Anadarko Plans to Sell Additional Assets in 2003

Anadarko intends to sell about $100 million in total properties this year, excluding $40 million of assets in New Mexico that the company sold in the first quarter. Additional asset sales intended for closing prior to year end include about 20 properties in West Texas and 40 to 50 properties in the Gulf of Mexico, amounting to up to 400,000 BOE in 2003 volumes.

"Our aim is to focus on our key assets and reduce costs," Allison said. "At the end of the year, we expect to have fewer Gulf of Mexico fields but higher margins. This is an ongoing strategy that has allowed us to high-grade our portfolio, increase cash margins per barrel and add growth potential."

Earlier today, Anadarko agreed to buy 26 shallow-water Gulf fields from Amerada Hess for about $225 million. The new fields hold about 23 million barrels of proved oil and gas reserves and are expected to boost annual output by about 2.5 million barrels this year. The company expects the former Hess assets to generate $75 million of cash flow over the remainder of this year. Anadarko said more than 60 percent of the reserves are concentrated within three fields. Some of the Hess assets also are located near existing Anadarko operations, paving the way for cost savings. More than 60 percent of the reserves are concentrated within three fields: South Timbalier blocks 172 and 190/205/206 and South Pass 89. The company has identified more than 50 development opportunities including production enhancements, recompletions and low risk development wells, and as many as 10 exploration prospects that can be drilled over the next few years. The identified exploration prospects are located in high potential deep shelf gas plays, which Anadarko has been pursuing.