Stronger-than-expected natural gas output from the Marcellus Shale and huge liquids growth from the Greater Wattenberg Field in Colorado contributed to record volumes by Anadarko Petroleum Corp. in the first three months of 2013.
The Houston-based operator, which explores for oil and gas worldwide, has most of its spending earmarked for the United States, from the deepwater of the Gulf of Mexico to onshore fields in the Rockies, the Midcontinent and in the Northeast.
Average daily volumes in the United States totaled 793,000 boe/d in 1Q2013, versus year-ago output of 704,000 boe/d. Daily gas sales volumes also were higher, averaging 2.69 Bcf/d from 2.42 Bcf/d. U.S. crude oil and condensate sales averaged 159,000 b/d, up from 138,000 b/d, and natural gas liquids (NGL) volumes averaged 88,000 b/d from 80,000 b/d.
No plans are in place to increase gas drilling this year until currently higher U.S. prices are “sustained,” said onshore operations chief Chuck Meloy. However, even with no assistance, gas volumes continue to rise, in particular from the Marcellus, where volumes jumped 71% year/year to 427 MMcf/d from 250 MMcf/d.
“There are two or three good reasons for that,” said Meloy during a conference call. “The first is just the Marcellus performance. If you look year-over-year, the growth has been phenomenal. Our sales are up about 71% from the prior year, and that’s a combination of completing the wells we are drilling and unloading the backlog that was in our nonoperated position, and getting the infrastructure completed in that area.”
“The Wattenberg field continues to be a top performer,” said CEO Al Walker. “Our sales volumes were enhanced by liquids increase of 45% year-over-year. To accelerate value, we tripled the number of horizontal wells drilled in the first quarter 2013, and we expect to increase this over the course of next year and this year. This asset enjoys the strongest return on capital characteristics on our portfolio with an expected rate of return exceeding 100%.”
Nearly all of Anadarko’s drilling today is focused in the U.S. onshore, where 42 operated rigs are working in the Lower 48 states, the same level as at the end of 2012. In the GOM, three rigs also are operating, as well as five overseas.
Nowhere was liquids production growth more evident than in the Wattenberg, where output reached 113,000 boe/d from year-ago volumes of 81,000. From January through March, the Rockies plays delivered record sales volumes of about 327,000 boe/d, up about 5% year/year. The Southern and Appalachia business unit’s sales volumes f averaged more than 237,000 boe/d, 36% higher year/year and 8% more than in 4Q2012.
Net income totaled $460 million (91 cents/share) in 1Q2013, versus year-ago profits of $2.16 billion ($4.28/share). Adjusted for one-time items, net income was $547 million ($1.08), versus $475 million (92 cents). Revenues climbed to $3.89 billion from $3.45 billion; operating income rose to $2.6 billion from $745 million. Realized gas prices averaged $3.33/Mcf versus $2.60; crude oil prices were $97.32/bbl from $105.75; and NGLs sold for $38.17/bbl, down from $47.09 a year ago.
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