Anadarko Petroleum Corp. (APC), the second-largest U.S. independent oil and natural gas producer by market value, rose after announcing an agreement to sell part of its stake in a Mozambique project for $2.64 billion.
Anadarko, based in The Woodlands, Texas, climbed as much as 2.6 percent to $92.10, the highest intraday price since July 22. The stock was up 2 percent at $91.61 by 11:19 a.m. in New York. Before today, the shares had increased 21 percent this year.
The company yesterday announced the sale of a 10 percent stake in Mozambique’s Offshore Area 1 to ONGC Videsh Ltd., a unit of India’s biggest energy explorer. Anadarko said the deal values its pre-transaction holding at more than $9.6 billion. It also tops the $2.5 billion price Oil & Natural Gas Corp. and Oil India Ltd. (OINL) agreed earlier this year to pay for a 10 percent stake in the area from Videocon Industries Ltd. (VCLF)
“Certainly, it was the highest marker out there so far,” said Scott Hanold, an analyst at RBC Capital Markets in Minneapolis who has a rating on the stock equivalent to a buy and owns no shares of Anadarko. The price “shows the value relative to what they’ve discovered so far,” he said.
The company, which will keep a 26.5 percent working interest in Area 1, will remain operator. Anadarko’s role as the operator may have enabled it to get a high price, Hanold said in a phone interview. Anadarko said the transaction is expected to close around the end of this year pending approval.
The block contains the Prosperidade and Golfinho/Atum natural gas complexes that together hold an estimated 35 trillion to 65 trillion cubic feet of recoverable gas, according to the company. Anadarko has been working with Eni SpA to develop a liquefied natural gas, or LNG, project with first shipments expected in 2018.
The company plans to use the sale proceeds to speed up the development of U.S. projects such as the Wattenberg field, Eagle Ford Shale, Permian and Powder River basins, and the Gulf of Mexico, Chairman and Chief Executive Officer Al Walker said in a statement yesterday.
Anadarko is the largest U.S. independent oil and gas producer by market value behind ConocoPhillips. Independent producers don’t own refineries or a chemical unit.
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