What ConocoPhillips (COP) Said on Its Q3 Earnings Call

Key Points

• Strong Q3 cash generation: ConocoPhillips reported adjusted earnings of $3.27 per share, $7.2 billion in cash from operations, and about $4 billion in free cash flow. It returned $3.4 billion to shareholders and raised its quarterly dividend by 11%.
• Growth with lower future spending: The company expects 2027 capital spending to be modestly lower, with low-single-digit underlying production growth led by the Lower 48. It targets returning 45% of cash from operations to shareholders and forecasts a roughly $7 billion increase in free cash flow by 2029 at $70 oil.
• Projects and portfolio updates: Willow remains on track for first production in early 2029, while Qatar’s North Field East expansion is expected online in the first half of 2027. ConocoPhillips completed its $5 billion divestment program and is reviewing offers for its Norway assets, without deciding to sell.

ConocoPhillips NYSE: COP reported third-quarter adjusted earnings of $3.27 per share and $7.2 billion in cash from operations, while raising its quarterly dividend by 11% and outlining plans for lower capital spending in 2027.

The company produced 2.302 million barrels of oil equivalent per day during the quarter. Capital expenditures totaled $3.1 billion, resulting in approximately $4 billion of free cash flow, Chief Financial Officer Konnie Haynes-Welsh said on the earnings call.

ConocoPhillips returned $3.4 billion to shareholders during the quarter, including $2.4 billion in share repurchases and $1 billion in ordinary dividends. President and CEO Andy O’Brien said buybacks are expected to increase in the fourth quarter as the company pursues its goal of returning 45% of cash from operations to shareholders for the full year.

Production Growth With Lower Spending

For the fourth quarter, ConocoPhillips expects production of 2.32 million to 2.36 million barrels of oil equivalent per day, putting full-year production at around 2.3 million barrels per day. The forecast incorporates a range of outcomes in Qatar, where production remains dependent on regional conditions, Haynes-Welsh said.

Fourth-quarter capital spending is expected to rise modestly from the third quarter, reflecting the Lower 48 spending profile and a seasonal increase in Alaska ahead of winter construction and exploration. Full-year guidance remained unchanged.

Looking to 2027, Haynes-Welsh said the company anticipates modestly lower capital spending, low-single-digit underlying production growth led by the Lower 48, and lower operating costs per unit. ConocoPhillips also plans to target shareholder returns equal to 45% of cash from operations next year.

O’Brien said the company expects an approximately $7 billion increase in free cash flow by 2029, which would roughly double 2025 free cash flow at $70-per-barrel West Texas Intermediate oil prices. He said the company expects further cash-flow growth beyond 2029 at a structurally lower reinvestment rate.

At a $70 oil price assumption, O’Brien estimated that the company’s reinvestment rate over the past couple of years would have been close to 60%, including spending on projects not yet producing. He expects it to be well below 50% in the 2030s as projects come online and spending declines.

Willow and Qatar Projects

ConocoPhillips remains on track for first production from its Willow project in Alaska in early 2029, O’Brien said. Kirk Johnson, executive vice president of global operations and technical functions, said the project is past its halfway point overall and that fabrication of its Gulf Coast process modules is more than 75% complete.

Johnson said the company expects to finish module fabrication in the second quarter of 2027 and transport the modules to Alaska during the summer. Drilling is also expected to begin next year, helping build an inventory of wells for the project’s production ramp-up.

In Qatar, production increased in the third quarter from the second but remained below pre-conflict levels, Johnson said. Despite utilization constraints, he said construction has continued on the North Field East expansion, which the company expects to come online in the first half of 2027, consistent with QatarEnergy’s published expectations.

ConocoPhillips has expanded its commercial liquefied natural gas offtake portfolio to 13 million tons per year. O’Brien said Port Arthur phase one is the key source of new commercial LNG volumes expected next year; ConocoPhillips owns a 30% equity interest in the project.

Portfolio Review and Permian Efficiency

The company completed its $5 billion divestment program, including $1.6 billion in proceeds during the third quarter, O’Brien said. He also confirmed that ConocoPhillips is reviewing offers for its Norway assets after receiving an unsolicited approach, but has made no decision to sell.

“If we don’t receive an offer that exceeds our expectations, we’re happy to keep the asset,” O’Brien said, describing Norway as a significant source of cash for the company.

In the Lower 48, Executive Vice President Nick Olds said the company achieved record Permian completion performance during the third quarter. Pump hours rose 15% from 2025 levels, while stimulated footage per day improved 20%, he said.

Olds also said surfactant-treated wells have shown a 20% uplift in oil productivity, based on roughly a year and a half of data from several groups of wells. ConocoPhillips plans additional applications across its portfolio in 2027 at a measured pace, he said.

About ConocoPhillips (NYSE:COP)

ConocoPhillips is an independent exploration and production company focused on finding, developing and producing oil and natural gas. Its products include crude oil, natural gas, liquefied natural gas and natural gas liquids.

The company operates in several regions, including North America, Europe, the Middle East, North Africa and the Asia-Pacific. Its activities span exploration, development and production, with a portfolio that includes both conventional and unconventional resources.

ConocoPhillips was formed in 2002 through the merger of Conoco and Phillips Petroleum.

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