Click here to close now.

Welcome!

News Feed Item

Anadarko Announces 2014 Capital Program and Guidance

HOUSTON, TX -- (Marketwired) -- 03/04/14 -- Anadarko Petroleum Corporation (NYSE: APC) today announced its 2014 capital expectations and guidance, concurrent with the company's Investor Conference in Boston, Mass.

"Anadarko is uniquely positioned to build upon our multi-year track record of success and to deliver sustained growth and unmatched optionality in 2014 and beyond," said Anadarko Chairman, President and CEO Al Walker. "Our 2014 capital program is again a prudent and disciplined approach that is within anticipated cash flow. We expect this capital plan to enable us to increase year-over-year 'same-store'(1) sales volumes by 6 to 7 percent. Driving this year-over-year growth is an expected increase in our oil production of approximately 40,000 barrels per day.

"During 2014, Anadarko expects to drill up to 25 high-potential deepwater exploration/ appraisal wells. Additionally, we plan to continue accelerating value through active portfolio management and monetizations, as demonstrated by the recently announced divestiture of our non-operated assets in Bohai Bay, China, and the closing of our sale of a 10-percent working interest in Mozambique's Offshore Area 1 to OVL."

2014 Capital Program and Expectations
Total 2014 capital investments are expected to be $8.1 to $8.5 billion, excluding capital investments associated with Western Gas Partners, LP (NYSE: WES), a separate publicly traded entity controlled by Anadarko and included in its consolidated financial statements.


              2014 Capital Expectations ($8.1 - $8.5 billion)*

               By Area                               By Product

U.S. Onshore                     60%    Oil                              70%
International & DW Operations    20%    Liquids Rich                     15%
International & DW Exploration   10%    Dry Natural Gas                  5%
Midstream & Other                10%    Other                            10%

* Excludes capital investments associated with Western Gas Partners, LP
(NYSE: WES)
Note: All percentages are approximates.

U.S. Onshore
More than 80 percent of Anadarko's 2014 U.S. onshore capital investments will be allocated toward oil and liquids-rich opportunities. As a result, the company expects to increase its total U.S. onshore year-over-year same-store(2) sales volumes by more than 10 percent to more than 625,000 BOE per day for full-year 2014, including an approximate 50,000 barrels-per-day increase in liquids volumes. Much of this growth is expected to be driven by the company's Wattenberg Horizontal program in Colorado, its Eagleford Shale development in South Texas, and other liquids-rich growth plays, including the Wolfcamp Shale in West Texas and the East Texas/North Louisiana area.

The Wattenberg Horizontal program generates the strongest returns in Anadarko's U.S. onshore portfolio and is expected to achieve significant growth in 2014, as the company realizes the benefits from its concentrated acreage position and infrastructure expansions. These expansions include the 300-million-cubic-feet-per-day (MMcf/d) Lancaster cryogenic plant and the 150,000-barrels-per-day Front Range NGL Pipeline, which are currently being commissioned. The company plans to operate approximately 13 rigs in the Wattenberg field during the year and drill more than 360 wells.

Anadarko also is accelerating its operated activity in the Wolfcamp oil play where it has evaluated about 20 percent of its approximate 600,000-gross-acre position. The company has already identified more than 1,000 drilling locations in this de-risked area of the Wolfcamp, with significant additional upside as it evaluates the remaining acreage and potential stacked-pay intervals. In 2014, the company expects to operate eight to 10 rigs, with plans to drill more than 80 wells.

Gulf of Mexico
Anadarko is on schedule to achieve first oil from its 80,000 barrels-of-oil-per-day Lucius development late in the second half of 2014, just three years from the time it was sanctioned. The company's Heidelberg development also remains on track, with spar construction more than 75-percent complete and first oil expected in 2016, again, just three years following sanction.

Anadarko's 2014 deepwater Gulf of Mexico exploration/appraisal program is focused on building upon the tremendous success achieved in the Shenandoah Basin in 2013, which is emerging as one of the largest oil accumulations ever discovered in the Gulf. Appraisal activity at the Coronado, Yucatan and Shenandoah discoveries in the Shenandoah Basin highlights the company's six-to-eight-well Gulf program in 2014.

International
In 2014, Anadarko expects to realize a full-year's benefit of oil production from the world-class El Merk project in Algeria. El Merk, which recently achieved net production of more than 30,000 barrels per day, is expected to contribute to at least a 30-percent year-over-year increase in sales volumes from Algeria during 2014. In Ghana, Anadarko and its partners have awarded major contracts and are advancing development of the TEN complex, which is expected to achieve first oil in 2016. In Mozambique, the company's successful 2013 appraisal and exploration activities increased its estimated recoverable natural gas resources to a range of 45 to 70-plus trillion cubic feet (Tcf) in Offshore Area 1, up from the previous range of 35 to 65-plus Tcf. The company's 2014 program in Mozambique is focused on advancing the development toward first LNG cargoes in 2018.

The company's international exploration/appraisal program includes 15 to 18 planned deepwater wells, primarily in East and West Africa.

2014 Guidance
Details about the company's 2014 guidance and updated hedging positions are provided in the attached tables, and a reconciliation of Anadarko's same-store sales volumes is provided below.


                      Same-Store(1) Sales Volumes

          2013             2014 Expectations    Year-Over-Year Increase

       274 MMBOE            290 - 294 MMBOE             6% - 7%

(1) "Same-store" sales volumes are intended to present performance of Anadarko's continuing asset base, giving effect to significant recent divestitures; accordingly, sales volumes presented, exclude approximately 11 million barrels of oil equivalent (BOE) of 2013 production and all 2014 volumes associated with the China and Pinedale/Jonah asset divestitures.

(2) Excludes sales volumes associated with the Pinedale/Jonah asset divestiture.

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 2013, the company had approximately 2.79 billion barrels-equivalent of proved reserves, making it one of the world's largest independent exploration and production companies. For more information about Anadarko and APC Flash Feed updates, 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 the nature and timing of a final judgment or other decisions rendered relating to the Tronox Adversary Proceeding, the amount of damages, interest, attorneys' fees, and other costs for which the defendants may be found liable, and the effect of such amounts on its business, prospects, results of operations, financial condition and liquidity; Anadarko's ability to meet financial and operating guidance; to meet the long-term goals and consummate the transaction identified in this news release; to execute the 2014 capital program; to drill, develop and commercially operate the drilling prospects identified in this news release; to achieve production and budget expectations on its mega projects; and to successfully plan, secure necessary government approvals, finance, build and operate the necessary structure and an LNG park. See "Risk Factors" in the company's 2013 Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other public filings and press releases. Anadarko undertakes no obligation to publicly update or revise any forward-looking statements.

Cautionary Note to Investors: The United States Securities and Exchange Commission ("SEC") permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable and possible reserves that meet the SEC's definitions for such terms. Anadarko uses certain terms in this news release, such as "estimated recoverable natural gas resources" and similar terms that the SEC's guidelines strictly prohibit Anadarko from including in filings with the SEC. U.S. investors are urged to consider closely the disclosure in Anadarko's Form 10-K for the year ended Dec. 31, 2013, File No. 001-08968, available from Anadarko at www.anadarko.com or by writing Anadarko at: Anadarko Petroleum Corporation, 1201 Lake Robbins Drive, The Woodlands, Texas 77380, Attn: Investor Relations. This form may also be obtained by contacting the SEC at 1-800-SEC-0330.


                       Anadarko Petroleum Corporation
                 Financial and Operating External Guidance
                               March 4, 2014


                                              1st-Qtr          Full-Year
                                             Guidance          Guidance
                                         ----------------  ----------------

                                               Units             Units
                                         ----------------  ----------------

Total Sales Volumes (MMBOE)                  69  -     71     290  -    294

Crude Oil (MBbl/d):                         246  -    250     271  -    277

  United States                             169  -    173     181  -    187
  Algeria                                    57  -     58      70  -     72
  Ghana                                      19  -     20      19  -     21

Natural Gas (MMcf/d):

  United States                           2,600  -  2,650   2,450  -  2,525

Natural Gas Liquids (MBbl/d):

  United States                              92  -    100     100  -    115
  Algeria                                     -  -      -       2  -      3

---------------------------------------------------------------------------

                                             $ / Unit          $ / Unit
                                         ----------------  ----------------
Price Differentials vs. NYMEX (w/o
 hedges)

Crude Oil ($/Bbl):                            -  -   3.00       -  -   3.00

  United States                           (5.00) -      -   (5.00) -      -
  Algeria                                  5.00  -  10.00    5.00  -  10.00
  Ghana                                    5.00  -  10.00    5.00  -  10.00

Natural Gas ($/Mcf):

  United States                           (0.20) -  (0.10)  (0.35) -  (0.25)



                       Anadarko Petroleum Corporation
                  Financial and Operating External Guidance
                                March 4, 2014


                                              1st-Qtr          Full-Year
                                              Guidance          Guidance
                                         ----------------- -----------------

                                                $ MM              $ MM
                                         ----------------- -----------------
Other Revenues:
  Marketing and Gathering Margin              50 -      70     240 -     260
  Minerals and Other                          45 -      55     190 -     210

----------------------------------------------------------------------------
Costs and Expenses:
                                              $ / BOE           $ / BOE
                                         ----------------- -----------------

  Oil & Gas Direct Operating                4.50 -    4.70    3.90 -    4.10
  Oil & Gas Transportation/Other            3.55 -    3.75    3.75 -    3.85
  Depreciation, Depletion and
   Amortization                            14.00 -   14.50   14.00 -   14.50
  Production Taxes (% of Product
   Revenue)                                 7.5% -    8.5%    8.5% -    9.5%

                                                $ MM              $ MM
                                         ----------------- -----------------

  General and Administrative                 280 -     300   1,150 -   1,250
  Exploration Expense
    Non-Cash                                  80 -     100     550 -     650
    Cash                                      95 -     105     400 -     450
  Interest Expense (net)                     180 -     185     730 -     740
  Other (Income) Expense                      40 -      50     135 -     155

Taxes:
Algeria (All current)                        45% -     55%     45% -     55%
Rest of Company (100% deferred for Q1,
 10% current for FY)                         50% -     60%     40% -     50%


----------------------------------------------------------------------------

Avg. Shares Outstanding (MM)

Basic                                        503 -     504     504 -     505
Diluted                                      506 -     507     507 -     508

Capital Investment (Excluding Western
 Gas Partners, LP)                              $ MM              $ MM
                                         ----------------- -----------------


APC Capital Expenditures                   2,400 -   2,600   8,100 -   8,500



                       Anadarko Petroleum Corporation
           Commodity Hedge Positions (Excluding Natural Gas Basis)
                             As of March 4, 2014


                                                 Weighted Average Price per
                                                           barrel
                                               -----------------------------

                                       Volume    Floor     Floor    Ceiling
                                     (MBbls/d)    Sold   Purchased    Sold
                                     --------- --------- --------- ---------
Crude Oil
  Fixed Price -
   Financial
  2014
    WTI                                  70    $  96.03
    Brent                                37    $ 109.19
                                     ---------  --------
                                        107    $ 100.58


                                                 Weighted Average Price per
                                                           MMBtu
                                               -----------------------------

                                       Volume
                                     (thousand   Floor     Floor    Ceiling
                                      MMBtu/d)    Sold   Purchased    Sold
                                     --------- --------- --------- ---------
Natural Gas
  Three-Way Collars
  2014                                  600    $  2.75   $  3.75   $  5.01
  2015                                  635    $  2.75   $  3.75   $  4.76

  Fixed Price -
   Financial
  2014                                  600    $  4.26

  Extendable
  2014 (January - June)  Fixed Price    400    $  4.19
  2014 (July - December) Swap           400                        $  4.19



                          Interest Rate Derivatives
                             As of March 4, 2014

----------------------------------------------------------------------------
 Instrument  Notional Amt.  Start Date   Maturity   Rate Paid  Rate Received
----------------------------------------------------------------------------
    Swap     $750 Million    June 2014   June 2024    6.00%      3M LIBOR
    Swap    $1,100 Million   June 2014   June 2044    5.57%      3M LIBOR
    Swap      $50 Million   Sept. 2016  Sept. 2026    5.91%      3M LIBOR
    Swap     $750 Million   Sept. 2016  Sept. 2046    5.86%      3M LIBOR


More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
In the midst of the widespread popularity and adoption of cloud computing, it seems like everything is being offered “as a Service” these days: Infrastructure? Check. Platform? You bet. Software? Absolutely. Toaster? It’s only a matter of time. With service providers positioning vastly differing offerings under a generic “cloud” umbrella, it’s all too easy to get confused about what’s actually being offered. In his session at 16th Cloud Expo, Kevin Hazard, Director of Digital Content for SoftL...
Agile, which started in the development organization, has gradually expanded into other areas downstream - namely IT and Operations. Teams – then teams of teams – have streamlined processes, improved feedback loops and driven a much faster pace into IT departments which have had profound effects on the entire organization. In his session at DevOps Summit, Anders Wallgren, Chief Technology Officer of Electric Cloud, will discuss how DevOps and Continuous Delivery have emerged to help connect dev...
Today air travel is a minefield of delays, hassles and customer disappointment. Airlines struggle to revitalize the experience. GE and M2Mi will demonstrate practical examples of how IoT solutions are helping airlines bring back personalization, reduce trip time and improve reliability. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Dr. Sarah Cooper, M2Mi’s VP Business Development and Engineering, will explore the IoT cloud-based platform technologies drivi...
Containers are changing the security landscape for software development and deployment. As with any security solutions, security approaches that work for developers, operations personnel and security professionals is a requirement. In his session at DevOps Summit, Kevin Gilpin, CTO and Co-Founder of Conjur, will discuss various security considerations for container-based infrastructure and related DevOps workflows.
It is one thing to build single industrial IoT applications, but what will it take to build the Smart Cities and truly society-changing applications of the future? The technology won’t be the problem, it will be the number of parties that need to work together and be aligned in their motivation to succeed. In his session at @ThingsExpo, Jason Mondanaro, Director, Product Management at Metanga, discussed how you can plan to cooperate, partner, and form lasting all-star teams to change the world...
Overgrown applications have given way to modular applications, driven by the need to break larger problems into smaller problems. Similarly large monolithic development processes have been forced to be broken into smaller agile development cycles. Looking at trends in software development, microservices architectures meet the same demands. Additional benefits of microservices architectures are compartmentalization and a limited impact of service failure versus a complete software malfunction. ...
Internet of Things is moving from being a hype to a reality. Experts estimate that internet connected cars will grow to 152 million, while over 100 million internet connected wireless light bulbs and lamps will be operational by 2020. These and many other intriguing statistics highlight the importance of Internet powered devices and how market penetration is going to multiply many times over in the next few years.
Internet of Things (IoT) will be a hybrid ecosystem of diverse devices and sensors collaborating with operational and enterprise systems to create the next big application. In their session at @ThingsExpo, Bramh Gupta, founder and CEO of robomq.io, and Fred Yatzeck, principal architect leading product development at robomq.io, discussed how choosing the right middleware and integration strategy from the get-go will enable IoT solution developers to adapt and grow with the industry, while at th...
Containers have changed the mind of IT in DevOps. They enable developers to work with dev, test, stage and production environments identically. Containers provide the right abstraction for microservices and many cloud platforms have integrated them into deployment pipelines. DevOps and Containers together help companies to achieve their business goals faster and more effectively. In his session at DevOps Summit, Ruslan Synytsky, CEO and Co-founder of Jelastic, reviewed the current landscape of...
Malicious agents are moving faster than the speed of business. Even more worrisome, most companies are relying on legacy approaches to security that are no longer capable of meeting current threats. In the modern cloud, threat diversity is rapidly expanding, necessitating more sophisticated security protocols than those used in the past or in desktop environments. Yet companies are falling for cloud security myths that were truths at one time but have evolved out of existence.
The cloud has transformed how we think about software quality. Instead of preventing failures, we must focus on automatic recovery from failure. In other words, resilience trumps traditional quality measures. Continuous delivery models further squeeze traditional notions of quality. Remember the venerable project management Iron Triangle? Among time, scope, and cost, you can only fix two or quality will suffer. Only in today's DevOps world, continuous testing, integration, and deployment upend...
The time is ripe for high speed resilient software defined storage solutions with unlimited scalability. ISS has been working with the leading open source projects and developed a commercial high performance solution that is able to grow forever without performance limitations. In his session at Cloud Expo, Alex Gorbachev, President of Intelligent Systems Services Inc., shared foundation principles of Ceph architecture, as well as the design to deliver this storage to traditional SAN storage co...
To many people, IoT is a buzzword whose value is not understood. Many people think IoT is all about wearables and home automation. In his session at @ThingsExpo, Mike Kavis, Vice President & Principal Cloud Architect at Cloud Technology Partners, discussed some incredible game-changing use cases and how they are transforming industries like agriculture, manufacturing, health care, and smart cities. He will discuss cool technologies like smart dust, robotics, smart labels, and much more. Prepare...
"We provide a web application framework for building really sophisticated web applications that run on a browser without any installation need so we get used for biotech, defense, and banking applications," noted Charles Kendrick, CTO and Chief Architect at Isomorphic Software, in this SYS-CON.tv interview at @DevOpsSummit (http://DevOpsSummit.SYS-CON.com), held June 9-11, 2015, at the Javits Center in New York
The Internet of Things is not only adding billions of sensors and billions of terabytes to the Internet. It is also forcing a fundamental change in the way we envision Information Technology. For the first time, more data is being created by devices at the edge of the Internet rather than from centralized systems. What does this mean for today's IT professional? In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists addressed this very serious issue of pro...