Published: March 25, 2020 |

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Phillips 66 will be taking actions in response to the challenging business environment.

“Phillips 66 is well positioned to manage through the challenging environment with our high-quality, diversified asset base and strong balance sheet,” said Greg Garland, chairman and CEO of Phillips 66.

“Our top priorities remain the well-being of our employees, our communities, and safe and reliable operations. We are taking action to maintain our financial strength to ensure security of our dividend, execute capital growth projects that are near completion, and maintain our strong investment grade credit rating. We remain focused on disciplined capital allocation and creating long-term value for our shareholders,” added Garland.

The company is taking the following actions:

• Reducing 2020 consolidated capital spending by $700 million to $3.1 billion.
— Capital spending net of cash capital contributions from joint venture partners (adjusted capital) is now expected to be $3.0 billion. This reduction in adjusted capital from the $3.3 billion budget reflects a $700 million reduction in our consolidated capital spending, partially offset by a $400 million reduction in cash capital contributions anticipated from DCP Midstream.
     
— In midstream, the Red Oak Pipeline and Sweeny Frac 4 projects, as well as Phillips 66 Partners’ Liberty Pipeline, will all be deferred. Phillips 66 Partners has also postponed its final investment decision on ACE Pipeline. Phillips 66 does not expect DCP Midstream to exercise its option to participate in Sweeny Fracs 2 and 3 in 2020.
     
— In refining, the company is deferring and cancelling certain discretionary projects.
 
• Reducing operating and administrative costs by $500 million in 2020.
 
• Temporarily suspended share repurchases effective March 18. Share repurchases during the first quarter of 2020 were approximately $440 million. Phillips 66 will evaluate timing to resume share repurchases.
 
• Secured a new $1 billion, 364-day term loan facility. This facility provides additional liquidity and financial flexibility in addition to the existing $5 billion revolving credit facility. Phillips 66 Partners has a $750 million revolving credit facility.

“We will continue to closely monitor market conditions and evaluate the impact on our portfolio. We are prepared to take additional action as needed. During these times of uncertainty, the people of Phillips 66 remain fully committed to providing energy and improving lives,” said Garland.

About Phillips 66
Phillips 66 is a diversified energy manufacturing and logistics company. With a portfolio of midstream, chemicals, refining, and marketing and specialties businesses, the company processes, transports, stores, and markets fuels and products globally. Phillips 66 Partners, the company’s master limited partnership, is integral to the portfolio. Headquartered in Houston, the company has 14,500 employees committed to safety and operating excellence. Phillips 66 had $59 billion of assets as of Dec. 31, 2019.

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