ConocoPhillips profits fall $1.1bn after refining spin-off



Profits fell at ConocoPhillips in its first earnings report after spinning off its refining segment in April.

Net income for the second quarter fell to US$2.3 billion (Dh8.44bn) from $3.4bn a year earlier, with income per share falling to $1.80 from $2.41.

"We are off to a strong start as an independent [exploration and production] company," said Ryan Lance, the chief executive. "The business is running well."

The company's decision to create a separate company, branded Phillips 66, was the first by a super-major towards undoing one of the mergers that created giant integrated companies such as ExxonMobil and Total.

Its performance after the spin-off, which created the largest American oil and gas producer without a refining or chemicals business, will help inform other companies considering spin-offs, such as BP.

Shares of ConocoPhillips were down in early trade in New York, declining to $53.54 from its last closing price of $54.64.

Yesterday, the company said it was increasing production at American shale oilfields, including North Dakota's huge Bakken shale.

The company is targeting $10bnin asset sales this year.

In 2010, ConocoPhillips backed out of Abu Dhabi's challenging Shah sour gasfield project designed to strip toxic sulphur from natural gas and transport the sulphur in pellets to the coast.

It also backed out of a refinery development in Yanbu, Saudi Arabia at the same time.

A year later,Abu Dhabi picked Occidental, the biggest American oil independent at the time, to carry out the $10bn project at Shah.

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