Anadarko Petroleum Signs Long-Term SPA With JERA And CPC

Anadarko Petroleum Corporation (NYSE:APC) recently announced that Mozambique LNG1 Company Pte. Ltd. has signed a Sale and Purchase Agreement for 17 years for ex-ship supply of 1.6 million tonnes per annum (MTPA)with JERA Co., Inc (JERA) and CPC Corporation, Taiwan (CPC). Mozambique LNG1 Company is the jointly-owned sales entity of the Mozambique Area 1. Apart from Anadarko, the co-venturers in Area 1 include six other entities.

The company is on track to complete the Mozambique LNG project and making a final investment decision in the first half of 2019, post securing final approvals. The deal brings company’s total long-term agreements to 11.1 MTPA.

LNG Development

The company’s international operations include oil, natural gas and NGL production in South America and Africa. The company’s asset portfolioincludes a natural-gas discovery in Mozambique.

Anadarko Petroleum is developing Mozambique's first onshore LNG facility that comprises two initial LNG trains with a capacity of 12.88 MTPA to support the development of Offshore Area 1.

Strong Asset Portfolio

The company’s asset portfolio is positioned to deliver long-term value to stakeholders. The company’s premium shale properties, which include the Delaware and Denver-Julesburg basins, the Deepwater Gulf of Mexico and Powder River basin are boosting production volumes.To focus on high-return domestic assets and achieve capital efficiency, Anadarko Petroleum has been systematically selling non-core properties since 2004.

The strong asset base of Anadarko Petroleum in the Permian Basin made it a prime acquisition candidate for the companies that are trying to expand operation in the United States resource rich onshore basin. Initially, Chevron Corp. (NYSE:CVX) had made its bid for the company, but when Occidental Petroleum (NYSE:OXY) raised its bid, Chevron decided to move out with $1-billion breakup fee.

Anadarko’s international operation in Africa that includes the Mozambique holdings will eventually move to TOTAL S.A. (NYSE:TOT) . TOTAL has entered into a binding agreement with Occidental to acquire Anadarko’s assets in Africa (for a consideration of $8.8 billion) post the successful completion of the bid for Anadarko.

Zacks Rank & Price Movement

Anadarko Petroleum currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The shares of the company have increased 4.4%, against the industry’s decline of 31.9% in the past 12 months.

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