US refiner Phillips 66 set a lower capital budget for 2016 and raised its share buyback plan.

The company said it would spend $3.6 billion in capital expenditure next year, excluding Phillips 66 Partners’ capital programme.

The company’s capital budget was $4.6 billion for the current year, which included $200 million for Phillips 66 Partners, according to a Simmons & Co analyst.

Of the total budget, the refiner plans to invest $2 billion in its midstream business and $1.2 billion in its refining operations. The company is building a liquids export terminal at Freeport, Texas, expanding its natural gas liquids fractionator in nearby Sweeny and investing in several pipeline projects.

Phillips 66 also raised its share buyback by $2 billion to $9 billion. Chief executive Greg Garland said the company planned to increase dividends in 2016.

The company’s shares were up slightly at $83.67 in morning trading on the New York Stock Exchange. Up to Friday’s close, the stock had fallen 16.5 per cent this year. Meanwhile, the US refiner warned of planned flaring at Wilmington  Phillips 66 warned of planned flaring at its 139,000-barrel-per-day (bpd) Los

Angeles-area refinery in Wilmington, California, according to a filing with state pollution regulators.

The refinery has two linked facilities about five miles apart in Carson and Wilmington. The former processes crude oil while the latter upgrades the products.

A refinery uses its safety flare when hydrocarbons cannot be processed normally due to a malfunction or planned work.

Phillips 66 over the summer reported second-quarter earnings of $1.02 billion, up from $997 million in the first quarter and $872 million in second-quarter 2014. The company’s refining adjusted earnings were $604 million in the second quarter, up from $495 million in the first quarter.