<article><p class="lead">ConocoPhillips will keep its $6.1bn current year spending plan unchanged in 2019 to continue generating free cash flow in a volatile oil market. </p><p>The world's biggest independent has set a 2019 production target of 1.3mn-1.35mn b/d of oil equivalent (boe/d), excluding Libya. That compares to the 1.28mn-1.32mn boe/d set for this year, which was increased from 1.23mn-1.26mn boe/d given in the second quarter. </p><p>Of the total 2019 capital expenditures (capex), about $3.1bn will go to the lower 48 states, roughly flat versus this year. It plans to run 10-11 rigs across its three main unconventional portfolios the Eagle Ford in Texas, the Bakken in North Dakota, and the Delaware, which is part of the Permian basin. ConocoPhillips has the flexibility to shift activity among these regions based on where it makes more money, it said.</p><p>The unconventional spending plan also includes funds to conduct multi-well pilots of new completion designs, which may help drive productivity improvements further. It also plans exploration and appraisal activity in areas including the Austin Chalk in Louisiana.</p><p>Spending in Alaska will increase to $1.2bn from about $900mn this year, as the company steps up work at <a href="http://direct.argusmedia.com/newsandanalysis/article/1774037">its recently sanctioned</a> Greater Mooses Tooth 2 (GMT 2) project. </p><p>Canada will get $500mn versus $300mn this year, while the Europe and North Africa region will $700mn compared with $900mn this year amid asset sales. Allocations for the Asia Pacific and the Middle East will fall to $500mn from $700mn.</p><p>At that level of spending, ConocoPhillips will generate enough money from operations to fund its capex and return cash to investors at Nymex WTI prices above $40/bl. It also increased its target of returns to shareholders to greater than 30pc of cash flow from 25-30pc now. It expects to repurchase shares worth $3bn in 2019, which together with dividends will mean a payout of up to 50pc of cash to shareholders at $50/bl WTI.</p><p>The emphasis on returns comes as investors continue to pressure companies to improve margins by lowering costs and keeping a lid on spending. </p><p>"We are running our business for sustained through-cycle financial returns, which is necessary for attracting investors back to the E&amp;P (exploration and production) sector," chief executive Ryan Lance said. </p></article>