Anadarko Petroleum Corp. (APC) announced its capital spending plans for 2010 in the $5.3 to $5.6 billion range, up from $4.6 billion in 2009. This represents an increase of about 15% to 22% over 2009.
For 2010, the company has allocated approximately $2 billion (36%) of its capex to near-term projects and expects to increase sales volumes in 2010 by up to 5% over the 2009 total of 220 million BOE.
Approximately 22% of the 2010 capital budget is allocated to the ongoing development of its oil-weighted and sanctioned mega projects, which remain on time and on budget.
Andarko’s mega projects include – the Jubilee Phase I development, offshore Ghana and the Caesar/Tonga complex, deepwater Gulf of Mexico. In addition, the company is progressing with its El Merk development in Algeria with first production is anticipated in late 2011. By 2012, the company expects these three sanctioned mega projects to deliver approximately 60,000 barrels of oil per day, net to Anadarko.
Furthermore, the company is also exploring for natural gas in prolific U.S. shale formations. The company has allotted 10% of its capital budget to core positions in the Marcellus, Haynesville, Eagleford and Pearsall shale plays onshore in the U.S. These areas have the potential to increase their production over a five-year period at a compound annual growth rate (CAGR) of 60% .
Approximately 20% of the 2010 capital program is allocated to exploration, with much of it focused on the company’s worldwide deepwater exploration program that includes plans to drill approximately 30 high-impact exploration/appraisal wells. Up to 13 exploration/appraisal wells are expected to be drilled offshore West Africa, 7 to 10 wells in the Gulf of Mexico, 4 to 6 wells in Brazil, 4 to 6 wells in Mozambique and 3 to 5 wells in southeast Asia.
Building upon the success of its sanctioned natural gas shale plays and oil-focused mega projects, the company expects to surpass 3 billion BOE (barrels of oil equivalent) of proved reserves by year-end 2014. This represents an increase in oil and gas production of 7% to 9% over the five-year period.
Additionally, Anadarko provided its total sales volumes guidance of 226 million to 231 million BOE for 2010. For the first quarter of 2010, the company expects sales volumes to be in the range of 56 million to 59 million BOE.
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