ConocoPhillips splits to add net worth

International energy provider and third largest U.S. oil company ConocoPhillips announced Thursday that it will split itself into two by spinning off its refining arm with an aim that each operation would be worth more as a separate company. The company will become the first of the “so-called super majors” to break away from the traditional strategy that led the energy industry to consolidate into a smaller group of global players in the gas and oil industry. Interesting enough, shares of ConocoPhillips rose as much as 7.5 percent after the company broke the news.

The split will create the largest refining company in the nation based on capacity and the largest exploration and production company by far based on oil and gas reserves, according to Reuters. The site also says that ConocoPhillips' move comes just two weeks after smaller competitor Marathon Oil Co spun off its refining arm into Marathon Petroleum Corp. Analysts say it could help close a valuation gap with other energy companies.

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"We believe more value is created in the formation of two very clear stand-alone companies," chief executive Jim Mulva told analysts on a conference call. He also says that two separate companies will allow their management teams to focus more intently on running their businesses, as well as allow investors a choice.          

Industry professionals say that the split should unlock value in the exploration and production part of the business. Additionally, ConocoPhillips has been working on a portfolio shift to sell up to $17 billion in assets to reduce its debt and has aggressively purchased back its shares to increase its dividend.