Phillips 66 is a diversified energy manufacturing and logistics company with a portfolio of integrated businesses: Midstream, Chemicals, Refining, and Marketing and Specialties. Our company processes, transports, stores and markets fuels and products globally. Phillips 66 Partners LP, our master limited partnership, is an integral part of the portfolio.
A deep understanding of these businesses enables the company to grow and to allocate capital to the best opportunities. Headquartered in Houston, Phillips 66 has 14,000 employees committed to safety and operating excellence. As of Dec. 31, 2015, we had $49 billion in assets. The company’s stock trades on the New York Stock Exchange under the ticker symbol PSX, while Phillips 66 Partners trades under the ticker symbol PSXP.
The 14,000 employees of Phillips 66 are executing the strategy that has guided the company since its creation in 2012: maintain strong operating excellence, deliver profitable growth, enhance returns on capital, grow shareholder distributions and develop its employees to sustain a high-performing organization.
Maintain Strong Operating Excellence
For Phillips 66, operating excellence encompasses personal safety, process safety, reliability, cost efficiency and environmental stewardship. Safety is a core value. The company’s safety record in 2015 tied for its best ever. Phillips 66 is determined to be the safest and most reliable company in its industry.
By maintaining strong operating excellence, we protect each other, contribute to the well-being of the communities that support us, deliver quality products to customers and enhance shareholder value.
Deliver Profitable Growth
We are reshaping the company’s portfolio by investing capital in higher-valued businesses. We continuously test our capital allocation decisions through a range of economic and market scenarios.
Our 2016 consolidated capital budget is $3.9 billion, consisting of $2.6 billion of growth capital and $1.3 billion of sustaining capital. Most of the growth capital will fund infrastructure projects in our Midstream segment. The sustaining capital will focus on maintaining high levels of safety and reliability in our Refining business. Our 2016 capital budget excludes our portion of planned capital spending by joint ventures DCP Midstream, CPChem and WRB totaling $1.4 billion, all of which are expected to be self-funded.
The Midstream segment is at the core of our growth plans. The segment consists of natural gas liquids (NGL) and transportation businesses, Phillips 66 Partners, and our 50 percent interest in DCP Midstream.
Through our 50-50 joint venture with Chevron, CPChem, we continue to invest in our high-return Chemicals segment. CPChem is one of the world’s leading petrochemical companies, and its U.S. Gulf Coast petrochemicals project is approximately 80 percent complete with startup planned for the second half of 2017.
Enhance Returns on Capital
A disciplined capital allocation process ensures that we focus investments in projects that generate competitive returns throughout the business cycle. Phillips 66’s Refining segment is a significant competitor in the domestic fuels industry, with 11 of its 14 refineries located in the United States.
Through planned operating enhancements, we expect to drive efficiency and improve returns. The majority of the improvement will come from higher product yields and a focus on controllable costs. In early 2015, we sold the Bantry Bay terminal, a storage complex located in Ireland. And in August 2016, we announced the sale of our Whitegate Refinery, located near Cork, Ireland. The transaction is expected to close in the third quarter of 2016.
Grow Shareholder Distributions
During 2015, we increased the dividend by 12 percent and returned $2.7 billion of capital to shareholders through dividends and share repurchases. Phillips 66 is committed to paying a regular dividend that is secure, has a competitive yield and increases annually. In May 2016, Phillips 66 announced a 12.5 percent increase in the quarterly dividend, the sixth increase since the company’s formation. From the company’s 2012 inception to June 30, 2016, we have returned $12.3 billion of capital to shareholders.
Build on Phillips 66's High-Performing Organization
Our purpose is to provide energy and improve lives, and we are governed by three strongly held values: safety, honor and commitment. Our employees are committed to building capability, pursuing excellence and doing the right thing. We strive to attract, train, develop and retain individuals with the knowledge and skills to implement our business strategy and the character to live our values.