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ConocoPhillips went from a profit in the 1st quarter last year to a loss in the same period of 2020 after being hit by impairment charges and lower oil and gas prices. The company reported a 1st-quarter 2020 loss of $1.7 billion compared with 1st-quarter 2019 earnings of $1.8 billion.
Excluding special items, 1st-quarter 2020 adjusted earnings were $0.5 billion compared with 1st-quarter 2019 adjusted earnings of $1.1 billion. Earnings decreased from 1st-quarter 2019 due to a change in Cenovus Energy equity market value, lower realized prices, and price-driven non-cash impairments.
Excluding special items, adjusted earnings were lower compared with 1st-quarter 2019 due to lower realized prices and volumes, partially offset by decreases in operating costs.
ConocoPhillips’ production, excluding Libya, for the 1st quarter of 2020 was 1,278 thousand barrels of oil equivalent per day (MBOED), a decrease of 40 MBOED from the same period a year ago. The company recently announced that it expects to voluntarily curtail production due to weak prices.
Voluntary curtailments for the month of May are now estimated to be 265 thousand barrels of oil per day (MBOD) gross, comprised of 165 MBOD gross in the Lower 48 and 100 MBOD gross at Surmont. This represents approximately 230 MBOED on a net basis.
The company currently estimates voluntary curtailments for the month of June will be 460 MBOD gross, comprised of 260 MBOD gross in the Lower 48, 100 MBOD gross at Surmont and 100 MBOD gross in Alaska. This represents approximately 420 MBOED on a net basis.
Future voluntary curtailment decisions will be made on a month-by-month basis. Daily net barrel oil equivalent impacts may vary from estimates due to differences in working interests and product mixes.
The company also expects some level of additional curtailments from infrastructure constraints, actions from partner-operated assets or government mandates.
Given ongoing uncertainty, continued market volatility, and production curtailments over the coming months, the company recently announced that its original 2020 guidance items should not be relied upon and that further guidance has been temporarily suspended.
