COP ConocoPhillips

By Michael Dabaie

ConocoPhillips said it will reduce its 2020 operating plan capital expenditures by $700 million, or about 10% from its previous guidance, in response to the recent oil market downturn.

Shares fell 7.7% premarket to $24.24.

The company said it will slow operated development activity in the Lower 48 states, expects decreases in non-operated activity in the Lower 48, and will defer drilling in Alaska.

ConocoPhillips said it expects the reductions to impact 2020 full-year production guidance by about 20,000 barrels of oil equivalent per day.

The company said it will also reduce its 2020 share repurchase program to a quarterly run rate of $250 million beginning in the second quarter from the previous run rate of $750 million.

Combined, the capital and share repurchase actions represent a reduction in 2020 cash uses of $2.2 billion, with limited impact to the company's productive capacity, ConocoPhillips said.

The company continues to review its capital and operating plans and will provide a full 2020 guidance update with first-quarter earnings April 30.

"Our industry is clearly experiencing an unprecedented event brought about by simultaneous supply and demand shocks," Chief Executive Ryan Lance said. "The actions we are now taking reflect an acknowledgement of current events as well as uncertainty around the timing and path of a recovery."

Write to Michael Dabaie at michael.dabaie@wsj.com

(END) Dow Jones Newswires

March 18, 2020 09:12 ET (13:12 GMT)

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