We are in interesting times. It's interesting to see as the environment changes, the number of companies that are having to adjust strategies to reposition themselves to fit. But I guess what I would say here is I'm not here to talk about a changed strategy. We believe the strategy that we put in place a number of years ago at Noble Energy is one that is very appropriate for the current environment.It was a strategy that came about after we closed on the acquisition of Patina Oil & Gas. And what we said at that time was we wanted to move to a diversified portfolio. We wanted to derisk our development program and we wanted to move the exploration program to something that was much more material. We wanted to get away from exploration which prior to that was basically trying to deliver near-term production. And in my view, that is not the intent of an exploration program. The intent of an exploration program is to position the company for the future, put material legacy assets in the portfolio that will be with you for a long time. We wanted to be financially disciplined from every aspect and we wanted to build an organization that was capable of best-in-class execution. So that's been our strategy. During a few years after that, we're willing to sacrifice near-term growth. Offsetting that was building the portfolio for long-term growth. But I would say that we felt this strategy played out very well. It worked for us. And we are not here to change it. So let's just talk about some of the results and how we see the company going forward in the future. At our November meeting, we talked about our long-term growth plans, and this is a chart we showed then. It reflected debt-adjusted per share growth rates on production, cash flow and reserves, all double digits, all very strong. You can see the drivers on the right, you can see production going up over the five years by 2016, projecting production at just under 500,000 barrels a day equivalent, strong growth in proven reserves, free cash flow near the end of that period as well.
As I look at those metrics and I look at some of the reports that are put out in the space, I think I can confidently say that assuming we deliver on that, which is certainly our intent that is ought to make Noble Energy one of the more attractive, perhaps one of the most attractive E&Ps, especially when you can deliver debt-adjusted per share growth of 15% up to 20% on a cash flow basis.Again, it is about diversification. Today, we're in five core areas. We added the Marcellus of course last year. But besides the Marcellus onshore, we've got the Rockies, primarily Wattenberg in the DJ Basin, the deepwater Gulf of Mexico, offshore West Africa, primarily Equatorial Guinea in the Eastern med and Israel and now Cyprus with the discovery we announced just before the end of the year. A little over half of our reserves are international, and you can see production historically has been about 40% oil and some natural gas liquids, 30% U.S. gas and 30% international gas. Although I would say and we'll be putting out guidance here in a couple of days, we're seeing a shift more this year to liquids, and that's driven by the fact we've got two big oil projects coming in, Aseng which has already started up in West Africa, and Galapagos would be predominantly oil as well, as well as what we're driving in the Niobrara in terms of production. And the percent of international gas will be down this year as a result of some work that's being done at the Alba field as well as we're managing the declining Mari-B field in Israel to bridge it over to when Tamar comes on in early 2013. Read the rest of this transcript for free on seekingalpha.com