Anadarko Signs Contract for 2.6 Million-Acre Exploration Block Offshore Mozambique.

HOUSTON -- Anadarko Petroleum Corporation (NYSE:APC) today announced it has signed an exploration and production concession contract with the Government of Mozambique for Offshore Area 1 in the Rovuma Basin. Anadarko was awarded the block in Mozambique's second licensing round earlier this year.

The 2.64 million-acre block, positioned in northeast Mozambique, includes approximately 90,000 onshore acres and stretches eastward 35 miles (56 kilometers) offshore, where water depths extend down to 6,000 feet (1,800 meters). The block's boundary borders Tanzania to the north and extends southward about 100 miles (160 kilometers).

"Offshore Area 1 is a ground-floor opportunity to explore the highly prospective Rovuma Basin, where only two wells have ever been drilled," said Bob Daniels, Anadarko senior vice president of worldwide exploration. "We are very pleased to have signed this contract to explore for oil and gas in Mozambique. Through our regional evaluation and analysis of existing seismic data covering most of the block, we have already identified multiple leads across an area equivalent in size to 460 typical Gulf of Mexico lease blocks."

Under the terms of the contract, Anadarko has secured a five-year initial exploration term with options to extend that phase another three years, and a 30-year production term following any commercial discoveries. Anadarko was awarded the block on the basis of a work commitment to acquire new 2D and 3D seismic and drill seven wells during the initial exploration term. Anadarko will operate the block, initially with a 100 percent working interest.

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 2.4 billion barrels-equivalent of proved reserves, making it one of the world's largest independent exploration and production companies. In August 2006, Anadarko acquired Kerr-McGee Corporation and Western Gas Resources, Inc. in separate transactions.

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. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release. Anadarko cannot guarantee that it will successfully integrate the recently acquired businesses or complete its pending or proposed asset sales. 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.