Anadarko Enters West Texas Exploration Venture with Chevron; Delaware Basin Deal Seeks to Extend Haley Success.

HOUSTON -- Anadarko Petroleum Corporation (NYSE:APC) today announced it has entered an exploration joint venture with Chevron U.S.A. Inc. on approximately 200,000 net mineral acres Chevron owns within the Delaware Basin in west Texas. The acreage overlaps and extends westward from Anadarko's existing leasehold, which includes the rapidly growing Haley natural gas field.

Under the agreement, Anadarko will serve as operator and earn up to a 100 percent working interest in the Chevron-owned acreage. Chevron will retain royalty interests on its mineral acres, as well as hold an option to take up to a 25 percent working interest in each well.

"Anadarko has ramped up our gross operated gas production in the Haley field from zero in 2003 to 175 million cubic feet per day currently, making it one of our largest and fastest-growing onshore gas plays," Anadarko Senior Vice President Karl Kurz said. "The new venture with Chevron will allow us to apply our play concept farther westward, with the Chevron acreage essentially more than doubling our net land position in the highly prospective Delaware Basin."

Anadarko's existing holdings in the region total 264,000 gross acres (140,000 net), of which the Haley field represents about 60,000 gross acres (44,000 net).

"The Pennsylvanian zones we are targeting in the Delaware Basin have already produced a cumulative 2 trillion cubic feet of natural gas, and we believe more than 10 trillion cubic feet of gross resource potential remains just on our captured land position, inclusive of the Chevron acreage," Kurz said. "We expect to be operating as many as 13 drilling rigs in the region by year-end, up from the six rigs we had working through May and the nine rigs currently drilling in the play. That activity level allows for continued development of the Haley field, where we have grown gas production nearly 50 percent so far this year, as well as the drilling of three to five significant exploration wells in 2006, which could include our first test of the Chevron acreage. We have been very pleased with the results of our drilling program so far, and are excited about the potential we see on the Chevron acreage."

ABOUT ANADARKO

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 2.45 billion barrels-equivalent of proved reserves, making it one of the world's largest independent exploration and production companies. Anadarko's operational focus in North America extends from the deepwater Gulf of Mexico, up through the western U.S. and Canadian regions and onto the North Slope of Alaska. Anadarko's international activities are focused on major positions in North Africa, the Middle East and Indonesia, as well as exploration or production operations in several other countries. In June, Anadarko agreed to acquire Kerr-McGee Corporation (NYSE:KMG) and Western Gas Resources, Inc. (NYSE:WGR) in separate all-cash transactions totaling $21.1 billion, plus the assumption of debt estimated at $2.2 billion. 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 such expectations will prove to have been correct, or that the transactions described above will occur. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release. 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.