Anadarko’s 2018 production guidance
For 2018, Anadarko Petroleum (APC) provided a production forecast of 658 Mboed–685 Mboed or 671.5 at the mid-point. APC’s production volumes in 2017 were 672 Mboed.
Peers ConocoPhillips (COP), EOG Resources (EOG), and Occidental Petroleum (OXY) expect their 2018 production volumes at 1,195 Mboed–1,235 Mboed, 685.8 Mboed–728.5 Mboed, and 640 Mboed–665 Mboed, respectively. All these companies were among the top five upstream companies, based on first quarter production.
APC’s oil volumes are forecast to range between 376 Mboepd and 396 Mboepd (million barrels of oil equivalent per day) in 2018, compared to 355 Mboepd in 2017. This range represents an increase of ~9% at the mid-point. Much of this oil growth is expected to come from the DJ Basin and the Delaware Basin. APC expects to deliver year-over-year oil growth of over 30% in the DJ Basin and over 50% in the Delaware basin. See the previous parts of this series to learn more about APC’s operations in these regions.
Portfolio shift has resulted in improved APC’s margins
Adjusted EBITDAX (earnings before interest, taxes, depreciation, depletion, amortization, and exploration expenses) per barrel of equivalent was $28.43 in the first quarter of 2018, compared to $22.42 in first-quarter 2017.
Since mid-2016, Anadarko has shed $7 billion worth of assets and sharpened its focus on the DJ Basin, the Delaware Basin, and the deepwater Gulf of Mexico with an aim to achieve oil-levered growth
As we saw in Part 1 of this series, over 85% of Anadarko’s 2018 capital spending is allocated to its core assets—the US onshore (DJ and Delaware basins) and the Gulf of Mexico. The company noted that these three assets could deliver a 10%–14% compounded growth rate for oil in the next three-year period.
In the next part of this series, we’ll take a look at how APC’s production mix has evolved.