding (in Millions)
1,179
1,203
1,274
Net Income (Loss) Per Share of Common Stock
$
7.82
9.08
14.62
Diluted earnings per share
Net Income (Loss) available to common shareholders
$
9,218
10,922
18,620
Average common shares outstanding (in Millions)
1,179
1,203
1,274
Add: Dilutive impact of options and unvested
non-participating RSU/PSUs
2
3
4
Average diluted shares outstanding (in Millions)
1,181
1,206
1,278
Net Income (Loss) Per Share of Common Stock
$
7.81
9.06
14.57
Note 23—Segment Disclosures and Related Information
We explore for, produce, transport and market crude oil, bitumen, natural gas, LNG and NGLs on a worldwide basis. We
manage our operations through six operating segments, which are primarily defined by geographic region: Alaska; Lower
48 (L48); Canada; Europe, Middle East and North Africa (EMENA); Asia Pacific (AP); and Other International (OI).
Corporate and Other (Corporate) represents income and costs not directly associated with an operating segment, such as
most interest expense, premiums on early retirement of debt, corporate overhead and certain technology activities,
including licensing revenues. Corporate assets include all cash and cash equivalents and short-term investments.
Our chief operating decision maker (CODM) is our Chairman of the Board of Directors and Chief Executive Officer, who
evaluates performance and allocates resources among our operating segments based on each segment's net income
(loss). This is done through the annual budget and forecasting process.
Segment accounting policies are the same as those in Note 1. Intersegment sales are at prices that approximate market.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
132
2024 Segment level net income (loss)
Year Ended December 31, 2024
Millions of Dollars
Alaska
L48
Canada EMENA
AP
OI
Corporate
Consolidated
Total
Segment sales and other operating
revenues
Sales and other operating revenues
$ 6,553 37,028 5,636 5,788 1,847
—
54
56,906
Intersegment eliminations
—
(2) (2,122)
—
—
—
(37)
(2,161)
Consolidated sales and other
operating revenues*
6,553 37,026 3,514 5,788 1,847
—
17
54,745
Significant segment expenses**
Production and operating expenses
1,951 4,751
902
671
384
—
92
8,751
DD&A
1,299 6,442
639
761
425
—
33
9,599
Income tax provision (benefit)
480 1,462
228 2,854
211
(1)
(807)
4,427
Total
3,730 12,655 1,769 4,286 1,020
(1)
(682)
22,777
Other segment items
Equity in earnings of affiliates
1
(5)
—
(586) (1,089)
—
(26)
(1,705)
Interest income
—
—
—
—
(8)
—
(394)
(402)
Interest and debt expense
—
—
—
—
—
—
783
783
Other***
1,496 19,201 1,033
899
200
2
1,216
24,047
Total
1,497 19,196 1,033
313
(897)
2
1,579
22,723
Net income (loss)
$ 1,326 5,175
712 1,189 1,724
(1)
(880)
9,245
*In 2024, sales by our Lower 48 segment to a certain pipeline company accounted for approximately $6.7 billion or
approximately 12 percent of our total consolidated sales and other operating revenues.
**The significant segment expense categories and amounts in the table above align with segment-level information that
is regularly provided to the CODM.
***Other segment items not required to be separately disclosed for each reportable segment include:
Gain (loss) on disposition: L48, Canada, EMENA and OI
Other income; Selling, general and administrative expenses and Exploration expenses: Alaska, L48, Canada,
EMENA, AP, OI and Corporate
Purchased commodities: Alaska, L48, Canada, EMENA and AP
Impairments: Alaska, L48, Canada and EMENA
Taxes other than income taxes and Accretion on discounted liabilities: Alaska, L48, Canada, EMENA, AP and
Corporate
Foreign currency transaction (gain) loss: Canada, EMENA and Corporate
Other expenses: Alaska, L48, EMENA and Corporate
Other segment disclosures
Year Ended December 31, 2024
Millions of Dollars
Alaska
L48
Canada EMENA
AP
OI
Corporate
Consolidated
Total
Investment in and advances to affiliates
$
3
123
— 1,948 4,977
8
1,551
8,610
Total Assets
18,030 66,977 9,513 9,770 8,390
8
10,092
122,780
Capital expenditures and investments
3,194 6,510
551 1,021
370
—
472
12,118
Notes to Consolidated Financial Statements
133
ConocoPhillips 2024 10-K
2023 Segment level net income (loss)
Year Ended December 31, 2023
Millions of Dollars
Alaska
L48
Canada EMENA
AP
OI
Corporate
Consolidated
Total
Segment sales and other operating
revenues
Sales and other operating revenues
$ 7,098 38,244 4,873 5,854 1,913
—
63
58,045
Intersegment eliminations
—
(7) (1,867)
—
—
—
(30)
(1,904)
Consolidated sales and other
operating revenues*
7,098 38,237 3,006 5,854 1,913
—
33
56,141
Significant segment expenses**
Production and operating expenses
1,829 4,199
619
593
391
1
61
7,693
DD&A
1,061 5,722
420
587
455
—
25
8,270
Income tax provision (benefit)
642 1,763
26 3,065
42
—
(207)
5,331
Total
3,532 11,684 1,065 4,245
888
1
(121)
21,294
Other segment items
Equity in earnings of affiliates
(1)
9
—
(580) (1,151)
—
3
(1,720)
Interest income
—
—
—
(1)
(8)
—
(403)
(412)
Interest and debt expense
—
—
—
—
—
—
780
780
Other***
1,789 20,083 1,539 1,001
223
12
595
25,242
Total
1,788 20,092 1,539
420
(936)
12
975
23,890
Net income (loss)
$ 1,778 6,461
402 1,189 1,961
(13)
(821)
10,957
*In 2023, sales by our Lower 48 segment to a certain pipeline company accounted for approximately $5.8 billion or
approximately 10 percent of our total consolidated sales and other operating revenues.
**The significant segment expense categories and amounts in the table above align with segment-level information that
is regularly provided to the CODM.
***Other segment items not required to be separately disclosed for each reportable segment include:
Gain (loss) on dispositions: Alaska, L48, AP, OI and Corporate
Other income; Purchased commodities; Selling, general and administrative expenses and Exploration expenses:
Alaska, L48, Canada, EMENA, AP, OI and Corporate
Impairments: L48, Canada and Corporate
Taxes other than income taxes and Accretion on discounted liabilities: Alaska, L48, Canada, EMENA, AP and
Corporate
Foreign currency transaction (gain) loss: Canada, EMENA, AP and Corporate
Other expenses: Alaska, L48, EMENA and Corporate
Other segment disclosures
Year Ended December 31, 2023
Millions of Dollars
Alaska
L48
Canada EMENA
AP
OI
Corporate
Consolidated
Total
Investment in and advances to affiliates
$
32
118
— 1,191 5,419
—
1,145
7,905
Total Assets
16,174 42,415 10,277 8,396 8,903
—
9,759
95,924
Capital expenditures and investments
1,705 6,487
456 1,111
354
—
1,135
11,248
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
134
2022 Segment level net income (loss)
Year Ended December 31, 2022
Millions of Dollars
Alaska
L48
Canada EMENA
AP
OI
Corporate
Consolidated
Total
Segment sales and other operating
revenues
Sales and other operating revenues
$ 7,905 52,921 6,159 11,271 2,606
—
122
80,984
Intersegment eliminations
—
(18) (2,445)
(1)
—
—
(26)
(2,490)
Consolidated sales and other
operating revenues*
7,905 52,903 3,714 11,270 2,606
—
96
78,494
Significant segment expenses**
Production and operating expenses
1,703 3,627
591
590
365
—
130
7,006
DD&A
939 4,865
402
736
518
—
44
7,504
Income tax provision (benefit)
885 3,088
206 5,445
480
53
(609)
9,548
Total
3,527 11,580 1,199 6,771 1,363
53
(435)
24,058
Other segment items
Equity in earnings of affiliates
(4)
14
—
(780) (1,310)
(1)
—
(2,081)
Interest income
—
—
—
(1)
(9)
—
(185)
(195)
Interest and debt expense
—
—
—
—
—
—
805
805
Other***
2,030 30,294 1,801 3,036
(174)
(1)
241
37,227
Total
2,026 30,308 1,801 2,255 (1,493)
(2)
861
35,756
Net income (loss)
$ 2,352 11,015
714 2,244 2,736
(51)
(330)
18,680
*In 2022, no single customer amounted to 10% of our total consolidated sales and other operating revenues.
**The significant segment expense categories and amounts in the table above align with segment-level information that
is regularly provided to the CODM.
***Other segment items not required to be separately disclosed for each reportable segment include:
Gain (loss) on dispositions: Alaska, L48, Canada, AP, OI and Corporate
Other income: Alaska, L48, EMENA, AP, OI and Corporate
Purchased commodities: Alaska, L48, Canada, EMENA and AP
Selling, general and administrative expenses: Alaska, L48, Canada, EMENA, AP, OI and Corporate
Exploration expenses, Impairments, Taxes other than income taxes and Accretion on discounted liabilities: Alaska,
L48, Canada, EMENA, AP and Corporate
Foreign currency transaction (gain) loss: Canada, EMENA, AP, OI and Corporate
Other expenses: Alaska, L48, Canada, EMENA and Corporate
Other segment disclosures
Year Ended December 31, 2022
Millions of Dollars
Alaska
L48
Canada EMENA
AP
OI
Corporate
Consolidated
Total
Investment in and advances to affiliates
$
55
235
— 1,049 6,154
—
—
7,493
Total Assets
15,126 42,950 6,971 8,263 9,511
—
11,008
93,829
Capital expenditures and investments
1,091 5,630
530
998 1,880
—
30
10,159
Notes to Consolidated Financial Statements
135
ConocoPhillips 2024 10-K
Sales and Other Operating Revenues by Product
Millions of Dollars
2024
2023
2022
Crude oil
$
39,010
37,833
41,492
Natural gas
6,444
10,725
26,941
Natural gas liquids
2,889
2,609
3,650
Other*
6,402
4,974
6,411
Consolidated sales and other operating revenues by product
$
54,745
56,141
78,494
*Includes bitumen and power.
Geographic Information
Millions of Dollars
Sales and Other Operating Revenues*
Long-Lived Assets**
2024
2023
2022
2024
2023
2022
U.S.
$
43,480
45,101
60,899
79,141
53,955
51,200
Australia
—
—
—
4,987
5,426
6,158
Canada
3,405
3,006
3,714
8,773
9,666
6,269
China
939
952
1,135
1,651
1,635
1,538
Equatorial Guinea
66
—
—
1,593
—
—
Indonesia***
—
—
159
—
—
—
Libya
1,703
1,730
1,582
733
703
714
Malaysia
908
961
1,312
856
939
1,107
Norway
2,405
2,408
3,415
3,850
4,489
4,369
Singapore
37
—
—
—
—
—
U.K.
1,796
1,978
6,273
2
2
1
Other foreign countries
6
5
5
1,380
1,134
1,003
Worldwide consolidated
$
54,745
56,141
78,494
102,966
77,949
72,359
*Sales and other operating revenues are attributable to countries based on the location of their selling operation.
** Defined as net PP&E plus equity investments and advances to affiliated companies.
*** Assets divested in 2022. See Note 3.
Note 24—New Accounting Standards
In December 2023, the FASB issued ASU No. 2023-09, “Improvements to Income Tax Disclosures” which enhances the
disclosure requirements within Topic 740 “Income Taxes.” The enhancements will impact our financial statement
disclosures only and will be applied prospectively with retrospective application permitted. The ASU is effective for
annual periods beginning after December 15, 2024, and early adoption is permitted. We are currently evaluating the
impact of the adoption of this ASU.
In November 2024, the FASB issued ASU No. 2024-03, “Disaggregation of Income Statement Expenses” to improve the
disclosures about a public business entity’s expenses (including purchases of inventory, employee compensation,
depreciation, depletion and amortization) in commonly presented expense captions. The ASU will impact our financial
statement disclosures only and will be applied prospectively with retrospective application permitted. The ASU is
effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after
December 15, 2027, and early adoption is permitted. We are currently evaluating the impact of the adoption of this ASU.
Notes to Consolidated Financial Statements
ConocoPhillips 2024 10-K
136
Oil and Gas Operations (Unaudited)
In accordance with FASB ASC Topic 932, “Extractive Activities—Oil and Gas,” and regulations of the SEC, we are making certain
supplemental disclosures about our oil and gas exploration and production operations.
These disclosures include information about our consolidated oil and gas activities and our proportionate share of our equity
affiliates’ oil and gas activities in our operating segments. As a result, amounts reported as equity affiliates in Oil and Gas
Operations may differ from those shown in the individual segment disclosures reported elsewhere in this report. Our
disclosures by geographic area include the U.S., Canada, Europe, Asia Pacific/Middle East (inclusive of equity affiliates) and
Africa.
As required by current authoritative guidelines, the estimated future date when an asset will be permanently shut down for
economic reasons is based on historical 12-month first-of-month average prices and current costs. This estimated date when
production will end affects the amount of estimated reserves. Therefore, as prices and cost levels change from year to year,
the estimate of proved reserves also changes. Generally, our proved reserves decrease as prices decline and increase as prices
rise.
Our proved reserves include estimated quantities related to PSCs, which are reported under the “economic interest” method,
as well as variable-royalty regimes, and are subject to fluctuations in commodity prices, recoverable operating expenses and
capital costs. If costs remain stable, reserve quantities attributable to recovery of costs will change inversely to changes in
commodity prices. For example, if prices increase, then our applicable reserve quantities would decline. At December 31,
2024, approximately three percent of our total proved reserves were under PSCs, located in our Asia Pacific/Middle East and
Africa geographic reporting areas, and seven percent of our total proved reserves were under a variable-royalty regime,
located in our Canada geographic reporting area.
Reserves Governance
The recording and reporting of proved reserves are governed by criteria established by regulations of the SEC and FASB.
Proved reserves are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated
with reasonable certainty to be economically producible—from a given date forward, from known reservoirs, and under
existing economic conditions, operating methods, and government regulations—prior to the time at which contracts
providing the right to operate expire, unless evidence indicates renewal is reasonably certain, regardless of whether
deterministic or probabilistic methods are used for the estimation. The project to extract the hydrocarbons must have
commenced or the operator must be reasonably certain it will commence the project within a reasonable time.
Proved reserves are further classified as either developed or undeveloped. Proved developed reserves are proved reserves
that can be expected to be recovered through existing wells with existing equipment and operating methods, or in which the
cost of the required equipment is relatively minor compared with the cost of a new well, and through installed extraction
equipment and infrastructure operational at the time of the reserves estimate if the extraction is by means not involving a
well. Proved undeveloped reserves are proved reserves expected to be recovered from new wells on undrilled acreage, or
from existing wells where a relatively major expenditure is required for recompletion. Reserves on undrilled acreage are
limited to those directly offsetting development spacing areas that are reasonably certain of production when drilled, unless
evidence provided by reliable technologies exists that establishes reasonable certainty of economic producibility at greater
distances. As defined by SEC regulations, reliable technologies may be used in reserve estimation when they have been
demonstrated in the field to provide reasonably certain results with consistency and repeatability in the formation being
evaluated or in an analogous formation. The technologies and data used in the estimation of our proved reserves include, but
are not limited to, performance-based methods, volumetric-based methods, geologic maps, seismic interpretation, well logs,
well test data, core data, analogy and statistical analysis.
Supplementary Data
137
ConocoPhillips 2024 10-K
We have a company-wide, comprehensive, SEC-compliant internal policy that governs the determination and reporting of
proved reserves. This policy is applied by the geoscientists and reservoir engineers in our business units around the world. As
part of our internal control process, each business unit’s reserves processes and controls are reviewed annually by an internal
team which is headed by the company’s Manager of Reserves Compliance and Reporting. This team, composed of internal
reservoir engineers, geoscientists, finance personnel and a senior representative from DeGolyer and MacNaughton (D&M), a
third-party petroleum engineering consulting firm, reviews the business unit's reserves for adherence to SEC guidelines and
company policy through on-site visits, teleconferences and review of documentation. In addition to providing independent
reviews, this internal team also ensures reserves are calculated using consistent and appropriate standards and procedures.
This team is independent of business unit line management and is responsible for reporting its findings to senior
management. The team is responsible for communicating our reserves policy and procedures and is available for internal peer
reviews and consultation on major projects or technical issues throughout the year. All of our proved reserves held by
consolidated companies and our share of equity affiliates have been estimated by ConocoPhillips.
During 2024, our processes and controls used to assess over 85 percent of proved reserves as of December 31, 2024, were
reviewed by D&M. The purpose of their review was to assess whether the adequacy and effectiveness of our internal
processes and controls used to determine estimates of proved reserves are in accordance with SEC regulations. In such
review, ConocoPhillips’ technical staff presented D&M with an overview of the reserves data, as well as the methods and
assumptions used in estimating reserves. The data presented included pertinent seismic information, geologic maps, well logs,
production tests, material balance calculations, reservoir simulation models, well performance data, operating procedures
and relevant economic criteria. Management’s intent in retaining D&M to review its processes and controls was to provide
objective third-party input on these processes and controls. D&M’s opinion was the general processes and controls employed
by ConocoPhillips in estimating its December 31, 2024 proved reserves for the properties reviewed are in accordance with the
SEC reserves definitions. D&M’s report is included as Exhibit 99 of this Annual Report on Form 10-K.
The technical person primarily responsible for overseeing the processes and internal controls used in the preparation of the
company’s reserves estimates is the Manager of Reserves Compliance and Reporting. This individual holds a master’s degree
in reservoir engineering. He is a member of the Society of Petroleum Engineers with over 20 years of oil and gas industry
experience and has held positions of increasing responsibility in reservoir engineering, subsurface and asset management in
the U.S. and several international field locations.
Engineering estimates of the quantities of proved reserves are inherently imprecise. See the “Critical Accounting Estimates”
section of Management’s Discussion and Analysis of Financial Condition and Results of Operations for additional discussion of
the sensitivities surrounding these estimates.
Supplementary Data
ConocoPhillips 2024 10-K
138
Proved Reserves
Years Ended
December 31
Crude Oil
Millions of Barrels
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed and Undeveloped
End of 2021
1,035
1,452
2,487
10
161
122
184
2,964
63
3,027
Revisions
(31)
24
(7)
—
31
19
(3)
40
—
40
Improved recovery
—
—
—
—
—
3
—
3
—
3
Purchases
—
6
6
—
—
—
42
48
—
48
Extensions and discoveries
15
250
265
—
8
—
—
273
35
308
Production
(64)
(193)
(257)
(2)
(25)
(22)
(13)
(319)
(5)
(324)
Sales
—
(31)
(31)
—
—
(3)
—
(34)
—
(34)
End of 2022
955
1,508
2,463
8
175
119
210
2,975
93
3,068
Revisions
(57)
126
69
1
(1)
8
10
87
1
88
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
—
2
2
—
—
—
—
2
—
2
Extensions and discoveries
219
54
273
15
3
19
—
310
—
310
Production
(64)
(202)
(266)
(3)
(23)
(22)
(17)
(331)
(5)
(336)
Sales
—
(11)
(11)
—
—
—
—
(11)
—
(11)
End of 2023
1,053
1,477
2,530
21
154
124
203
3,032
89
3,121
Revisions
5
185
190
5
(5)
15
52
257
—
257
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
23
364
387
—
—
—
25
412
—
412
Extensions and discoveries
14
29
43
9
—
—
—
52
24
76
Production
(62)
(211)
(273)
(6)
(25)
(22)
(18)
(344)
(5)
(349)
Sales
—
(3)
(3)
—
—
—
—
(3)
—
(3)
End of 2024
1,033
1,841
2,874
29
124
117
262
3,406
108
3,514
Years Ended
December 31
Crude Oil
Millions of Barrels
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed
End of 2021
912
916
1,828
4
122
98
171
2,223
63
2,286
End of 2022
867
828
1,695
5
124
102
191
2,117
58
2,175
End of 2023
790
793
1,583
7
109
91
181
1,971
54
2,025
End of 2024
767
1,122
1,889
11
101
88
208
2,297
49
2,346
Undeveloped
End of 2021
123
536
659
6
39
24
13
741
—
741
End of 2022
88
680
768
3
51
17
19
858
35
893
End of 2023
263
684
947
14
45
33
22
1,061
35
1,096
End of 2024
266
719
985
18
23
29
54
1,109
59
1,168
*All Equity Affiliate reserves are located in our Asia Pacific/Middle East Region.
Supplementary Data
139
ConocoPhillips 2024 10-K
Notable changes in proved crude oil reserves in the three years ended December 31, 2024, included:
•
Revisions: In 2024, upward revisions in Lower 48 were due to development drilling of 298 million barrels and
technical revisions of 28 million barrels, partially offset by downward revisions of 114 million barrels for changes in
development plans, 23 million barrels due to lower prices and increasing operating costs of 4 million barrels. An
upward revision of 52 million barrels in Africa was due to an increase in development plans in Libya. In the
consolidated operations in Asia Pacific/Middle East, upward revisions of 15 million barrels were primarily due to the
project sanction of Bohai Bay Phase 5 in China. Upward revisions of 5 million barrels in Canada were due to technical
revisions. In Alaska, where future production is constrained by the Trans-Alaska Pipeline System minimum flow limit,
updated total North Slope development phasing indicated that the flow limit will be reached later than previously
premised, resulting in upward revisions of 22 million barrels. Further upward revisions in Alaska include development
plan changes of 8 million barrels. These were partially offset by downward revisions due to increasing operating costs
of 15 million barrels and 10 million barrels due to technical revisions. Downward revisions in Europe were due to
technical revisions of 3 million barrels and development plan changes of 2 million barrels.
In 2023, upward revisions in Lower 48 were due to development drilling of 161 million barrels and technical revisions
in the unconventional plays of 31 million barrels, partially offset by downward revisions of 52 million barrels due to
lower prices and 14 million barrels for changes in development plans. An upward revision of 10 million barrels in
Africa was primarily development drilling in Libya. Upward revisions of 8 million barrels in the consolidated
operations in Asia Pacific/Middle East were due to technical revisions. In Alaska, where future production is
constrained by the Trans-Alaska Pipeline System minimum flow limit, updated total North Slope development
phasing indicated that the flow limit will be reached earlier than previously premised, resulting in downward
revisions of 25 million barrels. Further downward revisions in Alaska include development plan changes of 14 million
barrels, cost escalation of 13 million barrels, and 7 million barrels due to lower prices, partially offset by 2 million
barrels of technical revisions.
In 2022, upward revisions in Lower 48 were due to additional development drilling in the unconventional plays of 81
million barrels and higher prices of 33 million barrels, partially offset by increasing operating costs of 72 million
barrels and technical revisions of 18 million barrels. Upward revisions in Europe were primarily due to technical
revisions of 23 million barrels and 8 million barrels due to higher prices. Upward revisions of 19 million barrels in our
consolidated operations in Asia Pacific/Middle East were primarily due to technical revisions.
•
Purchases: In 2024, our acquisition of Marathon Oil resulted in purchases for Lower 48, as well as for Africa,
representing reserves in Equatorial Guinea. Purchases in Alaska represent the acquisition of additional interest in the
Kuparuk River and Prudhoe Bay units.
In 2022, crude oil reserve purchases were primarily in Africa, as a result of the acquisition of additional interest in the
Libya Waha Concession.
•
Extensions and discoveries: In 2024, Lower 48 extensions and discoveries were primarily within unconventional plays
in the Permian Basin. Alaska extensions and discoveries were primarily due to Nuna and other Western North Slope
projects. Extensions and discoveries in Canada were in Montney. Extensions and discoveries in our equity affiliates
were in the Middle East.
In 2023, extensions and discoveries in Alaska were driven primarily by the Willow and Nuna projects. Lower 48
extensions and discoveries were primarily within unconventional plays in the Permian Basin. Extensions and
discoveries in Canada and Asia Pacific/Middle East were driven primarily by Montney and Bohai Phase 4B in China,
respectively.
In 2022, extensions and discoveries in Lower 48 were primarily within unconventional plays in the Permian Basin.
Extensions and discoveries in our equity affiliates were in the Middle East.
Supplementary Data
ConocoPhillips 2024 10-K
140
Years Ended
December 31
Natural Gas Liquids
Millions of Barrels
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed and Undeveloped
End of 2021
82
546
628
5
11
—
644
33
677
Revisions
1
208
209
1
3
—
213
—
213
Improved recovery
—
—
—
—
—
—
—
—
—
Purchases
—
3
3
—
—
—
3
—
3
Extensions and discoveries
—
80
80
—
1
—
81
20
101
Production
(5)
(81)
(86)
(1)
(2)
—
(89)
(3)
(92)
Sales
—
(7)
(7)
—
—
—
(7)
—
(7)
End of 2022
78
749
827
5
13
—
845
50
895
Revisions
(1)
119
118
—
2
—
120
1
121
Improved recovery
—
—
—
—
—
—
—
—
—
Purchases
—
1
1
—
—
—
1
—
1
Extensions and discoveries
—
20
20
6
—
—
26
—
26
Production
(5)
(90)
(95)
(1)
(2)
—
(98)
(3)
(101)
Sales
—
(2)
(2)
—
—
—
(2)
—
(2)
End of 2023
72
797
869
10
13
—
—
892
48
940
Revisions
4
123
127
1
(2)
—
—
126
—
126
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
1
209
210
—
—
—
14
224
—
224
Extensions and discoveries
—
15
15
3
—
—
—
18
17
35
Production
(6)
(102)
(108)
(2)
(2)
—
—
(112)
(3)
(115)
Sales
—
(1)
(1)
—
—
—
—
(1)
—
(1)
End of 2024
71
1,041
1,112
12
9
—
14
1,147
62
1,209
Years Ended
December 31
Natural Gas Liquids
Millions of Barrels
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed
End of 2021
82
334
416
3
9
—
428
33
461
End of 2022
78
409
487
3
10
—
500
31
531
End of 2023
72
426
498
4
9
—
511
28
539
End of 2024
71
653
724
6
7
—
13
750
25
775
Undeveloped
End of 2021
—
212
212
2
2
—
216
—
216
End of 2022
—
340
340
2
3
—
345
19
364
End of 2023
—
371
371
6
4
—
381
20
401
End of 2024
—
388
388
6
2
—
1
397
37
434
*All Equity Affiliate reserves are located in our Asia Pacific/Middle East Region.
Supplementary Data
141
ConocoPhillips 2024 10-K
Notable changes in proved NGL reserves in the three years ended December 31, 2024, included:
•
Revisions: In 2024, upward revisions in Lower 48 were due to additional development drilling of 164 million barrels
and technical revisions of 52 million barrels. This was partially offset by development plan changes of 73 million
barrels and lower prices impacting 20 million barrels.
In 2023, upward revisions in Lower 48 were due to additional development drilling in the unconventional plays of 86
million barrels and technical revisions of 71 million barrels. This was partially offset by lower prices impacting 34
million barrels and development plan changes of 4 million barrels.
In 2022, upward revisions in Lower 48 were due to additional development drilling in the unconventional plays of 88
million barrels, technical revisions of 75 million barrels, continued conversion of acquired Concho Permian two-
stream contracts to a three-stream (crude oil, natural gas and NGLs) basis adding 70 million barrels, and higher prices
of 13 million barrels. This was partially offset by increasing operating costs of 38 million barrels.
•
Purchases: Purchases in 2024 were due to our acquisition of Marathon Oil, resulting in purchases for Lower 48 as well
as in Africa, representing reserves in Equatorial Guinea.
•
Extensions and discoveries: In 2024, Lower 48 extensions and discoveries were primarily within unconventional plays
in the Permian Basin. Extensions and discoveries in our equity affiliates were in the Middle East.
In 2023, extensions and discoveries in Lower 48 were primarily within unconventional plays in the Permian Basin.
Canada extensions and discoveries were in Montney.
In 2022, extensions and discoveries in Lower 48 were primarily within unconventional plays in the Permian Basin.
Extensions and discoveries in our equity affiliates were in the Middle East.
Supplementary Data
ConocoPhillips 2024 10-K
142
Years Ended
December 31
Natural Gas
Billions of Cubic Feet
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed and Undeveloped
End of 2021
2,625
4,658
7,283
105
768
764
217
9,137
3,697
12,834
Revisions
(35)
361
326
8
108
(2)
(14)
426
898
1,324
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
—
23
23
—
—
—
48
71
479
550
Extensions and discoveries
—
505
505
4
103
—
—
612
1,118
1,730
Production
(88)
(543)
(631)
(23)
(117)
(51)
(10)
(832)
(439)
(1,271)
Sales
—
(262)
(262)
—
—
(385)
—
(647)
—
(647)
End of 2022
2,502
4,742
7,244
94
862
326
241
8,767
5,753
14,520
Revisions
(243)
521
278
27
73
6
(57)
327
(90)
237
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
—
4
4
—
—
—
—
4
—
4
Extensions and discoveries
—
121
121
144
1
4
—
270
58
328
Production
(84)
(570)
(654)
(25)
(113)
(24)
(12)
(828)
(446)
(1,274)
Sales
—
(97)
(97)
—
—
—
—
(97)
—
(97)
End of 2023
2,175
4,721
6,896
240
823
312
172
8,443
5,275
13,718
Revisions
102
356
458
15
47
9
3
532
(26)
506
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
47
1,177
1,224
—
—
—
310
1,534
—
1,534
Extensions and discoveries
—
87
87
67
1
—
—
155
1,075
1,230
Production
(78)
(599)
(677)
(43)
(125)
(25)
(17)
(887)
(454)
(1,341)
Sales
—
(6)
(6)
—
—
—
—
(6)
—
(6)
End of 2024
2,246
5,736
7,982
279
746
296
468
9,771
5,870
15,641
Years Ended
December 31
Natural Gas
Billions of Cubic Feet
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed
End of 2021
2,579
3,100
5,679
52
679
688
217
7,315
3,204
10,519
End of 2022
2,474
2,628
5,102
64
641
322
241
6,370
3,974
10,344
End of 2023
2,156
2,525
4,681
92
591
305
172
5,841
3,558
9,399
End of 2024
2,186
3,670
5,856
147
642
289
457
7,391
3,189
10,580
Undeveloped
End of 2021
46
1,558
1,604
53
89
76
—
1,822
493
2,315
End of 2022
28
2,114
2,142
30
221
4
—
2,397
1,779
4,176
End of 2023
19
2,196
2,215
148
232
7
—
2,602
1,717
4,319
End of 2024
60
2,066
2,126
132
104
7
11
2,380
2,681
5,061
*All Equity Affiliate reserves are located in our Asia Pacific/Middle East Region.
Natural gas production in the reserves table may differ from gas production (delivered for sale) in our statistics disclosure,
primarily because the quantities above include gas consumed in production operations. Quantities consumed in production
operations are not significant in the periods presented. The value of net production consumed in operations is not reflected in
net revenues and production expenses, nor do the volumes impact the respective per unit metrics.
Reserve volumes include natural gas to be consumed in operations of 2,285 BCF, 2,263 BCF and 2,416 BCF, as of December 31,
2024, 2023 and 2022, respectively. These volumes are not included in the calculation of our Standardized Measure of
Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserve Quantities.
Natural gas reserves are computed at 14.65 pounds per square inch absolute and 60 degrees Fahrenheit.
Supplementary Data
143
ConocoPhillips 2024 10-K
Notable changes in proved natural gas reserves in the three years ended December 31, 2024, included:
•
Revisions: In 2024, upward revisions in Lower 48 were due to were due to additional development drilling of 841 BCF,
technical revisions of 113 BCF, partly offset by downward revisions of 422 BCF for changes in development plans, 127
BCF due to lower prices and 49 BCF due to increasing operating costs. Upward revisions in Alaska of 68 BCF were due
to updated total North Slope development phasing, as future production of gas is dependent on the Trans-Alaska
Pipeline System minimum flow limit, which will be reached later than previously premised. Further upward revisions
in Alaska included 28 BCF from revised development plans and 24 BCF to be consumed in operations. Offsetting
downward revisions from technical revisions and costs were 18 BCF. In Europe, technical revisions contributed 64
BCF of upward revisions, offset by 17 BCF of development plan changes. In our equity affiliates, downward revisions
were due to lower prices of 81 BCF, partially offset by positive technical revisions of 55 BCF.
In 2023, upward revisions in Lower 48 were due to additional development drilling in the unconventional plays of 502
BCF, technical revisions of 268 BCF, partly offset by lower prices of 211 BCF and development plan downward
revisions of 38 BCF. In Europe, technical revisions contributed 64 BCF and development drilling of 14 BCF, partially
offset by lower prices of 5 BCF. In Canada, upward revisions were driven by technical revisions of 37 BCF, partially
offset by lower prices of 10 BCF. In Alaska, where future production is constrained by the Trans-Alaska Pipeline
System minimum flow limit, updated total North Slope development phasing indicated that the flow limit will be
reached earlier than previously premised, resulting in downward revisions of 121 BCF. Further downward revisions in
Alaska included 72 BCF from operating efficiencies resulting in less gas to be consumed in operations, 22 BCF due to
lower prices, 14 BCF from cost escalation, and 14 BCF due to technical revisions. Downward revisions in Africa of 57
BCF due to infrastructure constraints and sales demand revisions. In our equity affiliates, downward revisions were
due to lower prices of 288 BCF, offset by upward technical revisions of 198 BCF.
In 2022, upward revisions in Lower 48 were due to additional development drilling in the unconventional plays of 544
BCF, higher prices of 109 BCF, and technical revisions of 41 BCF. These were partially offset by decreases of 233 BCF
due to increasing operating costs, and 100 BCF due to the continued conversion of acquired Concho Permian two-
stream contracts to a three-stream (crude oil, natural gas and natural gas liquids) basis. Upward revisions in Canada
were driven by higher prices of 26 BCF, partially offset by technical revisions of 18 BCF. In Europe, technical revisions
contributed 96 BCF, and higher prices 12 BCF of upward revisions. Downward revisions in Africa were primarily due
to technical revisions. In our equity affiliates in Asia Pacific/Middle East, upward revisions were due to higher prices
of 423 BCF, changing dynamics and improved prices in the regional LNG spot market of 331 BCF, and technical
revisions of 204 BCF, partially offset by downward revisions due to increasing operating costs of 60 BCF.
•
Purchases: In 2024, our acquisition of Marathon Oil resulted in purchases for Lower 48, as well as for Africa,
representing reserves in Equatorial Guinea. Purchases in Alaska represent the acquisition of additional interest in the
Kuparuk River and Prudhoe Bay units.
In 2022, purchases in Africa were a result of the acquisition of additional interest in the Libya Waha Concession. In
our equity affiliates, purchases were due to the acquisition of additional affiliate interest in Asia Pacific.
•
Extensions and discoveries: In 2024, extensions and discoveries in Lower 48 were primarily within unconventional
plays in the Permian Basin. Canada extensions and discoveries were in Montney. Extensions and discoveries in our
equity affiliates were in the Middle East and Australia.
In 2023, extensions and discoveries in Lower 48 were primarily within unconventional plays in the Permian Basin.
Canada extensions and discoveries were in Montney. Extensions and discoveries in our equity affiliates were in
Australia.
In 2022, extensions and discoveries in Lower 48 were primarily within unconventional plays in the Permian Basin. In
Europe, extensions and discoveries were due to additional planned development. Extensions and discoveries in our
equity affiliates were primarily in the Middle East.
•
Sales: In 2023, Lower 48 sales represent the disposition of noncore assets.
In 2022, Lower 48 sales represent the disposition of noncore assets. Sales in our consolidated operations in Asia
Pacific/Middle East represent the disposition of our Indonesia assets.
Supplementary Data
ConocoPhillips 2024 10-K
144
Years Ended
December 31
Bitumen
Millions of Barrels
Canada
Total*
Developed and Undeveloped
End of 2021
257
257
Revisions
(17)
(17)
Improved recovery
—
—
Purchases
—
—
Extensions and discoveries
—
—
Production
(24)
(24)
Sales
—
—
End of 2022
216
216
Revisions
15
15
Improved recovery
—
—
Purchases
209
209
Extensions and discoveries
—
—
Production
(30)
(30)
Sales
—
—
End of 2023
410
410
Revisions
118
118
Improved recovery
—
—
Purchases
—
—
Extensions and discoveries
—
—
Production
(45)
(45)
Sales
—
—
End of 2024
483
483
Years Ended
December 31
Bitumen
Millions of Barrels
Canada
Total*
Developed
End of 2021
150
150
End of 2022
127
127
End of 2023
293
293
End of 2024
230
230
Undeveloped
End of 2021
107
107
End of 2022
89
89
End of 2023
117
117
End of 2024
253
253
*There are no Bitumen reserves associated with our Equity Affiliates.
Notable changes in proved bitumen reserves in the three years ended December 31, 2024, included:
•
Revisions: In 2024, upward revisions of 125 million barrels due to changes in development timing was partially offset
by downward revisions due to price of 7 million barrels.
In 2023, the upward revision of 15 million barrels is primarily due to the impact of price on variable royalties.
In 2022, the impact of variable royalties on price resulted in downward revisions of 30 million barrels, partially offset
by upward revisions primarily due to changes in development timing for specific pad locations from the Surmont
development program.
•
Purchases: In 2023, purchases in Canada were a result of the acquisition of the remaining 50 percent working interest
in Surmont.
Supplementary Data
145
ConocoPhillips 2024 10-K
Years Ended
December 31
Total Proved Reserves
Millions of Barrels of Oil Equivalent
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed and Undeveloped
End of 2021
1,555
2,775
4,330
290
299
249
220
5,388
713
6,101
Revisions
(35)
292
257
(15)
52
19
(5)
308
149
457
Improved recovery
—
—
—
—
—
3
—
3
—
3
Purchases
—
13
13
—
—
—
50
63
80
143
Extensions and discoveries
15
414
429
1
26
—
—
456
241
697
Production
(85)
(364)
(449)
(31)
(46)
(31)
(15)
(572)
(81)
(653)
Sales
—
(82)
(82)
—
—
(67)
—
(149)
—
(149)
End of 2022
1,450
3,048
4,498
245
331
173
250
5,497
1,102
6,599
Revisions
(98)
332
234
20
12
9
1
276
(14)
262
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
—
4
4
209
—
—
—
213
—
213
Extensions and discoveries
219
94
313
45
3
20
—
381
10
391
Production
(83)
(387)
(470)
(38)
(43)
(26)
(19)
(596)
(82)
(678)
Sales
—
(29)
(29)
—
—
—
—
(29)
—
(29)
End of 2023
1,488
3,062
4,550
481
303
176
232
5,742
1,016
6,758
Revisions
25
367
392
127
3
16
52
590
(6)
584
Improved recovery
—
—
—
—
—
—
—
—
—
—
Purchases
32
768
800
—
—
—
91
891
—
891
Extensions and discoveries
14
59
73
23
—
—
—
96
220
316
Production
(81)
(413)
(494)
(60)
(48)
(26)
(21)
(649)
(83)
(732)
Sales
—
(5)
(5)
—
—
—
—
(5)
—
(5)
End of 2024
1,478
3,838
5,316
571
258
166
354
6,665
1,147
7,812
Years Ended
December 31
Total Proved Reserves
Millions of Barrels of Oil Equivalent
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
Developed
End of 2021
1,424
1,767
3,191
166
244
212
207
4,020
631
4,651
End of 2022
1,357
1,676
3,033
147
240
155
231
3,806
751
4,557
End of 2023
1,222
1,639
2,861
320
216
142
210
3,749
675
4,424
End of 2024
1,202
2,387
3,589
272
215
136
297
4,509
606
5,115
Undeveloped
End of 2021
131
1,008
1,139
124
55
37
13
1,368
82
1,450
End of 2022
93
1,372
1,465
98
91
18
19
1,691
351
2,042
End of 2023
266
1,423
1,689
161
87
34
22
1,993
341
2,334
End of 2024
276
1,451
1,727
299
43
30
57
2,156
541
2,697
*All Equity Affiliate reserves are located in our Asia Pacific/Middle East Region.
Natural gas reserves are converted to BOE based on a 6:1 ratio: six MCF of natural gas converts to one BOE.
Supplementary Data
ConocoPhillips 2024 10-K
146
Proved Undeveloped Reserves
The following table shows changes in total proved undeveloped reserves for 2024:
Proved Undeveloped Reserves
Millions of Barrels of Oil Equivalent
End of 2023
2,334
Revisions
535
Improved recovery
—
Purchases
57
Extensions and discoveries
281
Sales
(1)
Transfers to Proved Developed
(509)
End of 2024
2,697
Revisions of 535 MMBOE were predominately driven by progression of development plans in the Lower 48 unconventional
plays, Canada Oil Sands and Libya, partially offset by 31MMBOE due to product price changes across the portfolio.
Purchases of 57 were primarily due to our acquisition of Marathon Oil in Lower 48 and Equatorial Guinea.
Extensions and discoveries were largely driven by the continued development planned in equity affiliates in Asia Pacific/
Middle East. The remaining extensions and discoveries were driven by the continued development planned in the other
geographic regions, including Canada, Lower 48 unconventional plays, and Alaska.
Transfers to proved developed reserves were driven by the ongoing development of our assets. Approximately 75 percent of
the transfers were from the development of our Lower 48 unconventional plays. The remainder of transfers were from
development across the other geographic regions.
At both December 31, 2024 and 2023, our PUDs represented 35 percent of total proved reserves. Costs incurred for the year
ended December 31, 2024, relating to the development of PUDs were $9.4 billion. A portion of our costs incurred each year
relates to development projects where the PUDs will be converted to proved developed reserves in future years.
At the end of 2024, approximately 88 percent of total PUDs were under development or scheduled for development within
five years of initial disclosure, including all of our Lower 48 PUDs. The PUDs to be developed beyond five years are in the
Willow project in Alaska, a development that is currently underway with production anticipated in 2029 due to its large scale
and remote location, as well as in major development areas which are currently producing and located in Canada and in our
equity affiliate in Australia.
Supplementary Data
147
ConocoPhillips 2024 10-K
Results of Operations
The company’s results of operations from oil and gas activities for the years 2024, 2023 and 2022 are shown in the following
tables. Non-oil and gas activities, such as pipeline and marine operations, LNG operations, crude oil and gas marketing
activities, and the profit element of transportation operations in which we have an ownership interest are excluded.
Additional information about selected line items within the results of operations tables is shown below:
•
Sales include sales to unaffiliated entities attributable primarily to the company’s net working interests and royalty
interests. Sales are net of fees to transport our produced hydrocarbons beyond the production function to a final
delivery point using transportation operations which are not consolidated.
•
Transportation costs reflect fees to transport our produced hydrocarbons beyond the production function to a final
delivery point using transportation operations which are consolidated.
•
Other revenues include gains and losses from asset sales, certain amounts resulting from the purchase and sale of
hydrocarbons, and other miscellaneous income.
•
Production costs include costs incurred to operate and maintain wells, related equipment and facilities used in the
production of petroleum liquids and natural gas.
•
Taxes other than income taxes include production, property and other non-income taxes.
•
Depreciation of support equipment is reclassified as applicable.
•
Other related expenses include inventory fluctuations, foreign currency transaction gains and losses and other
miscellaneous expenses.
Results of Operations
Year Ended
December 31, 2024
Millions of Dollars
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Other
Areas
Total
Consolidated
Operations
Equity
Affiliates*
Consolidated operations
Sales
$ 5,574 19,028 24,602
2,567
3,469
1,847 1,488
—
33,973
917
Transfers
6
—
6
—
—
—
—
—
6
3,343
Transportation costs
(709)
—
(709)
—
—
—
—
—
(709)
—
Other revenues
—
108
108
(34)
(69)
3
117
13
138
18
Total revenues
4,871 19,136 24,007
2,533
3,400
1,850 1,605
13
33,408
4,278
Production costs excluding taxes
1,330
4,691
6,021
902
506
350
120
—
7,899
543
Taxes other than income taxes
410
1,372
1,782
31
36
108
4
—
1,961
1,181
Exploration expenses
74
85
159
80
68
40
8
1
356
—
Depreciation, depletion and amortization
1,175
6,422
7,597
594
689
424
67
—
9,371
484
Impairments
32
42
74
4
2
—
—
—
80
—
Other related expenses
(36)
49
13
(52)
(68)
—
5
14
(88)
(8)
Accretion
106
79
185
18
68
28
—
—
299
19
1,780
6,396
8,176
956
2,099
900 1,401
(2)
13,530
2,059
Income tax provision (benefit)
461
1,407
1,868
224
1,539
222 1,306
(1)
5,158
623
Results of operations
$ 1,319
4,989
6,308
732
560
678
95
(1)
8,372
1,436
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region.
Supplementary Data
ConocoPhillips 2024 10-K
148
Year Ended
December 31,2023
Millions of Dollars
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Other
Areas
Total
Consolidated
Operations
Equity
Affiliates*
Consolidated operations
Sales
$ 5,918 18,976 24,894
1,517
3,449
1,914 1,447
—
33,221
822
Transfers
5
—
5
—
—
—
—
—
5
3,429
Transportation costs
(611)
—
(611)
—
—
—
—
—
(611)
—
Other revenues
(4)
142
138
(1)
3
(1)
181
3
323
14
Total revenues
5,308 19,118 24,426
1,516
3,452
1,913 1,628
3
32,938
4,265
Production costs excluding taxes
1,242
4,175
5,417
602
499
348
74
1
6,941
493
Taxes other than income taxes
442
1,347
1,789
26
35
115
3
—
1,968
1,208
Exploration expenses
72
153
225
49
73
44
4
3
398
—
Depreciation, depletion and amortization
938
5,702
6,640
374
532
454
50
—
8,050
390
Impairments
—
7
7
6
—
—
—
—
13
—
Other related expenses
71
42
113
60
(24)
17
3
12
181
(8)
Accretion
94
65
159
12
61
27
—
—
259
30
2,449
7,627 10,076
387
2,276
908 1,494
(13)
15,128
2,152
Income tax provision (benefit)
640
1,667
2,307
5
1,704
66 1,375
—
5,457
658
Results of operations
$ 1,809
5,960
7,769
382
572
842
119
(13)
9,671
1,494
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region.
Year Ended
December 31,2022
Millions of Dollars
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Other
Areas
Total
Consolidated
Operations
Equity
Affiliates*
Consolidated operations
Sales
$ 7,210 24,309 31,519
1,622
6,594
2,602 1,339
—
43,676
1,000
Transfers
6
—
6
—
—
—
—
—
6
4,272
Transportation costs
(647)
—
(647)
—
—
—
—
—
(647)
—
Other revenues
(1)
115
114
338
1
536
184
10
1,183
41
Total revenues
6,568 24,424 30,992
1,960
6,595
3,138 1,523
10
44,218
5,313
Production costs excluding taxes
1,160
3,600
4,760
581
511
342
55
—
6,249
491
Taxes other than income taxes
1,265
1,687
2,952
21
36
243
2
—
3,254
1,536
Exploration expenses
34
189
223
149
122
49
19
2
564
—
Depreciation, depletion and amortization
833
4,843
5,676
354
693
517
36
—
7,276
530
Impairments
2
(11)
(9)
(2)
(1)
—
—
—
(12)
—
Other related expenses
(19)
4
(15)
(41)
(178)
40
5
6
(183)
(2)
Accretion
78
55
133
11
62
25
—
—
231
27
3,215 14,057 17,272
887
5,350
1,922 1,406
2
26,839
2,731
Income tax provision (benefit)
866
3,113
3,979
198
4,057
512 1,301
53
10,100
836
Results of operations
$ 2,349 10,944 13,293
689
1,293
1,410
105
(51)
16,739
1,895
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region.
Supplementary Data
149
ConocoPhillips 2024 10-K
Statistics
Net Production
2024
2023
2022
Thousands of Barrels Daily
Crude Oil
Consolidated operations
Alaska
173
173
177
Lower 48
602
569
534
United States
775
742
711
Canada
17
9
6
Europe
69
64
71
Asia Pacific
59
60
61
Africa
49
48
36
Total consolidated operations
969
923
885
Equity affiliates—Asia Pacific/Middle East
13
13
13
Total company
982
936
898
Delaware Basin Area (Lower 48)*
301
274
258
Natural Gas Liquids
Consolidated operations
Alaska
15
16
17
Lower 48
279
256
221
United States
294
272
238
Canada
6
3
3
Europe
4
4
3
Total consolidated operations
304
279
244
Equity affiliates—Asia Pacific/Middle East
8
8
8
Total company
312
287
252
Delaware Basin Area (Lower 48)*
144
135
114
Bitumen
Consolidated operations—Canada
122
81
66
Total company
122
81
66
Natural Gas
Millions of Cubic Feet Daily
Consolidated operations
Alaska
39
38
34
Lower 48
1,625
1,457
1,402
United States
1,664
1,495
1,436
Canada
115
65
61
Europe
329
279
306
Asia Pacific
50
48
114
Africa
42
29
22
Total consolidated operations
2,200
1,916
1,939
Equity affiliates—Asia Pacific/Middle East
1,233
1,219
1,191
Total company
3,433
3,135
3,130
Delaware Basin Area (Lower 48)*
884
768
752
*At year-end 2024, 2023 and 2022, the Delaware Basin Area in Lower 48 contained more than 15 percent of our total proved reserves.
Supplementary Data
ConocoPhillips 2024 10-K
150
Average Sales Prices
2024
2023
2022
Crude Oil Per Barrel
Consolidated operations
Alaska*
$
71.32
74.46
92.58
Lower 48
74.17
76.19
94.46
United States
73.49
75.75
93.96
Canada
64.47
66.19
79.94
Europe
81.09
84.56
99.88
Asia Pacific
82.42
84.79
105.52
Africa
80.65
83.07
97.85
Total international
79.97
83.33
100.75
Total consolidated operations
74.76
77.19
95.27
Equity affiliates—Asia Pacific/Middle East
76.76
78.45
97.31
Total operations
74.78
77.21
95.30
Natural Gas Liquids Per Barrel
Consolidated operations
Lower 48
$
22.02
21.73
35.36
United States
22.02
21.73
35.36
Canada
29.59
26.13
37.70
Europe
45.50
41.13
54.52
Total international
33.60
34.56
46.16
Total consolidated operations
22.43
22.12
35.67
Equity affiliates—Asia Pacific/Middle East
51.53
47.09
61.22
Total operations
23.19
22.82
36.50
Bitumen Per Barrel
Consolidated operations—Canada
$
47.92
42.15
55.56
Natural Gas Per Thousand Cubic Feet
Consolidated operations
Alaska
$
3.90
4.47
3.64
Lower 48
0.87
2.12
5.92
United States
0.88
2.13
5.92
Canada**
0.54
1.80
3.62
Europe
11.11
13.33
35.33
Asia Pacific
3.74
3.95
5.84
Africa
7.32
6.49
6.59
Total international
7.87
10.01
23.54
Total consolidated operations
2.61
3.89
10.56
Equity affiliates—Asia Pacific/Middle East
8.22
8.46
9.39
Total operations
4.69
5.69
10.60
*Average sales prices for Alaska crude oil above reflects a reduction for transportation costs in which we have an ownership interest that are incurred
subsequent to the terminal point of the production function. Accordingly, the average sales prices differ from those discussed in Item 7 of Management's
Discussion and Analysis of Financial Condition and Results of Operations.
**Average sales prices include unutilized transportation costs.
Supplementary Data
151
ConocoPhillips 2024 10-K
2024
2023
2022
Average Production Costs Per Barrel of Oil Equivalent*
Consolidated operations
Alaska
$
18.73
17.45
15.89
Lower 48
11.13
10.72
9.97
United States
12.22
11.76
10.97
Canada
15.03
15.86
18.73
Europe
10.80
11.89
11.20
Asia Pacific
14.27
14.02
11.71
Africa
5.85
3.83
3.77
Total international
12.36
12.28
12.36
Total consolidated operations
12.26
11.87
11.27
Equity affiliates—Asia Pacific/Middle East
6.56
6.03
6.14
Average Production Costs Per Barrel—Bitumen
Consolidated operations—Canada
$
15.19
14.42
17.62
Taxes Other Than Income Taxes Per Barrel of Oil Equivalent
Consolidated operations
Alaska
$
5.77
6.21
17.33
Lower 48
3.25
3.46
4.67
United States
3.62
3.88
6.80
Canada
0.52
0.68
0.68
Europe
0.77
0.83
0.79
Asia Pacific
4.40
4.63
8.32
Africa
0.20
0.16
0.14
Total international
1.18
1.44
2.51
Total consolidated operations
3.04
3.37
5.87
Equity affiliates—Asia Pacific/Middle East
14.28
14.77
19.22
Depreciation, Depletion and Amortization Per Barrel of Oil Equivalent
Consolidated operations
Alaska
$
16.55
13.18
11.41
Lower 48
15.23
14.64
13.42
United States
15.42
14.42
13.08
Canada
9.90
9.85
11.41
Europe
14.71
12.67
15.19
Asia Pacific
17.29
18.29
17.71
Africa
3.27
2.58
2.47
Total international
11.68
11.36
13.28
Total consolidated operations
14.54
13.77
13.12
Equity affiliates—Asia Pacific/Middle East
5.85
4.77
6.63
*Includes bitumen.
Supplementary Data
ConocoPhillips 2024 10-K
152
Development and Exploration Activities
The following two tables summarize our net interest in productive and dry exploratory and development wells in the years
ended December 31, 2024, 2023 and 2022. A “development well” is a well drilled within the proved area of a reservoir to the
depth of a stratigraphic horizon known to be productive. An “exploratory well” is a well drilled to find and produce crude oil
or natural gas in an unknown field or a new reservoir within a proven field. Exploratory wells also include wells drilled in areas
near or offsetting current production, or in areas where well density or production history have not achieved statistical
certainty of results. Excluded from the exploratory well count are stratigraphic-type exploratory wells, primarily relating to oil
sands delineation wells located in Canada and CBM test wells located in Asia Pacific/Middle East.
Net Wells Completed
Productive
Dry
2024
2023
2022
2024
2023
2022
Exploratory
Consolidated operations
Alaska
—
—
—
—
2
—
Lower 48
39
38
118
—
2
—
United States
39
38
118
—
4
—
Canada
7
6
6
—
—
—
Europe
—
—
—
*
*
2
Asia Pacific/Middle East
*
—
—
—
—
1
Africa
—
—
—
1
—
3
Other areas
—
—
—
—
—
—
Total consolidated operations
46
44
124
1
4
6
Equity affiliates
Asia Pacific/Middle East
2
3
*
—
*
—
Total equity affiliates
2
3
*
—
*
—
Development
Consolidated operations
Alaska
13
11
11
—
—
—
Lower 48
507
494
388
—
—
—
United States
520
505
399
—
—
—
Canada
38
21
11
—
—
—
Europe
8
4
3
—
—
—
Asia Pacific/Middle East
23
20
22
—
—
—
Africa
5
4
2
—
—
—
Other areas
—
—
—
—
—
—
Total consolidated operations
594
554
437
—
—
—
Equity affiliates
Asia Pacific/Middle East
54
45
28
—
—
—
Total equity affiliates
54
45
28
—
—
—
*Our total proportionate interest was less than one.
Supplementary Data
153
ConocoPhillips 2024 10-K
The table below represents the status of our wells drilling at December 31, 2024, and includes wells in the process of drilling
or in active completion. It also represents gross and net productive wells, including producing wells and wells capable of
production at December 31, 2024.
Wells at December 31, 2024
Productive
In Progress
Oil
Gas
Gross
Net
Gross
Net
Gross
Net
Consolidated operations
Alaska
3
3
1,557
936
—
—
Lower 48
832
450
21,323
10,179
4,638
2,782
United States
835
453
22,880
11,115
4,638
2,782
Canada
62
62
213
213
174
174
Europe
14
2
497
84
65
4
Asia Pacific/Middle East
7
3
491
233
6
2
Africa
27
6
917
187
27
13
Other areas
—
—
—
—
—
—
Total consolidated operations
945
526
24,998
11,832
4,910
2,975
Equity affiliates
Asia Pacific/Middle East
422
65
—
—
5,461
1,615
Total equity affiliates
422
65
—
—
5,461
1,615
Acreage at December 31, 2024
Thousands of Acres
Developed
Undeveloped
Gross
Net
Gross
Net
Consolidated operations
Alaska
741
566
1,038
1,012
Lower 48
4,773
3,318
10,258
8,100
United States
5,514
3,884
11,296
9,112
Canada
309
286
3,396
2,006
Europe
451
60
610
188
Asia Pacific/Middle East
422
152
10,341
7,630
Africa
440
140
12,545
2,561
Other areas
—
—
156
125
Total consolidated operations
7,136
4,522
38,344
21,622
Equity affiliates
Asia Pacific/Middle East
1,085
325
4,173
1,078
Total equity affiliates
1,085
325
4,173
1,078
Supplementary Data
ConocoPhillips 2024 10-K
154
Costs Incurred
Year Ended
December 31
Millions of Dollars
Alaska
Lower
48
Total
U.S. Canada Europe
Asia Pacific/
Middle East
Africa
Other
Areas
Total
Consolidated
Operations
Equity
Affiliates*
2024
Consolidated operations
Unproved property acquisition
$
— 10,985 10,985
—
—
—
—
—
10,985
—
Proved property acquisition
297 12,118 12,415
(46)
—
— 1,100
—
13,469
—
297 23,103 23,400
(46)
—
— 1,100
—
24,454
—
Exploration
98
548
646
239
49
46
7
1
988
18
Development
2,808
6,301
9,109
390
598
354
91
—
10,542
323
$ 3,203 29,952 33,155
583
647
400 1,198
1
35,984
341
2023
Consolidated operations
Unproved property acquisition
$
—
157
157
156
—
—
—
—
313
—
Proved property acquisition
—
106
106 2,973
—
—
—
—
3,079
—
—
263
263 3,129
—
—
—
—
3,392
—
Exploration
67
396
463
144
45
49
4
3
708
46
Development
1,884
6,266
8,150
367
843
383
38
—
9,781
416
$ 1,951
6,925
8,876 3,640
888
432
42
3
13,881
462
2022
Consolidated operations
Unproved property acquisition
$
—
255
255
—
—
—
—
—
255
—
Proved property acquisition
—
249
249
—
—
—
104
—
353
881
—
504
504
—
—
—
104
—
608
881
Exploration
61
1,278
1,339
99
121
59
3
2
1,623
25
Development
1,316
4,559
5,875
475
711
425
4
—
7,490
244
$ 1,377
6,341
7,718
574
832
484
111
2
9,721
1,150
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region.
Capitalized Costs
At December 31
Millions of Dollars
Alaska
Lower
48
Total
U.S. Canada
Europe
Asia Pacific/
Middle East
Africa
Other
Areas
Total
Consolidated
Operations
Equity
Affiliates*
2024
Consolidated operations
Proved property
$ 29,435 88,461 117,896 10,904 12,986
11,274 2,304
—
155,364
11,691
Unproved property
107 13,883 13,990 1,256
41
96
97
10
15,490
2,133
29,542 102,344 131,886 12,160 13,027
11,370 2,401
10
170,854
13,824
Accumulated depreciation, depletion
and amortization
13,946 42,089 56,035 3,651 9,412
8,842
575
10
78,525
9,246
$ 15,596 60,255 75,851 8,509 3,615
2,528 1,826
—
92,329
4,578
2023
Consolidated operations
Proved property
$ 26,358 70,621 96,979 11,255 14,124
10,923 1,113
—
134,394
11,159
Unproved property
108
3,393
3,501 1,443
65
90
98
9
5,206
2,263
26,466 74,014 100,480 12,698 14,189
11,013 1,211
9
139,600
13,422
Accumulated depreciation, depletion
and amortization
12,789 36,829 49,618 3,377 9,978
8,423
508
9
71,913
8,779
$ 13,677 37,185 50,862 9,321 4,211
2,590
703
—
67,687
4,643
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region.
Supplementary Data
155
ConocoPhillips 2024 10-K
Standardized Measure of Discounted Future Net Cash Flows Relating to Proved Oil and Gas Reserve Quantities
In accordance with SEC and FASB requirements, amounts were computed using 12-month average prices (adjusted only for
existing contractual terms) and end-of-year costs, appropriate statutory tax rates and a prescribed 10 percent discount factor.
Twelve-month average prices are calculated as the unweighted arithmetic average of the first-day-of-the-month price for
each month within the 12-month period prior to the end of the reporting period. For all years, continuation of year-end
economic conditions was assumed. The calculations were based on estimates of proved reserves, which are revised over time
as new data becomes available. Probable or possible reserves, which may become proved in the future, were not considered.
The calculations also require assumptions as to the timing of future production of proved reserves and the timing and amount
of future development costs, including dismantlement, and future production costs, including taxes other than income taxes.
While due care was taken in its preparation, we do not represent that this data is the fair value of our oil and gas properties,
or a fair estimate of the present value of cash flows to be obtained from their development and production.
Discounted Future Net Cash Flows
Millions of Dollars
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
2024
Future cash inflows
$ 79,396 164,264 243,660 24,685 18,148
10,405 26,592
323,490
51,975 375,465
Less:
Future production costs
39,861 73,663 113,524
9,433
5,924
4,189
2,678
135,748
29,807 165,555
Future development costs
12,766 21,143 33,909
2,370
3,611
1,586
693
42,169
3,234
45,403
Future income tax provisions
5,664 13,098 18,762
1,886
6,680
1,131 20,750
49,209
5,630
54,839
Future net cash flows
21,105 56,360 77,465 10,996
1,933
3,499
2,471
96,364
13,304 109,668
10 percent annual discount
9,742 17,667 27,409
4,217
94
1,087
828
33,635
5,170
38,805
Discounted future net cash flows
$ 11,363 38,693 50,056
6,779
1,839
2,412
1,643
62,729
8,134
70,863
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region. Total Discounted future net cash flows for Asia Pacific/Middle East was $10,546.
Millions of Dollars
Alaska
Lower
48**
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total**
2023
Future cash inflows
$ 83,793 141,307 225,100 19,937 23,569
11,322 21,562
301,490
51,887 353,377
Less:
Future production costs
39,069 57,303 96,372
8,699
6,576
4,586
1,008
117,241
28,579 145,820
Future development costs
13,685 21,391 35,076
2,058
3,802
1,458
400
42,794
2,299
45,093
Future income tax provisions
7,386 12,451 19,837
880 10,140
1,316 18,687
50,860
5,647
56,507
Future net cash flows
23,653 50,162 73,815
8,300
3,051
3,962
1,467
90,595
15,362 105,957
10 percent annual discount
11,522 16,850 28,372
2,723
432
1,257
570
33,354
5,543
38,897
Discounted future net cash flows
$ 12,131 33,312 45,443
5,577
2,619
2,705
897
57,241
9,819
67,060
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region. Total Discounted future net cash flows for Asia Pacific/Middle East was $12,524.
**Certain amounts in Lower 48 have been revised to reflect additional Future cash inflows and Future production costs.
Millions of Dollars
Alaska
Lower
48
Total
U.S.
Canada
Europe
Asia Pacific/
Middle East
Africa
Total
Consolidated
Operations
Equity
Affiliates*
Total
2022
Future cash inflows
$ 94,332 195,605 289,937 13,768 44,942
13,458 27,067
389,172
87,644 476,816
Less:
Future production costs
47,979 63,987 111,966
5,722
7,559
5,582
1,085
131,914
51,912 183,826
Future development costs
8,501 21,379 29,880
960
4,378
1,159
531
36,908
2,685
39,593
Future income tax provisions
8,882 23,136 32,018
863 25,416
1,780 23,615
83,692
8,988
92,680
Future net cash flows
28,970 87,103 116,073
6,223
7,589
4,937
1,836
136,658
24,059 160,717
10 percent annual discount
13,733 31,191 44,924
1,936
1,827
1,505
746
50,938
10,787
61,725
Discounted future net cash flows
$ 15,237 55,912 71,149
4,287
5,762
3,432
1,090
85,720
13,272
98,992
*All Equity Affiliate activity is located in our Asia Pacific/Middle East Region. Total Discounted future net cash flows for Asia Pacific/Middle East was $16,704.
Supplementary Data
ConocoPhillips 2024 10-K
156
Sources of Change in Discounted Future Net Cash Flows
Millions of Dollars
Consolidated Operations
Equity Affiliates
Total Company
2024
2023*
2022
2024
2023
2022
2024
2023*
2022
Discounted future net cash flows at the
beginning of the year
$ 57,241 $ 85,720 52,695 $ 9,819 13,272
5,000 $ 67,060 98,992 57,695
Changes during the year
Revenues less production costs for
the year
(23,410) (23,706) (33,532)
(2,536)
(2,550)
(3,245) (25,946) (26,256) (36,777)
Net change in prices, and production
costs
(10,025) (51,887) 61,902
(941)
(4,519)
8,184 (10,966) (56,406) 70,086
Extensions, discoveries and improved
recovery, less estimated future
costs
(1,015)
1,751
7,882
507
118
1,472
(508)
1,869
9,354
Development costs for the year
10,197
9,129
6,687
402
326
272 10,599
9,455
6,959
Changes in estimated future
development costs
(3,512)
(6,754)
(4,088)
(274)
(150)
189
(3,786)
(6,904)
(3,899)
Purchases of reserves in place, less
estimated future costs
11,068
3,024
3,353
—
—
1,282 11,068
3,024
4,635
Sales of reserves in place, less
estimated future costs
(113)
(446)
(3,847)
—
—
—
(113)
(446)
(3,847)
Revisions of previous quantity
estimates
14,175
9,047 13,080
23
492
2,193 14,198
9,539 15,273
Accretion of discount
8,137 12,414
7,021
1,199
1,635
616
9,336 14,049
7,637
Net change in income taxes
(14) 18,949 (25,433)
(65)
1,195
(2,691)
(79) 20,144 (28,124)
Total changes
5,488 (28,479) 33,025
(1,685)
(3,453)
8,272
3,803 (31,932) 41,297
Discounted future net cash flows at
year end
$ 62,729 $ 57,241 85,720 $ 8,134
9,819 13,272 $ 70,863 67,060 98,992
*Certain amounts in Consolidated Operations have been revised to reflect adjustments to the discounted future net cash flows.
•
The net change in prices and production costs is the beginning-of-year reserve-production forecast multiplied by the
net annual change in the per-unit sales price and production cost, discounted at 10 percent.
•
Purchases and sales of reserves in place, along with extensions, discoveries and improved recovery, are calculated
using production forecasts of the applicable reserve quantities for the year multiplied by the 12-month average sales
prices, less future estimated costs, discounted at 10 percent.
•
Revisions of previous quantity estimates are calculated using production forecast changes for the year, including
changes in the timing of production, multiplied by the 12-month average sales prices, less future estimated costs,
discounted at 10 percent.
•
The accretion of discount is 10 percent of the prior year’s discounted future cash inflows, less future production and
development costs.
•
The net change in income taxes is the annual change in the discounted future income tax provisions.
Supplementary Data
157
ConocoPhillips 2024 10-K
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial
Disclosure
None.
Item 9A. Controls and Procedures
We maintain disclosure controls and procedures designed to ensure information required to be disclosed in reports we
file or submit under the Securities Exchange Act of 1934, as amended (the Act), is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such
information is accumulated and communicated to management, including our principal executive and principal financial
officers, as appropriate, to allow timely decisions regarding required disclosure. As of December 31, 2024, with the
participation of our management, our Chairman and Chief Executive Officer (principal executive officer) and our Executive
Vice President and Chief Financial Officer (principal financial officer) carried out an evaluation, pursuant to Rule 13a-15(b)
of the Act, of ConocoPhillips’ disclosure controls and procedures (as defined in Rule 13a-15(e) of the Act). Based upon
that evaluation, our Chairman and Chief Executive Officer and our Executive Vice President and Chief Financial Officer
concluded our disclosure controls and procedures were operating effectively as of December 31, 2024.
In the third quarter of 2023, we began a multi-year implementation of an updated global enterprise resource planning
system (ERP). As a result, we have made corresponding changes to our business processes and information systems,
updating applicable internal controls over financial reporting where necessary. As the phased implementation of the ERP
system progresses, we expect to continue to modify or change certain processes and procedures which may result in
further changes to our internal controls over financial reporting.
There have been no other changes in our internal control over financial reporting, as defined in Rule 13a-15(f) of the Act,
in the period covered by this report that have materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
Management’s Annual Report on Internal Control Over Financial Reporting
This report is included in Item 8 on page 71 and is incorporated herein by reference.
Report of Independent Registered Public Accounting Firm
This report is included in Item 8 on page 72 and is incorporated herein by reference.
Item 9B. Other Information
Insider Trading Arrangements
During the three-month period ended December 31, 2024, no officer or director of the company adopted or terminated
any Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
ConocoPhillips 2024 10-K
158
Part III
Item 10. Directors, Executive Officers and Corporate Governance
Information regarding our executive officers appears in Part I of this report on page 30.
Code of Business Ethics and Conduct for Directors and Employees
We have a Code of Business Ethics and Conduct for Directors and Employees (Code of Ethics), including our principal
executive officer, principal financial officer, principal accounting officer and persons performing similar functions. We
have posted a copy of our Code of Ethics on the “Corporate Governance” section of our internet website at
www.conocophillips.com (within the Investors>Corporate Governance section). Any waivers of the Code of Ethics must be
approved, in advance, by our full Board of Directors. Any amendments to, or waivers from, the Code of Ethics that apply
to our executive officers and directors will be posted on the “Corporate Governance” section of our internet website.
Insider Trading Policies and Procedures
We have adopted insider trading policies and procedures governing the purchase, sale and/or other dispositions of our
securities by directors, officers and other personnel employed by us or any of our subsidiaries. All personnel are
responsible for ensuring their “Related Parties” (as defined in the policies) comply as well. We have an additional insider
trading policy that applies only to our directors, Section 16 officers and other designated officers and employees. We
believe our insider trading policies are reasonably designed to promote compliance with insider trading laws, rules and
regulations, the listing standards of the NYSE and Section 16 reporting requirements, as applicable.
All other information required by Item 10 of Part III will be included in our Proxy Statement relating to our 2025 Annual
Meeting of Stockholders, to be filed pursuant to Regulation 14A on or before April 30, 2025, and is incorporated herein by
reference.*
Item 11. Executive Compensation
Information required by Item 11 of Part III will be included in our Proxy Statement relating to our 2025 Annual Meeting of
Stockholders, to be filed pursuant to Regulation 14A on or before April 30, 2025, and is incorporated herein by
reference.*
Item 12. Security Ownership of Certain Beneficial Owners and Management and
Related Stockholder Matters
Information required by Item 12 of Part III will be included in our Proxy Statement relating to our 2025 Annual Meeting of
Stockholders, to be filed pursuant to Regulation 14A on or before April 30, 2025, and is incorporated herein by
reference.*
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information required by Item 13 of Part III will be included in our Proxy Statement relating to our 2025 Annual Meeting of
Stockholders, to be filed pursuant to Regulation 14A on or before April 30, 2025, and is incorporated herein by
reference.*
Item 14. Principal Accounting Fees and Services
Information required by Item 14 of Part III will be included in our Proxy Statement relating to our 2025 Annual Meeting of
Stockholders, to be filed pursuant to Regulation 14A on or before April 30, 2025, and is incorporated herein by
reference.*
_________________________
* Except for information or data specifically incorporated herein by reference under Items 10 through 14, other information and data appearing in our
2025 Proxy Statement are not deemed to be a part of this Annual Report on Form 10-K or deemed to be filed with the Commission as a part of this
report.
159
ConocoPhillips 2024 10-K
Part IV
Item 15. Exhibits, Financial Statement Schedules
(a) 1.
Financial Statements and Supplementary Data
The financial statements and supplementary information listed in the Index to Financial Statements, which
appears on page 70, are filed as part of this annual report.
2.
Financial Statement Schedules
All financial statement schedules are omitted because they are not required, not significant, not applicable or
the information is shown in another schedule, the financial statements or the notes to consolidated financial
statements.
3.
Exhibits
The exhibits listed in the Index to Exhibits, which appears on pages 161 through 164, are filed as part of this
annual report.
ConocoPhillips 2024 10-K
160
ConocoPhillips
Index to Exhibits
Incorporated by Reference
Exhibit
No.
Description
Exhibit
Form
File No.
2.1
Separation and Distribution Agreement Between ConocoPhillips and
Phillips 66, dated April 26, 2012.
2.1
8-K
001-32395
2.2†‡
Purchase and Sale Agreement, dated March 29, 2017, by and among
ConocoPhillips Company, ConocoPhillips Canada Resources Corp.,
ConocoPhillips Canada Energy Partnership, ConocoPhillips Western
Canada Partnership, ConocoPhillips Canada (BRC) Partnership,
ConocoPhillips Canada E&P ULC, and Cenovus Energy Inc.
2.1
10-Q
001-32395
2.3†‡
Asset Purchase and Sale Agreement Amending Agreement, dated as of
May 16, 2017, by and among ConocoPhillips Company, ConocoPhillips
Canada Resources Corp., ConocoPhillips Canada Energy Partnership,
ConocoPhillips Western Canada Partnership, ConocoPhillips Canada (BRC)
Partnership, ConocoPhillips Canada E&P ULC, and Cenovus Energy Inc.
2.2
8-K
001-32395
2.4
Agreement and Plan of Merger, dated as of October 18, 2020, among
ConocoPhillips, Falcon Merger Sub Corp. and Concho Resources Inc.
2.1
8-K
001-32395
2.5
Agreement and Plan of Merger, dated as of May 28, 2024, by and among
ConocoPhillips, Puma Merger Sub Corp, and Marathon Oil Corporation.
2.1
8-K
001-32395
3.1
Amended and Restated Certificate of Incorporation.
3.1
10-Q
001-32395
3.2
Certificate of Designations of Series A Junior Participating Preferred Stock
of ConocoPhillips.
3.2
8-K
000-49987
3.3
Restated Certificate of Incorporation of ConocoPhillips Company, dated
February 6, 2019.
3.4
10-K
001-32395
3.4
Second Amended and Restated Bylaws, dated May 16, 2023
3.1
10-Q
001-32395
ConocoPhillips and its subsidiaries are parties to several debt instruments
under which the total amount of securities authorized does not exceed
10 percent of the total assets of ConocoPhillips and its subsidiaries on a
consolidated basis. Pursuant to paragraph 4(iii)(A) of Item 601(b) of
Regulation S-K, ConocoPhillips agrees to furnish a copy of such
instruments to the SEC upon request.
4.1
Description of Securities of the Registrant.
4.1
10-K
001-32395
10.1
Indemnification and Release Agreement between ConocoPhillips and
Phillips 66, dated April 26, 2012.
10.1
8-K
001-32395
10.2
Intellectual Property Assignment and License Agreement between
ConocoPhillips and Phillips 66, dated April 26, 2012.
10.2
8-K
001-32395
10.3
Tax Sharing Agreement between ConocoPhillips and Phillips 66, dated
April 26, 2012.
10.3
8-K
001-32395
10.4
Employee Matters Agreement between ConocoPhillips and Phillips 66,
dated April 12, 2012.
10.4
8-K
001-32395
10.5.1
Phillips Petroleum Company Grantor Trust Agreement, dated June 1,
1998.
10.17.3
10-K
001-32395
10.5.2
First Amendment to the Trust Agreement under the Phillips Petroleum
Company Grantor Trust Agreement, dated May 3, 1999.
10.17.4
10-K
001-32395
10.5.3
Second Amendment to the Trust Agreement under the Phillips Petroleum
Company Grantor Trust Agreement, dated January 15, 2002.
10.17.5
10-K
001-32395
161
ConocoPhillips 2024 10-K
10.5.4
Third Amendment to the Trust Agreement under the Phillips Petroleum
Company Grantor Trust Agreement, dated October 5, 2006.
10.17.6
10-K
001-32395
10.5.5
Fourth Amendment to the Trust Agreement under the
ConocoPhillips Company Grantor Trust Agreement, dated May 1, 2012.
10.17.7
10-K
001-32395
10.5.6
Fifth Amendment to the Trust Agreement under the ConocoPhillips
Company Grantor Trust Agreement, dated May 20, 2015.
10.17.8
10-K
001-32395
10.6.1
Successor Trustee Agreement of the Deferred Compensation Trust
Agreement for Non-Employee Directors of ConocoPhillips dated July 31,
2020.
10.1
10-Q
001-32395
10.6.2
First Amendment to the Successor Trust Agreement of the Deferred
Compensation Trust Agreement for Non-Employee Directors of
ConocoPhillips, dated August 4, 2020.
10.2
10-Q
001-32395
10.7
Omnibus Securities Plan of Phillips Petroleum Company.
10.19
10-K
004-49987
10.8
2002 Omnibus Securities Plan of Phillips Petroleum Company.
10.26
10-K
000-49987
10.9.1
2004 Omnibus Stock and Performance Incentive Plan of ConocoPhillips.
Schedule
14A
Proxy
000-49987
10.9.2
Form of Performance Share Unit Award Agreement under the
Performance Share Program under the 2004 Omnibus Stock and
Performance Incentive Plan of ConocoPhillips.
10.27
10-K
001-32395
10.10
Omnibus Amendments to certain ConocoPhillips employee benefit plans,
adopted December 7, 2007.
10.30
10-K
001-32395
10.11
2009 Omnibus Stock and Performance Incentive Plan of ConocoPhillips.
Schedule
14A
Proxy
001-32395
10.12.1
2011 Omnibus Stock and Performance Incentive Plan of ConocoPhillips.
Schedule
14A
Proxy
001-32395
10.12.2
Form of Performance Share Unit Agreement under the Restricted Stock
Program under the 2011 Omnibus Stock and Performance Incentive Plan
of ConocoPhillips, dated February 5, 2013.
10.26.6
10-K
001-32395
10.12.3
Form of Key Employee Award Agreement, as part of the ConocoPhillips
Stock Option Program granted under the 2011 Omnibus Stock and
Performance Incentive Plan of ConocoPhillips, dated February 18, 2014.
10.1
10-Q
001-32395
10.12.4
Form of Performance Period IX Award Agreement, as part of the
ConocoPhillips Performance Share Program granted under the 2011
Omnibus Stock and Performance Incentive Plan of ConocoPhillips, dated
February 18, 2014.
10.3
10-Q
001-32395
10.12.5
Form of Performance Period X Award Agreement, as part of the
ConocoPhillips Performance Share Program granted under the 2011
Omnibus Stock and Performance Incentive Plan of ConocoPhillips, dated
February 18, 2014.
10.5
10-Q
001-32395
10.13.1
2014 Omnibus Stock and Performance Incentive Plan of ConocoPhillips.
10.1
8-K
001-32395
10.13.2
Form of Key Employee Award Agreement, as part of the ConocoPhillips
Stock Option Program granted under the 2014 Omnibus Stock and
Performance Incentive Plan of ConocoPhillips, dated February 16, 2016.
10.26.12
10-K
001-32395
10.13.3
Form of Performance Share Unit Award Terms and Conditions for
Performance Period 18, as part of the ConocoPhillips Performance Share
Program granted under the 2014 Omnibus Stock and Performance
Incentive Plan of ConocoPhillips, dated February 13, 2018.
10.26.24
10-K
001-32395
ConocoPhillips 2024 10-K
162
10.13.4
Form of Key Employee Award Terms and Conditions, as part of the
ConocoPhillips Stock Option Program granted under the 2014 Omnibus
Stock and Performance Incentive Plan of ConocoPhillips, dated February
14, 2017.
10.1
10-Q
001-32395
10.13.5
Form of Executive Restricted Stock Unit Award Terms and Conditions, as
part of the ConocoPhillips Executive Restricted Stock Unit Program,
granted under the 2014 Omnibus Stock and Performance Incentive Plan
of ConocoPhillips, dated February 11, 2020.
10.1
10-Q
001-32395
10.14.1
2023 Omnibus Stock and Performance Incentive Plan of ConocoPhillips
10.1
8-K
001-32395
10.14.2
Form of Performance Share Unit Award Terms and Conditions for
Performance Period 24, as part of the ConocoPhillips Performance Share
Program granted under the 2023 Omnibus Stock and Performance
Incentive Plan of ConocoPhillips, dated February 13, 2024.
10.1
10-Q
001-32395
10.14.3
Form of Executive Restricted Stock Unit Award Terms and Conditions, as
part of the ConocoPhillips Executive Restricted Stock Unit Program,
granted under the 2023 Omnibus Stock and Performance Incentive Plan
of ConocoPhillips, dated February 13, 2024.
10.2
10-Q
001-32395
10.14.4
Form of 2024 Retention Award Terms and Conditions, granted under the
2023 Omnibus Stock and Performance Incentive Plan of ConocoPhillips.
10.3
10-Q
001-32395
10.14.5
Form of 2024 Inducement Award Terms and Conditions, granted under
the 2023 Omnibus Stock and Performance Incentive Plan of
ConocoPhillips.
10.4
10-Q
001-32395
10.14.6*
Form of Performance Share Unit Award Terms and Conditions for
Performance Period 25, as part of the ConocoPhillips Performance Share
Program granted under the 2023 Omnibus Stock and Performance
Incentive Plan of ConocoPhillips, dated February 11, 2025.
10.14.7*
Form of Executive Restricted Stock Unit Award Terms and Conditions, as
part of the ConocoPhillips Executive Restricted Stock Unit Program,
granted under the 2023 Omnibus Stock and Performance Incentive Plan
of ConocoPhillips, dated February 11, 2025.
10.15
Amended and Restated ConocoPhillips Key Employee Supplemental
Retirement Plan, dated January 1, 2020.
10.10.1
10-K
001-32395
10.16.1
Amended and Restated Defined Contribution Make-Up Plan of
ConocoPhillips—Title I, dated January 1, 2020.
10.11.1
10-K
001-32395
10.16.2
Amended and Restated Defined Contribution Make-Up Plan of
ConocoPhillips—Title II, dated January 1, 2024.
10.16.2
10-K
001-32395
10.17
Amended and Restated Company Retirement Contribution Make-Up Plan
of ConocoPhillips, dated January 1, 2024.
10.17
10-K
001-32395
10.18.1
Amended and Restated Key Employee Deferred Compensation Plan of
ConocoPhillips—Title I, dated January 1, 2020.
10.19.1
10-K
001-32395
10.18.2
Amended and Restated Key Employee Deferred Compensation Plan of
ConocoPhillips—Title II, dated January 1, 2024.
10.18.2
10-K
001-32395
10.19
Amendment and Restatement of ConocoPhillips Key Employee Change in
Control Severance Plan, effective December 2, 2021.
10.20.1
10-K
001-32395
10.20.1
Form of Non-Employee Director Restricted Stock Units Terms and
Conditions, as part of the Deferred Compensation Plan for Non-Employee
Directors of ConocoPhillips, dated January 15, 2016.
10.3
10-Q
001-32395
10.20.2*
Form of Non-Employee Director Restricted Stock Units Terms and
Conditions, granted under the 2023 Omnibus Stock and Performance
Incentive Plan of ConocoPhillips and subject to the Deferred
Compensation Plan for Non-Employee Directors of ConocoPhillips, dated
January 15, 2025.
163
ConocoPhillips 2024 10-K
10.21
Deferred Compensation Plan for Non-Employee Directors of
ConocoPhillips.
10.17
10-K
001-32395
10.22.1
ConocoPhillips Directors’ Charitable Gift Program.
10.40
10-K
000-49987
10.22.2
First and Second Amendments to the ConocoPhillips Directors’ Charitable
Gift Program.
10
10-Q
001-32395
10.23
Amended and Restated 409A Annex to Nonqualified Deferred
Compensation Arrangements of ConocoPhillips, dated January 1, 2020.
10.27
10-K
001-32395
10.24
Amendment and Restatement of ConocoPhillips Executive Severance
Plan, dated December 2, 2021.
10.47
10-K
001-32395
10.25
Amendment and Restatement of the Burlington Resources Inc.
Management Supplemental Benefits Plan, dated April 19, 2012.
10.9
10-Q
001-32395
10.26
Purchase and Sale Agreement, dated as of September 20, 2021, by and
between Shell Enterprises LLC and ConocoPhillips.
10.1
10-Q
001-32395
10.27
Form of Aircraft Time Sharing Agreement by and between certain
executives and ConocoPhillips dated June 21, 2021.
10.2
10-Q
001-32395
10.28
Letter agreement with Timothy A. Leach, dated April 28, 2022.
10.1
10-Q
001-32395
10.29
Form of Aircraft Time Sharing Agreement by and between certain
executives and ConocoPhillips dated November 14, 2023.
10.29
10-K
001-32395
19*
Insider Trading Policies of ConocoPhillips
21*
List of Subsidiaries of ConocoPhillips.
22*
Subsidiary Guarantors of Guaranteed Securities.
23.1*
Consent of Ernst & Young LLP.
23.2*
Consent of DeGolyer and MacNaughton.
31.1*
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under
the Securities Exchange Act of 1934.
31.2*
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under
the Securities Exchange Act of 1934.
32**
Certifications pursuant to 18 U.S.C. Section 1350.
97
ConocoPhillips Clawback Policy effective October 2, 2023.
97.2
10-K
001-32395
99*
Report of DeGolyer and MacNaughton.
101.INS*
Inline XBRL Instance Document.
101.SCH* Inline XBRL Schema Document.
101.CAL* Inline XBRL Calculation Linkbase Document.
101.DEF* Inline XBRL Definition Linkbase Document.
101.LAB* Inline XBRL Labels Linkbase Document.
101.PRE* Inline XBRL Presentation Linkbase Document.
104*
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
* Filed herewith.
**Furnished herewith.
† The schedules to this exhibit have been omitted pursuant to Item 601(b)(2) of Regulation S-K. ConocoPhillips agrees to furnish a copy of any schedule
omitted from this exhibit to the SEC upon request.
‡ ConocoPhillips has previously been granted confidential treatment for certain portions of this exhibit pursuant to Rule 24b-2 under the Securities
Exchange Act of 1934, as amended.
ConocoPhillips 2024 10-K
164
Signature
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, thereunto duly authorized.
CONOCOPHILLIPS
February 18, 2025
/s/ Ryan M. Lance
Ryan M. Lance
Chairman of the Board of Directors
and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed, as of February 18,
2025, on behalf of the registrant by the following officers in the capacity indicated and by a majority of directors.
Signature
Title
/s/ Ryan M. Lance
Chairman of the Board of Directors
Ryan M. Lance
and Chief Executive Officer
(Principal executive officer)
/s/ William L. Bullock, Jr.
Executive Vice President and
William L. Bullock, Jr.
Chief Financial Officer
(Principal financial officer)
/s/ Christopher P. Delk
Vice President, Controller
Christopher P. Delk
and General Tax Counsel
(Principal accounting officer)
165
ConocoPhillips 2024 10-K
/s/ Dennis V. Arriola
Director
Dennis V. Arriola
/s/ Nelda J. Connors
Director
Nelda J. Connors
/s/ Gay Huey Evans
Director
Gay Huey Evans
/s/ Jeffrey A. Joerres
Director
Jeffrey A. Joerres
/s/ Timothy A. Leach
Director
Timothy A. Leach
/s/ William H. McRaven
Director
William H. McRaven
/s/ Sharmila Mulligan
Director
Sharmila Mulligan
/s/ Arjun N. Murti
Director
Arjun N. Murti
/s/ Robert A. Niblock
Director
Robert A. Niblock
/s/ David T. Seaton
Director
David T. Seaton
/s/ R.A. Walker
Director
R.A. Walker
ConocoPhillips 2024 10-K
166
Non-GAAP financial measures
Use of non-GAAP financial information
This annual report includes non-GAAP terms to help facilitate comparisons of company operating performance
across periods and with peer companies. The company believes that the non-GAAP measures included, when
viewed in combination with the company’s results prepared in accordance with GAAP, provide a more complete
understanding of the factors and trends affecting the company’s business and performance. The board of
directors and management also use these non-GAAP measures to analyze operating performance across
periods when overseeing and managing the company’s business. Reconciliations of any non-GAAP measures
presented in the annual report to the nearest corresponding GAAP measures are included both in the annual
report and on our website at www.conocophillips.com/nongaap.
Cash from operations
Cash from operations (CFO) is calculated by removing the impact from operating working capital from cash
provided by operating activities. The company believes that the non-GAAP measure cash from operations is useful
to investors to help understand changes in cash provided by operating activities excluding the impact of working
capital changes across periods on a consistent basis, and with the performance of peer companies in a manner
that, when viewed in combination with the company’s results prepared in accordance with GAAP, provides a more
complete understanding of the factors and trends affecting the company’s business and performance.
Free cash flow
Free cash flow is defined as CFO net of capital expenditures and investments. The company believes free
cash flow is useful to investors in understanding how existing CFO is utilized as a source for sustaining our
current capital plan and future development growth. Free cash flow is not a measure of cash available for
discretionary expenditures since the company has certain non-discretionary obligations such as debt service
that are not deducted from the measure.
Return on capital employed
Return on capital employed (ROCE) is a measure of the profitability of the company’s capital employed in its
business operations compared with that of its peers. The company calculates ROCE as a ratio, the numerator
of which is net income, and the denominator of which is average total equity plus average total debt. The net
income is adjusted for after-tax interest expense, for the purposes of measuring efficiency of debt capital
used in operations; net income is also adjusted for nonoperational or special items’ impacts to allow for
comparability in the long-term view across periods. The company believes ROCE is a good indicator of long-
term company and management performance as it relates to capital efficiency, both absolute and relative to
the company’s primary peer group.
RECONCILIATION OF RETURN ON CAPITAL EMPLOYED (ROCE)
$ Millions, except as indicated
2024
Numerator
Net income attributable to ConocoPhillips
9,245
Adjustment to exclude special items
(21)
After-tax interest expense
631
ROCE earnings
9,855
Denominator
Average total equity¹
51,497
Average total debt²
19,176
Average capital employed
70,673
ROCE (percent)
14%
¹ Average total equity is the average of beginning total equity and ending total equity by quarter.
2 Average total debt is the average of beginning long-term debt and short-term debt and ending long-term debt and short-term debt by quarter.
RECONCILIATION OF AVERAGE TOTAL SHAREHOLDER DISTRIBUTIONS AS A PERCENTAGE
OF CASH FROM OPERATIONS
$ Millions, except as indicated
2024
2023
2022
2021
2020
2019
2018
2017
Numerator
Dividends paid1
3,646
5,583
5,726
2,359
1,831
1,500
1,363
1,305
Repurchases of company
common stock
5,463
5,400
9,270
3,623
892
3,500
2,999
3,000
Total shareholder distributions
9,109
10,983
14,996
5,982
2,723
5,000
4,362
4,305
Denominator
Net cash provided by operating
activities
20,124
19,965
28,314
16,996
4,802
11,104
12,934
7,077
Adjustments:
Net operating working capital changes
(181)
(1,382)
(234)
1,271
(372)
(579)
635
15
Cash from operations (CFO)
20,305
21,347
28,548
15,725
5,174
11,683
12,299
7,062
Total shareholder distributions as a
percent of CFO
45%
51%
53%
38%
53%
43%
35%
61%
8-year average
47%
¹ Includes ordinary dividend and variable return of cash payments (if applicable).
TOTAL RESERVE REPLACEMENT RATIO
MMBOE, except as indicated
End of 2023
6,758
End of 2024
7,812
Change in reserves
1,054
Production1
732
Change in reserves excluding production1
1,786
2024 total reserve replacement ratio
244%
Production1
732
Purchases2
(891)
Sales2
5
Changes in reserves excluding production,1 purchases2 and sales2
900
2024 organic reserve replacement ratio
123%
¹ Production includes fuel gas.
2 Purchases refers to acquisitions and sales refers to dispositions.
Other terms
Cost of supply
Cost of supply is the WTI equivalent price that generates a 10% after-tax return on a point-forward and fully
burdened basis. Fully burdened includes capital infrastructure, foreign exchange, price-related inflation, G&A
and carbon tax (if currently assessed). If no carbon tax exists for the asset, carbon pricing aligned with internal
energy scenarios is applied. All barrels of resource in the cost of supply calculation are discounted
at 10%.
Reserve replacement
Reserve replacement is defined by the company as a ratio representing the change in proved reserves, net of
production, divided by current year production. The company believes that reserve replacement is useful to
investors to help understand how changes in proved reserves, net of production, compare with the company’s
current year production, inclusive of acquisitions and dispositions.
Organic reserve replacement
Organic reserve replacement is defined by the company as a ratio representing the change in proved
reserves, net of production and excluding acquisitions and dispositions, divided by current year production.
The company believes that organic reserve replacement is useful to investors to help understand how
changes in proved reserves, net of production, compare with the company’s current year production,
exclusive of acquisitions and dispositions.
Resources
The company estimates its total resources based on the Petroleum Resources Management System, a system
developed by industry that classifies recoverable hydrocarbons into commercial and sub-commercial
to reflect their status at the time of reporting. Proved, probable and possible reserves are classified as
commercial, while remaining resources are categorized as sub-commercial or contingent. The company’s
resource estimate includes volumes associated with both commercial and contingent categories. The SEC
permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible
reserves. U.S. investors are urged to consider closely the oil and gas disclosures in our Form 10-K and other
reports and filings with the SEC.
Return of capital
Return of capital is defined as the total of the ordinary dividend, share repurchases and variable return of
cash; also referred to as distributions or total shareholder distributions.
Certain disclosures in this annual report may be considered “forward-looking” statements. These are made pursuant to “safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995. The “Cautionary Statement” in the Management’s Discussion and Analysis in ConocoPhillips’ 2024 Form 10-K should be read in conjunction with such statements.
“ConocoPhillips,” “the company,” “we,” “us” and “our” are used interchangeably in this report to refer to the businesses of ConocoPhillips and its consolidated subsidiaries.
Cautionary Note to U.S. Investors — The SEC permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves. We use the terms
“resource” and “resources” in this annual report, which the SEC’s guidelines prohibit us from including in filings with the SEC. U.S. investors are urged to consider closely the oil and
gas disclosures in our Form 10-K and other reports and filings with the SEC. Copies are available from the SEC and on the ConocoPhillips website.
Proxy statement
Published annually and sent to
stockholders informing them
of when and where our Annual
Meeting of Stockholders is taking
place and detailing the matters
to be voted upon at the meeting.
conocophillips.com/proxy
Sustainability Report
Published annually to provide
details on priority reporting
issues for the company, a
letter from our CEO and
key environmental, social
and governance metrics.
conocophillips.com/reports
Managing Climate-Related
Risks Report
Published annually to provide
details on the company’s
governance framework,
risk management approach,
strategy, key metrics and targets
for climate-related issues.
conocophillips.com/reports
Upcoming and past
investor presentations
Provides notice of future and
archived presentations dating
back one year, including webcast
replays, transcripts and slides.
conocophillips.com/investors
Board
of directors
Dennis V. Arriola
Former Chief Executive Officer,
Avangrid, Inc.
Nelda J. Connors
Founder and Chief Executive
Officer, Pine Grove Holdings
Gay Huey Evans CBE
Former Chairman, London Metal
Exchange
Jeffrey A. Joerres
Former Executive Chairman
and Chief Executive Officer,
ManpowerGroup Inc.
Ryan M. Lance
Chairman and Chief Executive
Officer, ConocoPhillips
Timothy A. Leach
Advisor to the Chief Executive
Officer, ConocoPhillips
Ryan M. Lance
Chairman and Chief Executive Officer
William L. Bullock, Jr.
Executive Vice President and
Chief Financial Officer
Heather G. Hrap
Senior Vice President,
Human Resources and Real Estate
and Facilities Services
Kirk L. Johnson
Senior Vice President,
Global Operations
Timothy A. Leach
Advisor to the Chief Executive Officer
Executive
leadership team
William H. McRaven
Retired U.S. Navy Four-Star Admiral
(SEAL)
Sharmila Mulligan
Former Chief Strategy Officer,
Alteryx
Arjun N. Murti
Partner, Veriten LLC
Robert A. Niblock
Former Chairman, President and
Chief Executive Officer, Lowe’s
Companies, Inc.
David T. Seaton
Former Chairman and Chief
Executive Officer, Fluor Corporation
R.A. Walker
Former Chairman and Chief
Executive Officer, Anadarko
Petroleum Corporation
Andrew D. Lundquist
Senior Vice President,
Government Affairs
Andrew M. O’Brien
Senior Vice President, Strategy,
Commercial, Sustainability
and Technology
Nicholas G. Olds
Executive Vice President, Lower 48
Kelly B. Rose
Senior Vice President, Legal, General
Counsel and Corporate Secretary
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