Exhibit 99.2
Preliminary
FINANCIAL HIGHLIGHTS
Millions of Dollars
Three Months Ended Twelve Months Ended
December 31 December 31
2005 2004 2005 2004
Revenues
Sales and other operating revenues* $ 51,258 39,385 179,442 135,076
Equity in earnings of affiliates 831 555 3,457 1,535
Other income 84 132 465 305
----------- ----------- ----------- -----------
52,173 40,072 183,364 136,916
----------- ----------- ----------- -----------
Costs and expenses
Purchased crude oil, natural gas and products 36,322 26,984 124,925 90,182
Production and operating expenses 2,481 2,060 8,562 7,372
Selling, general and administrative expenses 557 615 2,247 2,128
Exploration expenses 229 192 661 703
Depreciation, depletion and amortization 1,178 1,030 4,253 3,798
Property impairments 11 101 42 164
Taxes other than income taxes* 4,598 4,609 18,356 17,487
Accretion on discounted liabilities 58 45 193 171
Interest and debt expense 110 141 497 546
Foreign currency transaction losses (gains) (4) 17 48 (36)
Minority interests 12 3 33 32
----------- ----------- ----------- -----------
45,552 35,797 159,817 122,547
----------- ----------- ----------- -----------
Income from continuing operations before income
taxes 6,621 4,275 23,547 14,369
Provision for income taxes 2,839 1,795 9,907 6,262
----------- ----------- ----------- -----------
Income from continuing operations 3,782 2,480 13,640 8,107
Income (loss) from discontinued operations (15) (48) (23) 22
----------- ----------- ----------- -----------
Income before cumulative effect of changes in
acccounting principles 3,767 2,432 13,617 8,129
Cumulative effect of changes in accounting principles (88) - (88) -
----------- ----------- ----------- -----------
Net Income $ 3,679 2,432 13,529 8,129
=========== =========== =========== ===========
Income (loss) per share of common stock (dollars)**
Basic
Continuing operations $ 2.73 1.78 9.79 5.87
Discontinued operations (0.01) (0.03) (0.02) 0.01
----------- ----------- ----------- -----------
Before cumulative effect of changes in acccounting
principles 2.72 1.75 9.77 5.88
Cumulative effect of changes in accounting
principles (0.06) - (0.06) -
----------- ----------- ----------- -----------
Net income $ 2.66 1.75 9.71 5.88
=========== =========== =========== ===========
Diluted
Continuing operations $ 2.69 1.76 9.63 5.79
Discontinued operations (0.01) (0.04) (0.02) 0.01
----------- ----------- ----------- -----------
Before cumulative effect of changes in acccounting
principles 2.68 1.72 9.61 5.80
Cumulative effect of changes in accounting
principles (0.07) - (0.06) -
----------- ----------- ----------- -----------
Net income $ 2.61 1.72 9.55 5.80
=========== =========== =========== ===========
Average common shares outstanding (in thousands)**
Basic 1,385,034 1,390,916 1,393,371 1,381,568
Diluted 1,407,375 1,412,668 1,417,028 1,401,300
*Includes excise, value added and other similar taxes
on petroleum products sales: $ 4,252 4,284 17,037 16,357
** Per-share amounts and average number of common shares outstanding in all
periods reflect a two-for-one stock split effected as a 100 percent stock
dividend on June 1, 2005.
1
Preliminary
SELECTED FINANCIAL DATA
Millions of Dollars
Three Months Ended Twelve Months Ended
December 31 December 31
2005 2004 2005 2004
INCOME (LOSS) FROM CONTINUING OPERATIONS
E&P
United States $ 1,325 935 4,290 2,942
International 1,105 736 4,144 2,760
----------- ----------- ----------- -----------
Total E&P 2,430 1,671 8,434 5,702
----------- ----------- ----------- -----------
Midstream 147 100 688 235
----------- ----------- ----------- -----------
R&M
United States 805 484 3,407 2,126
International 251 269 849 617
----------- ----------- ----------- -----------
Total R&M 1,056 753 4,256 2,743
----------- ----------- ----------- -----------
LUKOIL Investment 189 74 714 74
Chemicals 114 83 323 249
Emerging Businesses (4) (24) (20) (102)
Corporate and other (150) (177) (755) (794)
----------- ----------- ----------- -----------
Consolidated $ 3,782 2,480 13,640 8,107
=========== =========== =========== ===========
CUMULATIVE EFFECT OF ACCOUNTING CHANGES
E&P
United States $ (2) - $ (2) -
International (2) - (2) -
----------- ----------- ----------- -----------
Total E&P (4) - (4) -
----------- ----------- ----------- -----------
Midstream - - - -
----------- ----------- ----------- -----------
R&M
United States (78) - (78) -
International (5) - (5) -
----------- ----------- ----------- -----------
Total R&M (83) - (83) -
----------- ----------- ----------- -----------
LUKOIL Investment - - - -
Chemicals - - - -
Emerging Businesses (1) - (1) -
Corporate and other - - - -
----------- ----------- ----------- -----------
Consolidated $ (88) - $ (88) -
=========== =========== =========== ===========
INCOME (LOSS) FROM DISCONTINUED OPERATIONS
Corporate and other (15) (48) (23) 22
SUMMARY OF NET INCOME (LOSS)
E&P
United States $ 1,323 935 4,288 2,942
International 1,103 736 4,142 2,760
----------- ----------- ----------- -----------
Total E&P 2,426 1,671 8,430 5,702
----------- ----------- ----------- -----------
Midstream 147 100 688 235
----------- ----------- ----------- -----------
R&M
United States 727 484 3,329 2,126
International 246 269 844 617
----------- ----------- ----------- -----------
Total R&M 973 753 4,173 2,743
----------- ----------- ----------- -----------
LUKOIL Investment 189 74 714 74
Chemicals 114 83 323 249
Emerging Businesses (5) (24) (21) (102)
Corporate and other (165) (225) (778) (772)
----------- ----------- ----------- -----------
Net income $ 3,679 2,432 13,529 8,129
=========== =========== =========== ===========
2
Preliminary
SELECTED FINANCIAL DATA
Three Months Ended Twelve Months Ended
December 31 December 31
2005 2004 2005 2004
INCOME FROM CONTINUING OPERATIONS
Effective tax rate % 42.9 % 42.0 42.1 43.6
Millions of Dollars
FOREIGN CURRENCY GAINS (LOSSES)
AFTER-TAX
E&P $ 1 (28) 7 (13)
Midstream - (1) 7 (1)
R&M (3) 11 (52) 12
LUKOIL Investment - - (1) -
Chemicals - - - -
Emerging Businesses (1) - (1) -
Corporate and other (15) 23 (42) 44
----------- ----------- ----------- -----------
$ (18) 5 (82) 42
=========== =========== =========== ===========
CASH FLOWS FROM OPERATING ACTIVITIES
Income from continuing operations $ 3,782 2,480 13,640 8,107
Depreciation, depletion and amortization 1,178 1,030 4,253 3,798
Property impairments 11 101 42 164
Dry hole costs and leasehold impairment 138 75 349 417
Accretion on discounted liabilities 58 45 193 171
Deferred income taxes 348 27 1,101 1,025
Undistributed equity earnings (92) (236) (1,774) (777)
Net (gain) loss on asset dispositions (14) (34) (278) (116)
Other (140) (295) (139) (190)
Working capital changes (595) 10 246 (601)
----------- ----------- ----------- -----------
Net cash provided by continuing operations 4,674 3,203 17,633 11,998
Net cash provided by (used in) discontinued
operations 1 (6) (5) (39)
----------- ----------- ----------- -----------
Net cash provided by operating activities $ 4,675 3,197 17,628 11,959
=========== =========== =========== ===========
CAPITAL EXPENDITURES AND INVESTMENTS
E&P
United States $ 416 368 1,637 1,314
International 1,250 1,184 5,047 3,935
----------- ----------- ----------- -----------
1,666 1,552 6,684 5,249
Midstream - 1 839 7
R&M 663 574 1,738 1,344
LUKOIL Investment 637 2,649 2,160 2,649
Chemicals - - - -
Emerging Businesses - 1 5 75
Corporate and other* 81 60 194 172
----------- ----------- ----------- -----------
$ 3,047 4,837 11,620 9,496
=========== =========== =========== ===========
*Excludes discontinued operations
OTHER
At December 31, 2005 At December 31, 2004
Total debt $ 12,516 15,002
Common stockholders' equity $ 52,731 42,723
3
Preliminary
OPERATING HIGHLIGHTS
BY SEGMENT
Three Months Ended Twelve Months Ended
December 31 December 31
2005 2004 2005 2004
Thousands of Barrels Daily
E&P
Crude oil produced
United States
Alaska 291 313 294 298
Lower 48 54 50 59 51
----------- ----------- ----------- -----------
345 363 353 349
Norway 188 211 197 207
United Kingdom 62 66 60 64
Canada 22 24 23 25
China 23 17 23 25
Indonesia 13 18 15 15
Vietnam 37 33 29 33
Timor Sea 36 34 33 21
Other 51 55 53 58
----------- ----------- ----------- -----------
Total consolidated 777 821 786 797
Equity affiliates 116 103 121 108
----------- ----------- ----------- -----------
Total Worldwide 893 924 907 905
=========== =========== =========== ===========
Syncrude 20 20 19 21
=========== =========== =========== ===========
Natural gas liquids produced
United States
Alaska* 21 24 20 23
Lower 48 31 26 30 26
----------- ----------- ----------- -----------
52 50 50 49
Norway 11 9 9 8
Canada 10 11 10 10
Timor Sea 19 16 16 9
Other 7 6 6 8
----------- ----------- ----------- -----------
Total Worldwide 99 92 91 84
=========== =========== =========== ===========
* Includes reinjected volumes sold lease-to-lease. 13 13 9 13
Millions of Cubic Feet Daily
Natural gas produced*
United States
Alaska 172 163 169 165
Lower 48 1,264 1,214 1,212 1,223
----------- ----------- ----------- -----------
1,436 1,377 1,381 1,388
Norway 264 306 272 301
United Kingdom 851 852 751 818
Canada 430 442 425 433
Timor Sea 33 35 34 35
Indonesia 330 266 298 250
Vietnam 19 19 18 16
Other 105 59 84 71
----------- ----------- ----------- -----------
Total consolidated 3,468 3,356 3,263 3,312
Equity affiliates 3 4 7 5
----------- ----------- ----------- -----------
Total Worldwide 3,471 3,360 3,270 3,317
=========== =========== =========== ===========
* Represents quantities available for sale. Excludes gas equivalent of
NGL shown above.
Liquefied natural gas sales 118 107 117 105
LUKOIL Investment
Production (MBOE/D)* 293 159 246 40
Refinery crude oil throughput (MB/D)* 156 77 122 19
* Represents our estimated net share of LUKOIL.
4
Preliminary
OPERATING HIGHLIGHTS
Three Months Ended Twelve Months Ended
December 31 December 31
2005 2004 2005 2004
E&P
Per Unit
Average sales prices
Crude oil (per barrel)
United States
Alaska $ 57.61 44.37 52.24 38.47
Lower 48 46.62 42.30 45.24 36.95
Total U.S. 55.86 44.08 51.09 38.25
International 54.49 41.75 52.27 37.18
Total consolidated 55.06 42.79 51.74 37.65
Equity affiliates 38.90 26.55 37.79 24.18
Total Worldwide 53.05 40.96 49.87 36.06
Natural gas-lease (per MCF)
United States
Alaska 3.01 2.23 2.75 2.35
Lower 48 9.37 6.04 7.28 5.46
Total U.S. 9.17 5.92 7.12 5.33
International 7.19 4.63 5.78 4.14
Total consolidated 7.96 5.13 6.32 4.62
Equity affiliates 0.28 0.25 0.26 2.19
Total Worldwide 7.94 5.13 6.30 4.61
Midstream
Thousands of Barrels Daily
Natural gas liquids extracted
Consolidated
United States 22 23 22 32
International - 49 25 45
Equity affiliates
United States* 172 113 142 111
International 6 7 6 6
----------- ----------- ----------- -----------
200 192 195 194
=========== =========== =========== ===========
* Represents 30.3 percent interest in Duke Energy Field Services, LLC (DEFS),
through June 30,2005 and 50 percent interest beginning in July 2005.
Per Barrel
U.S. product prices
Weighted average NGL**
Consolidated $ 42.70 34.40 36.68 29.38
DEFS 41.84 33.69 35.52 28.60
** Prices are based on index prices from the Mont Belvieu and Conway market
hubs that are weighted by natural-gas-liquids component and location mix.
5
Three Months Ended Twelve Months Ended
December 31 December 31
2005 2004 2005 2004
Thousands of Barrels Daily
R&M
United States
Crude oil capacity 2,182 2,160 2,180 2,164
Crude oil runs 1,853 2,005 1,996 2,059
Refinery production 2,037 2,232 2,186 2,245
International*
Crude oil capacity 428 428 428 437
Crude oil runs 435 438 424 396
Refinery production 458 453 439 405
U.S. Petroleum products outside sales
Gasoline 1,368 1,415 1,374 1,356
Distillates 653 562 675 553
Aviation fuels 189 195 201 191
Other products 521 613 519 564
----------- ----------- ----------- -----------
2,731 2,785 2,769 2,664
International 490 493 482 477
----------- ----------- ----------- -----------
3,221 3,278 3,251 3,141
=========== =========== =========== ===========
Per Gallon
U.S. Average sales prices**
Automotive gasoline-wholesale $ 1.77 1.40 1.73 1.33
Automotive gasoline-retail 1.96 1.62 1.88 1.52
Distillates-wholesale 2.06 1.41 1.80 1.24
* Includes ConocoPhillips' share of equity affiliates.
** Excludes excise taxes.
6