What changed in this filing

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Item 1A. Risk Factors

2022-02-17 compared with 2021-02-16 · 1134 added, 925 removed, 54 unchanged (97% of the section changed)

should carefully consider the following risk

factors in addition to the other information

included in this

Annual Report on Form 10-K.

These risk factors are not the only risks

Our business could also be

affected by additional risks and uncertainties not currently

known to us or that we currently consider to be

If any of these risks or other risks that are yet unknown

were to occur, our business, operating

results and financial condition, as well as the

value of an investment in our common stock

could be adversely

You should carefully

consider the following risk factors

in addition to the other information

included in this Annual

Report on Form 10-K.

These risk factors are not

the only risks we face.

Our business could also be affected

additional risks and uncertainties not currently

known to us or that we currently consider

to be immaterial.

of these risks or other risks that are yet unknown

were to occur,

our business, operating results and

condition, as well as the value of an investment

in our common stock could be adversely

Risks Related to Our Industry

We have been negatively affected and may continue to be negatively affected by the prolonged drop in

commodity prices that began in early 2020.

The oil and gas business is fundamentally a commodity

business and our revenues, operating results

rate of growth are highly dependent on the prices

we receive for crude oil, bitumen, natural gas,

Such prices can fluctuate widely depending upon

global events or conditions that affect supply and

demand, most of which are out of our control.

Since early 2020, there has been a precipitous

demand for oil globally, largely caused by the dramatic decrease in travel and commerce

resulting from the

COVID-19 pandemic.

Management’s Discussion and Analysis of Financial

Condition and Results

of Operations, for additional information

on commodity prices and how we have been

assurance of when or if commodity prices will

return to pre-COVID-19 levels,

and if they do return to pre-

COVID levels, how long they will remain at those

The speed and extent of any recovery remains

uncertain and is subject to various risk factors,

including the duration, impact and actions taken

proliferation of the COVID-19 pandemic, the extent

to which those nations party to the OPEC

plus production

agreement decide to increase production of crude

oil, bitumen, natural gas and NGLs and other factors

described herein.

Even after a recovery, our industry will continue to be exposed to the

effects of changing

commodity prices given the volatility

in commodity price drivers and the worldwide political

environment generally, as well as continued uncertainty caused by armed hostilities

in various oil-producing

regions around the globe.

Lower crude oil, bitumen, natural gas, NGL and

LNG prices may have a material adverse effect on our

revenues, earnings, cash flows and liquidity, and may also affect the amount of dividends

we elect to declare

and pay on our common stock.

As a result of the oil market downturn that

began in early 2020, we suspended

our share repurchase program.

Lower prices may also limit the amount of reserves

we can produce

economically, thus adversely affecting our proved reserves and reserve replacement ratio

Our operating results, our ability to execute

on our strategy and the carrying value of our assets

are exposed to

the effects of changing commodity prices.

The oil and gas business is a commodity business.

Our revenues, operating results

and future rate of growth are

highly dependent on the prices we receive for

crude oil, bitumen, natural gas

Such prices can fluctuate

widely depending upon global events or conditions

that affect supply and demand, most

of which are out of our

In early 2020 global oil demand decreased precipitously

alongside global COVID-19 economic shutdowns.

Although global oil demand and global oil prices improved

through 2021, the global economic recovery

Our industry will continue to be exposed to

the effects of changing commodity prices

volatility in commodity price drivers

and the worldwide political and economic environment

continued uncertainty caused by

armed hostilities in various oil-producing regions

around the globe.

Lower crude oil, bitumen, natural gas

and NGL prices may have a material adverse

effect on our revenues,

operating income, cash flows

and liquidity, and

may also affect the amount of dividends we elect

to declare and

pay on our common stock and the amount

of shares we elect to acquire as part of the share repurchase

and the timing of such acquisitions.

Lower prices may also limit the amount of reserves we

economically,

thus adversely affecting our proved

reserves and reserve replacement ratio

and accelerating the

reduction in our existing reserve levels as we continue

production from upstream fields.

reduction in our existing reserve levels

as we continue production from upstream

Prolonged depressed

crude oil prices may affect certain decisions related to

our operations, including decisions to reduce

investments or curtail operated production.

crude oil prices may affect certain

decisions related to our operations,

including decisions to reduce capital

investments or curtail operated

Significant reductions in crude oil, bitumen, natural

gas, NGLs and LNG prices could also

require us to reduce

our capital expenditures, impair the carrying value

of our assets or discontinue the classification

assets as proved reserves.

In 2020, we recognized several impairments,

which are described in Note 7—

Suspended Wells and Exploration Expenses and Note 8—Impairments, in the Notes

to Consolidated Financial

due to changes in assumptions for commodity

prices and development plans.

If the outlook for

commodity prices remains low relative to historic

levels, and as we continue to optimize our investments

exercise capital flexibility, it is reasonably likely we will incur future impairments

to long-lived assets used in

operations, investments in nonconsolidated entities

accounted for under the equity method and unproved

If oil and gas prices persist at depressed levels,

our reserve estimates may decrease further, which

could incrementally increase the rate used to determine

DD&A expense on our unit-of-production method

Management’s Discussion and Analysis for further examination

of DD&A rate impacts

versus comparative periods.

Although it is not reasonably practicable to quantify

the impact of any future

impairments or estimated change to our unit-of-production

rates at this time, our results of operations could

adversely affected as a result.

Our business has been, and will continue to

be, adversely affected by the coronavirus (COVID-19)

The COVID-19 pandemic and the measures put

in place to address it have negatively impacted

economy, disrupted global supply chains, reduced global demand for oil

and gas, and created significant

volatility and disruption of financial and commodity

According to the National Bureau of Economic

Research, as a result of the pandemic and its broad

reach across the entire economy, the U.S.

recession in early 2020 and the timing, pace and extent

of the recovery is still unknown.

Public health officials

have recommended or mandated certain precautions

to mitigate the spread of COVID-19, including limiting

non-essential gatherings of people, ceasing all

non-essential travel and issuing “social or

physical distancing”

guidelines, “shelter-in-place” orders and mandatory

closures or reductions in capacity for non-essential

Although some of these limitations and mandates

have been relaxed in certain jurisdictions,

have been reinstated in areas that have experienced

a resurgence of COVID-19 cases.

In addition, despite

approval of vaccines to immunize against

COVID-19, the speed at which such vaccinations

will be available to

the public’s willingness to be inoculated and the effectiveness of the vaccine

(including to variants)

still remain unknown.

As a result, the full impact of the COVID-19

pandemic remains uncertain and will

depend on the severity, location and duration of the effects and spread of the disease,

the effectiveness and

duration of actions taken by authorities to contain

the virus or treat its effect, the availability and effectiveness

of vaccines or other treatments, and how quickly

and to what extent economic conditions improve.

We have already been impacted by the COVID-19 pandemic.

Management’s Discussion and

Analysis of Financial Condition and Results of

Operations, for additional information on how we have

impacted and the steps we have taken in response.

Our business is likely to continue to be further

negatively impacted by the COVID-19

impacts could include but are not limited

Continued reduced demand

for our products as a result of prolonged reductions

in travel and

even if restrictions are lifted;

gas and NGL prices could also require us to

reduce our capital

expenditures, impair the carrying value of our

assets or discontinue the classification of certain

assets as proved

In the past three years, we recognized

several impairments, which

are described in

prices decrease relative to their current

levels, and as we continue to optimize

our investments and exercise

capital flexibility,

it is reasonably likely we could

incur future impairments to long-lived assets

used in operations,

investment in nonconsolidated

entities accounted for under the equity

method and unproved properties.

Although it is not reasonably practicable to

quantify the impact of any future impairments

or estimated change to

our unit-of-production

rates at this time, our results

of operations could be adversely affected

Our business has been, and will continue to be, adversely affected

by the coronavirus (COVID-19) pandemic.

The COVID-19 pandemic and the measures put in place to

address it have negatively

impacted the global economy,

disrupted global supply chains, reduced global demand for

oil and gas and created significant

volatility and

disruption of financial and commodity markets.

Over the course of the pandemic, public health

officials have

recommended or mandated certain

precautions to mitigate

the spread of COVID-19, including limiting non-

essential gatherings of people, ceasing all non-essential

travel and issuing “social or

physical distancing” guidelines,

“shelter-in-place” orders and

mandatory closures or reductions in capacity

for non-essential businesses.

some of these limitations and mandates have

been relaxed in certain jurisdictions,

others have been reinstated

areas that have experienced a resurgence

of COVID-19 cases and there is no guarantee

restrictions will not be

reimposed in the future.

Despite the increased availability

of vaccines in certain jurisdictions, the COVID

pandemic may continue or worsen

during the upcoming months, including as a result of the emergence

infectious variants of the virus,

vaccine hesitancy or increased business and

social activities, which may cause

governmental authorities to reinstate

restrictions.

As a result, the ongoing impact of the COVID-19 pandemic

ConocoPhillips

remains uncertain and will depend on the severity,

location and duration of the effects

and spread of the disease,

the effectiveness and duration

of actions taken by authorities to contain

the virus or treat its effect, the availability

and effectiveness of vaccines

or other treatments, and how quickly and

to what extent economic conditions

See our Human Capital Management section within Item 1 and 2—Business and Properties

, for additional

information on how we have

been impacted and the steps we have

taken in response.

Our business is likely to continue to

be further negatively impacted by the COVID

-19 pandemic.

These impacts

could include but are not limited to:

Reduced demand for our products

as a result of reductions in travel

and commerce, whether related to

mandated restrictions or otherwise;

Disruptions in our supply chain due in part to scrutiny

or embargoing of shipments from infected areas

or invocation of force majeure clauses in commercial

contracts due to restrictions imposed as a result

of the global response to the pandemic;

Failure of third parties on which we rely, including our suppliers, contract

or embargoing of shipments from infected

invocation of force majeure

clauses in commercial contracts

due to restrictions imposed as a result

global response to the pandemic;

Failure of third-parties on which we rely,

including our suppliers, contract

manufacturers, contractors,

joint venture partners and external business partners,

to meet their obligations to the company, or

significant disruptions in their ability to

do so, which may be caused by their own financial

operational difficulties or restrictions imposed in

response to the disease outbreak;

Reduced workforce productivity caused by, but not limited to, illness, travel

restrictions, quarantine,

or government mandates;

Business interruptions resulting from a portion

of our workforce continuing to telecommute,

the implementation and maintenance of protections

for employees commuting for work, such as

personnel screenings and self-quarantines before or

after travel;

or involuntary curtailments to support oil prices

or alleviate storage shortages for our

Any of these factors, or other cascading effects of the

COVID-19 pandemic that are not currently foreseeable,

could materially increase our costs, negatively impact

our revenues and damage our financial condition,

of operations, cash flows and liquidity position.

Despite the rollout of vaccines, the pandemic

progress and evolve, and the full extent and duration

of any such impacts cannot be predicted

because of the sweeping impact of the COVID-19 pandemic

on daily life around the world and a lack of

certainty as to if or when conditions will return

to pre-COVID levels.

Unless we successfully add to our existing proved

reserves, our future crude oil, bitumen,

natural gas and

NGL production will decline, resulting in an

adverse impact to our business.

The rate of production from upstream fields

generally declines as reserves are depleted.

If we do not conduct

successful exploration and development activities,

or, through engineering studies, optimize production

performance or identify additional or secondary

recovery reserves, our proved reserves

will decline materially

as we produce crude oil, bitumen, natural gas and

NGLs, and our business will experience reduced cash

and results of operations.

Any cash conservation efforts we may undertake as a result

of commodity price

declines may further limit our ability to replace

depleted reserves.

The exploration and production of oil and gas

is a highly competitive industry.

The exploration and production of crude oil,

bitumen, natural gas and NGLs is a highly

competitive business.

We compete with private, public and state-owned companies in all facets of the

exploration and production

business, including to locate and obtain new

sources of supply and to produce crude oil,

bitumen, natural gas

and NGLs in an efficient, cost-effective manner.

Some of our competitors are larger and have greater

resources than we do or may be willing to incur a

higher level of risk than we are willing to

incur to obtain

potential sources of supply.

joint venture partners

and external business partners, to

meet their obligations to the company,

significant disruptions in their ability to do so,

which may be caused by their own financial or operational

difficulties or restrictions imposed in response

to the disease outbreak;

Reduced workforce productivity

caused by, but

not limited to, illness, travel

restrictions, quarantine, or

government mandates;

Increased challenges in retention

of personnel caused by vaccine hesitancy

and the resistance of some in

our workforce to comply with

workplace protocols necessary to ensure

the health and safety of our

workforce and minimize disruptions

to the business, such as vaccine and testing requirements,

of personal protective equipment;

Voluntary or involuntary

curtailments to support oil prices or alleviate storage

shortages for our products.

Any of these factors, or other cascading

effects of the COVID-19 pandemic that

are not currently foreseeable,

could materially increase our costs,

negatively impact our revenues and

damage our financial condition, results of

operations, cash flows and liquidity position.

Despite the rollout of vaccines, the pandemic continues

and evolve, and the full extent and

duration of any such impacts cannot

be predicted at this time because of the

sweeping impact of the COVID-19 pandemic on daily life

around the world and a lack of certainty

as to if or when

conditions will return to pre-COVID

Unless we successfully develop resources, the scope

of our business will decline, resulting in an adverse impact to

our business.

As we produce crude oil and natural

gas from our existing portfolio,

the amount of our remaining reserves

If we are not successful in replacing the crude oil and

natural gas we produce with

good prospects for

future organic opportunities or through

acquisitions, our business will decline.

In addition, our ability to

successfully develop our reserves is dependent

on a number of factors, including our ability to

obtain and renew

rights to develop and produce hydrocarbons;

our success at reservoir optimization;

to bring long-lead

time, capital intensive projects

to completion on budget and on schedule;

and our ability

to efficiently and

profitably operate mature

If we are not successful in developing the resources

in our portfolio, our

financial condition and results of operations

may be adversely affected.

The exploration and production of oil and gas is a highly comp

etitive industry.

The exploration and production

of crude oil, bitumen, natural gas and NGLs

is a highly competitive business.

compete with private, public

and state-owned companies in all

facets of the exploration and

production business,

including to locate and obtain new sources

of supply and to produce crude oil, bitumen, natural

gas and NGLs in an

efficient, cost-effective

We must compete for

the materials, equipment, services, employees

personnel (including geologists, geophysicists,

engineers and other specialists) necessary to conduct

our business.

Some of our competitors are larger

and have greater resources

than we do, or may have

established strategic

ConocoPhillips

term positions or strong governmental

or other relationships in countries

or areas in which we operate, or may

willing to incur a higher level of risk than we are willing to

incur to obtain potential sources

consequence, we may be at a competitive

disadvantage in certain respects,

such as in accessing the necessary

materials, equipment, services, resources

and personnel.

In addition, we may be at a competitive disadvantage

when competing with state-

owned companies if they are motivated by political

or other factors in making their business decisions,

less emphasis on financial returns.

when competing with state-owned

companies if they are motivated

by political or other factors in making their

business decisions, with less emphasis on financial returns.

If we are not successful in our competition for

new reserves, our financial

condition and results of operations may be adversely

reserves, our financial condition and results

of operations may be adversely

Any material change in the factors and assumptions

underlying our estimates of crude oil, bitumen,

gas and NGL reserves could impair the quantity

and value of those reserves.

Our proved reserve information included in this annual

report represents management’s best estimates based

on assumptions, as of a specified date, of the volumes

to be recovered from underground accumulations of

crude oil, bitumen, natural gas and NGLs.

Such volumes cannot be directly measured

and the estimates and

underlying assumptions used by management are

subject to substantial risk and uncertainty.

changes in the factors and assumptions underlying

underlying our estimates of crude oil, bitumen, natural gas

and NGL reserves could impair the quantity and value of those reserves.

Our proved reserve information

included in this annual report represents

management’s best estimates

assumptions, as of a specified date, of the volumes

to be recovered from underground

accumulations of crude oil,

bitumen, natural gas and NGLs.

Such volumes cannot be directly measured and the

estimates and underlying

assumptions used by management are subject to

substantial risk and uncertainty.

Any material changes in the

factors and assumptions underlying

our estimates of these items could result

in a material

negative impact to the volume of reserves reported

or could cause us to incur impairment expenses

associated with the production of those reserves.

Future reserve revisions could also result

from changes in,

among other things, governmental regulation.

in a material negative impact to the

volume of reserves reported or could

cause us to incur impairment expenses on property

associated with the

production of those reserves.

Future reserve revisions could also

result from changes in, among other things,

governmental regulation.

Our business may be adversely affected by price controls,

government-imposed limitations on production

crude oil, bitumen, natural gas and NGLs, or the

unavailability of adequate gathering, processing,

compression, transportation, and pipeline

facilities and equipment for our production

of crude oil, bitumen,

exports of crude oil, bitumen, natural gas and NGLs, or the unavailability of adequate

gathering, processing,

compression, transportation, and pipeline facilities and

equipment for our production of crude oil, bitumen,

natural gas and NGLs.

As discussed herein, our operations are subject

to extensive governmental regulations.

As discussed herein, our operations

are subject to extensive governmental

From time to time,

regulatory agencies have imposed price controls

and limitations on production by restricting

the rate of flow of

crude oil, bitumen, natural gas and NGL wells

below actual production capacity.

Because legal requirements

are frequently changed and subject to interpretation,

we cannot predict whether future restrictions

business may be enacted or become applicable to

Our ability to sell and deliver the crude oil, bitumen,

natural gas, NGLs and LNG that we produce

depends on the availability, proximity, and capacity of gathering, processing, compression, transportation

pipeline facilities and equipment, as well as any necessary

diluents to prepare our crude oil, bitumen, natural

gas, NGLs and LNG for transport.

The facilities, equipment and diluents we rely

on may be temporarily

unavailable to us due to market conditions, extreme

weather events, regulatory reasons, mechanical

other factors or conditions, many of which are

beyond our control.

In addition, in certain newer plays, the

capacity of necessary facilities, equipment and diluents

may not be sufficient to accommodate production

existing and new wells, and construction and permitting

delays, permitting costs and regulatory or other

constraints could limit or delay the construction,

manufacture or other acquisition of new facilities

If any facilities, equipment or diluents, or

any of the transportation methods and channels

rely on become unavailable for any period of time,

we may incur increased costs to transport

our crude oil,

bitumen, natural gas, NGLs and LNG for sale or

we may be forced to curtail our production

of crude oil,

bitumen, natural gas or NGLs.

regulatory agencies have imposed

price controls and limitations

on production by restricting the rate

crude oil, bitumen, natural gas and

NGL wells below actual production capacity.

Similarly, in response

domestic energy costs, circumstances

determined to be in the economic interest

of the country,

or a declared

national emergency,

government could restrict

the export of our products which would

adversely impact

our domestic business.

Because legal requirements are frequently

changed and subject to interpretation,

cannot predict whether future restrictions

on our business may be enacted or become applicable

Our ability to sell and deliver the crude oil, bitumen, natural

gas, NGLs and LNG that we produce also

the availability,

and capacity of gathering, processing, compression,

transportation and pipeline facilities

and equipment, as well as any necessary diluents

to prepare our crude oil, bitumen, natural

gas, NGLs and LNG for

Furthermore, we rely on there being sufficient

facilities and takeaway

capacity to support our ambitions

to reduce routine flaring.

The facilities, equipment and diluents

we rely on may be temporarily

unavailable to us

due to market conditions, extreme

weather events, regulatory

reasons, mechanical reasons or other factors

conditions, many of which are beyond

In addition, in certain newer plays, the capacity

facilities, equipment and diluents may

not be sufficient to accommodate production

from existing and new wells,

and construction and permitting delays,

permitting costs and regulatory or

other constraints could limit or delay

the construction, manufacture or other acquisition

of new facilities and equipment.

If any facilities, equipment or

diluents, or any of the transportation

methods and channels that we rely on become unavailable

for any period of

time, we may incur increased costs

to transport our crude oil, bitumen, natural

gas, NGLs and LNG for sale or we

may be forced to curtail our

production of crude oil, bitumen, natural

ConocoPhillips

Our investments in joint ventures decrease

our ability to manage risk.

We conduct many of our operations through joint ventures in which we may share

control with our joint

venture partners.

There is a risk our joint venture participants may

at any time have economic, business or

legal interests or goals that are inconsistent with

those of the joint venture or us, or our joint

venture partners

may be unable to meet their economic or other

obligations and we may be required to

fulfill those obligations

Failure by us, or an entity in which we have

a joint venture interest, to adequately manage

associated with any operations, acquisitions or

dispositions could have a material adverse effect on the

financial condition or results of operations of our

joint ventures and, in turn, our business and

Our operations present hazards and risks that

require significant and continuous oversight.

The scope and nature of our operations present

a variety of significant hazards and risks, including

hazards and risks such as explosions, fires,

crude oil spills, severe weather, geological events, labor disputes,

armed hostilities, terrorist attacks, sabotage, civil

unrest or cyber attacks.

Our operations may also be

adversely affected by unavailability, interruptions or accidents involving services

or infrastructure required to

develop, produce, process or transport our production,

such as contract labor, drilling rigs, pipelines, railcars,

tankers, barges or other infrastructure.

Our operations are subject to the additional hazards

of pollution,

releases of toxic gas and other environmental hazards

We conduct many of our operations

through joint ventures in which we

may share control with our

joint venture

There is a risk our joint venture participants

may at any time have economic,

business or legal interests

or goals that are inconsistent

with those of the joint venture or us, or our joint

venture partners may be unable

meet their economic or other obligations and

we may be required to fulfill those obligations

Failure by us,

or an entity in which we have a joint venture

interest, to adequately manage

the risks associated with any

operations, acquisitions or dispositions could

have a material adverse

effect on the financial condition or results

operations of our joint ventures

and, in turn, our business and operations.

Our operations present hazards and risks that require significant

and continuous oversight.

The scope and nature of our operations

present a variety of significant hazards

and risks, including operational

hazards and risks such as explosions,

fires, product spills, severe weather,

geological events, labor disputes,

geopolitical tensions, armed hostilities, terrorist

or piracy attacks, sabotage,

civil unrest or cyberattacks.

operations are subject to the additional

hazards of pollution, toxic substances

and other environmental hazards

Offshore activities may pose incrementally

greater risks because of complex subsurface

conditions such as higher reservoir pressures,

water depths and

metocean conditions.

All such hazards could result in loss of human

life, significant property and equipment

damage, environmental pollution, impairment

of operations, substantial losses to us and damage to

Further, our business and operations may be disrupted if

we do not respond, or are perceived not to

respond, in an appropriate manner to any of these hazards

and risks or any other major crisis or if

unable to efficiently restore or replace affected operational

components and capacity.

greater risks because of complex

subsurface conditions such

as higher reservoir pressures, water

depths and metocean conditions.

All such hazards could result in loss of

human life, significant property

and equipment damage, environmental

pollution, impairment of operations,

substantial losses to us and damage to

our reputation.

Our business and operations may be disrupted

respond, or are perceived not to

respond, in an appropriate manner to

any of these hazards and risks

major crisis or if we are unable to efficiently

restore or replace affected

operational components

and capacity.

insurance may not be adequate to

compensate us for all resulting

losses, and the cost to obtain

adequate coverage may

increase for us in the future.

Legal and Regulatory Risks

We expect to continue to incur substantial capital expenditures and operating

costs as a result of our

compliance with existing and future environmental

We expect to continue

to incur substantial capital

expenditures and operating costs

as a result of our compliance

with existing and future environmental

laws and regulations.

Our business is subject to numerous laws and regulations

relating to the protection of the environment, which

are expected to continue to have an increasing

impact on our operations.

For a description of the most

significant of these environmental laws and regulations,

see the “Contingencies—Environmental” and

“Contingencies—Climate Change” sections

of Management’s Discussion and Analysis of Financial Condition

and Results of Operations.

These laws and regulations continue to increase in

both number and complexity

and affect our operations with respect to, among other things:

Our business is subject to numerous laws and

regulations relating to the protection

of the environment, which are

expected to continue to have

an increasing impact on our operations.

For a description of the most significant of

these environmental laws and

regulations, see the “Contingencies—Environmental”

and “Contingencies—Climate

Change” sections of Management’s

Discussion and Analysis of Financial Condition and Results

of Operations.

These laws and regulations continue

to increase in both number and complexity and

affect our operations

respect to, among other things:

Permits required in connection with exploration,

drilling, production and other activities, including

those issued by national, subnational, and local authorities;

The discharge of pollutants into the environment;

Emissions into the atmosphere, such as nitrogen

oxides, sulfur dioxide, mercury and GHG emissions;

drilling, production and other activities, including those

issued by national, subnational, and local authorities;

The discharge of pollutants into

the environment;

Emissions into the atmosphere, such

as nitrogen oxides, sulfur dioxide, mercury

and GHG emissions,

including methane;

Carbon taxes;

The handling, use, storage, transportation, disposal

and cleanup of hazardous materials and hazardous

The handling, use, storage, transportation,

disposal and cleanup of hazardous materials

and hazardous

and nonhazardous wastes

The dismantlement, abandonment and restoration

of our properties and facilities at the end of

of historic properties and facilities at

the end of their

useful lives;

Exploration and production activities

in certain areas, such as offshore environments, arctic fields,

sands reservoirs and unconventional plays.

We have incurred and will continue to incur substantial capital, operating and maintenance,

and remediation

expenditures as a result of these laws and regulations.

Any failure by us to comply with existing

laws, regulations and other requirements could result

in administrative or civil penalties, criminal

enforcement actions or third-party litigation

To the extent these expenditures, as with all costs, are

not ultimately reflected in the prices of our products

and services, our business, financial

condition, results of

operations and cash flows in future periods could

be materially adversely affected.

Existing and future laws, regulations and internal

initiatives relating to global climate change,

limitations on GHG emissions, may impact or limit

our business plans, result in significant expenditures,

promote alternative uses of energy or reduce demand

for our products.

Continuing political and social attention to the

issue of global climate change has resulted in

both existing and

pending international agreements and national,

regional or local legislation and regulatory

measures to limit

GHG emissions, such as cap and trade regimes, carbon

taxes, restrictive permitting, increased fuel efficiency

standards and incentives or mandates for renewable

For example, in December 2015, the U.S.

the international community at the 21st Conference

of the Parties of the United Nations Framework

Convention on Climate Change in Paris that

prepared an agreement requiring member countries

to review and

represent a progression in their intended GHG

emission reduction goals every five years

beginning in 2020.

While the U.S.

previously withdrew from the

Paris Agreement, the new administration

has recommitted the

United States to the Paris Agreement, and a significant

number of U.S.

state and local governments

corporations headquartered in the U.S.

have also announced

their intention to satisfy these commitments.

addition, our operations continue in countries around

the world which are party to, and have not announced

intent to withdraw from, the Paris Agreement.

The implementation of current agreements

and regulatory

measures, as well as any future agreements or measures

addressing climate change and GHG emissions,

adversely impact the demand for our products,

impose taxes on our products or operations or

require us to

purchase emission credits or reduce emission of

GHGs from our operations.

As a result, we may experience

declines in commodity prices or incur substantial

capital expenditures and compliance, operating, maintenance

and remediation costs, any of which may have

an adverse effect on our business and results of operations.

In October 2020, we announced the adoption of a

Paris-aligned climate risk framework, whereby

committed to a reduction of our gross operated

(scope 1 and 2) emissions intensity, with an ambition to

achieve net zero by 2050 from operated emissions.

We also endorsed the World Bank Zero Routine Flaring by

2030 initiative, with an ambition to meet that

goal by 2025 and reaffirmed our commitment to advocate

reduction of scope 3 emissions intensity through

our support for a U.S.

carbon price.

Compliance with, and

achievement of, climate change related internal initiatives

such as the foregoing may increase costs, require

to purchase emission credits, or limit or

impact our business plans, potentially resulting in the

reduction to the

economic end-of-field life of certain assets

and an impairment of the associated net book

Increasing attention to global climate change has

also resulted in pressure upon stockholders,

institutions and/or financial markets to modify

their relationships with oil and gas companies

investments and/or funding to such companies.

For example, in 2019 Norway’s Government Pension Fund

announced it would reduce its investment exposure

to companies that explore for oil and gas,

and in 2020 a

number of major financial institutions

announced that they would no longer finance oil and

gas exploration

projects in the Arctic.

As public pressure continues to mount, our access to

capital on terms we find favorable

(if it is available at all) may be limited and our costs

may increase or our business and results

of operations

may be otherwise adversely affected.

Furthermore, increasing attention to global climate

change has resulted in an increased likelihood

governmental investigations and private litigation,

which could increase our costs or otherwise adversely

our business.

Exploration and production

activities in certain areas, such as offshore

environments, arctic fields, oil

sands reservoirs and unconventional

We have incurred and

will continue to incur substantial

capital, operating and maintenance, and

expenditures as a result of these laws and

In addition, to the extent these expenditures

by a buyer as a result of a disposition, it may

result in our incurring substantial costs

if the buyer is unable to satisfy

these obligations.

Any failure by us to comply

with existing or future laws, regulations

and other requirements

could result in administrative

or civil penalties, criminal fines, other enforcement

actions or third-party litigation

ConocoPhillips

To the extent

these expenditures, as with all costs,

are not ultimately reflected in

the prices of our

products and services, our business, financial condition, results

of operations and cash flows in future

could be materially adversely affected.

Existing and future laws, regulations and internal initiatives

relating to global climate change, such as

limitations on GHG emissions may impact or limit our business plans,

result in significant expenditures, promote

alternative uses of energy or reduce demand for our products.

Continuing political and social attention

to the issue of global climate change has resulted

in both existing and

pending international agreements

and national, regional or local legislation and regulatory

measures to limit GHG

emissions, such as cap and trade regimes, specific

emission standards, carbon taxes,

restrictive permitting,

increased fuel efficiency standards

and incentives or mandates for renewable

Although we may support

many of these legislative and regulatory

measures, how and when they are enacted could

result in a material

adverse effect to our

business, financial condition, results of operations

and cash flows in future periods.

For example, in November 2021,

Environmental Protection

Agency published a Proposed Rule that would

revise the regulations governing

the emission of GHG and volatile organic compounds

from new oil and gas

production facilities, and emission guidelines

for states to use when revising

Clean Air Act implementation plans to

limit GHG emissions from existing oil and gas

Although the company supports the direct federal

regulation of methane from new and existing

the final form and substance of any regulations

currently known and could result in additional

capital expenditures and compliance,

operating and maintenance

costs, any of which may have

an adverse effect on our business

and results of operations.

Additionally,

in 2021, the U.S.

joined the international community at

the 26th Conference of the Parties (COP26).

At the conclusion of COP26, the U.S.

200 other counties agreed to the Glasgow Climate

committing to revisiting and strengthening

their current emissions targets

to 2030 in 2022 and finalizing the

outstanding elements of the Paris

In addition, our operations continue

in countries around the world

which are party to the Paris Agreement.

The implementation of current

agreements and regulatory measures,

well as any future agreements

or measures addressing climate change and

GHG emissions, may adversely impact

the demand for our products, impose taxes

on our products or operations or require

us to purchase emission

credits or reduce emission of GHGs from our operations.

As a result, we may experience declines in commodity

prices or incur substantial capital expenditures

and compliance, operating, maintenance

and remediation costs,

any of which may have an

adverse effect on our business

and results of operations.

In September 2021, we announced an improvement

to our Paris-aligned climate risk framework,

committed to an improvement

to our targets for reduc

ing our scope 1 and 2 emissions intensity on both a

operated and net equity basis and reaffirmed

our commitment to advocate

for the reduction of scope 3 emissions

through our support for a U.S.

Compliance with, and achievement of,

climate change-related

internal initiatives such as the foregoing

may increase costs, require

us to purchase emission credits, or limit or

impact our business plans.

If we are not successful in select internal initiatives,

we may be adversely affected

potentially need to reduce

economic end-of-field life

of certain assets and impair associated

net book value.

Increasing attention to

global climate change has also resulted in pressure

from and upon stockholders,

institutions and/or financial markets

to modify their relationships with oil and gas

companies and to limit

investments and/or funding to

such companies.

For example, Harvard University

announced in September 2021

that it will stop investing

its $42 billion endowment in fossil fuels and will let its current

investments expire without

As public pressure continues to

mount, our access to capital on terms we

find favorable (if it is available

at all) may be limited and our costs

may increase,

our reputation could be damaged or our business

and results of

operations may be otherwise adversely

Furthermore, increasing attention

to global climate change has resulted

in an increased likelihood of governmental

investigations and private

litigation, which could increase our costs

or otherwise adversely affect our business.

Beginning in 2017, cities, counties, governments

and other entities in several states in the U.S.

have filed lawsuits against oil and gas companies,

and other entities in several states

have filed lawsuits

against oil and gas companies,

including ConocoPhillips, seeking compensatory

and equitable relief to abate alleged climate change

Additional lawsuits with similar allegations

damages and equitable relief to

ConocoPhillips

abate alleged climate change impacts.

Additional lawsuits with similar allegations are

expected to be filed.

The amounts claimed by plaintiffs are unspecified

amounts claimed by plaintiffs are unspecified

and the legal and factual issues

involved in these cases are unprecedented.

ConocoPhillips believes these lawsuits are factually

meritless and are an inappropriate vehicle to address

the challenges associated with climate

change and will

vigorously defend against such lawsuits.

The ultimate outcome and impact to us cannot

be predicted with

certainty, and we could incur substantial legal costs associated with defending

these and similar lawsuits in the

In addition, although we design and operate our

business operations to accommodate expected

conditions, to the extent there are significant

changes in the earth’s climate, such as more severe or frequent

weather conditions in the markets where we operate

or the areas where our assets reside, we could

increased expenses, our operations could be adversely

impacted, and demand for our products could fall.

For more information on legislation or precursors

for possible regulation relating to global climate

affect or could affect our operations and a description of the company’s response, see the

“Contingencies—

Climate Change” section of Management’s Discussion and Analysis of

Financial Condition and Results of

Domestic and worldwide political and economic

developments could damage our operations and materially

involved in these cases are

unprecedented.

ConocoPhillips believes these lawsuits

are factually and legally meritless and

are an inappropriate

vehicle to address the challenges associated

with climate change and will vigorously

defend against such lawsuits.

The ultimate outcome and impact to

us cannot be predicted with certainty,

and we could incur substantial

costs associated with defending

these and similar lawsuits in the future.

We could also receive lawsuits

failure or lack of diligence to meet our

publicly stated ESG goals, so

called “greenwashing” cases.

In addition, although we design and operate

our business operations to accommodate

expected climatic

conditions, to the extent there are

significant changes in the earth’s

climate, such as more severe or frequent

weather conditions in the markets

where we operate or the areas

where our assets reside, we could incur

increased expenses, our operations

and supply chain could be adversely impacted, and

demand for our products

For more information on legislation

or precursors for possible regulation

relating to global climate change that

affect or could affect

our operations and a description

of the company’s response,

see the “Contingencies—Climate

Change” section of Management’s Discussion and Analysis of Financial Condition and Results of Operations

Domestic and worldwide political and economic developments

could damage our operations and materially

reduce our profitability and cash flows.

Actions of the U.S., state, local and foreign

governments, through sanctions, tax and other

executive order and commercial restrictions,

could reduce our operating profitability both

In certain locations, restrictions

on our operations;

special taxes or tax assessments;

transparency regulations that could require us to

disclose competitively sensitive information

or might cause us

to violate non-disclosure laws

of other countries have been imposed or proposed

by governments or certain

interest groups.

Actions of the U.S., state, local

and foreign governments, through

sanctions, tax and other legislation, executive

order and commercial restrictions,

could reduce our operating profitability

both in the U.S.

locations, restrictions on our operations;

leasing restrictions;

special taxes

or tax assessments;

transparency regulations

that could require us to disclose competitively

sensitive information or might

violate non-disclosure laws of other countries

have been imposed or proposed by governments

or certain interest

For example, in 2020 a ballot initiative

known as the Fair Share Act was proposed in the

of Alaska, which, if enacted would have increased

the state’s share of production revenues and required

producers to publicly disclose additional financial

Although ultimately defeated, similar

initiatives may be proposed and may be successful

in the future.

The change in control of Congress and the

White House because of the 2020 election increases

the possibility of the promulgation of more stringent

regulations of our operations and the enactment

of tax law changes that may adversely affect the fossil

In addition, the current administration

may use the Congressional Review Act to repeal

regulations finalized in the last five months of the

prior administration.

known as the Fair Share Act was proposed

in the state of Alaska,

which, if enacted would have increased

share of production revenues and

required producers to

publicly disclose additional financial information.

Although ultimately defeated,

similar initiatives may be

proposed and may be successful in the future.

In addition, we may face regulatory

changes in the U.S.

but not limited to, the enactment of tax

law changes that adversely affect

the fossil fuel industry,

emissions standards, restrictive

flaring requirements, and more stringent

environmental impact studies

We also cannot rule out the possibility

of similar regulatory shifts and attendant cost and

market access implications in other international

jurisdictions.

One area subject to significant political

and regulatory activity is the use of hydraulic

of similar regulatory shifts and attendant

cost and market access

implications in other international jurisdictions.

One area subject to significant political and

regulatory activity is the use of hydraulic

fracturing, an essential

completion technique that facilitates production

of oil and natural gas otherwise trapped in lower

completion technique that facilitates

production of oil and natural gas

otherwise trapped in lower permeability

rock formations.

A range of local, state, federal and national laws

and regulations currently govern or, in some

hydraulic fracturing operations, prohibit hydraulic

A range of local, state,

federal and national laws and

regulations currently govern or,

hydraulic fracturing

operations, prohibit hydraulic

fracturing in some jurisdictions.

Although hydraulic

fracturing has been conducted safely for many

decades, a number of new laws, regulations

and permitting

requirements are under consideration which could

result in increased costs, operating restrictions,

delays or could limit the ability to develop oil and

natural gas resources.

Certain jurisdictions in which we

operate have adopted or are considering regulations

that could impose new or more stringent

disclosure or other regulatory requirements on

hydraulic fracturing or other oil and natural

gas operations,

including subsurface water disposal.

On January 27, 2021, the new administration

signed an executive order

directing the Secretary of the Interior to stop

issuing new oil and gas leases on federal

lands, allowing time to

review and reset the Federal Government’s oil and gas leasing program.

Existing production and permits

already issued on Federal lands were not impacted

by this order.

If this temporary moratorium were to be

extended indefinitely, we believe we can mitigate the impact for a considerable

period of time with our current

permits and adjusting our development plans across

our diverse acreage position.

In addition, certain interest groups have also

proposed ballot initiatives and constitutional

designed to restrict oil and natural gas development

generally and hydraulic fracturing in particular.

event that ballot initiatives, local, state,

or national restrictions or prohibitions are adopted

and result in more

stringent limitations on the production and development

of oil and natural gas in areas where we conduct

operations, we may incur significant costs to

comply with such requirements or may experience

curtailment in the permitting or pursuit of exploration,

Although hydraulic fracturing

has been conducted safely for

many decades, a number of new laws, regulations

and permitting requirements are

under consideration which could result

in increased costs, operating restrictions,

operational delays or could

the ability to develop oil and natural

gas resources.

Certain jurisdictions in which we operate have

adopted or are

considering regulations that could impose

new or more stringent permitting, disclosure

or other regulatory

requirements on hydraulic

fracturing or other oil and natural gas

operations, including subsurface water

In addition, certain interest

groups have also proposed ballot initiatives

and constitutional amendments designed

to restrict oil and natural

gas development generally and hydraulic

fracturing in particular.

In the event that ballot

initiatives, local, state,

or national restrictions or prohibitions are

adopted and result in more stringent

on the production and development of oil and

natural gas in areas where we

conduct operations, we may

significant costs to comply with

such requirements or may experience delays

or curtailment in the permitting or

pursuit of exploration,

development or production activities.

Such compliance

costs and delays, curtailments, limitations or

prohibitions could have a material adverse effect on our

prospects, results of operations, financial condition

and liquidity.

government can also prevent or restrict

us from doing business in foreign countries.

restrictions and those of foreign governments

Such compliance costs and delays,

curtailments,

limitations or prohibitions could have

a material adverse effect

on our business, prospects, results of operations,

financial condition and liquidity.

ConocoPhillips

government can also prevent

or restrict us from doing business in foreign

These restrictions

and those of foreign governments

have in the past limited our ability to

operate in, or gain access

to, opportunities in various countries.

Actions by host governments, such as the expropriation

of our oil assets

by the Venezuelan government, have affected operations significantly in the past and may continue to

Changes in domestic and international policies

and regulations may affect our ability to collect

payments such as those pertaining to the settlement

with PDVSA or the ICSID Award against the Government

of Venezuela;

or to obtain or maintain permits, including those necessary for drilling and development

in various locations.

Similarly, the declaration of a “climate emergency” could result in actions to limit

exports of our products and other restrictions.

Local political and economic factors in international

markets could have a material adverse effect on us.

Approximately 48 percent of our hydrocarbon

production was derived from production outside

2020, and 42 percent of our proved reserves, as

of December 31, 2020, were located outside

subject to risks associated with operations in international

markets, including changes in foreign governmental

policies relating to crude oil, natural gas, bitumen,

NGLs or LNG pricing and taxation, other

operate in, or gain access to,

opportunities

in various countries.

Actions by host governments, such

as the expropriation of our oil assets by the Venezuelan

government, have affected

operations significantly in the past

and may continue to do so in the future.

domestic and international policies and regulations

may affect our ability to collect payments

such as those

to the settlement with Petróleos

de Venezuela, S.A.

or the ICSID Award against

Government of Venezuela;

or to obtain or maintain licenses or permits,

including those necessary for drilling and

development of wells in various locations.

Similarly, the declaration

of a “climate emergency” could

actions to limit exports of our products and other

restrictions.

Local political and economic factors

in international markets

could have a material adverse

effect on us.

Approximately 38 percent

of our hydrocarbon

production was derived from production

outside the U.S.

and 29 percent of our proved reserves,

as of December 31, 2021, were located

outside the U.S.

We are subject to

risks associated with operations

in both domestic and international markets,

including changes in foreign

governmental policies relating

to crude oil, natural gas, bitumen, NGLs

or LNG pricing and taxation, other

economic or diplomatic developments (including

the macro effects of international trade policies and

disputes), potentially disruptive geopolitical

and international monetary and currency rate

fluctuations.

In addition, some countries where we operate

lack a fully independent judiciary system.

coupled with changes in foreign law or policy, results in a lack of legal certainty

that exposes our operations to

increased risks, including increased difficulty in enforcing

our agreements in those jurisdictions and increased

risks of adverse actions by local government authorities,

such as expropriations.

Risks Related to Our Acquisition of Concho

Combining our business with Concho’s may be more difficult, costly or time-consuming

than expected and

we may fail to realize the anticipated benefits

of the Merger, which may adversely affect our business results

and negatively affect the value of our common stock.

Our acquisition of Concho (the Merger)

the combination of two companies which, until

completion of the Merger,

as independent public companies.

The success of the Merger will depend

on, among other things, the ability of our

two companies to combine our businesses in

a manner that adds

value to shareholders.

However, there can be no assurances that our respective businesses

can be integrated

successfully, and we will be required to devote significant management attention

and resources to the

integration process.

We must achieve the anticipated improvement in free cash flow generation and returns

and achieve the planned cost savings without adversely

affecting current revenues or compromising the

disciplined investment philosophy to maximize value

for shareholders.

There are a large number of processes, policies, procedures,

operations and technologies and systems that must

be integrated, and although we expect that the

elimination of duplicative costs, strategic

benefits, and

additional income, as well as the realization

of other efficiencies related to the integration of the business,

offset incremental transaction and Merger-related costs over time, we may

encounter difficulties in the

integration and any net benefit may not be achieved

in the near term or at all.

It is possible that the integration

process could take longer than originally anticipated

and could result in the loss of key employees;

commercial and vendor partners;

the disruption of our ongoing businesses;

inconsistencies in standards,

controls, procedures and policies;

unexpected integration issues;

and higher than expected integration costs.

An inability to realize the full extent of the anticipated

benefits of the Merger and the other transactions

contemplated by the Merger Agreement, as well as any delays

encountered in the integration process, could

have an adverse effect upon the revenues, level of expenses

and operating results of ConocoPhillips, which

may adversely affect the value of our common stock.

The market value of our common stock could

decline if large amounts of our common

stock are sold now

that the Concho acquisition has been consummated.

We issued shares of ConocoPhillips common stock to former Concho stockholders.

Former Concho

stockholders may decide not to hold the shares

of ConocoPhillips common stock that they received

Merger, and ConocoPhillips stockholders may decide to reduce their investment

in ConocoPhillips as a result

of the changes to ConocoPhillips’ investment

profile as a result of the Merger.

Other Concho stockholders,

such as funds with limitations on their permitted

holdings of stock in individual issuers, may

be required to sell

the shares of ConocoPhillips common stock that

they received in the Merger.

Such sales of ConocoPhillips

common stock could have the effect of depressing the

market price for ConocoPhillips common stock.

Other Risk Factors Facing our Business or

We may need additional capital in the future, and it may not be available on acceptable

the macro effects of international

trade policies and disputes),

potentially disruptive geopolitical conditions,

and international monetary and currency

rate fluctuations.

Restrictions on production of oil and

gas could increase to the extent

governments view such measures as

approach for pursuing national

and global energy and climate policies.

In addition, some countries where we

operate lack a fully independent judiciary

This, coupled with changes in foreign law or policy,

lack of legal certainty that exposes

our operations to increased risks,

including increased difficulty in enforcing

agreements in those jurisdictions and increased risks

of adverse actions by local government authorities,

expropriations.

Other Risk Factors Facing

our Business or Operations

We may need additional capital in the

future, and it may not be available on acceptable terms

We have historically

relied primarily upon cash generated

by our operations to fund our

operations and strategy;

we have also relied from time to

time on access to the debt and equity capital markets

There can be no assurance that additional

debt or equity financing will be available in the future on

terms or at all.

We have historically relied primarily upon cash generated by our operations to fund

our operations and

however, we have also relied from time to time on access to

the debt and equity capital markets for

There can be no assurance that additional debt

or equity financing will be available in the future

acceptable terms, or at all.

In addition, although we anticipate we

will be able to repay our existing

indebtedness when it matures or in accordance

with our stated plans, there can be no assurance

we will be able

Our ability to obtain additional financing or refinance

our existing indebtedness when it matures

accordance with our plans, will be subject

to a number of factors, including market conditions,

our operating

performance, investor sentiment and our ability

to incur additional debt in compliance with agreements

governing our then-outstanding debt.

If we are unable to generate sufficient funds from

operations or raise

additional capital for any reason, our business could

be adversely affected.

In addition, we are regularly evaluated by the major

rating agencies based on a number of factors,

our financial strength and conditions affecting the oil

and gas industry generally.

We and other industry

companies have had their ratings reduced in the

past due to negative commodity price outlooks.

downgrade in our credit rating or announcement

that our credit rating is under review for possible

could increase the cost associated with any additional

indebtedness we incur.

In addition, although we anticipate we will be

able to repay our existing

indebtedness when it

matures or in accordance with our stated

plans, there can be no assurance we will be able to

Our ability to

obtain additional financing or refinance our existing

indebtedness when it matures or in

accordance with our

plans, will be subject to a number of factors,

including market conditions, our

operating performance, investor

sentiment and our ability to incur additional debt

in compliance with agreements governing our then-outstanding

If we are unable to generate sufficient

funds from operations or raise

additional capital for any reason,

business could be adversely affected.

In addition, we are regularly evaluated

by the major rating agencies based on a number of factors,

including our

financial strength and conditions affecting

the oil and gas industry generally.

We and other industry companies

have had their ratings reduced

in the past due to negative commodity

price outlooks.

Any downgrade in our credit

rating or announcement that our credit

rating is under review for possible

downgrade could increase the cost

associated with any additional indebtedness

ConocoPhillips

Our business may be adversely affected by deterioration

in the credit quality of, or defaults under our

contracts with, third parties with whom we do

The operation of our business requires us to engage

in transactions with numerous counterparties

operating in a

in the credit quality of, or defaults under

our contracts

with, third-parties with whom we do business.

The operation of our business requires

us to engage in transactions with

numerous counterparties operating

variety of industries, including other companies

operating in the oil and gas industry.

These counterparties

may default on their obligations to us as a result

of operational failures or a lack of liquidity, or for other

reasons, including bankruptcy.

Market speculation about the credit quality

of these counterparties, or their

ability to continue performing on their existing obligations,

may also exacerbate any operational difficulties

liquidity issues they are experiencing, particularly

as it relates to other companies in the oil and gas industry

a result of the volatility in commodity prices.

Any default by any of our counterparties may

result in our

inability to perform our obligations under agreements

we have made with third parties or may otherwise

adversely affect our business or results of operations.

These counterparties may

default on their obligations to

us as a result of operational failures

or a lack of liquidity,

or for other reasons,

including bankruptcy.

Market speculation about the credit

quality of these counterparties, or their ability

continue performing on their existing

obligations, may also exacerbate

any operational difficulties

issues they are experiencing, particularly as it relates

to other companies in the oil and gas industry

as a result of

the volatility in commodity prices.

Any default by any of our

counterparties may result in our

inability to perform

our obligations under agreements we have

made with third-parties or may otherwise adversely

affect our business

or results of operations.

In addition, our rights against any of our counterparties

as a result of a default may not be adequate to

compensate us for the resulting harm caused

or may not be

enforceable at all in some circumstances.

We may also be forced to incur additional costs as we attempt to

enforce any rights we have against a defaulting

counterparty, which could further adversely impact our results

as a result of a default may not be

adequate to compensate us

for the resulting harm caused or may

not be enforceable at all in some circumstances.

We may also be forced

to incur additional costs as we attempt

to enforce any rights

we have against

counterparty,

which could further adversely impact our results

of operations.

In particular, in August 2018, we entered into a settlement

agreement with Petróleos de Venezuela, S.A.

(PDVSA) providing for the payment of approximately

$2 billion over a five-year period in connection

arbitration award issued by the International

Chamber of Commerce (ICC) Tribunal in favor of ConocoPhillips

on a contractual dispute arising from Venezuela’s expropriation of our interests in the Petrozuata and Hamaca

heavy oil ventures and other pre-expropriation

fiscal measures.

We have collected approximately $0.8 billion

of the $2.0 billion settlement to date and PDVSA

has defaulted on its remaining payment obligations

this agreement.

We are therefore incurring additional costs as we seek to recover any unpaid amounts

the agreement.

Additionally, in March 2019, an ICSID arbitration tribunal issued an award

ordering the government of Venezuela to pay ConocoPhillips approximately $8.7 billion in compensation

the government’s unlawful expropriation of the company’s investments in Venezuela in 2007.

ConocoPhillips

has filed requests for recognition of the award in several

jurisdictions.

On August 29, 2019, the ICSID tribunal

issued a decision rectifying the award and reducing

it by approximately $227 million.

The award now stands

at $8.5 billion plus interest.

The government of Venezuela is seeking annulment of the award before another

panel at ICSID and annulment proceedings

are underway.

No amounts have been collected as a result of this

Our ability to declare and pay dividends and repurchase

shares is subject to certain considerations.

Dividends are authorized and determined by

our Board of Directors in its sole discretion

and depend upon a

number of factors, including:

Our ability to execute our capital

return program is subject to certain considerations.

In December 2021, we initiated a three

-tier capital return program

that consists of our ordinary dividend, share

repurchases and a quarterly variable

return of cash (VROC).

Ordinary dividends are authorized and determined

by our Board of Directors in its

sole discretion and depend

upon a number of factors, including:

Cash available for distribution;

Our results of operations and anticipated future

results of operations;

Our financial condition, especially in relation

to the anticipated future capital needs of our

The level of distributions paid by comparable companies;

Our results of operations and anticipated

future results of operations;

Our financial condition, especially in relation to

the anticipated future capital needs of our

The level of distributions paid by comparable

Our operating expenses;

Other factors our Board of Directors deems

We expect to continue to pay quarterly dividends to our stockholders;

however, our Board of Directors may

reduce our dividend or cease declaring dividends

Other factors our Board of Directors

deems relevant.

VROC distributions are also authorized

and determined by our Board of Directors

in its sole discretion and depend

upon a number of factors, including:

The anticipated level of distributions

required to meet our capital returns

Forward prices;

Balance sheet cash;

Other factors our Board of Directors

deems relevant.

We expect to continue

to pay a quarterly ordinary dividend

to our stockholders.

In addition, based on the current

environment, we anticipate

also paying a quarterly VROC to

our shareholders staggered from

dividend payment, resulting in up to

eight cash distributions to shareholders

throughout the year;

amount of the VROC is variable and will depend upon the

above factors, and our Board

of Directors may determine

not to pay a VROC in a quarter or may

cease declaring a VROC at any time.

our Board of Directors may

reduce our ordinary dividend or cease declaring dividends

at any time, including if it determines that

provided by operating activities,

after deducting capital expenditures and investments,

are not sufficient to pay

after deducting capital expenditures

and investments, are not sufficient

our desired levels of dividends to our stockholders

or to pay dividends to our stockholders at all.

Additionally, as of December 31, 2020,

$14.5 billion of repurchase authority remained

of the $25 billion share

repurchase program our Board of Directors had

Our share repurchase program does not

to acquire a specific number of shares during any

or to pay dividends to our stockholders

ConocoPhillips

Additionally, as

of December 31, 2021, $10.9 billion of repurchase authority

remained of the $25 billion share

repurchase program our Board

of Directors had authorized.

Our share repurchase program

does not obligate us to

acquire a specific number of shares during any

period, and our decision to commence, discontinue

repurchases in any period will depend on the same

factors that our Board of Directors

may consider when

repurchases in any period will depend

on the same factors that our Board

of Directors may consider when

declaring dividends, among others.

In the past we have suspended our share repurchase

program in response

to market downturns, and we may do so again

in the future.

Any downward revision in the amount of dividends

we pay to stockholders or the number of shares

purchase under our share repurchase program could

have an adverse effect on the market price of our common

There are substantial risks with any acquisitions

or divestitures we may choose to undertake.

We regularly review our portfolio and pursue growth through acquisitions

and seek to divest non-core assets or

We may not be able to complete these transactions on favorable terms, on

a timely basis, or at all.

Even if we do complete such

transactions, our cash flow from operations may be

adversely impacted or

otherwise the transactions

may not result in the benefits anticipated

due to various risks, including, but not

limited to (i) the failure of the acquired assets or

businesses to meet or exceed expected returns,

including risk

of impairment;

(ii) difficulties in integrating the operations,

technologies, products and personnel of the

In the past we have suspended our share

repurchase program in response

market downturns, including as a

result of the oil market downturn

that began in early 2020, and we may do so

again in the future.

Any downward revision

in the amount of our ordinary dividend or VROC or the volume of

shares we purchase

under our share repurchase program

could have an adverse effect

on the market price of our common stock.

There are substantial risks with any

acquisitions or divestitures we have completed

or that we may choose to

We regularly review our portfolio

and pursue growth through acquisitions

and seek to divest noncore assets or

We may not be able to complete these

transactions on favorable

terms, on a timely basis, or at all.

Even if we do complete such transactions,

our cash flow from operations may

be adversely impacted or otherwise

the transactions may not result in the

benefits anticipated due to various

risks, including, but not limited to (i) the

failure of the acquired assets or businesses

to meet or exceed expected

returns, including risk of impairment;

the inability to dispose of noncore assets and

businesses on satisfactory terms and conditions;

and (iii) the

discovery of unknown and unforeseen liabilities

or other issues related to any

acquisition for which contractual

protections are inadequate

or we lack insurance or indemnities, including environmental

liabilities, or with regard

to divested assets or businesses, claims by

purchasers to whom we have provided

contractual indemnification.

In addition, we may face difficulties

in integrating the operations,

technologies, products and personnel of any

acquired assets or businesses.

(iii) the inability

to dispose of non-core assets and businesses on satisfactory

terms and conditions;

and (iv) the discovery of

unknown and unforeseen liabilities or

other issues related to

any acquisition for which contractual protections

are inadequate or we lack insurance or indemnities,

environmental liabilities, or with regard to divested

assets or businesses, claims by purchasers

have provided contractual indemnification.

Our technologies, systems and networks may be subject

to cyber attacks.

Our business, like others within the oil and gas

industry, has become increasingly dependent on digital

technologies, some of which are managed by third-party

service providers on whom we rely to

help us collect,

host or process information.

Among other activities, we rely on digital technology

to estimate oil and gas

reserves, process and record financial and operating

we completed two major acquisitions in

2021, including the

acquisition of Concho in January and the acquisition of the Shell Permian assets

Combined, these

transactions added approximately

800,000 net acres, thereby significantly

increasing our unconventional

and operations in the Permian.

We may still encounter

difficulties integrating the acquired

assets into our

There are a large number of processes,

policies, procedures, operations

and technologies and systems

that must be integrated

in connection with the transactions and the integration

of the acquired assets.

possible that the integration process

could result in the disruption of our ongoing business;

inconsistencies in

standards, controls,

procedures and policies;

unexpected integration

higher than expected integration

and an overall post-completion

integration process that

takes longer than originally anticipated.

and will be required to devote management

attention and resources

to integrating the business

practices and

Any delays encountered

in the integration process

could have an adverse effect

on our revenues or on

our level of expenses or capital investment

and operating results, which may

adversely affect the value

common stock.

In addition, the actual integration may

result in additional and unforeseen

expect that the strategic benefits,

and additional income, as well as the realization

of other efficiencies related to

the integration of the acquired

assets, may offset incremental

transaction-related costs

over time, if we are not

able to adequately address integration

ConocoPhillips

Our technologies, systems and networks

may be subject to cyberattacks.

Our business, like others within the oil and

gas industry,

has become increasingly dependent on digital

technologies, some of which are managed by third

-party service providers on whom we rely

to help us collect, host

or process information.

Among other activities, we rely on digital technology to

estimate oil and gas reserves,

process and record financial and operating

data, analyze seismic and drilling information

communicate with employees and third-parties.

As a result, we face various cyber security

threats such as

attempts to gain unauthorized access to, or control

of, sensitive information about our operations

employees, attempts to render our data or systems

(or those of third-parties with whom we do

corrupted or unusable, threats to the security

of our facilities and infrastructure as well as

those of third-parties

with whom we do business and attempted cyber

In addition, computers control oil and gas production,

processing equipment and distribution

systems globally

and are necessary to deliver our production to market.

A disruption, failure, or a cyber breach of these

operating systems, or of the networks and infrastructure

on which they rely, many of which are not owned or

operated by us, could damage critical production,

distribution or storage assets, delay or prevent delivery

markets or make it difficult or impossible to accurately

account for production and settle transactions.

Although we have experienced occasional breaches

of our cyber security, none of these breaches have had a

material effect on our business, operations or reputation.

As cyber attacks continue to evolve, we must

continually expend additional resources to continue

to modify or enhance our protective measures

investigate and remediate any vulnerabilities

Our implementation of various procedures

to monitor and mitigate security threats

and to increase security for our information, facilities

infrastructure may result in increased costs.

Despite our ongoing investments in security

resources, talent and

business practices, we are unable to assure that

any security measures will be effective.

If our systems and infrastructure were to be breached,

damaged or disrupted, we could be subject to serious

negative consequences, including disruption of

our operations, damage to our reputation,

and communicate with

employees and third-parties.

As a result, we face various cybersecurity

threats such as attempts to

unauthorized access to, or control

of, sensitive information

about our operations and our employees, attempts

render our data or systems

(or those of third-parties with whom we do business,

including third-party cloud and IT

service providers) corrupted or unusable,

threats to the security of our facilities and infrastructure

as well as those

of third-parties with whom we do business,

including third-party cloud and IT service providers,

and attempted

cyber terrorism.

In addition, computers control

oil and gas production, processing equipment

and distribution systems

are necessary to deliver our production

A disruption, failure, or a cyberattack

of these operating

systems, or of the networks

software and infrastructure

on which they rely,

many of which are not owned or

operated by us, could damage critical

production, distribution or storage

assets, delay or prevent delivery

make it difficult or impossible to accurately

account for production and settle

transactions, or negatively

impact public health or safety,

economic security, or

national security.

Although we have experienced occasional

cybersecurity incidents, none have had

a material effect on our

business, operations or reputation.

As cyberattacks have

to evolve, we have become subject

government-imposed security requirements

to implement specific mitigation measures

to protect against

ransomware attacks

and other known threats to information

and operations technology.

In response, we must

continually expend additional resources

to continue to modify or enhance our protective

measures or to

investigate and

remediate any vulnerabilities

Our implementation of reasonable security

and controls to monitor and mitigate

security threats and to increase security

for our information, facilities

infrastructure may result

in increased costs.

Despite our ongoing investments

in security resources, talent and

business practices, we are unable to assure

that any security measures will be completely

If our systems and infrastructure

were to be breached, damaged or disrupted,

we could be subject to serious

negative consequences, including disruption

of our operations, damage to our reputation,

a loss of counterparty

trust, reimbursement or other costs, increased compliance

costs, significant litigation exposure and legal

liability or regulatory fines, penalties or intervention.

Any of these could materially and adversely affect our

business, results of operations or financial condition.

Although we have business continuity plans in

operations may be adversely affected by significant and

widespread disruption to our systems and

infrastructure that support our business.

While we continue to evolve and modify our

business continuity

plans, there can be no assurance that they will

be effective in avoiding disruption and business impacts.

Further, our insurance may not be adequate to compensate us

for all resulting losses, and the cost to obtain

adequate coverage may increase for us in the future.

trust, reimbursement or other costs,

increased compliance costs, litigation

exposure and legal liability or regulatory

fines, penalties or intervention.

In addition, we have exposure to

cybersecurity incidents and the negative

of such incidents related to our data

and proprietary information housed

on third-party IT systems, including

Any of these could materially and adversel

affect our business, results of operations

or financial condition,

and any of the foregoing can

be exacerbated by a delay

or failure to detect a cybersecurity

incident or the full

extent of such incident notwithstanding

reasonable security procedures and controls.

The prevalence of remote

working during the pandemic has introduced

additional cybersecurity risk.

Although we have business continuity

plans in place, our operations may be adversely

affected by significant

and widespread disruption to our systems

and infrastructure that support

our business.

While we continue to evolve and modify our business

plans, there can be no assurance that

they will be completely effective

in avoiding disruption and business

insurance may not be adequate to

compensate us for all resulting

losses, and the cost to obtain

adequate coverage may

increase for us in the future.

ConocoPhillips

Unresolved Staff Comments

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors