• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 1 hour GREEN NEW DEAL = BLIZZARD OF LIES
  • 22 hours "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
  • 6 days America should go after China but it should be done in a wise way.
  • 12 days Does Toyota Know Something That We Don’t?
  • 1 day World could get rid of Putin and Russia but nobody is bold enough
  • 22 hours How Far Have We Really Gotten With Alternative Energy
  • 2 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 3 days Even Shell Agrees with Climate Change!
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in

Breaking News:

OPEC Lifts Production in February

Anadarko Splashes US$2 Billion On Freeport Oil Assets

Anadarko will pay US$2 billion to acquire a number of assets of mining giant Freeport-McMoRan in the Gulf of Mexico, the oil company said yesterday. The deal, Anadarko added, will expand its daily production by 80,000 net barrels of oil equivalent, to a total of 155,000 boed, of which over 85 percent is oil.

The buy will also lead to incremental free cash flow gains of some US$3 billion over the next five years, based on current strip prices.

The acquisition will also substantially expand Anadarko’s presence in the deepwater sector of the Gulf of Mexico and more precisely the Lucius development, where it will now hold 49 percent.

Commenting on the news, Anadarko’s chief executive, president and chairman, Al Walker, said that the additional free cash flow will be used to fund the company’s onshore projects in the Delaware and Denver-Julesburg basins. This will involve adding two drilling rigs in each of the basins by the end of this year, with plans to boost the combined output from the two plays to a minimum of 600,000 barrels of oil equivalent daily by 2021.

For Freeport, the sale would provide much needed cash in times of trouble, with commodity markets still in turmoil despite gold’s rally. Copper, in particular, has remained subdued price-wise so far this year due to a market imbalance similar to that in crude oil. Weak demand from China has been seen as the leading factor for low copper prices.

Earlier this year, Freeport put its 56 percent stake of its largest copper mine, Tenke Fungurume, on the chopping block, and struck a deal with China Molybdenum in May to sell it for US$2.65-billion, although the sale has yet to finalize, and is being called into question with a minority stakeholder objecting to the sale. The divestment attempt is a result of efforts to manage the substantial debt load of the miner, much of it accumulated from its entry into oil and gas in 2013, just a year before the oil price meltdown started.

As of the end of the first quarter of 2016, Freeport had a debt of US$20 billion but asset sales and rigorous cost-cutting measures have helped it cut this by US$700 million.

By Irina Slav for Oilprice.com

ADVERTISEMENT

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News