Anadarko Petroleum Corp. on Wednesday said it would earn 25 cents per share in the first quarter, significantly lower than the First Call/Thomson Financial analysts’ consensus estimate of 34 cents a share. The guidance comes a week after the company restated earnings in 2001 because of a $1 billion accounting error (see Daily GPI, Jan. 31). Anadarko also said it expected to reach $2 per share for the full year, which matches First Call estimates. The Houston-based independent said total volumes of crude oil and natural gas in 2002 are expected to match 2001 levels, at about 199 MMboe. The company’s U.S. natural gas production is expected to decline but will be offset by increased production from Canada, Qatar and Algeria. Anadarko’s volumes for the first quarter of 2002 are expected to be “modestly” higher than the fourth quarter of 2001 due to higher oil sales. Anadarko’s earnings estimates are based on Nymex prices for crude oil and natural gas, minus customary price differentials received at various producing locations. The company’s full-year earnings estimate is based on Nymex prices of $2.70/Mcf for natural gas and $21/bbl. The first quarter earnings estimate is based on Nymex prices of $2.20/Mcf and $18.50/bbl.

El Paso Energy Partners LP completed two separate acquisitions of underground salt dome natural gas liquids (NGL) storage and terminal facilities for $10 million, or about 7 to 8 times earnings before interest, depreciation, and amortization (EBITDA). The transactions are expected to be immediately accretive to EPN’s adjusted EBITDA. The purchases include a 3.3 MMbbl propane storage business and complete leaching operation located in Hattiesburg, MS, from Suburban Propane Partners LP. As part of the transaction, which closed on January 31, EPN entered into a long-term propane storage agreement with Suburban for a portion of the acquired storage capacities. EPN intends to convert a portion of these assets to natural gas storage and will integrate them with its adjacent natural gas storage facilities, Petal Gas Storage LLC. In a separate transaction, EPN purchased a 3.2 MMbbl NGL multi-product storage facility near Breaux Bridge, LA, from a unit of Williams. The Hattiesburg and Breaux Bridge storage facilities include truck, rail, and pipeline terminals. Both facilities connect to the 1,300-mile Dixie propane pipeline. “These acquisitions fit well with our midstream strategy for El Paso Energy Partners,” said Robert G. Phillips, CEO of EPN. “Both are fixed-fee operations with steady, long-term cash flows. In addition, these assets are strategically located and enhance the position of our natural gas liquids business acquired in January 2001, as well as provide additional salt dome cavern expansion potential for our Petal natural gas storage facilities.”

A unit of Williams has begun receiving oil and natural gas into new deepwater pipelines that were recently completed in the western Gulf of Mexico. The production is coming from the Nansen Field in the East Breaks area, located 150 miles south of Houston in 3,700 feet of water. First deliveries of oil were received Jan. 28. First deliveries of gas were received Jan. 30. The new pipelines have a capacity of transporting up to 80,000 b/d of oil and up to 360 MMcf/d of natural gas. For the next couple weeks, initial deliveries into the line are expected to average around 20,000 barrels per day of oil and 10 to 15 MMcf/d of gas. Production will continue to ramp up as new Nansen Field wells are tied in during the first and second quarter. The pipes are also designed to serve a neighboring development in the Boomvang Field. Production from Boomvang is expected to begin flowing into the new pipes in May. Williams’ $200 million East Breaks project is comprised of the 56-mile oil gathering system, the 114-mile gas gathering system, a new state-of-the-art 300 MMcf/d gas processing plant in Markham, TX, and a shallow-water platform at Galveston Block A244. The new Markham gas plant has been fully operational since the fourth quarter 2001.

©Copyright 2002 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.