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ANADARKO ANNOUNCES PROPERTY ACQUISITION; U.S. OIL RESERVES DOUBLE

 HOUSTON, Nov. 30 ~PRNewswire~ -- Anadarko Petroleum Corporation (NYSE: APC) said today the company signed a letter of intent with Atlantic Richfield Company (NYSE: ARC) to purchase proved reserves estimated at 28 million barrels of crude oil and 57 billion cubic feet of natural gas (or about 37 million energy equivalent barrels). The purchase price is $208.9 million, which will be reduced by revenues net of expenses from the July 1, 1992, effective date to closing.
 Acquisition of these properties will double Anadarko's proved U.S. crude oil reserves and increase the company's 1993 oil production by about 7,300 barrels per day or about 60 percent. Natural gas reserves and production will also increase modestly. Based on current market conditions, this acquisition should improve Anadarko's earnings and cash flow in future years.
 Most of the crude oil is produced from secondary recovery (or waterflood) operations in the Permian Basin of West Texas and southeast New Mexico. The company will become operator of properties containing over two-thirds of these proved reserves.
 The purchase also includes "deep" exploration rights on 54,000 gross (39,000 net) lease acres held by production. ARCO will have an option to participate in exploration with Anadarko under certain select fields.
 The agreement has been approved by the boards of directors of both companies and is subject to various regulatory approvals and negotiation of a definitive purchase agreement. The companies plan to close the transaction by year-end.
 Anadarko Chairman and Chief Executive Officer Robert J. Allison Jr. said: "Our shareholders benefit because we're buying quality properties with a long reserve life at an attractive price. We expect both stable oil production volumes and continued reserve growth from these properties for many years because of their significant upside potential for future development.
 "For the past ten years we've been successfully growing our reserve base


and we plan to continue that success. Now, we see acquisitions such as this as a great complement to our ongoing drilling programs. They bring added value to our shareholders," he said.
 Anadarko said 1992 will be the 11th consecutive year that the company has more than replaced production with proved reserves of oil and gas. Anadarko expects to add reserves in 1992 from all sources (including this and other acquisitions, drilling and revisions) that will exceed 1992 production by more than a two-to-one ratio. Final results for 1992 reserve replacement will not be known until late January.
 The company also said the properties fit strategically with ongoing production operations now conducted from the company's Midland, Texas, division office. "Midland's oil production will triple next year (from 3,400 barrels per day to over 10,000 barrels per day) which gives us more clout in oil markets," Allison said.
 Anadarko said it would initially finance the acquisition through a floating rate credit facility. However, the company intends to pursue an equity offering when market conditions warrant to fund a portion of the acquisition.
 Anadarko finds and develops energy reserves -- natural gas, crude oil and natural gas liquids. The company has exploration and development drilling operations underway in 18 states and five foreign countries. Anadarko also owns interests in five gas gathering pipelines and six natural gas processing plants.
 At year-end 1991, Anadarko was one of the nation's largest independent exploration and production companies with over 335 million equivalent barrels of proved energy reserves, including about 45 million barrels of crude oil, condensate and natural gas liquids and about 1.7 trillion cubic feet of natural gas.
 -0- 11~30~92
 ~CONTACT: A. Paul Taylor Jr. of Anadarko, 713-875-1101~
 (APC ARC)


CO: Anadarko Petroleum Corporation; Atlantic Richfield Company ST: Texas IN: OIL SU: TNM

GK -- NY012 -- 4030 11~30~92 09:11 EST
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Publication:PR Newswire
Date:Nov 30, 1992
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