Cash Return Mix
Q: How will the $9B distribution be allocated among dividends and buybacks?
A: ConocoPhillips plans to return $9 billion to shareholders in 2024, shifting the mix to be more weighted towards buybacks, which will comprise about 60% of total distributions—roughly $5.3 to $5.4 billion, similar to 2023 levels. The remaining 40% will be in cash dividends, including a $0.20 per share VROC, providing a solid mix of cash and buybacks.

Breakeven Prices
Q: What's the portfolio's dividend breakeven price?
A: The company's free cash flow breakeven averages about $35 WTI over their 10-year plan at mid-cycle prices. Adding the dividend increases the breakeven by an additional $8 to $9, bringing the total to around $43 to $44 WTI. This breakeven is higher in the first half of the plan due to pre-productive capital and lowers as projects come on stream.

M&A Strategy
Q: How does ConocoPhillips approach M&A opportunities?
A: Their M&A strategy focuses on cost of supply and must fit within their financial framework, improving their 10-year plan. Any acquisition should enhance the asset and align with mid-cycle price assumptions. This consistent approach has guided their M&A activities over the past years.

Willow Project Update
Q: What's the status of the Willow project amid legal challenges?
A: Despite ongoing legal appeals, positive rulings have allowed construction to proceed on the Willow project. They are in their second winter construction season, mobilizing 1,200 workers to build infrastructure. 2024 capital spending is expected at the upper end of $1 to $1.5 billion, with total capital to first production remaining at $7 to $7.5 billion. About 70% of contracts are lump sum or unit-rate, limiting inflation exposure.

Production Growth Outlook
Q: What is the outlook for production growth?
A: ConocoPhillips expects underlying production growth of 2% to 4% this year versus last year, driven by both the Lower 48 and international portfolio. They are holding Lower 48 activity flat to focus on efficiency and returns, not chasing growth. The additional 50% interest in Surmont will contribute to organic growth.

Lower 48 Production Plans
Q: How is ConocoPhillips approaching Lower 48 development this year?
A: They see a deceleration in U.S. growth rates but still expect growth between 300,000 to 500,000 barrels of oil equivalent, primarily from the Permian. They anticipate low to single-digit growth rates with activity levels similar to 2023 and do not intend to ramp up their Lower 48 program at this time.

Impact of LNG Pause
Q: Does the LNG permitting pause affect ConocoPhillips' plans?
A: The LNG permitting pause is not impacting their plans. Port Arthur Phase 1 is fully permitted, including free trade and non-free trade agreement permits, and environmental permits. They continue investing in LNG opportunities, believing the market will be strong for decades.

Montney Development
Q: How are lower natural gas prices affecting Montney development?
A: Lower natural gas prices do not impact their long-term Montney development plans. They began operating a second rig and expect production to grow from an average of 33,000 barrels a day in Q4 2023. The modest increase in Canadian capital expenditure is due to additional equity in Surmont and the second Montney rig.

Reserve Replacement
Q: What impact does Willow have on reserve replacement ratios?
A: The initial booking for Willow added about 160 million barrels upon sanction. As development progresses, this will approach their base case resource estimate of 600 million barrels. Along with strong contributions from the Lower 48 and Montney, and the addition of 200 million barrels from the Surmont acquisition, they achieved a strong total reserve replacement ratio.