Anadarko: No Drilling in the Eagle Ford for Q2

Anadarko Petroleum Corp. 2nd Quarter Earnings

Anadarko Petroleum Corp. 2nd Quarter Earnings

Anadarko announces it will focus activity on other shale plays instead of the Eagle Ford into 2017.

Related: Anadarko Holds the Line on Spending

In the wake of a $692 million second quarter loss, Anadarko Petroluem Corp. says they are sticking with their plan of patience outlined earlier this year, which includes holding the line on spending for 2016.

R. A. Walker – Chairman, President & Chief Executive Officer says that should change next year as he foresees a sustained $60 oil price environment for 2017. He says if that happens, the company will likely spend its money on the DJ and Delaware basins over the Eagle Ford Shale. 

The Eagle Ford Shale doesn’t compete for capital as well as the other two basins (DJ and Delaware). That doesn’t mean that it doesn’t create attractive rates of return. It just unfortunately is up against two exceptional assets that create better rates of return. And for a company that’s trying to stay close to or on top of discretionary cash flow with CapEx, it just unfortunately as a result of that doesn’t feed on capital and constantly is not being unallocated capital.
— R. A. Walker

Anadarko reported there was no drilling activity for the quarter in the Eagle ford. Anadarko is one of the Eagleford’s largest producers, with roughly 388,000 gross acres in Dimmit, LaSalle, Maverick and Webb Counties.

Read more about Anadarko in the Eagle Ford

Anadarko’s second quarter highlights:

  • Record production levels at three Gulf of Mexico facilities and in the U.S. onshoreDelaware and DJ basins
  • Encountered more than 1,040 net feet of oil pay at the Shenandoah-5 appraisal well and increased working interest in this operated deepwater discovery
  • Closed $2.5 billion of monetizations year to date
  • Retired $3 billion of near-term maturities with proceeds from debt issued during the first quarter