ConocoPhillips Reports Third-Quarter Earnings of $1.8 Billion or $1.46 Per Share

ConocoPhillips (NYSE: COP) today reported third-quarter 2012 earnings of
$1.8 billion, or $1.46 per share, compared with third-quarter 2011
earnings of $2.6 billion, or $1.91 per share.

Excluding special items of $26 million, third-quarter 2012 adjusted
earnings were $1.8 billion, or $1.44 per share, compared with
third-quarter 2011 adjusted earnings of $1.9 billion, or $1.40 per
share. Special items for the current quarter were primarily related to
net gains on asset sales offset by the impact of tax law changes in the
United Kingdom and pension settlement expense.

Highlights

• 
  Quarterly production of 1.525 million BOE per day.
  
• 
  Continued ramp up in Eagle Ford and Bakken.
  
• 
  Ongoing growth from Canadian oil sands and successful startup of
  Christina Lake Phase D.
  
• 
  Major projects and drilling programs on schedule to deliver volume and
  margin growth.
  
• 
  Completed turnarounds at major worldwide facilities, as planned.
  
• 
  Ramping up exploration activity in conventional and unconventional
  opportunities globally.
  
• 
  Completed sale of NMNG and dilution of interest in APLNG.
  

'We performed well in our first full quarter as an independent E&P
company,? said Ryan Lance, chairman and chief executive officer. 'Our
production was on target, our growth projects and drilling programs are
on track and our portfolio optimization plans continue to progress.
Quarterly production, excluding the impact of dispositions, grew by 40
thousand BOE per day compared to the third quarter of 2011.?

'For the first nine months of 2012, we have generated $2.1 billion in
proceeds from asset dispositions and remain on track to complete our
$8-$10 billion disposition program by the end of 2013,? Lance added. 'We
are focused on delivering average annual production growth and margin
growth of 3 to 5 percent, improving our financial returns, and offering
a sector-leading dividend.?

Operations Update

In the Lower 48 and Latin America segment, third-quarter
production was 462 thousand barrels of oil equivalent (BOE) per day, an
increase of 28 thousand BOE per day compared to the same period of 2011.
Significant growth continues from the ramp up of several high-margin,
liquids-rich shale plays, including Eagle Ford and Bakken. Eagle Ford
reached a record production level of 86 thousand BOE per day in the
third quarter. For the quarter, these shale plays delivered
approximately 102 thousand BOE per day, a 51 thousand BOE per day
increase compared to the third quarter of 2011.

In the Canada segment, third-quarter production increased by 21
thousand BOE per day over the same period in 2011, to 277 thousand BOE
per day, reflecting strong performance from the company′s significant
oil sands portfolio. Christina Lake Phase D achieved first production
during the quarter, driving overall bitumen production to 92 thousand
BOE per day, a 28 thousand BOE per day increase compared to the third
quarter of 2011. Additional growth is expected from expansion phases at
both FCCL and Surmont which are progressing on schedule.

For the quarter, total Lower 48 and Canada liquids production increased
by 24 percent compared to the same period in 2011. This shift to liquids
is consistent with the company′s overall strategy to improve margins
over time.

Third-quarter production in the Alaska segment was 176 thousand
BOE per day, down 32 thousand BOE per day compared to the same period in
2011, reflecting normal field decline and increased turnaround activity
in the current quarter.

In the Asia Pacific and Middle East segment, quarterly production
was 306 thousand BOE per day, down 6 thousand BOE per day compared to
the third quarter of 2011, with continued ramp up in China largely
offsetting the impact of dispositions. In Malaysia, development
continued on several major offshore fields with first production from
the deepwater Gumusut oil field expected in the fourth quarter.
ConocoPhillips also further ?diluted its interest in the Australia
Pacific LNG ?(APLNG) project from 42.5 percent to 37.5 percent during the
quarter. ?This reduced ownership interest, coupled with ?Sinopec Corp.'s
estimated $2.1 billion injection into APLNG associated with the dilution
and APLNG's successful placement of $8.5 billion of project financing,
will ?lower ConocoPhillips′ future capital requirements to fund the
project.

In the Europe segment, production for the quarter was 191
thousand BOE per day, down 54 thousand BOE per day compared to the same
period a year ago, reflecting the impact from dispositions and normal
field decline. Progress continued on several major developments in the
United Kingdom and Norway, which will result in significant new
production from 2013 onwards.

In the Other International segment, production increased from 83
thousand BOE per day in the third quarter of 2011 to 113 thousand BOE
per day in the current quarter, primarily reflecting the resumption of
production in Libya following the civil unrest in 2011. During the
quarter, the company completed the sale of its 30 percent interest in
NaryanMarNefteGaz (NMNG) and certain related assets.

In conventional exploration, the company advanced its
opportunities in the deepwater Gulf of Mexico, as drilling continued at
the Coronado and Shenandoah prospects. ConocoPhillips holds 1.5 million
acres in the deepwater Gulf of Mexico, and in October, secured access to
a new build ultra deepwater drillship, providing future rig availability
and flexibility for the company′s drilling programs. The company
confirmed a successful appraisal in Australia′s Browse Basin following
the drilling of the Boreas-1 well, and is currently evaluating seismic
results in deepwater Angola and Bangladesh.

In unconventional exploration, several pilot programs are
underway across shale plays in the Lower 48 and Canada. In Western
Australia, the first phase of drilling commenced in the Canning Basin.
In Europe, the company exercised its option to acquire a 70 percent
interest in Lane Energy Poland and assumed operatorship for three
western Baltic Basin concessions, where a fourth exploration well is
currently being drilled, and ongoing analysis and testing is underway.

Third-Quarter Review

Production for the third quarter of 2012 was 1.525 million BOE per day,
compared with 1.538 million BOE per day for the third quarter of 2011.
As expected, production was lower due to the impact of dispositions.
Normal field decline was more than offset by additional production from
major projects as well as higher production in China and Libya. Sales
volumes for the quarter exceeded production, resulting in a favorable
impact to earnings of approximately $80 million.

In line with worldwide commodity prices, ConocoPhillips′ realized prices
fell in the third quarter compared to the same period of 2011. Realized
crude oil prices decreased $3.89 per barrel to $102.72 per barrel,
compared with $106.61 per barrel for the third quarter of 2011. Realized
natural gas prices decreased by 16 percent from $5.45 per thousand cubic
feet (MCF) in the third quarter of 2011 to $4.56 per MCF for the current
quarter. Realized natural gas liquids (NGL) prices decreased by 27
percent to $40.39 per barrel, compared with $55.61 per barrel for the
third quarter of 2011.

During the quarter, ConocoPhillips generated $3.9 billion in cash from
continuing operating activities, excluding working capital. Cash
provided by continuing operating activities was $3.5 billion, reflecting
a $0.4 billion increase in working capital. The company also received
$0.5 billion in proceeds from asset dispositions. The company funded a
$3.7 billion capital program, paid dividends of $0.8 billion and reduced
debt by $2.0 billion.

Nine-Month Review

ConocoPhillips′ nine-month 2012 earnings were $7.0 billion, or $5.55 per
share, compared with $9.0 billion, or $6.42 per share, for the same
period in 2011. Nine-month 2012 adjusted earnings were $5.1 billion, or
$4.09 per share, compared with nine-month 2011 adjusted earnings of $6.1
billion, or $4.35 per share.

Production for the first nine months of 2012 was 1.569 million BOE per
day, compared with 1.626 million BOE per day for the same period in
2011. Excluding asset dispositions, normal field decline was largely
offset by new production from major projects and drilling programs.

ConocoPhillips′ nine-month 2012 worldwide realized price for crude oil
increased to $106.92 per barrel, compared with $105.78 per barrel for
the first nine months of 2011. Realized natural gas prices decreased by
15 percent from $5.39 per MCF for the first nine months of 2011 to $4.60
per MCF for the first nine months of 2012. Realized NGL prices decreased
by 16 percent to $46.02 per barrel, compared with $54.97 per barrel for
the first nine months of 2011.

As of Sept. 30, 2012, ConocoPhillips had debt of $21.1 billion and the
debt-to-capital ratio was 31 percent. The company had $1.3 billion of
cash and cash equivalents and $2.5 billion in restricted cash targeted
for dividends and debt reduction.

Outlook

Production for the fourth quarter is expected to increase compared to
the third quarter of 2012, reflecting completion of turnaround activity
and ongoing ramp up in major North American programs, notably in the
Eagle Ford and oil sands. Full-year 2012 production is expected to be
1.570 million to 1.580 million BOE per day. The company expects
continued progress on its major projects and drilling programs in the
fourth quarter, including evaluating drilling results on several
exploration prospects.

'Our business is running well, and we expect to achieve several
operational and strategic milestones in the months to come,? said Lance.
'Our projects and drilling programs continue to perform, our exploration
activities are building momentum and our asset sales are progressing. We
are on our way to delivering our unique combination of growth, returns
and yield.?

ConocoPhillips will hold its annual analyst meeting on Feb. 28, 2013 in
New York. Representatives from company management will discuss the
company′s strategic plans for growth and value creation.

ConocoPhillips will host a conference call at 1 p.m. Eastern time today
to discuss its quarterly results and provide a status update on
operational and strategic plans. To listen to the call and view related
presentation materials, go to www.conocophillips.com/investor.
For detailed supplemental information, go to www.conocophillips.com/investor/earnings.

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About ConocoPhillips

Headquartered in Houston, Texas, ConocoPhillips had operations and
activities in 30 countries, $115 billion of assets, and approximately
16,700 employees as of Sept. 30, 2012. Production averaged 1.57 million
BOE per day for the nine months ended Sept. 30, 2012, and proved
reserves were 8.4 billion BOE as of Dec. 31, 2011. For more information,
go to www.conocophillips.com.

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includes the terms adjusted earnings and adjusted earnings per share.
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ConocoPhillips

Aftab Ahmed, 281-293-4138 (media)

aftab.ahmed@conocophillips.com

or

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or

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