Anadarko Petroleum Announces Third-Quarter Earnings.Energy Editors/Business Editors HOUSTON--(BUSINESS WIRE)--Oct. 31, 2003 Anadarko Petroleum Corporation Anadarko Petroleum Corporation (NYSE: APC) is one of the world’s largest independent oil and gas exploration and production companies, with 2.37 billion barrels of oil equivalent (BOE) of proved reserves and a production of 190 million BOE in 2004. Ranked No. (NYSE NYSE See: New York Stock Exchange :APC (1) (American Power Conversion Corporation, West Kingston, RI, www.apcc.com) The leading manufacturer of UPS systems and surge suppressors, founded in 1981 by Rodger Dowdell, Neil Rasmussen and Emanual Landsman, three electronic power engineers who had worked at MIT. ) -- APC Headed for Record Annual Earnings -- Company Reports Net Income of $1.09 Per Share; or $1.46 Per Share Excluding Impairments and Restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). Costs(1) Anadarko Petroleum Corporation (NYSE:APC) today announced third quarter 2003 net income available to common shareholders of $274 million, or $1.09 per share (diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. ), on revenues of $1.3 billion. For the same period in 2002, the company earned $189 million, or 74 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. (diluted), on revenues of $938 million. Net income for the third quarter 2003 excluding the effect of foreign oil and gas impairments and restructuring costs related to the company's cost reduction plan was $1.46 per share (diluted).(1) Cash flow from operating activities totaled $884 million in the third quarter of 2003, up 63 percent from $544 million in the same period in 2002. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses before changes in assets and liabilities for the third quarter totaled $868 million, compared with $539 million for the same quarter in 2002.(1) "Our solid performance the past several quarters puts Anadarko on track to achieve record earnings this year," said Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. J. Allison
Allison, which may come from a medieval Norman nickname for Alice, meaning "noble type", or from the Irish name "Iseult", meaning "fair lady". , Jr., Anadarko Chairman, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We're we're Contraction of we are. we're we are making significant progress on cutting overhead costs overhead costs see fixed costs. . We've we've Contraction of we have. we've have made new discoveries this quarter in Algeria Algeria (ăljēr`ēə), Arab. Al Djazair, Fr. Algérie, officially People's Democratic Republic of Algeria, republic (2005 est. pop. and we're encouraged by the recent results of our exploration program in the deepwater Deepwater or Deep Water may refer to:
Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east . Meanwhile, our U.S. onshore on·shore adj. 1. Moving or directed toward the shore: an onshore wind. 2. Located on the shore: an onshore beacon; an onshore patrol. adv. bread-and-butter bread-and-but·ter adj. 1. a. Influenced by or undertaken out of necessity: a bread-and-butter job. b. plays, such as the Bossier Bossier may refer to:
American writer best known for Roots (1976), a fictionalized chronicle tracing his family history back to its African origins. Noun 1. trend in West Texas and from the redevelopment of some Gulf of Mexico properties. "Based on these successes, Anadarko is now expecting greater improvement in its finding and development costs -- which we expect to be better than $7.50 per barrel barrel: see English units of measurement. for the year. That number is lower than our previous guidance, and a significant improvement over last year," Allison added. Sales volumes totaled 50 million barrels of oil equivalent (BOE BOE Based on Experience BOE Board of Education BOE Boletín Oficial del Estado (Spanish) BOE Bank of England BOE Board of Equalization BOE Board of Elections BOE Barrel of Oil Equivalent BOE Bind on Equip ) during the third quarter of 2003, or 541,000 BOE per day, up nearly 3 percent from the second quarter 2003. In the third quarter of 2002, sales volumes were 48 million BOE, or 526,000 BOE per day. Natural gas volumes in the third quarter of 2003 were 1.84 billion cubic feet (Bcf) per day, compared with 1.74 Bcf per day in the second quarter of 2003. A year ago, natural gas volumes for the third quarter were 1.76 Bcf per day. Anadarko's realized average natural gas price in the third quarter of 2003 was $4.51 per thousand cubic feet (Mcf), compared with $2.62 per Mcf in the same period in 2002. Oil production in the third quarter of 2003 was 189,000 barrels a day, down slightly from 190,000 barrels a day in the second quarter of 2003 and 191,000 in the third quarter of 2002. Anadarko's realized oil price averaged $26.36 per barrel in the third quarter of this year, compared with $24.02 per barrel in the third quarter of 2002. THIRD-QUARTER 2003 OPERATING HIGHLIGHTS -- Anadarko and its partners have made their third and fourth exploration successes in the past 12 months in Algeria's prolific Berkine Basin BASIN Boulder Area Sustainability Information Network (Boulder, Colorado) BASIN Brothers And Sisters In Need . The most recent discovery, the BKNE-AAC-A well, is located in Block 404 and was drilled to a depth of 11,200 feet and encountered 36 net feet of oil pay. -- In Wyoming Wyoming, city, United States Wyoming, city (1990 pop. 63,891), Kent co., W Mich., in the greater Grand Rapids metropolitan area, on the Grand River; settled 1832, inc. 1959. , construction is progressing on a 125-mile pipeline to transport carbon dioxide carbon dioxide, chemical compound, CO2, a colorless, odorless, tasteless gas that is about one and one-half times as dense as air under ordinary conditions of temperature and pressure. (CO2) recovered from the Shute Shute , Nevil Pen name of Nevil Shute Norway. 1899-1960. British writer whose novels include A Town Like Alice (1950) and On the Beach (1957), both set in Australia. Noun 1. Creek gas processing plant in southwest Southwest or south west is the ordinal direction halfway between south and west, the opposite of northeast. Southwest or south west may also refer to:
enhanced oil recovery Enhanced Oil Recovery (EOR) is a generic term for techniques for increasing the amount of oil that can be extracted from an oil field. Using EOR, 30-60 %, or more, of the reservoir's original oil can be extracted [1] compared with 20-40% [2] (EOR EOR - exclusive or ) project at the Salt Creek Salt Creek refers to:
north of Casper Casper, city (1990 pop. 46,742), alt. 5,123 ft (1,561 m), seat of Natrona co., E central Wyo., on the North Platte River; inc. 1889. It is a rail, distribution, processing, and trade center in a farming, ranching, and mineral-rich area. . The pipeline construction should be complete by January January: see month. . Anadarko's successful pilot program has generated encouraging results and confirms the expected EOR performance to increase oil production over the next several years from 5,300 barrels per day Barrels per day (abbreviated BPD, bbl/d, bpd, bd or b/d) is a measurement used to describe the amount of crude oil (measured in barrels) produced or consumed by an entity in one day. to a peak rate of 35,000 barrels per day. CAPITAL BUDGET Anadarko will increase its 2003 capital budget by $100 million, based on improved NYMEX See New York Mercantile Exchange. NYMEX See New York Mercantile Exchange (NYM). prices of oil and gas, and remains committed to reducing debt this year by $300 million. The increased capital budget of $2.8 billion will allow the company to spend additional funds to advance the development of several successful programs such as the East Texas Bossier and North Louisiana Vernon Vernon, city, Canada Vernon, city (1991 pop. 23,514), S British Columbia, Canada, near the north end of Okanagan Lake. The center of a fruit-growing and dairying area, it has packing and dehydrating plants. plays, and conduct further delineation at some deepwater Gulf of Mexico discoveries. PRODUCTION & EARNINGS GUIDANCE Oil and gas sales volumes are expected to total 49 million BOE in the fourth quarter. Full-year 2003 sales volumes are expected to total 192 million BOE. The company expects net income of $275 million, or $1.10 per share (diluted), for the fourth quarter of 2003, with expected cash flow from operating activities of $760 million. Cash flow from operations before changes in assets and liabilities for the fourth quarter of 2003 is expected to be $780 million.(1) The expected average number of diluted shares outstanding is 251 million. For the full year, the company expects earnings of $1.3 billion, or $5 per share (diluted) and cash flow from operating activities of $3.1 billion. Cash flow from operations before changes in assets and liabilities for the full year 2003 is expected to be $3.2 billion.(1) The expected average number of diluted shares outstanding is 253 million. FINANCIAL DATA Four pages of summary financial data for the third quarter of 2003 follow. There is also a page with detailed financial guidance for the fourth quarter and full year, plus a summary of the company's current hedge positions for the remainder of 2003 and 2004. EARNINGS CONFERENCE CALL TODAY, OCT OCT ornithine carbamoyltransferase; oxytocin challenge test. OCT ornithine carbamoyl transferase, a liver specific enzyme. OCT Oxytocin stress test, see there . 31, AT 9:30 A.M. CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. (10:30 A.M. EST EST electroshock therapy. EST abbr. electroshock therapy ) Anadarko will host a conference call today, Oct. 31, at 9:30 a.m. Central Standard Time (10:30 a.m. Eastern Standard Time) to discuss third quarter 2003 results and the company's outlook. The dial-in number is 913-981-4900, and the confirmation number is 520517. For complete instructions on how to participate and to view additional information that will be presented during the call, visit our website at www.anadarko.com. ANADARKO OPERATIONS REPORT For more details on Anadarko's operations, please see the comprehensive report on individual wells drilled during the third quarter. The report will be available today at www.anadarko.com. 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 Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , Algeria, Qatar Qatar or Katar (both: kŭ`tər, gŭ–, kətär`), officially State of Qatar, independent emirate (2005 est. pop. 863,000), c. and Venezuela Venezuela (vĕnəzwā`lə, Span. vānāswā`lä), officially the Bolivarian Republic of Venezuela, republic (2005 est. pop. 25,375,000), 352,143 sq mi (912,050 sq km), N South America. and is executing strategic exploration programs in several other countries. More information is available at www.anadarko.com. (1) See accompanying ac·com·pa·ny v. ac·com·pa·nied, ac·com·pa·ny·ing, ac·com·pa·nies v.tr. 1. To be or go with as a companion. 2. tables for a reconciliation of GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). to non-GAAP financial measures utilized in calculating net income excluding oil and gas impairments and restructuring costs, cash flow from operations before changes in assets and liabilities and statements indicating why management believes the non-GAAP measures of net income and cash flow are useful information for investors. This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. 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 proved reserves The quantity of minerals expected to be recoverable under current economic and operating conditions. The amount of proved reserves is important in valuing the stock of a company with significant holdings in natural resources. that comply with the Securities and Exchange Commission's (SEC) definitions. Additionally, Anadarko may disclose estimated reserves, which the SEC guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. do not allow us to include in filings with the SEC. See Additional Factors Affecting Business in the Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial included in the company's 2002 Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. .
Anadarko Petroleum Corporation
Reconciliation of GAAP to Non-GAAP Measures
Below is a reconciliation of net income available to common
stockholders (GAAP) to net income available to common stockholders
before the after tax effect of impairments related to oil and gas
properties and restructuring costs (non-GAAP) as required under
Regulation G of the Securities Exchange Act of 1934.
The company uses net income excluding non-cash impairments and
restructuring costs to evaluate the company's results. Impairments
and restructuring costs related to the company's cost reduction plan
are excluded due to the lack of comparability between periods.
Quarter Ended Year to Date
September 30 September 30
------------- --------------
millions except per share amounts 2003 2002 2003 2002
---------------------------------------------------------------------
Net Income
---------------------------------------------------------------------
Net income available to common
stockholders $274 $189 $993 $516
Add back:
Impairments related to oil and gas
properties, net of taxes 72 - 84 25
Restructuring costs, net of taxes 21 - 21 -
---------------------------------------------------------------------
Net income available to common
stockholders excluding impairments and
restructuring costs after taxes $367 $189 $1,098 $541
---------------------------------------------------------------------
Per Common Share
---------------------------------------------------------------------
Net income available to common
stockholders - diluted $1.09 $0.74 $3.92 $2.01
Net income available to common
stockholders excluding impairments and
restructuring costs after taxes -
diluted $1.46 $0.74 $4.34 $2.10
---------------------------------------------------------------------
Below is a reconciliation of cash provided by operating activities
(GAAP) to cash flow from operations before changes in assets and
liabilities (non-GAAP) as required under Regulation G of the
Securities Exchange Act of 1934.
The company uses cash flow from operations before changes in assets
and liabilities to demonstrate the company's ability to internally
fund capital expenditures and to service or incur additional debt. It
is useful in comparisons of oil and gas exploration and production
companies because it excludes fluctuations in assets and liabilities.
Quarter Ended Year to Date
September 30 September 30
------------- ---------------
millions 2003 2002 2003 2002
----------------------------------------------------------------------
Cash Flow
----------------------------------------------------------------------
Net cash provided by operating activities $884 $544 $2,299 $1,505
Add back:
Change in accounts receivable (93) (42) (29) (137)
Change in accounts payable and accrued
expenses 88 (61) 92 47
Change in other items - net (11) 98 74 84
----------------------------------------------------------------------
Cash flow from operations before changes
in assets and liabilities $868 $539 $2,436 $1,499
----------------------------------------------------------------------
Anadarko Petroleum Corporation
Quarter Ended Year to Date
Summary Financial Information (a) September 30 September 30
---------------- ------------------
$ and shares in millions 2003 2002 2003 2002
---------------------------------------------------------------------
Revenues
---------------------------------------------------------------------
Gas sales $762 $425 $2,165 $1,290
Oil and condensate sales 458 422 1,337 1,197
Natural gas liquids sales 85 57 255 156
Other sales 35 34 87 87
---------------------------------------------------------------------
Total 1,340 938 3,844 2,730
---------------------------------------------------------------------
Costs and Expenses
---------------------------------------------------------------------
Operating expenses 207 172 587 555
Administrative and general 75 78 249 227
Depreciation, depletion and
amortization 341 288 954 829
Other taxes 70 50 216 168
Impairments related to oil and
gas properties 74 - 92 33
Restructuring costs 33 - 33 -
---------------------------------------------------------------------
Total 800 588 2,131 1,812
---------------------------------------------------------------------
Operating Income 540 350 1,713 918
---------------------------------------------------------------------
Other (Income) Expense
---------------------------------------------------------------------
Interest expense 59 49 187 146
Other (income) expense 2 (4) (25) (2)
---------------------------------------------------------------------
Total 61 45 162 144
---------------------------------------------------------------------
Income Before Income Taxes 479 305 1,551 774
---------------------------------------------------------------------
Income Tax Expense 203 115 601 254
---------------------------------------------------------------------
Net Income Before Cumulative
Effect of Change in
Accounting Principle $276 $190 $950 $520
---------------------------------------------------------------------
Preferred Stock Dividends 2 1 4 4
---------------------------------------------------------------------
Net Income Available to Common
Stockholders Before
Cumulative Effect of Change in
Accounting Principle $274 $189 $946 $516
---------------------------------------------------------------------
Cumulative Effect of Change in
Accounting Principle - - 47 -
---------------------------------------------------------------------
Net Income Available to Common
Stockholders $274 $189 $993 $516
---------------------------------------------------------------------
Per Common Share
---------------------------------------------------------------------
Net income - before change in
accounting principle - basic $1.09 $0.76 $3.79 $2.08
Net income - before change in
accounting principle - diluted $1.09 $0.74 $3.74 $2.01
Change in accounting principle -
basic $- $- $0.19 $-
Change in accounting principle -
diluted $- $- $0.18 $-
Net income - basic $1.09 $0.76 $3.98 $2.08
Net income - diluted $1.09 $0.74 $3.92 $2.01
---------------------------------------------------------------------
Average Number of Common Shares
Outstanding - Basic 250 249 249 248
---------------------------------------------------------------------
Average Number of Common Shares
Outstanding - Diluted 251 258 254 260
---------------------------------------------------------------------
(a) Unrealized gains and losses on derivative instruments that did not
meet the conditions to qualify for hedge accounting have been
reclassified to conform to the current presentation. The effect on
prior periods is insignificant.
Anadarko Petroleum Corporation
Quarter Ended Year to Date
Summary Financial Information (a) September 30 September 30
------------------ -----------------
$ in millions 2003 2002 2003 2002
---------------------------------------------------------------------
Cash Flow
---------------------------------------------------------------------
Net income before cumulative
effect of change in accounting
principle $276 $190 $950 $520
Depreciation, depletion and
amortization 341 288 954 829
Interest expense - zero coupon
debentures - 4 4 10
Deferred income taxes 156 63 419 116
Impairments related to oil and
gas properties 74 - 92 33
Other non-cash items 21 (6) 17 (9)
---------------------------------------------------------------------
Cash Flow from Operations 868 539 2,436 1,499
---------------------------------------------------------------------
Decrease in accounts receivable 93 42 29 137
Increase (decrease) in accounts
payable and accrued expenses (88) 61 (92) (47)
Other items - net 11 (98) (74) (84)
---------------------------------------------------------------------
Net Cash Provided by Operating
Activities $884 $544 $2,299 $1,505
---------------------------------------------------------------------
---------------------------------------------------------------------
Capital Expenditures
---------------------------------------------------------------------
Capital spending $566 $376 $1,929 $1,561
Capitalized interest 30 42 94 121
Capitalized overhead 45 48 142 148
---------------------------------------------------------------------
Total $641 $466 $2,165 $1,830
---------------------------------------------------------------------
Sept. 30, Dec. 31,
2003 2002
---------------------------------------------------------------------
Condensed Balance Sheet
---------------------------------------------------------------------
Current assets $1,426 $1,280
Net properties and equipment 17,013 15,098
Other assets 450 436
Goodwill 1,473 1,434
---------------------------------------------------------------------
Total Assets $20,362 $18,248
---------------------------------------------------------------------
Current liabilities $1,845 $1,861
Long-term debt 5,171 5,171
Other long-term liabilities 5,168 4,244
Stockholders' equity 8,178 6,972
---------------------------------------------------------------------
Total Liabilities and
Stockholders' Equity $20,362 $18,248
---------------------------------------------------------------------
Capitalization
---------------------------------------------------------------------
Total debt $5,448 $5,471
Stockholders' equity 8,178 6,972
---------------------------------------------------------------------
Total $13,626 $12,443
---------------------------------------------------------------------
Capitalization Ratios
---------------------------------------------------------------------
Total debt 40% 44%
Stockholders' equity 60% 56%
---------------------------------------------------------------------
(a) Unrealized gains and losses on derivative instruments that did not
meet the conditions to qualify for hedge accounting have been
reclassified to conform to the current presentation. The effect on
prior periods is insignificant.
Anadarko Petroleum Corporation
Quarter Ended Year to Date
Volumes and Prices (a) September 30 September 30
--------------- ---------------
2003 2002 2003 2002
----------------------------------------------------------------------
Natural Gas
----------------------------------------------------------------------
United States
----------------------------------------------------------------------
Volumes, billion cubic feet 136 126 378 389
Average daily volumes, million cubic
feet per day 1,481 1,375 1,383 1,423
Price per thousand cubic feet $4.48 $2.64 $4.41 $2.63
----------------------------------------------------------------------
Canada
----------------------------------------------------------------------
Volumes, billion cubic feet 33 36 103 99
Average daily volumes, million cubic
feet per day 357 389 379 364
Price per thousand cubic feet $4.65 $2.53 $4.83 $2.69
----------------------------------------------------------------------
Total
----------------------------------------------------------------------
Volumes, billion cubic feet 169 162 481 488
Average daily volumes, million cubic
feet per day 1,838 1,764 1,762 1,787
Price per thousand cubic feet $4.51 $2.62 $4.50 $2.64
----------------------------------------------------------------------
Crude Oil and Condensate
----------------------------------------------------------------------
United States
----------------------------------------------------------------------
Volumes, million barrels 8 8 26 23
Average daily volumes, thousand
barrels per day 97 84 96 88
Price per barrel $26.34 $24.77 $26.45 $22.28
----------------------------------------------------------------------
Canada
----------------------------------------------------------------------
Volumes, million barrels 2 3 5 10
Average daily volumes, thousand
barrels per day 17 37 17 37
Price per barrel $26.43 $19.36 $27.56 $18.57
----------------------------------------------------------------------
Algeria
----------------------------------------------------------------------
Volumes, million barrels 5 5 14 16
Average daily volumes, thousand
barrels per day 51 51 52 57
Price per barrel $27.66 $26.91 $28.06 $23.54
----------------------------------------------------------------------
Other International
----------------------------------------------------------------------
Volumes, million barrels 2 2 5 6
Average daily volumes, thousand
barrels per day 24 19 19 21
Price per barrel $23.68 $22.05 $22.94 $19.34
----------------------------------------------------------------------
Total
----------------------------------------------------------------------
Volumes, million barrels 17 18 50 55
Average daily volumes, thousand
barrels per day 189 191 184 203
Price per barrel $26.36 $24.02 $26.64 $21.64
----------------------------------------------------------------------
Natural Gas Liquids
----------------------------------------------------------------------
Total
----------------------------------------------------------------------
Volumes, million barrels 4 4 12 11
Average daily volumes, thousand
barrels per day 46 41 44 41
Price per barrel $20.36 $15.40 $21.10 $13.92
----------------------------------------------------------------------
Total Barrels of Oil Equivalent (BOE)
----------------------------------------------------------------------
Volumes, million BOE 50 48 142 148
Average daily volumes, thousand BOE
per day 541 526 522 542
----------------------------------------------------------------------
(a) Unrealized gains and losses on derivative instruments that did not
meet the conditions to qualify for hedge accounting have been
reclassified to conform to the current presentation. The effect on
prior periods is insignificant.
Anadarko Petroleum Corporation
Fourth Quarter 2003
Financial Model - Guidance
October 31, 2003
3rd Quarter 4th Quarter Total Year
Actuals Forecast Forecast
--------------- -------------- ---------------
$MM $/Share $MM $/Share $MM $/Share
------ ------- ------ ------- ----- -------
Net Income $274 $1.09 $275 $1.10 $1,269 $5.02
Cash Flow from
Operations before
changes in assets and
liabilities(1) $868 $780 $3,216
Change in assets
and liabilities $16 $(20) $(157)
Cash Flow from
Operating Activities $884 $760 $3,059
----------------------------------------------------------------------
Price Deck (NYMEX) ($/Unit) ($/Unit) ($/Unit)
Crude Oil ($/Bbl) $30.26 $29.50 $30.65
Natural Gas ($/Mcf) $4.97 $4.60 $5.39
Natural Gas Liquids (%
of NYMEX Oil) 67% 77% 70%
----------------------------------------------------------------------
Price Price Price
Differ- Differ- Differ-
ential ential ential
Volumes ($/Unit) Volumes ($/Unit) Volumes ($/Unit)
------- -------- ------- -------- ------- --------
Total Sales (MMBoe) 50 49 192
Crude Oil (MBbl/d): 189 $(3.90) 191 $(3.74) 185 $(4.23)
United States 97 $(3.92) 91 $(4.64) 94 $(4.59)
Canada 17 $(3.83) 18 $(2.59) 17 $(3.24)
Algeria 51 $(2.60) 57 $(1.44) 53 $(2.59)
Other International 24 $(6.58) 25 $(6.51) 21 $(7.69)
Natural Gas (MMcf/d): 1,838 $(0.46) 1,806 $(0.52) 1,773 $(1.00)
United States 1,481 $(0.49) 1,400 $(0.50) 1,387 $(1.06)
Canada 357 $(0.32) 406 $(0.60) 386 $(0.77)
Natural Gas Liquids
(MBbl/d): 46 44 45
United States 44 42 43
Canada 2 2 2
----------------------------------------------------------------------
$MM $MM $MM
------ ------ ------
Other Revenues:
Marketing Margin
(Sales - Costs) $18 $16 $54
Minerals and Other $17 $12 $61
$MM $/Boe $MM $/Boe $MM $/Boe
----- ------- ------ ------- ------ -------
Costs and Expenses:
Operating Costs $207 $4.17 $207 $4.22 $794 $4.14
Administrative and
General $75 $80 $330
Depreciation,
Depletion and
Amortization $341 $6.87 $340 $6.91 $1,294 $6.75
Impairments $74 $30 $122
Production and Other
Taxes (% of Rev) $70 5.0% $68 6.0% $283 5.7%
Restructuring Costs $33 $3 $36
----------------------------------------------------------------------
$MM $MM $MM
------ ------ ------
Other Items:
Interest Expense $59 $59 $246
Other (Income)
Expense $2 $5 $(20)
----------------------------------------------------------------------
Federal Tax Rate 42% 39% 39%
Deferred Taxes (% of
Total Taxes) 79% 75% 71%
----------------------------------------------------------------------
Average Shares
Outstanding (MM)
Basic 250 250 250
Diluted 251 251 253
----------------------------------------------------------------------
$MM $MM $MM
------ ------ ------
Capital Investment
Program $641 $660 $2,825
Capital Budget
(Estimated) $566 $582 $2,511
Capitalized Direct
Expenses $45 $48 $190
Capitalized Interest $30 $30 $124
(1) See accompanying table for a reconciliation of GAAP to non-GAAP
financial measures utilized in calculating cash flow from
operations before changes in assets and liabilities, and a
statement indicating why management believes the non-GAAP measure
of cash flow is useful information to investors.
Anadarko Petroleum Corporation
Hedge Position
As of September 30, 2003
Fixed and Physical
Contracts 2- Way Collars
------------------- --------------------------
NYMEX
Volume Price Volume Floor Ceiling
Crude Oil Bbl/day $/Bbl Bbl/day $/Bbl $/Bbl
--------- --------- -------- -------- --------
United States
4th Qtr 2003 14,000 $25.39 3,750 $25.00 $28.29
Total Year 2004 8,000 $23.09 3,260 $22.00 $26.32
Algeria
Total Year 2004 - -
Total Crude Oil, All
Locations
4th Qtr 2003 14,000 $25.39 3,750 $25.00 $28.29
Total Year 2004 8,000 $23.09 3,260 $22.00 $26.32
NYMEX
Volume Price Volume Floor Ceiling
Natural Gas MMMBtu/d $/MMBtu MMMBtu/d $/MMBtu $/MMBtu
--------- --------- -------- -------- ---------
United States
4th Qtr 2003 430.0 $4.44 60.7 $4.79 $8.73
Total Year 2004 200.0 $3.88 44.3 $4.29 $6.43
Canada
4th Qtr 2003 65.1 $3.24 -
Total Year 2004 58.9 $3.19 -
Total Natural Gas, All
Locations
4th Qtr 2003 495.1 $4.28 60.7 $4.79 $8.73
Total Year 2004 258.9 $3.72 44.3 $4.29 $6.43
3- Way Collars
--------------------------------------
Sold Purchased
Volume Floor Floor Ceiling
Crude Oil Bbl/day $/Bbl $/Bbl $/Bbl
--------- --------- --------- --------
United States
4th Qtr 2003 53,000 $18.62 $23.81 $27.39
Total Year 2004 -
Algeria
Total Year 2004 20,000 $18.00 $22.00 $28.07
Total Crude Oil, All Locations
4th Qtr 2003 53,000 $18.62 $23.81 $27.39
Total Year 2004 20,000 $18.00 $22.00 $28.07
Sold Purchased
Volume Floor Floor Ceiling
Natural Gas MMMBtu/d $/MMBtu $/MMBtu $/MMBtu
--------- --------- --------- --------
United States
4th Qtr 2003 398.8 $2.91 $3.97 $5.01
Total Year 2004 268.8 $2.67 $3.65 $5.30
Canada
4th Qtr 2003 -
Total Year 2004 -
Total Natural Gas, All Locations
4th Qtr 2003 398.8 $2.91 $3.97 $5.01
Total Year 2004 268.8 $2.67 $3.65 $5.30
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