ConocoPhillips Reports Second-Quarter Earnings of $2.3 Billion or $1.80 Per Share

ConocoPhillips (NYSE: COP) today reported second-quarter 2012 earnings
of $2.3 billion, or $1.80 per share, compared with second-quarter 2011
earnings of $3.4 billion, or $2.41 per share. The current quarter
includes one month of downstream earnings related to discontinued
operations associated with the April 30, 2012, spinoff of Phillips 66.
Last year′s quarter included three months of downstream earnings.

Excluding special items of $732 million, second-quarter 2012 adjusted
earnings were $1.5 billion, or $1.22 per share, compared with
second-quarter 2011 adjusted earnings of $2.3 billion, or $1.64 per
share. Special items for the current quarter include $534 million in
earnings from discontinued operations and $285 million from gains on
asset sales.

Second-Quarter Highlights

• 
  Completed spinoff of downstream businesses into Phillips 66.
  
• 
  Achieved production of 1.54 million BOE per day.
  
• 
  Continued progress on North American unconventional programs.
  
• 
  Progressed Australia Pacific LNG′s project with sanction of second
  train in early July.
  
• 
  Initiated drilling and acquired additional leases in deepwater Gulf of
  Mexico.
  
• 
  Completed disposition of Alba and Statfjord fields.
  
• 
  Repurchased 52 million ConocoPhillips shares, representing 4 percent
  of outstanding shares.
  
• 
  Paid quarterly dividend of 66 cents per share, consistent with
  pre-spinoff levels.
  

'We are off to a strong start as an independent E&P company and the
business is running well,? said Ryan Lance, chairman and chief executive
officer. 'Our production was on target, our major growth projects are on
track and we are continuing to add to our conventional and
unconventional exploration inventory. We continue to progress our asset
sales program, providing additional financial flexibility to fund our
high-margin organic investments. We remain committed to growing our
production by 3 to 5 percent, improving our financial returns and
delivering a sector-leading dividend.?

The company completed the spinoff of its downstream businesses to
stockholders on April 30, with the distribution of Phillips 66 (NYSE:
PSX) common stock. Following completion of this transaction,
ConocoPhillips is now the world′s largest independent exploration and
production company, based on proved reserves and production of liquids
and natural gas.

Operations Update

In the Lower 48 and Latin America segment, the company continues to
advance several high-margin growth projects across its asset base.
Ongoing ramp up of production from liquids-rich shale plays, including
Eagle Ford and Bakken, delivered approximately 50,000 barrels of oil
equivalent (BOE) per day more production for the quarter than a year
ago. Based on positive results to date, the company has identified
extensive development potential over the next several years and is
directing additional investments to these projects.

In Canada, the company′s oil sands projects continued to perform well,
with production growth from Christina Lake Phase C and Surmont Phase I
resulting in increased bitumen production of 20,000 BOE per day compared
to the second quarter of 2011. Additionally, Surmont Phase II
development and further FCCL expansion phases are on schedule and will
lead to further high-margin production growth over the next several
years.

In the Asia Pacific and Middle East segment, Australia Pacific LNG
sanctioned the second production train in July and signed project
finance agreements during the second quarter. The development and
construction of all infrastructure and facilities remain on track for
first delivery of LNG mid-2015. Concurrent with project sanction,
ConocoPhillips further reduced its working interest in the project to
37.5 percent. This reduction, along with the project financing, lowers
future capital requirements from ConocoPhillips to fund the Australia
Pacific LNG project. In Malaysia, development continued on several
projects, including the deepwater Gumusut oil field off the coast of
Sabah, the natural gas Kebabangan Field and oil fields at Malikai and
Siakap North-Petai.

In Europe, development continues across a number of high-margin growth
projects in the North Sea, including the Jasmine Field, Ekofisk South
and Eldfisk II expansion projects. Portfolio optimization continued with
the disposition of the Alba and Statfjord nonoperated fields.

ConocoPhillips continues to build momentum across its unconventional and
conventional exploration portfolio. In unconventional plays, several
North American pilot programs are underway in liquids-rich opportunities
that include Niobrara, Avalon, Wolfcamp and Duvernay. The company is
also building and evaluating positions in additional areas of interest
within North America. Internationally, the company began appraisal
activities in Western Australia to evaluate the company′s large resource
potential in the Canning Basin.

In conventional exploration, the company also made significant progress
during the quarter. In the deepwater Gulf of Mexico, drilling is in
progress at three nonoperated wells, including an appraisal well at the
Shenandoah prospect and two wildcat wells at the Bioko and Coronado
prospects. The company also continued to build its deepwater prospect
inventory in the Gulf of Mexico, acquiring additional blocks in the June
lease sale. The company now holds more than 340 blocks in the Gulf of
Mexico.

In the Browse Basin, offshore northwest Australia, the appraisal program
has resumed with the drilling of the Boreas well. Seismic activities
were completed in the deepwater Bay of Bengal, offshore Bangladesh.
Earlier in the year, the company completed the acquisition of two
deepwater blocks and recently commenced seismic activities in Angola′s
emerging subsalt play trend.

Second-Quarter Review

Production for the second quarter of 2012 was 1.54 million BOE per day,
compared with 1.64 million BOE per day for the second quarter of 2011.
As expected, production was lower due to the impact of dispositions and
maintenance downtime, as well as curtailments in North American
conventional natural gas. Normal field decline was largely offset by
additional production from major projects and drilling programs.

ConocoPhillips′ second-quarter 2012 worldwide realized price for crude
oil decreased $7.39 per barrel to $105.56 per barrel, compared with
$112.95 per barrel for the second quarter of 2011. Realized natural gas
prices decreased by 20 percent from $5.50 per thousand cubic feet (MCF)
in the second quarter of 2011 to $4.41 per MCF for the current quarter.

During the second quarter of 2012, ConocoPhillips repurchased
approximately 52 million of its shares, or 4 percent of shares
outstanding, for $3.1 billion. This brings the company′s total shares
repurchased to approximately 20 percent of the shares outstanding at the
inception of the repurchase program in 2010. At June 30, 2012, the
outstanding basic shares were 1,215 million.

During the quarter, ConocoPhillips generated $3.0 billion in cash from
continuing operating activities excluding working capital.
Current-quarter cash flows reflect the impact of scheduled downtime in
high-margin operations. Cash provided by continuing operating activities
was $2.2 billion, reflecting a $0.8 billion increase in working capital.
The company also received $0.5 billion in proceeds from asset
dispositions and increased debt by $0.8 billion. ConocoPhillips funded a
$4.0 billion capital program, repurchased $3.1 billion of its common
stock and paid $0.8 billion in dividends.

Six-Month Review

ConocoPhillips′ six-month 2012 earnings were $5.2 billion, or $4.08 per
share, compared with $6.4 billion, or $4.50 per share, for the same
period in 2011. Six-month 2012 adjusted earnings were $3.4 billion, or
$2.65 per share, compared with six-month 2011 adjusted earnings of $4.2
billion, or $2.96 per share.

Production for the first six months of 2012 was 1.59 million BOE per
day, compared with 1.67 million BOE per day for the same period in 2011.
The decrease was primarily from normal decline and asset dispositions,
partially offset by new production from major projects and other field
exploitation.

ConocoPhillips′ six-month 2012 worldwide realized price for crude oil
increased to $108.95 per barrel, compared with $105.42 per barrel for
the first six months of 2011. Realized natural gas prices decreased by
14 percent from $5.36 per MCF a year ago to $4.61 per MCF for the first
six months of 2012.

ConocoPhillips continues to optimize its portfolio through its
disposition program. For the first half of 2012, the company has raised
$1.6 billion in disposal proceeds, including the sale of the Vietnam
business unit, Alba and Statfjord fields in the North Sea and other
smaller asset sales. The company remains on track to complete its $8-$10
billion asset disposition program by mid-2013, with additional
transactions currently in progress.

At June 30, 2012, debt was $23.0 billion and the debt-to-capital ratio
was 33 percent. The company had total cash of $6.0 billion, comprised of
$5.0 billion in restricted cash targeted for dividends and debt
reduction, and $1.0 billion of cash and cash equivalents. Quarter-ending
cash and debt reflect the impact of the Phillips 66 spinoff.

ConocoPhillips will host a conference call at 11 a.m. Eastern time today
to discuss its quarterly results and provide a status update on
operational and strategic plans. To listen to the call and view related
presentation materials, go to www.conocophillips.com/investor.
For detailed supplemental information, go to www.conocophillips.com/investor/earnings.

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About ConocoPhillips

Headquartered in Houston, Texas, ConocoPhillips has operations and
activities in 30 countries and approximately 16,500 employees as of June
30, 2012. Production averaged 1.59 million BOE per day for the six
months ended June 30, 2012, and proved reserves were 8.4 billion BOE as
of Dec. 31, 2011. For more information, go to www.conocophillips.com.

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'SAFE HARBOR' PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995

This press release contains forward-looking statements.
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ConocoPhillips undertakes no obligation to update publicly any
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Use of Non-GAAP Financial Information ? This press release
includes the terms adjusted earnings and adjusted earnings per share.
These are non-GAAP financial measures. Adjusted earnings and adjusted
earnings per share are included to help facilitate comparisons of
company operating performance across periods.

References in the release to earnings refer to net income
attributable to ConocoPhillips.

ConocoPhillips

Aftab Ahmed, 281-293-4138 (media)

aftab.ahmed@conocophillips.com

or

Daren
Beaudo, 281-293-2073 (media)

daren.beaudo@conocophillips.com

or

Vladimir
R. dela Cruz, 212-207-1996 (investors)

v.r.delacruz@conocophillips.com