Anadarko Announces Sale of Oil Assets in the Northern Rockies.

HOUSTON -- Anadarko Petroleum Corporation (NYSE:APC) today announced it has agreed to sell its interests in the Elk Basin and Gooseberry area, primarily located in Park County, Wyo., to Encore Acquisition Company (NYSE:EAC) for $400 million. The sale is effective Jan. 1, 2007.

"The sale of these oil fields furthers our efforts to concentrate our geographic footprint and high grade our assets," Anadarko Chairman, President and CEO Jim Hackett said. "We have significant positions in some of the most prolific basins in the Rocky Mountains. We have an extensive inventory of low-risk, repeatable projects, economies of scale and competitive advantages in the Greater Natural Buttes area in Utah, Powder River Basin in Wyoming and Wattenberg field in Colorado. Our divestiture program will enable us to concentrate on these areas where we are confident we can deliver strong, predictable growth for years to come."

At the effective date, production was approximately 4,350 barrels of oil equivalent per day (net) from 614 wells within two fields in the Elk Basin and Gooseberry area. Anadarko holds approximately 17,550 net acres and operates all of these properties. Oil accounted for approximately 80 percent of 2006 production. The sale also includes the Elk Basin Gas Plant and the Clear Fork Pipeline Company, an oil and natural gas gathering system. The Elk Basin Gas Plant has the capacity to process approximately 12 million cubic feet of natural gas per day.

This agreement is expected to close by the end of the first quarter of 2007, subject to customary closing conditions and adjustments.

Tristone Capital marketed the assets, while Lehman Brothers served as Anadarko's financial advisor.

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 2005, the company had 2.4 billion barrels-equivalent of proved reserves, making it one of the world's largest independent exploration and production companies. In August 2006, Anadarko acquired Kerr-McGee Corporation and Western Gas Resources, Inc. in separate transactions.

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. Anadarko cannot guarantee that it will successfully integrate the recently acquired businesses or complete its pending or proposed asset sales. See "Risk Factors" in the company's 2005 Annual Report on Form 10-K and other public filings, press releases and discussions with company management. Anadarko undertakes no obligation to publicly update or revise any forward-looking statements.