ConocoPhillips To Purchase German Refinery

Houston - ConocoPhillips announced it executed a definitive agreement with Louis Dreyfus Energy Holdings Limited for the cash purchase of both of the entities that own the Wilhelmshaven refinery in Wilhelmshaven, Germany, and UK-based Louis Dreyfus Refining and Marketing Limited.

The purchase includes the 275,000 barrels per day refinery, a marine terminal, rail and truck loading facilities and a tank farm, as well as Louis Dreyfus Refining and Marketing Limited, which provides commercial and administrative support to the refinery. The purchase is expected to be completed during the first half of 2006, subject to satisfaction of the conditions to closing, including obtaining the necessary governmental approvals and regulatory permits. Other terms and conditions of the sale were not disclosed by the parties.

The addition of the Wilhelmshaven refinery is consistent with ConocoPhillips' strategy to increase shareholder value through investments in both domestic and international refining. The asset is expected to provide a foundation for strengthening the company's ability to supply products to key export markets.

"This acquisition enables ConocoPhillips to apply its significant refining expertise to the strong asset and human resources already in place at Wilhelmshaven," said Jim Nokes, executive vice president refining, marketing, supply and transportation. "Our intention is to seriously consider adding significant deep conversion and power generation capabilities to the Wilhelmshaven plant. We will move swiftly to work with German authorities to seek the necessary support and permitting to enable such investment."

These additions would let the plant run a more advantaged crude slate, including Russian Export blends, while increasing overall conversion and reducing operating costs.

"Wilhelmshaven is expected to enable ConocoPhillips to enhance its strategic position in Europe, strengthen our global refining capabilities, generate significant synergies with existing refining and marketing operations and provide an outlet for Russian crude oil production," Nokes said.

The addition of the Wilhelmshaven refinery would increase ConocoPhillips' overall European refining capacity by approximately 74 percent, from 372,000 barrels per day to 647,000 barrels per day.

SOURCE: ConocoPhillips