Anadarko CEO: Better Access is One Answer to Natural Gas Supply Woes; `Unlike Oil, We Can Supply More Homegrown Natural Gas - It's a Matter of Energy Security'.

Energy Editors/Business Editors

HOUSTON--(BUSINESS WIRE)--March 4, 2003

"Homegrown natural gas supplies are critical to national security. And, today's oil and gas industry can do something to increase our domestic supply provided we have better access to places in the U.S. where we can explore," John Seitz, president and CEO of Anadarko Petroleum Corporation (NYSE:APC), said today.

Seitz, speaking before the Texas Independent Producers and Royalty Owners Association (TIPRO), explained that "plentiful supplies of natural gas produced here in the U.S. are critical to America's energy security. But that security is being challenged as demand growth continues to outpace supply.

"Unlike oil, where America is dependent on foreign imports, producers can increase domestic gas production to help close the widening gap between supply and demand, but to do so, they must have better access to areas within the U.S. where the greatest undiscovered gas resources are located.

"Anadarko has a full portfolio of prospects, and we've laid out a $2.3 billion worldwide capital program that should enable us to grow production this year. But we believe the domestic industry as a whole is short of low-risk drilling locations, and here's why: Potentially vast resources of natural gas found on federal lands are off limits to exploration.

"What's the solution? The industry needs not only better access, but more pragmatic regulation of areas that are supposedly open for exploration but are too expensive to develop because of tight leasing restrictions and permitting delays," he explained. "Many projects in the West, for example, just aren't economic if they encounter too many delays. So in effect, delay is denial.

"At Anadarko, we're doing what we can to ramp up activity and increase supplies this year," he added. The company expects to operate an average of about 50 drilling rigs in North America this year - compared with about 40 during 2002. In fact, this week, Anadarko has more drilling rigs operating in the United States than any other company.

"This program should enable Anadarko to increase production to about 200 million barrels of oil equivalent and show a 7 percent growth in annual natural gas volumes over 2002. The growth will come primarily from fields in the Gulf of Mexico, Western Canada, East and Central Texas, North Louisiana and Wyoming.

"Part of America's long-term solution could be improved efficiency, and perhaps a wider choice of clean fuels. But for now, the best answer is to encourage greater natural gas exploration and development here at home," Seitz said.

To do that, he said, industry needs to pursue new frontier gas resources in challenging places like the Alaskan and Canadian Arctic, where Anadarko has made multi-year investments to look for new sources of oil and gas. The industry also needs to be exploring offshore areas in federal waters that are currently under moratoria, he added.

"These are extremely long-term prospects, granted, but our gas supply challenge isn't just a short-term problem," Seitz said. "We believe frontier gas can be developed economically, and we will find solutions to these challenges because it's in our national interest to do so.

"As an industry, we can be part of the solution, and we can help provide this country with the energy security it seeks. All we need is a strong, dedicated domestic industry, enlightened national leadership, and new ways of thinking," Seitz concluded.

Anadarko Petroleum Corporation is one of the world's largest independent oil and gas exploration and production companies. Houston-based Anadarko is active in the U.S., Canada, Algeria and Qatar and is executing strategic exploration programs in several other countries. More information is available at 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 and Exchange Act of 1934. Anadarko believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that its goals will be achieved. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this release. While Anadarko makes these forward-looking statements in good faith, neither Anadarko nor its management can guarantee that the anticipated future results will be achieved. Anadarko discloses proved reserves that comply with the Securities and Exchange Commission's (SEC) definitions. Additionally, Anadarko may disclose estimated recoverable reserves, which the SEC guidelines do not allow us to include in filings with the SEC. See Additional Factors Affecting Business in the Management's Discussion and Analysis included in the company's 2001 Annual Report on Form 10-K.