ConocoPhillips trims spending 20% in 2015 as crude slips

(MENAFN- ProactiveInvestors) ConocoPhillips (NYSE:COP) fell to the lowest this month after the third-largest U.S. energy company said its 2015 capital budget would be 20 percent or about $3 billion lower than this year's.

Shares dropped to $65.30 the lowest intraday price since Nov. 28 and were down 3.5 percent at $65.46 at 1:52 p.m. in New York. 

ConocoPhillips has become the first major oil and gas company to detail cuts to its capital spending plans following the steep fall in crude prices since June.

The Houston Texas-based company said in a statement today that it planned to slow its activity in U.S. shale oil and gas exploration as well as completing some large projects that had pushed its spending higher in recent years.

ConocoPhillips said it would "defer significant investment" on less developed projects in the Montney and Duvernay fields in Canada the Permian Basin in Texas and the Niobrara shale field which extends over Colorado Wyoming Nebraska and Kansas.

"We are setting our 2015 capital budget at a level that we believe is prudent given the current environment. This plan demonstrates our focus on cash flow neutrality and a competitive dividend while maintaining our financial strength” chief executive officer Ryan Lance said in the statement. “We are fortunate to have significant flexibility in our capital program.” 

U.S. shale explorers have been thrown into the spotlight as a result of the fall in oil prices because their costs are higher than for many other conventional crude oil producers worldwide.

Several oil producers including Denbury Resources Inc and Halcon Resources Corp have set lower budgets for 2015 following a 42 percent drop in crude prices since June.

Schlumberger (NYSE:SLB) the world's largest oilfield services provider said last week that it would cut jobs. Driller Hercules Offshore (NASDAQ:HERO) announced last month a 15 percent workforce reduction.

Brent for January settlement declined 4.1 percent to $66.21 a barrel at 12:18 p.m. New York time on the London-based ICE Futures Europe exchange. WTI for January delivery dropped 3.7 percent to $63.40 a barrel on the New York Mercantile Exchange after reaching $63.16 the lowest since July 2009.