Ryan Lance
Chairman and Chief Executive Officer at ConocoPhillips
Thank you, Ellen. Today's quarterly results come right on the heels of our June 30 market update during which we again laid out a compelling multi-year outlook for the Company. The update was widely followed and we received some pretty positive feedback. As you'd expect, given the recency of our update, there isn't much incremental news to share at this time, except to say we remain convinced it was timely and relevant given the ongoing volatility we're seeing in the sector. And today, we're pleased to follow it up with a very strong quarterly results we announced this morning.
As you recall, we kicked off our update by declaring that we believe we are at a defining moment for the E&P sector and that persists today. All equities have been especially volatile recently, in part due to uncertainties in the macro, and because we know investors need to see evidence that sector discipline will hold and returns on and of capital will follow. It's clear to us that long-term sector sponsorship requires leadership on the part of companies as well as conviction on the part of investors. Of course for investors, the case for these equities requires a reasonably constructive macro view. The case for equities also requires conviction around a micro view. In other words, who is best positioned for the cyclical business realities and who has a track record of execution and performance and who can truly lead in ESG. Most companies are espousing the virtues of discipline and everyone now looks better coming out of the 2020 downturn. The questions investors need to consider is who can deliver consistent returns-focused performance through thick and thin. That's where leadership matters.
In June, we met this defining moment with a credible and highly investable plan that generates massive free cash flow and returns of capital with financial returns that are competitive with the S&P. The leadership requires more than setting expectations and plans. It also requires successfully executing them. Execution is where the rubber meets the road. ConocoPhillips offers a unique combination of a credible and compelling investment plan with a commitment to strong ongoing execution. You saw the plan in June and today, you see the execution. In other words, you're seeing the June plan at work.
This morning's release and supplementary information provided details on this quarter's performance. So I won't restate them, but here are a few key takeaways and themes that I wanted to underscore. During the second quarter, the business ran extremely well. Our planned turnaround activity went smoothly as did our ongoing core programs across the Company. These include activities in the North American shale plays as well as in the multiple programs in our Alaska and international regions. While we're talking about execution, I'll also mention that we continue to make good progress on more than 50 emission reduction projects that we have underway this year. Every part of our business has a role in delivering our results and I'm proud of our team for their accomplishments during a very busy year.
Overall, this quarter's financial results were really quite straightforward. The noise of 2020's market upheavals and most of the Concho transaction adjustments are behind us and the known deal integration synergies and streamlining impacts we discussed in June are showing up in our performance. We're on track to meet the updated 2021 guidance we issued a month ago, but we're not done, not done with our efforts to continue driving the operational and underlying efficiencies the team has described in our June material.
We can't ignore that higher benchmark prices were a factor in this quarter's sector performance broadly and certainly ConocoPhillips specifically. However, what is somewhat unique to ConocoPhillips is that our results demonstrate the capacity of our company to capture the benefit of higher prices when they do occur. That's because we're unhedged. We're diversified and we're almost entirely in tax and royalty regimes. Now a year ago, we demonstrated just how resilient we are to low prices. 12 months later and post-Concho transaction, this quarter gives you a sense for the upside torque we can realize when prices exceed the reference prices we showed you just one month ago. The clear bottom line, ConocoPhillips works differentially through the cycles. Cash from operations of $4 billion more than covered our capital expenditures of $1.3 billion and distributions of $1.2 billion in the quarter.
And importantly, we continue to meet and exceed our target of returning greater than 30% of our CFO to our shareholders. We announced another increase to our 2021 distributions in June, bringing our total planned returns of capital to about $6 billion for the year, representing almost 8% of our market cap today, while other companies are only announcing or just reactivating such programs. And of course, as Bill described in our market update, if prices continue at current levels, we would expect to have additional cash that could go toward greater distributions. And for reference, we estimate full year 2021 CFO at $50 per barrel WTI would be about $11 billion after adjusting for the one-time Concho transaction-related impacts and you can do the math on our sensitivities. They're roughly $300 million per $1 per barrel change in prices.
At this time, we still believe our distribution allocation of nearly 3% yielding ordinary dividend and share repurchases is a very sound mix, but we continue to evaluate the issue. and we want to engage with the market on alternative allocations. We know there isn't a perfect answer, but we know what matters and that's a credible commitment to return capital and a solid track record of a reliable performance, which we've certainly delivered now for multiple years.
So to summarize, we have a great shareholder-friendly business model and plan. We're hitting our stride after a busy time and putting the execution runs on the board. We are maintaining our discipline. The Company is running extremely well and we're not done with our work to improve underlying financial returns on capital employed. That's the goal. That's how we enlist long-term market sponsorship and that's what ConocoPhillips is all about.
We're pleased to be where we're at here at mid-year, but we recognize the year is still young. Looking forward to the second half of 2021, our priorities are squarely focused on executing our remaining plans and programs for this year. Meanwhile, we're closely watching how the macro evolves and beginning our internal process of setting our 2022 budget and capital plans. We'll stay actively engaged with the market and look forward to an ongoing discussion about how our plans are progressing.
So, let me turn the call over to the operator and we'll begin the Q&A portion of the call.
