HOUSTON, April 29 /PRNewswire/ -- Anadarko Petroleum Corporation
(NYSE: APC) today announced financial and operating results for the first
quarter of 1999.
For 1999's first quarter, Anadarko reported a net loss available to common
stockholders of $23.1 million, or 19 cents per share (diluted), on
$136 million of revenues. The loss reflects a non-cash charge of $20 million
before taxes ($13.3 million after taxes) related to its remaining operations
in Eritrea as a result of drilling an unsuccessful exploration well. By
comparison, during the first quarter of 1998, Anadarko had net income of
$7 million, or 6 cents per share (diluted), on $147 million of revenues.
Excluding the foreign impairment, the company's net loss for the first
three months of 1999 was $9.8 million, or 8 cents per share (diluted). In
addition to the charge for Eritrea, the company attributed the decrease in
revenues and earnings during 1999's first quarter primarily to significantly
lower commodity prices, higher interest expense and preferred stock dividends.
Robert J. Allison, Jr., Chairman, President and CEO, said, "The loss in
the first quarter is mainly due to low prices -- but prices have begun to
recover. Since early March we've seen almost a 50% improvement in oil prices
and a 30% increase in gas prices. We can't change prices... that's the
macroenvironment in which we live. What we can do is distinguish ourselves
from our peers in the way that we deal with the adversity that low prices
bring.
"We've concentrated capital spending on plays and projects -- in Algeria,
Alaska and the sub-salt trend in the Gulf of Mexico -- that add real economic
value for our stockholders. At the same time, we've taken steps to conserve
cash and cut costs. We are deferring some projects, especially in southwest
Kansas and west Texas, until our realized prices improve. These are deferrals
-- not lost opportunities."
1999 First Quarter Production Increases
During the first quarter of 1999, Anadarko produced 12.9 million energy
equivalent barrels, up 14% from 11.3 million barrels in 1998's same period.
The increase was attributed primarily to oil production from the company's
operations in Algeria, which came onstream in May 1998.
Anadarko's production from its operations in Algeria averaged about
60,000 gross barrels of oil per day during 1999's first quarter. Under the
recent OPEC cutbacks, the company's Algerian production currently is averaging
about 53,600 gross barrels of oil per day. However, the increase in oil
prices due to the OPEC cutbacks is expected to have a positive impact on the
company's revenues and earnings.
Anadarko's oil production for the first three months of 1999 rose 76% to
an average of 44,000 barrels per day, up from 25,000 barrels per day in 1998's
corresponding period. The higher oil production volumes were offset by a
19% decline in 1999's first quarter oil prices. Anadarko's average oil price
for the first quarter of 1999 was $10.60 per barrel, off 19% from $13.02 per
barrel a year ago.
In 1999's first quarter, the company's natural gas production averaged
489 million cubic feet per day, level with the same period in 1998.
Anadarko's wellhead price for natural gas was $1.59 per thousand cubic feet
(Mcf) for the first quarter of 1999, off 21% from $2.02 per Mcf a year ago.
During the first three months of 1999, Anadarko's natural gas liquids
(NGLs) sales volumes averaged 18,000 barrels per day, a 4% decline compared to
19,000 barrels per day in 1998's first quarter. The company's average price
for NGLs was $8.60 per barrel in 1999's first quarter, 26% below an average
price of $11.68 per barrel a year ago.
Anadarko has maintained active exploration and development drilling
programs in the first quarter. About two-thirds of Anadarko's capital
investment program for 1999 will go to three large development projects that
are expected to provide substantial growth for the company over the next three
years. The three are:
-- Alaska -- On Alaska's North Slope, the production facility for the
Alpine oil field is now about 65% complete and drilling of the initial
development wells has begun. In addition, two exploration wells were
drilled in early 1999 on satellite prospects north of Alpine.
However, the results have not yet been disclosed by the operator.
Alpine is scheduled to begin production at a rate of 40,000 gross
barrels of oil per day in mid-2000. Anadarko has a 22% working
interest in Alpine. ARCO Alaska, Inc., as operator, holds the
remaining 78% working interest.
-- Algeria -- Development plans are progressing for Anadarko's second
major field development project. Algeria's Council of Ministers
approved the Exploitation License decree for the Qoubba field (now
called Ourhroud) in February 1999. The company expects to invite bids
for an engineering, procurement and construction contract for the
field during the second quarter of 1999. Construction of the
production facility at Ourhroud is expected to get underway in 2000
with first production anticipated in mid-2002, ramping up to about
230,000 gross barrels of oil per day.
-- Gulf of Mexico -- Additional drilling continues at Anadarko's
Tanzanite and Hickory fields in the Gulf of Mexico's sub-salt play,
where discoveries were made in 1998. During 1999 and early 2000,
Anadarko plans to continue development of both fields with production
expected to begin in the second half of 2000. The company will also
seek to leverage its technical advantage in the sub-salt play into a
stronger acreage position during 1999. For competitive
reasons, the level of details disclosed about the sub-salt program
will be limited over the next few months.
Comparative financial highlights follow (amounts in millions, except per
share data):
Quarter Ended March 31
1999 1998
Net income (loss) available to common
stockholders $ (23.1)* $ 7.0
Earnings (loss) per share -- diluted $ (0.19)* $0.06
Revenues $136.4 $147.0
Average common shares outstanding 120.5 119.8
* Includes a non-cash charge of $20 million before taxes ($13.3 million
after taxes) related to the company's remaining operations in Eritrea.
Excluding the foreign impairment, the net loss was $9.8 million, or
$0.08 per share (diluted).
This press 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 assurances, 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
1998 Annual Report on Form 10-K.
For additional information, contact:
Analysts and Investors: Media:
A. Paul Taylor, Jr. Carol L. Cox
Phone: 281-874-3471 Phone: 281-873-3855
Steve C. Campbell
Phone: 281-874-3260
Anadarko Petroleum Corporation
Quarter Ended
Summary Financial Information March 31
$ and shares in millions 1999 1998
Revenues
Gas sales $77.8 $93.5
Oil and condensate sales 43.6 31.4
Natural gas liquids and other 15.0 22.1
Total 136.4 147.0
Costs and Expenses
Operating expenses 34.1 40.3
Administrative and general 24.4 21.2
Depreciation, depletion and amortization 56.5 51.3
Other taxes 9.3 10.8
Impairments related to international properties 20.0 ---
Total 144.3 123.6
Operating Income (Loss) (7.9) 23.4
Interest Expense 18.6 12.4
Income (Loss) before Income Taxes (26.5) 11.0
Income Taxes (6.1) 4.0
Net Income (Loss) $(20.4) $7.0
Preferred Stock Dividends 2.7 ---
Net Income (Loss) Available to Common Stockholders $(23.1) $7.0
Per Common Share
Net income (loss) - basic $(0.19) $0.06
Net income (loss) - diluted $(0.19) $0.06
Dividends $0.05 $0.0375
Average Number of Shares Outstanding 120.5 119.8
Cash Flow from Operations before Changes in
Assets and Liabilities
Net income (loss) $(20.4) $7.0
Depreciation, depletion and amortization 56.5 51.3
Amortization of restricted stock 0.3 0.3
Deferred U.S. income taxes (10.7) 4.0
Impairments related to international properties 20.0 ---
Total $45.7 $62.6
Capital Expenditures
Capital spending $84.3 $240.8
Capitalized interest 5.5 5.9
Capitalized overhead 22.0 21.4
Total $111.8 $268.1
Capitalization
Long-term debt $1,560.8 $1,095.1
Stockholders' equity 1,234.5 1,122.7
Total $2,795.3 $2,217.8
Capitalization Ratios
Long-term debt 56% 49%
Stockholders' equity 44% 51%
Total Assets $3,657.8 $3,189.8
Anadarko Petroleum Corporation
Quarter Ended
Volumes and Prices March 31
1999 1998
Natural Gas
Volumes, billion cubic feet 44.0 44.0
Average daily volumes, million cubic feet per day 489 489
Price per thousand cubic feet $1.59 $2.02
Crude Oil and Condensate
Volumes, thousand barrels 3,968 2,251
Average daily volumes, thousand barrels per day 44 25
Price per barrel $10.60 $13.02
Natural Gas Liquids
Volumes, thousand barrels 1,632 1,704
Average daily volumes, thousand barrels per day 18 19
Price per barrel $8.60 $11.68
Total Energy Equivalent Barrels
Volumes, million EEBs 12.9 11.3
SOURCE Anadarko Petroleum Corporation
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Company News On-Call:
http://www.prnewswire.com/comp/038950.html or fax,
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CONTACT:
analysts and investors, A. Paul Taylor, Jr.,
281-874-3471, or Steve C. Campbell, 281-874-3260, or media, Carol
L. Cox, 281-873-3855, all of Anadarko Petroleum Corporation
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