Compiled By Jill Jusko Integrated petroleum producer Phillips Petroleum Co. has approved $3.5 billion for capital projects in 2002, an increase over estimated capital spending of $3.1 billion in 2001. Phillips says the increased expenditures reflect increased spending on legacy exploration and production assets in Venezuela, China and the Timor Sea, as well as a full year of funding for projects resulting from its September 2001 acquisition of Tosco Corp. "Over the past two years, we have undertaken an aggressive transformation, and our 2002 capital budget reflects those changes," says J.J. (Jim) Mulva, chairman and CEO. The company will allocate 74% -- or $2.6 billion -- of its 2002 capital budget to exploration and production activities, with Alaska operations receiving 72% of its planned U.S. spending. Some $1.5 billion will be directed toward the development of international projects. Phillips also noted that 96% of the company's planned $839 million budget for refining, marketing and transportation is slated to be spent domestically. Corporate expenditures make up 2% of Phillips' capital budget in 2002.