San Francisco: ConocoPhillips, the world’s biggest exploration and production company, announced on Thursday still more substantial cuts to its spending plan with the most impact being felt on its deepwater operations in the Gulf of Mexico.
This is the third cutback in capital spending by the Houston-based American multinational this year. Conoco cites the continuing weakness of the oil price for its decision. Crude prices have plunged by 50 per cent.
In a sop to shareholders the company also announced a one cent increase in dividends, raising its quarterly payout from 73 cents to 74 cents, payable in September.
Among the projects to be hit by the spending cuts will be a three-year contract for an Ensco drill ship that was due to be delivered late this year. London-based Ensco claims Conoco will still be on the hook for early termination fees amounting to $550,000 per day, although Conoco says the parties are still discussing the details.