(Bloomberg) -- ConocoPhillips unveiled a $1 billion variable dividend as the second-largest driller in the Permian basin aims to boost investor returns in the new year. 

The new quarterly dividend will be set based on forward oil prices, cash flow and other factors and could result in eight cash payouts every year beginning in January 2022, according to a statement Monday. It’s the latest effort by the company to raise shareholder return after posting the highest quarterly profit in a decade. ConocoPhillips has said it plans to hand out about $7 billion in total to investors in 2022, a 16% increase from 2021. 

The company also said it will spend about $7.2 billion with shale operations counting for about 60% of that total. That’s up from about $5.3 billion this year. The spending boost comes just months after a pair of major acquisitions that made it the second-biggest oil driller in the country’s largest oil basin.

The recent purchases of Concho Resources Inc. and Royal Dutch Shell Plc’s Permian assets enabled ConocoPhillips to surpass Chevron Corp. as the Permian’s No. 2 crude producer, according to research firm Enverus. ConocoPhillips is keen to expand in shale at a time when it’s getting more difficult to win regulatory approval for a major Alaskan development that’s been held back by environmental challenges in the courts. 


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