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Anadarko reaffirms guidance for deepwater Gulf of Mexico in wake of Harvey, Irma

Houston (Platts)--21 Sep 2017 615 pm EDT/2215 GMT


Anadarko Petroleum reaffirmed its production guidance for the deepwater Gulf of Mexico, despite production shut-ins in the play forced by the arrivals of hurricanes Harvey and Irma.

The producer was forced to shut in oil and gas production from several offshore platforms in the western Gulf of Mexico as Harvey approached the Texas Gulf Coast last month. A short time later it was forced to do the same thing for platforms in the eastern Gulf as Irma threatened that region, Anadarko spokesman John Christiansen said Thursday.

"In the deepwater GOM, we continue to expect average production rates approaching 130,000 b/d for the full-year 2017," Anadarko Chairman President and CEO Al Walker said in a statement Wednesday.

Christiansen did not have an estimate as to how much production had been shut in as a result of the storms.

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In its statement this week, Anadarko also said it was on track to deliver its combined projected 2017 exit rate of approximately 150,000 b/d from two key US onshore plays, the Delaware portion and the Permian basin and the Denver-Julesburg Basin of Colorado.


$2.5 BILLION STOCK BUYBACK APPROVED


Anadarko also said that its board of directors had authorized a $2.5 billion share-repurchase program. The authorization extends through the end of 2018 and the company said it would initially target $1 billion of share repurchases prior to year-end 2017.

"We believe this is a very attractive use of our cash, given the value of our assets and the highly accretive nature of this program," Walker said. "At the current share price, this represents approximately 10% of the company's outstanding common shares."

He said the company's 2018 upstream investment plan "is anticipated to produce substantial free cash flow," assuming an average annual oil price of $50/b.

In a note to investors, analysts with Wells Fargo Securities called the repurchase plan "a positive development ... as it addresses the valuation discount, answers questions on uses of at least a portion of the cash on the balance sheet and further reinforces management's message of capital discipline and focus on returns."

--Jim Magill, jim.magill@spglobal.com
--Edited by Jason Lindquist, jason.lindquist@spglobal.com



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