Anadarko Petroleum Corp. said on Tuesday it will reduce spending by about 33% this year, as the E&P company responds to lower crude oil prices.
Oil prices have fallen by more than half since June as supplies from sources including North American shale fields grow in a time of waning demand. To conserve cash, exploration and production companies like Anadarko are slashing budgets and cutting rig counts.
"We don't see value in chasing growth in this environment," Al Walker, Anadarko's CEO, told analysts on a conference call.
The Houston company forecast 2015 capital investments in the range of $5.4 billion to $5.8 billion, excluding those associated with its Western Gas Partners LP unit.
In addition to earmarking 60% of its budget for onshore shale wells, Anadarko said it plans to drill nine to 12 deepwater exploration wells offshore Colombia, Kenya and the Gulf of Mexico.
Anadarko also plans to cut U.S. onshore rig activity by 40% and defer about 125 onshore well completions in the Wattenberg Field in Colorado, the Eagle Ford Shale and Permian Basin in Texas.
Anadarko expects total output of 295 million to 301 million barrels of oil equivalent (MMboe) in 2015, nearly in line with the 301 MMboe it produced last year.
So far this year, Anadarko has agreed to sell $700 million in oil and gas properties and more deals are possible, but there are no plans to tap capital markets, the Houston company told investors.
The company's shares rose 0.2% to $82.21 in late-morning trading on the New York Stock Exchange. Up to Monday's close, the stock has fallen nearly 26% since June.
Recommended Reading
NOG Closes Utica Shale, Delaware Basin Acquisitions
2024-02-05 - Northern Oil and Gas’ Utica deal marks the entry of the non-op E&P in the shale play while it’s Delaware Basin acquisition extends its footprint in the Permian.
California Resources Corp., Aera Energy to Combine in $2.1B Merger
2024-02-07 - The announced combination between California Resources and Aera Energy comes one year after Exxon and Shell closed the sale of Aera to a German asset manager for $4 billion.
DXP Enterprises Buys Water Service Company Kappe Associates
2024-02-06 - DXP Enterprise’s purchase of Kappe, a water and wastewater company, adds scale to DXP’s national water management profile.
Pioneer Natural Resources Shareholders Approve $60B Exxon Merger
2024-02-07 - Pioneer Natural Resources shareholders voted at a special meeting to approve a merger with Exxon Mobil, although the deal remains under federal scrutiny.
Parker Wellbore, TDE Partner to ‘Revolutionize’ Well Drilling
2024-03-13 - Parker Wellbore and TDE are offering what they call the industry’s first downhole high power, high bandwidth data highway.