Where Is the Major Growth at ConocoPhillips (COP) Coming From?

Malaysia
Conoco’s projects in Malasyia are ramping up over the next year, with production eventually growing by 70,000 barrels of oil equivalent per day by 2015. With four developments in the works, the company’s spending is on par with its U.K. investment of $2.5 billion over five years. However, there’s additional upside here for future growth beyond what’s already in the plans. As with any oil and gas project, the opportunity to capture upside over time will be important as it will help to offset the declines seen elsewhere.

Australia Pacific LNG
The final major project in development is an LNG export facility in Australia. Conoco owns a third of the facility, which is scheduled to begin operations in 2015. The facility, which will initially have two export trains, is permitted for two additional trains. While we still debate the merits of LNG exports here in the U.S., in places such as Australia and Mozambique, operators are developing large-scale LNG export facilities to get the gas from production basins to the world market. Only time will tell if we’ll join them to the same degree.

My Foolish take
When you add up all these major projects, they should drive 400,000 barrels of oil per day of production growth by 2017. With all of these projects targeting high-margin oil or LNG, ConocoPhillips should easily hit its targeted range of 3% to 5% growth in both production and margins over the next few years. As a ConocoPhillips shareholder, that’s exactly what I want to hear.

The article Where Is the Major Growth at ConocoPhillips Coming From? originally appeared on Fool.com and is written by Matt DiLallo.

Fool contributor Matt DiLallo owns shares of ConocoPhillips. The Motley Fool recommends Statoil (ADR) and Total SA. (ADR). The Motley Fool owns shares of Devon Energy.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.