Transaction Details: 

Closing : 12/15/2016

Anadarko Petroleum announced today it has closed the acquisition of Freeport-McMoRan Oil & Gas's deepwater Gulf of Mexico assets.

Annoucement : 09/12/2016

Anadarko Petroleum  has agreed to acquire the deepwater Gulf of Mexico (GOM) assets of Freeport McMoRan Oil & Gas for $2.0 billion. The Transaction is expected to be closed by years end.

This brings FreePort McMoran closer to its goal of divesting the oil and gas assets.  The company initially tried to sell the entire Oil & Gas division and when that didn't work the company decided to market the individual assets (GOM, Haynesville and California). See Map here

In July it sold its remaining Haynesville assets for $87 million, and now GOM to Anadarko. 

 Anadarko provided the following highlights of the deal.

• Doubles Anadarko's ownership in the Lucius development to approximately 49 percent (49%)
• Adds approximately 80,000 net barrels of oil equivalent (BOE) per day, more than 80 percent of which is oil
• Generates an estimated $3.0 billion of incremental Gulf of Mexico free cash flowover the next five years at current strip prices

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Doubling Ownership in Lucius

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About Lucius

Anadarko's operated Lucius facility in the deepwater Gulf of Mexico continues to achieve strong reservoir performance and facility productivity. As a result of this performance, the company is increasing the estimated ultimate recovery of the field to more than 400 million BOE from the previous 300-plus million BOE. Additionally, gross oil sales volumes through the facility recently surpassed 100,000 barrels of oil per day (BOPD). Under the terms of the transaction, Anadarko will increase its working interest in Lucius to approximately 49 percent from its previous 23.8-percent ownership, enabling the company to further capitalize on additional future value-adding opportunities at Lucius.

Metrics

The acquisition and development cost of the acquired properties, excluding a total of approximately $300 million of materials inventory and seismic, is approximately $13.50per BOE for the estimated proved reserves to be acquired.

Guidance

Upon closing, the transaction is expected to add approximately 80,000 BOE per day to Anadarko's sales-volume guidance more than 80 percent of which is comprised of oil.

The company also is expected to increase its 2016 full-year capital guidance, not including the acquisition, to a range of $2.8 to $3.0 billion, primarily reflecting the increased activity in the Delaware and DJ basins.

Jefferies Group LLC and Latham & Watkins LLP are serving as advisors to Anadarko on the acquisition.

Gulf of Mexico Deal Activity In Last 12 Months