Independent oil and gas producer
Anadarko Petroleum Corporation
) entered into an agreement with an undisclosed party to develop
its deepwater Lucius oil & natural gas project in the Gulf of
Mexico (GoM). The company has sold a 7.2% working interest of its
Lucius development project and in return will receive $556 million.
The Lucius project is positioned 230 miles off the GoM shore.
Although Anadarko's share declined to 27.8% from 35%, it is still
the major operator of the project. The ancillary partners include
Plains Exploration & Production Company
Exxon Mobil Corporation
), Apache Deepwater LLC, a subsidiary of
The sale proceeds will serve the purpose of meeting capital needs
of the project for the first stage of production. Production is
expected to come online in the latter half of 2014.
An estimated capacity of 80,000 barrels of oil per day (boe/d)
and in 450 million cubic feet of natural gas per day is anticipated
to be produced from Lucius. The success of this project will
positively add to its already impressive record of executing
high-impact projects and strengthening its overall portfolio.
Anadarko on earlier occasions has leveraged its strong acreage
position in other resource plays. It received $400 million and
$1.55 billion from its joint ventures at its Salt Creek oil field
and Eagleford Shale.
Anadarko Petroleum presently retains a Zacks #3 Rank, which
translates to a short-term Hold rating. The company posted 8% sales
growth in the first quarter of 2012, with GoM contributing sales
volumes of roughly 119,000 boe/d. Earnings of 92 cents per share
were also comfortably ahead of the Zacks Consensus Estimate of 83
cents in the quarter.
The company estimates sales volume for the second quarter and 2012
to be in the range of 64,000-66,000 boe/d and 258,000-262,000
We view the Lucius project will further enhance Anadarko's goal of
providing profitable and sustainable returns to its stakeholders in
the long run. However, threats related to unexpected accidents
during drilling could hamper or delay operations.
Based in Woodlands, Texas, Anadarko Petroleum is primarily engaged
in the exploration, development, production, gathering, processing
and marketing of natural gas, crude oil, condensate and NGLs.
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