Anadarko Petroleum Corp. has no interest in selling down its stake in a planned liquefied natural gas (LNG) project in Mozambique, the company's chief executive said on July 29, following talk of international interest in the southern African country's gas reserves.
The Houston company's desire to sell some of its interest in the project "approaches zero," CEO Al Walker told investors on a conference call to discuss second-quarter earnings.
Anadarko would like to be the operator on the multi-billion dollar project, so reducing its stake would put that status into question, said Walker.
There has been talk of intense interest in Mozambique's gas reserves from national oil companies and the world's largest oil companies. Anadarko has a 26.5 percent stake in the Area 1 license in the Rovuma Basin offshore Mozambique.
Anadarko's master limited partnership (MLP), Western Gas Partners LP, will provide capital to fund development in Mozambique, not from its cash from operations, Walker told investors.
Crude prices have tumbled about 20 percent since June 23, hit by growing inventories, worries about demand from China and expectations for Iran's re-entry into the crude market following the nuclear deal.
That slide is prompting oil and gas companies to take a more cautious view of the remainder of year.
Anadarko does not expect a recovery in prices and does not plan to accelerate its drilling plans, executives told investors.
"We'll continue the focus on the next six months by improving our cash margins and creating value in our portfolio," said Walker.
After the close of trading on July 28, Anadarko reported a profit that topped Wall Street expectations on higher-than-expected oil output and lower costs.
Shares of Anadarko climbed more than 5 percent to $76.77 in morning New York Stock Exchange trading. So far this year, the stock is down 7 percent.
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