Anadarko Outlines Future Growth Profile; 6% Growth Forecast for 2003, 10% for 2004.

Business/Energy Editors

Lehman Brothers CEO Energy Conference

NEW YORK--(BUSINESS WIRE)--Sept. 3, 2002

Anadarko Petroleum Corporation (NYSE:APC) today announced its future oil and gas production growth targets during the 16th Annual Lehman Brothers CEO Energy Conference.

Anadarko President and CEO John Seitz reiterated the company's earlier forecast of 6 percent growth in adjusted production volumes for 2003, based on an expected capital budget next year of about $2.5 billion funded from expected cash flow. "Both this budget and our 2004 estimate include significant exploration spending to fuel our future growth," Seitz said.

"Given the current outlook for energy prices -- combined with the exploration successes we've had and some major development projects that are under way -- we expect to accelerate our production growth over the next couple of years," Seitz said.

"For 2004, we currently expect worldwide production growth of about 10 percent, based on a $2.7 billion capital budget funded from expected cash flow."

These growth rates would start from a year-end 2002 production base of approximately 188 million barrels of oil equivalent (BOE). This adjusted volume figure reflects the annualized effect of the sale of $220 million of non-core U.S. and Canadian properties this year, as well as the planned sale of an additional $100 million of low-margin or low-growth properties.

2003 PRODUCTION FORECAST AT 199 MILLION BOE -- UP 6 PERCENT

"For 2003, we expect the bulk of our planned growth to come from Canada, Qatar and the Gulf of Mexico," Seitz said.

The company's recent exploration successes in the Slave Point play in Northeast British Columbia, and the Saddle Hills and Dawson areas of Western Alberta, will lead Canada's production growth next year.

Production capacity from the Al Rayyan field offshore Qatar is expected to increase significantly to 35,000 barrels a day gross as the result of a field expansion and redevelopment project scheduled for completion in the first quarter of 2003.

In the Gulf of Mexico, Anadarko expects increased production from the South Marsh Island Block 280/281 complex and the Hickory and Pardner subsalt fields.

Production from U.S. onshore areas and Algeria should be roughly flat compared with 2002.

2004 PRODUCTION FORECAST AT 220 MILLION BOE -- UP 10 PERCENT

"Most of our expected growth in 2004 would come from the Gulf of Mexico, Canada, the Lower 48 and Qatar," Seitz said.

In the Gulf of Mexico, several key projects are scheduled to come on-line in 2004, including the Marco Polo field -- Anadarko's first deep-water development -- in the first quarter of 2004; the recent K2 discovery; and the Tarantula discovery, which is scheduled for production by the first quarter of 2004.

Continued drilling in the Slave Point, Saddle Hills and Dawson areas also is expected to drive Canadian production growth in 2004.

In the Lower 48, production increases are expected in 2004 from new discoveries and increased development activity in the Bossier play in East Texas, from Central Texas and from the Vernon area in North Louisiana; from the ramp-up of coalbed methane production and conventional gas production from the East Green River Basin in the Rockies; from tight gas plays in West Texas; and from enhanced oil recovery projects in West Texas and Wyoming. Overall U.S. onshore volumes, including Alaska, should increase in 2004.

Additional production also should be realized from the full-year impact of the Al Rayyan expansion in Qatar.

Seitz said 2003 cash flow estimates are based on average NYMEX prices of $25 a barrel for oil and $3.85 per thousand cubic feet (Mcf) for natural gas. For 2004, forecasts assume $23.50 a barrel NYMEX oil and $3.85 per Mcf natural gas. "These prices are at or below current commodity market indications," Seitz noted. "We are actively hedging to protect a portion of our cash flow," he said.

"A number of projects -- both exploration and development -- are under way that we expect will continue our growth beyond 2004," Seitz said. "Our forecasts are less specific that far in the future, but we expect sustained growth from our portfolio. The majority of our capital projects will continue to be in our core areas. Exactly where the growth comes from will depend on where we allocate capital, and of course, on drilling results through 2003 and 2004. And as always, we're working on a number of high-impact opportunities in new areas that could contribute significantly to reserve and production growth and to shareholder value in the future," Seitz said.

Anadarko Petroleum Corporation is one of the world's largest independent oil and gas exploration and production companies, with assets of $17 billion and reserves of 2.3 billion BOE. 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. See Additional Factors Affecting Business in the Management's Discussion and Analysis (MD&A) included in the company's 2001 Annual Report on Form 10-K.