Anadarko Sells Take in K2 Unit in the Gulf of Mexico
Anadarko Petroleum has agreed to sell a portion of its interest in the K2 Unit in the Gulf of Mexico to two undisclosed parties for $1.2 billion. The sale is effective Jan. 1, 2007.
Year to date, gross daily production averaged 37,100 barrels of oil equivalent per day from six wells within the K2 Unit, in which Anadarko currently has a 65 percent working interest and is operator. The sale represents a 23.2 percent working interest. Following the transaction, Anadarko will remain the K2 Unit operator with a 41.8 percent working interest.
"This partial sale affirms our view of the value of this field and its contribution to our equity story, as well as keeping us ahead of schedule on debt reduction efforts," Anadarko Chief Financial Officer Al Walker said.
"This transaction allows us to both diversify our risk profile and retain a meaningful working interest as the operator in the unit," Anadarko Chairman, President and Chief Executive Officer Jim Hackett said. "We believe there is outstanding upside potential in this unit and are working with our partners to finalize plans to enhance the recovery of oil from this large reservoir."
"We believe getting our debt reduced quickly and maintaining a solid investment grade credit rating are integral to the successful execution of our business model," Hackett said. "We continue to be very pleased with the pace of, and values realized in, our divestiture program."
The transaction is expected to close in the second quarter of 2007, subject to applicable pre-emption rights of co-owners in the subject leases and other closing conditions agreed to by the parties.
Scotia Waterous marketed the assets, while UBS and Credit Suisse served as Anadarko's financial advisors.
- 4 Ways Agile Sourcing Can Lead Enterprises to Success (Nov 10)
- Gadfly: Anadarko Woke Up, and It Really Smells the Coffee (Nov 01)
- No More Free Lunch Is the Big Change Under Way in the Oil Market (Oct 09)