(Adds conference call details, updates stock)
By Ernest Scheyder
HOUSTON, Feb 1 (Reuters) - ConocoPhillips said on Thursday it swung to a quarterly profit due in part to rising crude prices and cost cuts, helping the U.S. oil and gas producer boost its dividend and expand a share buyback program.
The moves are likely to appease shareholders who have been clamoring for oil producers to focus more on margins and other shareholder-friendly metrics rather than production increases.
As oil prices have gained more than 33 percent since last fall, Conoco has vowed to boost output only when it was financially prudent and said that it would strictly adhere to shareholder returns. The company sold off $16 billion worth of assets in the past year, helping to cut its debt load, and also has been aggressively cutting costs to boost returns.
"Our value proposition is focused on creating long-term value and winning back both energy and generalist investors to a sector that has underperformed for far too long," Chief Executive Ryan Lance told investors on a Wednesday conference call.
Shares of Houston-based Conoco rose 1 percent to $59.42 in afternoon trading as oil prices rose.
The company posted fourth-quarter net income of $1.58 billion, or $1.32 per share, compared to a net loss of $35 million, or 3 cents per share, in the year-ago period.
Excluding one-time items, Conoco earned 45 cents per share, matching analyst expectations, according to Thomson Reuters I/B/E/S.
Quarterly production fell 23 percent to 1.2 million barrels of oil equivalent per day, due in part to asset sales. The divestment shrunk Conoco's reserves by nearly 2 billion barrels of oil equivalent, denting future growth potential.
The company's Canadian operations lost money during the quarter, offset by profit in U.S. assets, as well as projects in Europe, Africa and Asia.
The bulk of the company's quarterly profit came from Alaska, where Conoco is the largest oil producer. Conoco said on Thursday it paid $400 million to Anadarko Petroleum Corp for a 22 percent stake in the Western North Slope operations and a pipeline.
"We still see a lot of opportunity" in Alaska, said Lance. Conoco pumps about 170,000 bpd in the state, about 28 percent of its total production.
ConocoPhillips raised its quarterly dividend to 28.5 cents and increased its 2018 buyback plan by 33 percent to $2 billion.
The company expects a 2018 capital budget of $5.5 billion, in line with a forecast announced last fall for the next three years. (Reporting by Ernest Scheyder; editing by Chizu Nomiyama and Editing by Franklin Paul)