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UPDATE 2-ConocoPhillips posts surprise loss on higher-than-expected costs

Published 2017-05-02, 11:02 a/m
© Reuters.  UPDATE 2-ConocoPhillips posts surprise loss on higher-than-expected costs
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* Sees 2nd-qtr production of 1.495 million-1.535 million boepd

* 1st-qtr output inches up 2 pct to 1.584 million boepd

* Adjusted loss of $0.02 v/s cons of $0.01

* Shares down as much as 2.4 percent (Adds details)

May 2 (Reuters) - ConocoPhillips (NYSE:COP) COP.N reported a surprise quarterly loss on Tuesday as operating costs came in higher than Street estimates, sending its shares down as much as 2.4 percent in early trade.

However, the largest U.S. independent oil producer's results reflected a slow but steady improvement across the industry. Crude prices are stabilizing after a two-year rout as an OPEC-led production cut and a rebound in demand slowly drains a global glut.

The company said its total realized price was $36.18 per barrel of oil equivalent in the first quarter, compared with $22.94 a year earlier.

ConocoPhillips's production, excluding Libya, inched up 2 percent to 1.584 million barrels of oil equivalent per day (boepd) in the latest reported quarter. was higher than Wall Street expectations of 1.571 million boepd.

"Production was above guidance, but this was outweighed by higher costs," Raymond James analyst Pavel Molchanov said.

The company's operating expenses of $1.30 billion were higher than Raymond James' estimate of $1.24 billion, Molchanov said. While exploration expenses of $258 million on a pre-tax basis were also much larger than the $70 million Barclays (LON:BARC) analysts had estimated.

ConocoPhillips said it expects production of 1.495 million to 1.535 million boepd for the second quarter, adding this forecast excludes output from Libya, but does not reflect the impact of recently announced asset sales.

The oil producer said last month it would sell natural gas-heavy assets in San Juan basin to privately held Hilcorp Energy Co for about $3 billion.

The asset sale came after the company agreed in March to sell oil sands and western Canadian natural gas assets to Cenovus Energy Inc CVE.TO for C$17.7 billion.

ConocoPhillips has also marked other gas-weighted assets for sale, including some assets in the Anadarko basin, the Barnett shale field, and the Gulf of Mexico.

Net profit was $800 million, or 62 cents per share, in the first quarter ended March 31, compared with a net loss of $1.5 billion, or $1.18 per share, a year earlier.

Excluding a gain on the sale of assets in Canada, the company posted a loss of 2 cents per share. Analysts on average were expecting a profit of 1 cent per share, according to Thomson Reuters I/B/E/S.

ConocoPhillips's shares were down 1.5 percent at $46.75 in morning trade.

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