Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Non-Tech : $2 or higher gas - Can ethanol make a comeback? -- Ignore unavailable to you. Want to Upgrade?

To: richardred who wrote (1627)	9/14/2006 11:03:41 AM
From: richardred	Respond to of 2801

Canada Natural Res. to buy Anadarko assets Thursday September 14, 10:55 am ET By Matt Daily HOUSTON (Reuters) - Canadian Natural Resources Ltd. (TSX:CNQ.TO - News) said on Thursday it had agreed to buy Anadarko Petroleum Corp.'s (NYSE:APC - News) western Canadian oil and gas properties for $4.08 billion. Houston-based Anadarko put its Canadian oil and gas operations on the auction block to raise cash following the $21 billion acquisitions of Kerr-McGee Corp. and Western Gas Resources Inc., which were first announced in June. Canadian Natural Resources, which has made several acquisitions to become Canada's No 2 independent producer, will boost its natural gas output by nearly a quarter by adding the Anadarko Canada Corp. properties that produced 340 million cubic feet equivalent per day at the end of the second quarter. About 85 percent of that output was natural gas. At the end of 2005, ACC's properties had proven reserves of 262 million barrels of oil equivalent, 75 percent of which were proved developed. One analyst said the sale would help Anadarko, which is under pressure to raise money quickly to help trim the debt it took on to purchase Kerr-McGee and Western Gas Resources. "This deal is in line with expectations. I think it's a positive for Anadarko," said Tom Gardner, director of exploration and production research at investment firm Simmons & Company International in Houston. The deal was in line with the average Canadian acquisition price of $12,800 per thousand cubic feet equivalent, Gardner said. But on a reserve basis, the properties sold for about $2.70 per thousand cubic feet of proved reserves versus an average of $5.04 in Canada. Anadarko's shares were up 1 percent or 48 cents at $45.68 in early trade on the New York Stock Exchange, while Canadian Natural Resources share price rose 50 cents at C$51.79. Anadarko's interests in the Mackenzie Delta and other Canadian arctic frontier properties are excluded from the sale of Anadarko Canada Corp., or ACC. "This divestiture is an important step in refocusing the portfolio and reducing debt following our acquisitions of Kerr-McGee and Western Gas Resources in August," Anadarko Chief Executive Jim Hackett said in a statement. Anadarko has also put its undeveloped Knotty Head and Ghengis Khan deepwater Gulf of Mexico properties on the market, although that does not include its Marco Polo producing platform. Canadian Natural said ACC's land and production base were all located in Western Canada and were high quality, concentrated natural gas weighted assets. Canadian Natural said the acquisition is positive for its shareholders, with cash flow increasing by 24 cents per share in 2006 and 99 cents in 2007 on a strip pricing basis. Based on current crude oil and natural gas forward strip pricing, Canadian Natural estimates 2006 cash flow at between $4.9 billion to $5.3 billion. The earnings impact of the acquisition is expected to be neutral. Canadian Natural said its balance sheet had the strength to accommodate this acquisition, but the debt-to-book capitalization level would be near the top end of internal targets. To ensure future balance-sheet strength, Canadian Natural said it had hedged a significant portion of its natural gas and crude oil production for 2007 and 2008 at prices that protect investment returns. Canadian Natural also said it would consider divesting nonstrategic and noncore properties. The sale, which will have an effective date of June 30, 2006, is expected to close in October, pending approval by regulators. (Additional reporting by Mark McSherry in New York) biz.yahoo.com