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Anadarko Reverses Loss, Tops Earnings Expectations

Anadarkoreported second-quarter earnings that outpaced analysts forecasts, though the company's revenue fell short of expectations.

A view from inside the heart of the Transocean Deepwater Millennium dynamically positioned drillship as it runs drill pipe toward the pre-salt objective on block BM-C-30 offshore Brazil.
Source: anadarko.com
A view from inside the heart of the Transocean Deepwater Millennium dynamically positioned drillship as it runs drill pipe toward the pre-salt objective on block BM-C-30 offshore Brazil.

The company, which owns a 25 percent share in the BP well that spewed oil into the Gulf of Mexicofor a significant portion of the year, said it earned 49 cents a share excluding one-time items, reversing a loss of 56 cents a share last year.

Revenue for the most recent quarter jumped to $2.6 billion, up from $1.745 billion last year.

A group of 27 equity analysts who follow Anadarko expected the company to turn in a profit of 35 cents a share on sales of $2.753 billion, according to numbers compiled by Thomson Reuters.

Anadarko shares edged higher in extended trading Tuesday after finishing the regular New York Stock Exchange session slightly lower at $53.14. Get after-hour quotes for Anadarko here.

Including one-time items, the Houston-based company, which has an ambitious deepwater drilling program, reported a net loss of $40 million, or 8 cents per share, compared with a loss $226 million, or 48 cents per share, a year ago.

The full magnitude of the Mexico spill, triggered in April by a deadly rig explosion at the well, became apparent Monday as government scientists released revised figures showing almost 5 million barrels of oil leaked before the well was temporarily capped on July 15.

In a company statement reporting its earnings, Anadarko repeated its view that the April 20 well blow-out "was preventable and likely the result of gross negligence or willful misconduct."

Company Boosts Liquidity

Anadarko also said Tuesday that it secured $6.5 billion in loan commitments, in part to pay for potential liability from the Gulf oil spill.

BP has billed Anadarko so far for $1.2 billion for its share of the clean-up, but the Houston company said it has withheld payments so far.

"The capital raise is a positive because it gives them some more protection,'' said Phil Weiss, oil analyst with Argus Research. Still, he said the companies would likely settle their dispute and BP would not shoulder the entire bill.

So far, Anadarko has not set aside any funds to pay for spill-related liabilities, but it has arranged a $5 billion credit facility and a $1.5 billion loan to tap if needed, the company said.

Anadarko said it sees environmental liabilities under the Oil Pollution Act for all partners in the well of $6 billion to $10 billion, which excludes the $3 billion of costs paid by BP as of June 30, 2010, according to a filing with the U.S. Securities and Exchange Commission.

Separately, Anadarko said Tuesday its board of directors approved a quarterly dividend of 9 cents per common share. The dividend is payable on Sept. 22 to shareholders of record at the close of business Sept. 8.