Anadarko Petroleum Corp., committed to spending US$270 million on Canadian E&P this year, announced early success Monday in its winter drilling program in northeastern British Columbia and northern Alberta, with three natural gas discoveries and several successful oil field development projects.

“During this winter season, Anadarko significantly increased its Canadian exploratory drilling program, and now we’re starting to see positive returns with these discoveries,” said Robert P. Daniels, Anadarko Canada Corp. president. “Our goal is to grow overall production by 7% by year-end 2002.

“We continue to see tremendous potential in the Western Canadian Sedimentary Basin and frontier areas. As one of the most active drillers here, we plan to continue to test our growing inventory of prospects in order to take advantage of the next upturn in oil and gas prices,” Daniels added.

Nearly one-third of its Canadian budget, or $80 million, is designated for exploration in Northeast British Columbia, Central and Northern Alberta (the Deep Basin) as well as the southern Northwest Territories. Approximately 50 exploration wells are planned for 2002, with activity focused primarily toward gas. The Canadian capital budget includes approximately $190 million for development projects in those areas and in the heavy oil area of Northeast Alberta and shallow gas fields of Southwest Saskatchewan. Approximately 380 development wells are planned.

In addition to its Canadian program the company has split up its $2 billion worldwide E&P budget for 2002 into $370 million for projects in the Gulf of Mexico; $455 million for the U.S. onshore; $108 million in Alaska; $160 million for Algeria; and about $80 million for Qatar. The budget also includes more than $100 million for infrastructure construction and another $400 million for capitalized interest and exploration and development costs. Anadarko plans to spend about $1 billion on development worldwide and about $500 million on exploration. About 75% of the exploration budget will go toward drilling, up from 60% in 2001. The remainder will be used for seismic and lease acquisitions. The Gulf will be the company’s single most active area for exploration this year, with an exploration budget of almost $200 million. Total capital spending is off more than a third from the $3.3 billion budgeted in 2001.

“Last year we ran more than 90 Anadarko-operated rigs at our peak; for the first half of 2002, we expect to run about 45 or 50. That means we’re going to scale back spending substantially almost everywhere, except in places like Alaska, Algeria and Qatar, where we have ongoing field development projects,” John N. Seitz, Anadarko’s CEO, said recently.

“With energy prices where they are today, it’s going to be an opportunity-building year, not a production-building year. This budget is designed to maintain companywide production at current levels, and to grow the inventory of opportunities that we can take advantage of when energy prices recover — hopefully in the second half of 2002,” Seitz said.

The Canadian discoveries announced Monday include:

Anadarko holds a 100% working interest in all three of these discovery wells. Anadarko plans to have a peak of 25 drilling rigs working during the remainder of the winter drilling season. Through the end of the first quarter, nine of the 25 rigs will be drilling exploratory wells.

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