I'm wondering whether ConocoPhillips
The third-largest U.S.-based oil and gas company behind ExxonMobil
By that, I mean it'll put about $10 billion of its assets on the block during the next couple of years. The properties for sale haven't been completely identified. Nevertheless, it appears that they will include the company's 9% interest in Syncrude Canada, an oil sands venture. Also likely to go is Conoco's one-quarter stake in the nearly 1,700-mile natural gas Rockies Express Pipeline (REX), which connects Colorado and Ohio. It will be interesting to see if current REX partners Kinder Morgan
In addition, Conoco will also sell half of its 20% interest in Russia's huge oil company, Lukoil. In total, the sales are anticipated to raise about $15 billion for the company. And there's apt to be an unspecified delay in other previously planned projects, including the refurbishing of a major refinery in Germany. On the savings side, the company intends to lower its capital spending by 23% from the 2008 level. And to benefit its shareholders, Conoco is looking at share repurchases, raising its quarterly dividend by 10%, and trimming its debt ratio.
This approach signals a new world for ConocoPhillips. In 2002, while serving as CEO of Phillips Petroleum, Mr. Mulva pulled off a merger with Conoco. The empire building continued with several other acquisitions, including $35 billion for independent gas producer Burlington Resources.
In 2008, as world oil prices rocketed toward $150 per barrel, Warren Buffett began loading Berkshire Hathaway with Conoco shares to the point that it became the oil company's largest shareholder. Later, Mr. Buffett began shrinking that position, apparently for both investment and tax purposes. With so many other great names in the oil and gas space, I agree with Buffett's decision. It would be safest for Fools to stay away from ConocoPhillips at this time.