According to the Houston-based company's preliminary results, Conoco's volumes were down in the quarter, owing largely to "planned maintenance." Meanwhile, West Texas Intermediate crude price realizations jumped by about 90%, to nearly $124 a barrel -- but that same jump in crude prices translated to a nearly 49% drop in weighted U.S. refining margins. As such, when the company reports its full results for the quarter, you'll see higher upstream results, along with a drop in the downstream.
Most, if not all, of the big oil companies should reflect these results, which should only intensify calls for the proverbial heads of companies such as ExxonMobil
In addition to providing a quick glimpse of the coming earnings season, ConocoPhillips also announced a newly signed pact with the Abu Dhabi National Oil Company (ADNOC) for the development of the Shah Gas Field there. Abu Dhabi has been host to a number of foreign companies through the years, including BP
Conoco and ADNOC will share the front-end engineering costs for the facility, which will be located about 180 kilometers southwest of Abu Dhabi. Plans for the new project include construction of a billion-cubic-feet-per-day natural-gas processing plant, natural gas and liquid pipelines, and sulfur-exporting facilities at Ruwais in the United Arab Emirates. ADNOC and Conoco will split interests in the project 60%-40%, respectively.
The ADNOC arrangement is only one example of ConocoPhillips' global effort to expand its upstream and downstream operations. I strongly believe that, barring a sustained and unlikely pullback in crude prices, the company warrants continued attention from Foolish investors with a taste for energy.
Further Foolishness in the pipeline: