Anadarko Provides Growth Outlook
Posted on March 25, 2008 at 07:28 AM EDT
-- Increases 2008 Full-Year Production Guidance by 2 Million Barrels -- Increases Anticipated 2008 Reserve Bookings by 10 Percent -- Increases 2008 Capital Budget -- Increases Total Resources in Greater Natural Buttes to 9.2 Tcfe -- Expects to Sanction Tonga West and Jubilee in 2008
The Board of Directors of Anadarko Petroleum Corporation (NYSE:APC) has approved an expansion of the company’s 2008 capital budget by approximately $400 million. Anadarko now expects 2008 capital expenditures, including expensed exploration, to be in the range of $4.9 to $5.1 billion. The additional capital is expected to have a positive impact on the company’s 2008 production estimates and its 2008 reserve bookings.
“Anadarko is accelerating the development, production and value of our substantial inventory of nearer-term growth projects,” Anadarko Chairman, President and CEO Jim Hackett said. “Stronger-than-anticipated commodity prices and the recently announced divestitures of the Peregrino field offshore Brazil and the Kaskida Unit in the deepwater Gulf of Mexico have created an opportunity to increase the company’s capital expenditures in 2008. We expect the additional capital to enhance our operating metrics and generate stronger production volumes and reserve adds. As a result, we are increasing the midpoint of our full-year production guidance by 2 million BOE (barrels of oil equivalent). In addition, we are increasing our 2008 anticipated reserve bookings to at least 250 million BOE of proved reserves – an increase of approximately 10 percent over prior estimates at the same reserve-replacement-cost target.
“In addition to the already expected double-digit production growth in the Rocky Mountain region, the additional capital will enable us to accelerate development activities in the Texas and Mid-Continent areas that offer higher-margin, lower-risk production volumes in the near term. We also plan to direct a portion of the increased capital toward exploration drilling in the emerging Marcellus Shale area in the Appalachian Basin of Pennsylvania where we have access to approximately 500,000 gross acres in the fairway of the play. Separately, we expect to direct additional capital toward the enhancement of our acreage position in the deepwater Gulf of Mexico and our midstream infrastructure onshore,” Hackett added.
For the full year, Anadarko expects production volumes to be in the range of 207 to 212 million BOE – up from the previous guidance of 205 to 210 million BOE.
In addition to the expanded capital budget, Anadarko announced that it has identified an additional 2.3 trillion cubic feet of natural gas equivalent (Tcfe) of low-risk resources in the Greater Natural Buttes area of northeastern Utah. The additional resources were identified through the expansion and improved performance of the company’s 20-acre down-spacing activities and from new 10-acre infill-drilling opportunities. Including the company’s proved reserves of 1.4 Tcfe associated with Greater Natural Buttes, Anadarko now estimates total resources in the area are approximately 9.2 Tcfe.
The company also announced that it expects to sanction and begin booking reserves associated with two of its substantial deepwater discoveries – the Jubilee field offshore Ghana and Tonga West in the Gulf of Mexico – in 2008. Anadarko anticipates each field to begin production as early as 2010.
“These announcements are indicative of the robust nature of Anadarko’s resource pipeline,” Anadarko Chief Operating Officer Karl Kurz said. “We began 2007 with approximately 4 billion BOE of net risked captured resources. We booked approximately 250 million BOE as proved during 2007 and divested approximately 350 million BOE of net risked captured resources. As a result of the recent world-class deepwater discoveries offshore Ghana and in the Gulf of Mexico, coupled with the improved performance and infill drilling inventory in Greater Natural Buttes, we’ve more than replenished the 4 billion BOE of lower-risk development opportunities.”
Anadarko Petroleum Corporation’s mission is to deliver a competitive and sustainable rate of return to shareholders by exploring for, acquiring and developing oil and natural gas resources vital to the world’s health and welfare. As of year-end 2007, the company had 2.4 billion barrels-equivalent of proved reserves, making it one of the world’s largest independent exploration and production companies. For more information about Anadarko, please visit www.anadarko.com.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Anadarko believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release, including Anadarko’s ability to successfully meet its revised production guidance, identify and execute on exploration and drilling opportunities, sanction and complete the projects identified in this news release. See “Risk Factors” in the company’s 2007 Annual Report on Form 10-K and other public filings and press releases. Anadarko undertakes no obligation to publicly update or revise any forward-looking statements.
Cautionary Note to U.S. Investors: The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this news release, such as “net risked captured resources,”“total resources,” “low-risk resources” and similar terms that the SEC’s guidelines strictly prohibit us from including in filings with the SEC.U.S. Investors are urged to consider closely the disclosure in our Form 10-K for the year ended Dec. 31, 2007, File No. 001-08968, available from us at www.anadarko.com or by writing us at: Anadarko Petroleum Corporation, 1201 Lake Robbins Drive, The Woodlands, Texas 77380 Attn: Investor Relations. You can also obtain this form from the SEC by calling 1-800-SEC-0330.
John Christiansen, 832-636-8736
Paula Beasley, 832-636-8765
John Colglazier, 832-636-2306
Chris Campbell, CFA, 832-636-8434
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