ConocoPhillips’s production costs and margins
Excluding hedges, ConocoPhillips (COP) reported a positive cash margin as well as a positive total margin in 4Q16, as shown in the chart below.
In 4Q16, upstream companies such as Diamondback Energy (FANG), Pioneer Natural Resources (PXD), Encana (ECA), and EOG Resources (EOG) also reported positive cash margins. Encana reported a cash margin of ~$5.96 per boe, including hedging benefits.
Production cash cost = LOE (lease operating expenses) + production and ad valorem taxes + transportation expenses + G&A (general and administration) cash expenses + interest expenses
Total production cost = cash cost + DD&A (depletion, depreciation, and amortization)