Conoco CEO, Jim Mulva says inflation is a big problem. The government reports have yet to acknowledge the severity of the problrm.
The government should take the CPI data and throw it in the trash can.
Here are Jim Mulva's comments from Dow Jones Real-Time News at 12:12 p.m. on 07/26/2006;
By Bob Sechler
Of DOW JONES NEWSWIRES
ConocoPhillips (COP) Chief Executive Jim Mulva said the company is experiencing "pretty severe inflation and cost pressure" but hasn't changed its plans to spend $18 billion on capital projects this year.
"We're still saying $18 billion - we're not changing that," Mulva told analysts on a post-earnings conference call Wednesday.
The challenge for the company "is to manage the escalation in cost pressure," he said.
Cost inflation on energy-related projects has risen sharply industry wide as oil prices have soared.
Meanwhile, Mulva reiterated that the company plans to shed "several billion dollars" worth of assets over the next 18 months. He said the company will consider non-strategic assets in both its upstream and downstream operations for possible sale.
ConocoPhillips is likely to record an impairment charge in the third quarter as it changes the status on some of the assets to assets held for sale, he said.
Overall, Mulva said ConocoPhillips hopes to reduce debt by about $1 billion a quarter, continue a capital spending plan of about $18 billion a year, and raise its dividend once a year.
