Anadarko Enters Participation Agreement in Deepwater Gulf of Mexico.

HOUSTON -- Anadarko Petroleum Corporation (NYSE:APC) has signed an agreement with Chevron Corporation (NYSE:CVX) to participate in drilling four deepwater Gulf of Mexico prospects. Under this agreement, Anadarko will pay a disproportionate share of the drilling costs to earn a 20 to 25 percent working interest in two appraisal wells and two exploration wells scheduled to be completed by mid-year 2006. Anadarko will also gain rights in 29 deepwater Gulf of Mexico blocks.

"This agreement enhances our position in the Gulf of Mexico's prolific Miocene Foldbelt trend, a key growth area where we already have three discoveries under development," said Bob Daniels, Anadarko Senior Vice President, Exploration and Production. "These identified exploration opportunities, two of which are discovery appraisals, give us access to quality prospects that will be drilled in a short time frame."

The two appraisal wells, Tonga (Green Canyon block 727) and Sturgis (Atwater Valley block 138), will evaluate the commerciality of existing discoveries, as well as additional exploration potential identified in these areas. The two planned exploration wells are Turtle Lake (Green Canyon block 847) and Caterpillar (Mississippi Canyon block 782), which is in close proximity to Chevron's Blind Faith discovery. Chevron will operate all four wells utilizing drilling rigs already under contract. Caterpillar is expected to spud within the next two months.

In a separate transaction with another company, Anadarko gained a 15 percent working interest in Chevron's Big Foot prospect currently drilling on Walker Ridge block 29. Anadarko has interests in 270 deepwater blocks in the Gulf of Mexico.

Anadarko Petroleum Corporation's mission is to deliver a competitive and sustainable rate of return to shareholders by developing, acquiring and exploring for oil and gas resources vital to the world's health and welfare. As of year-end 2004, the company had 2.37 billion barrels of oil equivalent of proved reserves, making it one of the world's largest independent exploration and production companies. Anadarko's operational focus extends from the deepwater Gulf of Mexico, up through Texas, Louisiana, the Mid-Continent, western U.S. and Canadian Rockies and onto the North Slope of Alaska. Anadarko also has significant production in Algeria, Venezuela and Qatar, and exploration or production positions in several other countries. For more information about how Anadarko is bringing excellence to the surface, 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 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. See Regulatory Matters and Additional Factors Affecting Business in the Management's Discussion and Analysis included in the company's 2004 Annual Report on Form 10-K.