New INVESTOR RELATIONS Today and into the Next Decadefilecache.investorroom.com/mr5ir_anadarko/651/download... · 2015. 10. 29. · Anadarko Petroleum Corporation | NYSE: APC Announced

www.anadarko.com | NYSE: APC

INVESTOR RELATIONS CONTACTS:

John Colglazier Vice President 832/636-2306

Clay Gaspar Manager 832/636-2541

Wayne Rodrigs Manager 832/636-2305

2 0 1 2 A N A D A R K O I N V E S T O R C O N F E R E N C E

Growth and Value: Today and into the Next Decade

Al Walker President and Chief Operating Officer

March 13, 2012

Anadarko Petroleum Corporation


Announced Resolution to Algeria Dispute

Validates Our Position and Maintains Strong Relationship with Sonatrach

Settlement Provides ~$4.4 Billion of Net Present Value to Anadarko

$1.8 Billion to be Received over 12 Months from Effective Date

$2.6 Billion of NPV Resulting from Amended Contract Terms*

Benefits Are Not Included in Guidance

Will Provide Revised Guidance Subsequent to Algerian Government Approval

11

*Value is Based on Unescalated Current Prices for Sahara Blend and a 10% Discount Rate



Our Proven Strategy and Deep Portfolio

Identify and Commercialize Resources

Explore in High-Potential, Proven Basins

Employ a Global Business Development Approach

Ensure Financial Discipline and Flexibility

12

Areas of Activity



Capital-Efficient Growth

Focused on Returns

Capital Directed to Oil and Liquids-Rich Plays

Midstream Expansion to Increase Liquid Yields

Advancing Oil Mega Projects

Industry-Leading Global Exploration

Limited U.S. Onshore Dry Gas Activity

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Based on Unescalated NYMEX Prices of $100/Bbl and $3.25/Mcf

Oil/Liquids

Natural Gas

LNG

0 2 4 6 8 10

Reserve Replacement Efficiency (RRE)*

Esti

mat

ed

Ne

t R

eso

urc

es

(MM

BO

E)

1,000

East Texas HZ

Eagleford

Wattenberg

500

1,500

2,000

GNB

Permian Oil

Marcellus

El Merk

Ghana Lucius

GOM Discoveries

Mozambique

Balanced, Capital-Efficient Portfolio

Caesar/Tonga

Delivering Value in Today’s Price Environment

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Return on Capital of ~25 to 100+%

Bubble Size Representative of

2012 Capital

El Merk with TPE Resolution

* RRE = (EBITDAX/BOE) Divided by (F&D/BOE)



2012 Capital Expenditure Expectations by Area

15

US Onshore Operations

50%

Worldwide Exploration

20%

5%

Midstream/ Other 10%

WW DW Ops 15%

By Type

* Excludes Western Gas Partners, LP (WES)

50%

15%

5%

Midstream/ Other 10%

2012 Capital: $6.6 - $6.9 Billion*

5%

10%

5%

International

GOM

U.S. Onshore

Exploration



W 2012 (MMBOE)

2013 (MMBOE)

Portfolio Delivery Capability* 262 - 266 275 - 285

• Monetizations 3 TBD

• Dry Gas Curtailments 3

Sales-Volumes Guidance* 256 - 260 Liquids-Focused Growth

Value-Focused Growth: Capabilities and Expectations

16

* Includes Reduction for Anticipated Weather and Facility Downtime

In a Low Natural Gas Price Environment

0

900

2008 2009 2010 2011 2012E 2013E

Bcf

Natural Gas Sales Volumes

Base IHub Marcellus

0

150

2008 2009 2010 2011 2012E 2013E

MM

Bb

l

Liquids Sales Volumes

Base GOM Int'l Shale and Growth Plays

~45%

~48%

43% 41%

39% 39%

Liquids % of Total Sales Volumes



Predictable Reserves-Growth Pipeline

Clear Path to 3+ BBOE by YE 2014

Transparent Reserves Pipeline

Accelerating Reserve Replacement

Increasing Liquids Composition

17

0

2

4

YE 2011 Production Base Mega Shales YE 2014E

BB

OE

3+ BBOE of Proved Reserves by Year-End 2014

2.5 BBOE

3+ BBOE

2012 EXPECTATIONS

Reserve Replacement 150+%

F&D ~$16/BOE

Shales Wattenberg GNB Other Green GOM Int'l

Re

lati

ve N

et R

eso

urc

e Es

tim

ates

6.5+ BBOE Lower-Risk Development Opportunities

U.S. River Projects



Consistent Conversion of Discoveries to Cash

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4+ BBOE High-Margin Net Resources

2012 2020 2010 2008 2018 2016 2014 Notional First Production

Dev

elo

pm

en

t C

ost

/BO

E

TEN (GHANA)

CAESAR/TONGA (PRODUCING)

JUBILEE (PRODUCING)

LUCIUS

Oil/Liquids

Natural Gas

LNG

EL MERK

BRAZIL (POTENTIAL

MONETIZATION)

Higher

Lower

MARCELLUS (PRODUCING)

MOZAMBIQUE TRAIN 2

MOZAMBIQUE TRAIN 1

EAGLEFORD (PRODUCING)

MTAB (GHANA)

SHENANDOAH

VITO HEIDELBERG



Capital-Efficient Exploration

Monetizations Exceed Aggregate 2004 - 2011 Exploration Capital

4+ BBOE of Net Discovered Resources Since 2004

~70% Deepwater Exploration/Appraisal Success Rate over 5 Years

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Delivering Growth and Value Today and into the Next Decade

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2010 2011 2012E 2013E 2014E 2015E 2016E 2017E 2018E 2019E 2020E

Prudent Capital Allocation to Maximize Returns

Line-of-Sight Liquids Growth and Reserve Additions

Option Value with HBP Dry Gas Projects

Liquids

Gas

Gas at $4.50/Mcf



1 - 5 BBOE

300 - 1,000 MMBOE

<300 MMBOE

Net Risked Resources

Focused on Sustainable Growth and Value

21

Capital-Efficient, Value-Enhancing Allocation

Volumes Growth with Focus on Returns

Reserves Growth at Competitive Costs

Exploration Creates Differentiating Value

East Africa

Brazil

West Africa

Gulf of Mexico

U.S. Onshore

Algeria

Alaska

5+ BBOE

China







Bobby Reeves SVP, General Counsel and CAO

Clarifying Uncertainty

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March 13, 2012



Clarifying Uncertainties and Protecting Stakeholder Interests

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Algeria Exceptional Profits Tax

History: 2006: Algeria Parliament Established TPE on Foreign Companies’ Oil Production

2007: Anadarko Initiated a Conciliation Proceeding as Provided in the PSA

2008: Conciliation Board Issued its Non-Binding Recommendation

2009: Anadarko Submitted Notice of Arbitration to Sonatrach

2011: Arbitration Hearings Concluded

Announced Resolution Providing Substantial Value to Anadarko $4.4 Billion Settlement Announced

Win-Win Outcome Achieved

Relationship with Sonatrach Sustained and Improved

On Track for Government Approval in Next 120 Days

RESOLVED




24

BP Macondo JOA Dispute

Oct. 2011: Announced Settlement with BP

Paid $4 Billion and Transferred Interest in the Macondo Well and Lease to BP

Fully Indemnified by BP with Regard to Oil Pollution Act (OPA), Claims for Natural Resource Damages and Associated Damage-Assessment Costs and Any Claims Arising Under the Relevant Joint-Operating Agreement

BP, plc Guarantees Indemnification

Resolution with BP Eliminates Significant Uncertainties

RESOLVED




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Clean Water Act (CWA): Pending

CWA Fines are Fault-Based … Not Based on Working Interest

Court Has Said Anadarko Was Not Responsible for Accident and Spill

Though the BP Settlement Agreement Does Not Provide Indemnification Against Fines and Penalties, Punitive Damages or Certain Other Potential Claims, the Company Does Not Consider These Items to Represent a Significant Financial Risk




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Tronox Litigation: Pending

Confident in the Merits of Our Case

Preparing for Trial

Anticipate Continued Settlement Discussions

Current Estimated Loss Related to Final Disposition of the Adversary Proceeding is $250 Million

Trial Slated to Start in May 2012







Financial Discipline

Bob Gwin SVP, Finance and Chief Financial Officer

March 13, 2012



Exercising Financial Discipline

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~$2.7 Billion Cash at YE 2011

2012 Capital Expenditures in Line with Cash Flow

Cash Flow Protected with Tactical Hedges

Net Debt/Capital Ratio Target of 25 - 35%

Opportunistic Monetizations

Ongoing Midstream Asset Sales to WES



Capital Expenditures in Line with Cash Flow

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$90/Bbl $2.50/Mcf

Current Strip

$6.60 B – $1.25 B

$6.75 B $(0.15) B $1.10 B

$6.90 B $(0.30) B $0.95 B

2012 Estimated Free Cash Flow*

*Excludes Western Gas Partners, LP (WES)

Cap

ital

Ex

pe

nd

itu

res*



Tactical Hedges Protect Cash Flow

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Hedge Position* 2012 2013

Gas Volume

(Thousand MMBtu/d)

Price ($/MMBtu)

Volume (Thousand MMBtu/d)

Price ($/MMBtu)

Swaps 1,000 4.69 – –

3-ways – – 450 4 / 5 / 6.57

Total % Gas Hedged ~42% ~19%

Oil Volume

(MBbl/d) Price

($/Bbl)

Swaps - WTI 20 101.39

Swaps - Brent 40 110.10

3-ways - WTI 17 71 / 91 / 113

3-ways – Brent 45 85 / 105 / 126

Total % Oil Hedged ~51% N/A

*As of March 13, 2012



Debt-Reduction Framework

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Consolidated Net Debt to Capital

Year-End 2011 41%

Path to 25 - 35% Leverage Target During 2012

2012 Operations and Monetizations ~36%

2012 Effects of Algeria TPE Resolution* ~32%

Potential Other Monetizations TBD

Based on 2012 Strip Pricing

* Pro-forma for Full $1.8 Billion Recoupment Equates to ~30% Net Debt to Capital



Opportunistic 2012 Monetizations

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DIVESTITURE SALES AMOUNT (Millions)

2011 NET SALES VOLUMES

South Texas $185 1.7 MMBOE

Pompano $67 0.7 MMBOE

San Juan Plant $50 –

Brazil* TBD –

Indonesia* TBD –

JOINT VENTURE PARTNER INTEREST 2011 NET SALES

VOLUMES

Salt Creek EOR 23% 0.6 MMBOE

Greater DJ Basin* (Excludes Core Wattenberg)

TBD –

Other Areas* TBD –

*Under Consideration

~



(50%)

0%

50%

100%

150%

200%

250%

5/8/08 2/11/09 11/18/09 8/25/10 6/1/11 3/7/12

WES vs. Alerian MLP Index

WES AMZX

WES: Material Value Contributor to Anadarko

$1.8 Billion Cash Realized by Anadarko

$2.0 Billion Market Value of Public L.P. Units and Debt Holdings

Significant Value in Ownership of General Partner

33


Western Gas Partners, LP (NYSE: WES)

Western Gas Holdings, LLC Public Unitholders

43.6% Limited Partner Interest

100% Ownership

2% General Partner Interest and Incentive Distribution Rights

54.4% Limited Partner Interest

Total Return Since IPO: 239%

May 2008 Jan 2009 Jan 2010 Jan 2011 Jan 2012

As of 3/7/12

Tota

l Ret

urn



Flexibility to Deliver Growth and Value

High-Margin Liquids Growth

Clear Path to 25 - 35% Target Net Debt to Capital

Protected 2012 Cash Flows with Tactical Hedges

Capital Expenditures Aligned with Cash Flows

Portfolio Depth Provides Monetization Optionality

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Documents

New INVESTOR RELATIONS Today and into the Next Decadefilecache.investorroom.com/mr5ir_anadarko/651/download... · 2015. 10. 29. · Anadarko Petroleum Corporation | NYSE: APC Announced