ConocoPhillips 1Q profit drops 3 pct

ConocoPhillips recorded a 3 percent decline in first quarter profits, suffering from lower crude oil production and narrower refining profits, the oil company reported this morning.

The Houston-based energy giant booked $2.9 billion, or $2.27 per diluted share, in earnings during the three-month period ending March 31. During the same period last year, the company recorded earnings of $3 billion, or $2.09 per diluted share. Earnings per share rose as a result of the company’s share repurchase program.

Revenue was largely stagnant, reaching $58.3 billion in the first quarter of 2012, compared to $58.2 billion in the first quarter of 2011.

Still, CEO Jim Mulva said the company’s performance met expectations.

“We operated according to plan during the first quarter of 2012, achieving production and refinery utilization targets,” said ConocoPhillips Chairman and CEO Jim Mulva in a written statement. “We continued to progress our asset divestment program and execution of our major projects and growth plans.”

Net income for company’s refining and marketing arm, which includes gas stations and refineries, fell 6 percent in the first quarter to $452 million. Net income for the exploration and production business grew 8 percent to $2.5 billion.

The first-quarter financial report is scheduled to be ConocoPhillips’ last as an integrated oil production and refining business. The corporation is set to split May 1, forming two major energy companies. The new ConocoPhillips will focus on oil and natural gas production while the spinoff, Phillips 66, will be one of the United States’ largest independent refiners.

ConocoPhillps’ global production of crude oil and natural gas liquids during the first quarter fell 5 percent to 816 million barrels per day. Production of dry natural gas also fell 5 percent, to 4.4 billion cubic feet per day.

In the United States, ConocoPhillips boosted crude oil and NGL production by 17 percent to 364 million barrels per day. Natural gas production fell 2 percent to 1.5 billion cubic feet.

ConocoPhillips purchased $1.9 billion in common stock during the quarter, while the company’s aggressive asset sales program brought in $1.1 billion.

The company funneled $4.2 billion in capital into its oil and natural gas exploration and production division during the quarter, a 45 percent increase over the first quarter of 2011. Capital expenditures in the refining and marketing segment grew 37 percent to $214 million.

ConocoPhillips shares were down 56 cents to $72.32 on the New York Stock Exchange in midday trading.