You are given a text that consists of multiple sentences. Your task is to perform abstractive summarization on this text. Use your understanding of the content to express the main ideas and crucial details in a shorter, coherent, and natural sounding text. 
Text: We have Ryan Lance, our chairman and CEO; Bill Bullock, executive vice president and chief financial officer; Dominic Macklon, executive vice president of strategy, sustainability, and technology; Tim Leach, executive vice president of Lower 48; and Nick Olds, executive vice president for global operations.
And finally, we'll also make reference to some non-GAAP financial measures today.
So, 2021 was a truly remarkable year for ConocoPhillips.
Our operating performance around the globe was outstanding, we generated strong returns on and of capital for our shareholders and closed on two significant, highly accretive acquisitions in the heart of the Permian Basin.
Our exceptional results last year are directly attributable to the talent and dedication of our global workforce.
We produced 1.6 million barrels per day and brought first production online at GMT2 in Alaska, the third Montney well pad, and the Malikai Phase 2 and S&P Phase 2 projects in Malaysia.
We also completed the Tor II project in Norway and achieved all of this with excellent cost, schedule, safety, and environmental performance.
Financially, we achieved a 14% full-year return on capital employed or 16% on a cash-adjusted basis and generated $15.7 billion in CFO, with over $10 billion in free cash flow.
And we returned $6 billion to our shareholders, representing 38% of our cash from operations.
We also continued our rigorous portfolio optimization work, completing the truly transformative Concho and Shell Permian acquisitions and further high-grading our asset base around the world.
In the Asia Pacific region, we exercised our pre-emption right to acquire an additional 10% in APLNG and announced the sale of assets in Indonesia for $1.4 billion.
In the Lower 48, we generated $0.3 billion in proceeds from the sale of noncore assets last year, and last week, we signed an agreement to sell an additional property set, outside of our core areas for an additional $440 million.
Collectively, these transactions reduced both the average cost of supply and the GHG intensity of our more than 20-billion-barrel resource base and we're well down the road toward achieving our $4 billion to $5 billion in dispositions by 2023.
In early December, consistent with our 10-year plan and capital allocation priorities, we announced a returns-driven capital budget for 2022 that's expected to deliver modest growth this year.
We also introduced a new variable return of cash, or VROC, tiered to our distribution framework and provided a full-year target of $7 billion in total returns of capital to our shareholders.
Based on current prices on the forward curve, we've increased the target to $8 billion, with the incremental $1 billion coming in the form of increased share repurchases and a higher variable return of cash.
The $0.30 per share VROC announced for the second quarter represents a 50% increase over our inaugural variable return to shareholders that we paid this quarter.
Now, to put the $8 billion in perspective, it equates to an increase of more than 30% from the $6 billion returned last year and a greater than 50% increase in projected cash return to shareholders.
Our three-tier distribution framework provides a flexible and durable means to meet our returns commitment through the price cycle and truly is differential to others in this sector as our returns commitment is based on a percentage of CFO and not free cash flow.
And as you know, we are guided in everything we do by our triple mandate.
We must reliably and responsibly deliver oil and gas production to meet energy transition pathway demand.
We need to generate competitive returns on and of capital for our shareholders and achieve our Paris-aligned net-zero ambition by 2050.
Just as I'm very proud of the excellent operational and returns-focused performance we delivered in 2021, I'm equally pleased about the progress we have made in support of the third pillar of our mandate.
We increased our medium-term emissions intensity reduction target to 40% to 50% by 2030 and expanded it to include both gross operated and net equity production.
As a reminder, we're also committed to further reducing our methane emissions and achieving our zero routine flaring ambition by 2025.
And as highlighted in our December release, we've allocated $0.2 billion of this year's capital program for projects to reduce the company's Scope 1 and 2 emissions intensity and investments in several early stage, low-carbon opportunities that address end-use emissions.
We strongly believe that this level of focus on and performance toward is fully realizing our triple mandate as ConocoPhillips is very well positioned to not just survive through the energy transition, but to thrive regardless of the pathways it takes.
While we're on the topic of energy transition, I'd like to touch on the macroenvironment.
Commodity prices today reflect global energy demand returning to pre-pandemic levels, along with supply being impacted by decreased investment in oil and gas over the past couple of years, concerns about inventory levels, and the amount of available spare production capacity in the system.
All these factors demonstrate the ongoing importance of our sector to the global economy today and for the foreseeable future.
It's becoming increasingly clear that the energy transition isn't going to happen with the flip of a switch.
What people and businesses around the globe need is a managed and orderly transition, but that's not what the world is seeing to this point.
Supply and demand balances are fragile at the moment, likely driving continued volatility and the current commodity price situation in Europe may be providing a cautionary signal.
The simple reality is that most alternative energy sources still have a long way to go toward becoming as scalable, reliable, affordable, and accessible as the world needs them to be, which brings me back to our triple mandate and the importance of performing well across all three of the pillars, for our shareholders and for the people in the world who need and use our products.
Looking at fourth-quarter earnings, we generated $2.27 per share in adjusted earnings.
This performance reflects production above the midpoint of guidance and strong price realizations, as well as some commercial and inventory timing benefits, partially offset by slightly higher costs in DD&A.
Lower 48 production averaged 818,000 barrels of oil equivalent per day for the quarter, including 483,000 from the Permian, 213,000 from the Eagle Ford and 100,000 from the Bakken.
As previously communicated, our Permian and overall Lower 48 production were both increased roughly 40,000 barrels of oil equivalent per day in the quarter due to the conversion from two- to three-stream accounting for the acquired Concho assets.
At the end of the year, we had 20 operated drilling rigs and nine frac crews working in the Lower 48, including those developing the acreage we recently acquired from Shell.
As Ryan touched on earlier, operations across the rest of the portfolio also ran extremely well last year with our GMT2 project in Alaska producing first oil in the fourth quarter as planned.
Turning to cash from operations, we generated $5.5 billion in CFO, excluding working capital, resulting in free cash flow of $3.9 billion in the quarter.
For the full year 2021, we generated $15.7 billion in CFO, $10.4 billion of free cash flow, and returned $6 billion to shareholders.
In addition to the asset dispositions Ryan covered, we also sold 117 million shares we held in Synovis in the year, generating $1.1 billion in proceeds that we used to fund repurchases of our own shares.
This left us with a little over 90 million Synovis shares at the end of the year, which we intend to fully monetize by the end of this quarter.
We ended the year with over $5 billion in cash, maintaining our differential balance sheet strength, even after completing the all-cash acquisition of Shell's Delaware Basin assets.
So, to recap, it was not only a strong quarter but one that also bodes very well for 2022 and future years.
We continue to optimize the portfolio.
Our businesses are running very well around the globe, and we have had an overall reserve replacement ratio of nearly 380%, establishing an incredibly powerful platform for the company as we head into this year and beyond.
Our cash flow performance and leverage to prices have substantially improved over the past couple of years as demonstrated by our fourth-quarter results and expect it will continue to improve as we begin including the newly acquired Delaware assets in our consolidated results this quarter.
Now, demonstrating this point and appreciating that it's helpful for the market to have an accurate sense of our stronger CFO generating capacity, at a WTI price of $75 a barrel with a $3 differential to Brent and a Henry Hub price of $3.75, we estimate our 2022 full-year cash from operations would be approximately $21 billion, which reflects us reentering a tax-paying position in the U.S. this year at those price levels.
And our free cash flow for the year would be roughly $14 billion.
And of course, we continue to be unhedged across our global diverse production base, so we expect to fully capture the upside of the current price environment.
We provided updated sensitivities in today's supplemental materials to help estimate how much earnings and CFO are projected to change this year with market price movements.
So, to sum it up, all that we've shared with you today underscores our readiness to reliably generate very competitive returns for our shareholders as we thoughtfully move forward as a responsible, valuable E&P player in the energy transition.
That is our triple mandate.
It's what we have ConocoPhillips built for and are ready to deliver.
Now, with that, let's go to the operator to start the Q&A.

user
compname reports fourth-quarter and full-year 2021 results; increases planned 2022 return of capital to $8 billion and declares quarterly dividend and variable return of cash distribution.
q4 adjusted earnings per share $2.27 excluding items.
announced a $1 billion increase in expected 2022 return of capital to shareholders.
declared both ordinary dividend of 46 cents per share & second-quarter variable return of cash (vroc) payment of 30 cents per share.
completed all-cash shell permian acquisition.

assistant