The world’s largest independent energy exploration and production (E&P) company will be doing less exploration in 2015 and, it says, about 3% more production. ConocoPhillips (NYSE: COP), which is the largest E&P company in the world measured by production and proved reserves, announced Monday morning that its 2015 capital budget would total $13.5 billion, 20% less than the $16 billion the company budgeted for capex in 2014.

Conoco said it will spend less on major projects and defer spending on unconventional (shale) North American plays. Specifically the company said that it would defer its “significant investment” in the emerging shale plays in the Permian Basin of Texas, the Niobrara in Colorado and the Montney and Duvernay in Canada while continuing to “target” the Eagle Ford and Bakken plays. The cut in the development drilling budget totals about $1.5 billion, reducing Conoco’s planned spending from $6.5 billion in 2014 to around $5.0 billion next year.

Exploration and appraisal spending is planned at around $1.8 billion for 2015, down slightly from this year. In addition to focusing on unconventional plays in North America, the company will also continue work in the Gulf of Mexico and offshore West Africa and Nova Scotia.

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The major project budget is planned at about $4.8 billion for the coming year, as several major projects have passed their spending peaks and will begin production over the next few years. These include the Asia Pacific LNG project and phase 2 of the Surmont oil sands project, which is a 50/50 joint venture with Total S.A. (NYSE: TOT).

The company also plans to reduce base maintenance and corporate expenditures slightly to about $1.9 billion, “reflecting lower planned spending in several producing assets across the portfolio.”

Conoco’s CEO said, “This plan demonstrates our focus on cash flow neutrality and a competitive dividend, while maintaining our financial strength.” Translation: Conoco does not plan to lose money by drilling too many holes and it will do whatever it takes to maintain its 4.3% dividend yield. With average crude oil price forecasts for 2015 running between $70 and $80 a barrel, Conoco does not have a lot of other options.

The reaction from shareholders has been to send the stock down about 2.3% in the first hour of trading Monday to $66.36, in a 52-week range of $62.74 to $87.09.

Warren Buffet’s Berkshire Hathaway Inc. (NYSE: BRK-A) has pared its stake in Conoco down to fewer than 500,000 shares, compared with a relatively new stake in Exxon Mobil Corp. (NYSE: XOM) that now totals more than 41 million shares.

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