Energy Security and Climate Change

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Energy Security and Climate Change
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Energy Security and Climate Change

• Making sure we have the energy we need
• Addressing concerns over climate change
• Tackling both challenges together

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ConocoPhillips
Responsibly Delivering Energy to the World

• An integrated, international energy company
• Publicly owned by millions of American
  shareholders
• More than 32,000 employees
• Active in nearly 40 countries

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Five Questions

• What does ConocoPhillips do?
• Why does gasoline cost so much?
• What are you doing to secure our energy future?
• What are you doing about the environment
  andclimate change?
• What does ConocoPhillips do with its earnings?

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Deliver Energy to the World

• Find, produce and transport oil and natural gas
• Deliver refined materials to consumers and
  manufacturers
• Gasoline, diesel fuel, etc.
• Develop new conventional and unconventional
  fossil fuel sources
• Research and develop renewable and alternative
  energy

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Five Questions

• What does ConocoPhillips do?
• Why does gasoline cost so much?
• What are you doing to secure our energy future?
• What are you doing about the environment
  andclimate change?
• What does ConocoPhillips do with its earnings?

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Cost of Oil Cost of Gasoline

• Largest price component of gasoline is crude oil
• World crude oil prices have soared
• Supply/demand balance has tightened

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Oil is 74 of the Cost
Retail Price of 3.77/gallon
Retail Price of 2.80/gallon
Retail Price of 2.57/gallon
Retail Price of 2.27/gallon
Retail Price of 1.85/gallon
2004
2005
2006
2007
May 2008
Crude Oil
Federal State Tax
Refining Cost / Profit
Marketing / Distribution
Source Energy Information Administration
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Most of our Oil is Imported
Canada, 12
United States, 41
Saudi Arabia, 7
Venezuela, 6
Nigeria, 6
Mexico, 5
Other, 10
Algeria, 3
Angola, 3
Virgin Islands, 2
Iraq, 3
Russia, 2
Source API, The Truth About Oil and Gasoline
An API Primer, June 6, 2008
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Limited Access Abroad
Today
1960s
Full IOC access
Russian companies
NOC reserves (equity access)
NOC reserves
Full IOC access
Russia
IOC International oil company NOC National
oil company
NOC reserves (no equity access)
Only 7 of world reserves are fully accessible by
IOCs
Source PFC Energy, Oil Gas Journal, BP
Statistical Review 2007 Note Excludes
unconventional crude oil and bitumen reserves
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Restricted Access at Home
Undiscovered technically recoverable federal
reserves Source API, The Truth About Oil and
Gasoline An API Primer, June 6, 2008
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Economic Growth Demand for Energy
Real GDP Growth ()
Avg.
Source International Monetary Fund, April 2008
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Four Elements for a Secure Energy Future

• Energy supply diversity
• More innovation
• Greater efficiency
• Environmental stewardship

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Five Questions

• What does ConocoPhillips do?
• Why does gasoline cost so much?
• What are you doing to secure our energy future?
• What are you doing about the environment
  andclimate change?
• What does ConocoPhillips do with its earnings?

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Finding New Sources of Energy

• Traditional sources of oil and gas
• New sources
• Alternative energy
• Renewable fuels

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Energy Diversity Traditional Sources

• Oil and natural gas
• Onshore
• Offshore

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Energy Diversity - New Sources

• Heavy oil, oil sands
• Natural gas hydrates

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Energy Diversity - Alternatives Renewables

• Alternative fuels
• Ethanol
• Next-generation biofuels
• Renewable diesel fuel
• Coal gasification
• Renewable energy
• Wind
• Solar
• Other low-carbon sources

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Oil and Gas Half of our Energy in 2030
The U.S. will require 19 more energy in 2030
Excludes ethanol and other biofuels, they are
counted in biomass and renewables Source API,
The Truth About Oil and Gasoline An API
Primer, June 6, 2008
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Increasing Innovation

• Technology
• Investment
• Collaboration
• ConocoPhillips Energy Prize

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Achieving Energy Efficiency

• What ConocoPhillips is doing
• What government can do
• What we all can do

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Five Questions

• What does ConocoPhillips do?
• Why does gasoline cost so much?
• What are you doing to secure our energy future?
• What are you doing about the environment
  andclimate change?
• What does ConocoPhillips do with its earnings?

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Protecting Air, Land and Water

• Exercise responsible stewardship
• Minimize impact of
• operations
• Address carbon emissions

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Energy Security and Climate Change
ConocoPhillips urges progress on both
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New Opportunities for Green Businesses
CO2 Capture Storage
Renewable Power
Emission Trading
Gasification
Nuclear
Bio-Fuels
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Global Real Estate Facilities Energy
Opportunities

• SMART Buildings Solution
• Sustainable Development Guidelines
• 27 Sustainable Development projects complete-34
  more planned
• Colorado Campus

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Five Questions

• What does ConocoPhillips do?
• Why does gasoline cost so much?
• What are you doing to secure our energy future?
• What are you doing about the environment
  andclimate change?
• What does ConocoPhillips do with its earnings?

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Invest in Our Energy Future

• Produce crude oil and natural gas
• Buy additional oil to supply refineries
• Invest in technology
• Reinvest in facilities and infrastructure
• Provide investment returns to shareholders
• Pay U.S. federal, state and foreign taxes

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Questions andAnswers