Anadarko Petroleum Corp. posted a loss that was narrower than expected for the second quarter as it cuts costs and sells assets to weather the oil industry downturn.
The loss was $692 million, or $1.36 per share, compared with a profit of $61 million, or 12 cents, a year earlier, the Woodlands, Texas-based company said in a statement. Excluding one-time items, the per-share loss was 60 cents, better than the 79-cent average of 32 analysts’ estimates compiled by Bloomberg.
“Our portfolio continues to perform exceptionally well, and we’ve continued to significantly reduce our cost structure throughout the year,” Chief Executive Officer Al Walker said in the statement.
Anadarko, like its peers, has sought to slash spending and raise cash to cope with cheaper crude. The producer said it has closed $2.5 billion in asset sales so far this year and is targeting $3.5 billion for all of 2016. It is in the process of selling properties in Wyoming, East Texas and Louisiana, people with knowledge of the matter said in May.
The company may end the year with 170 drilled but uncompleted wells, or DUCs, in the U.S. as it works down its backlog, Bloomberg Intelligence analyst Vincent Piazza said Monday in a note.
The number of dormant crude and natural gas wells in the country, at 4,230 as of April 1, is set to shrink dramatically in the largest plays if prices hold steady as producers resume completion, Bloomberg Intelligence analyst Andrew Cosgrove said last week. Crude prices between $40 and $50 a barrel may wipe out most of the so-called fracklog in Texas’s Permian Basin and as much as 70 percent of the inventory in its Eagle Ford formation by the end of next year, he said.
West Texas Intermediate futures closed at $42.92 a barrel on Tuesday, down 17 percent from a June peak but still more than 60 percent up from a 12-year low in February. The rally, fueled by supply disruptions from Nigeria to Canada earlier this year, has waned as U.S. crude and fuel inventories remain at their highest seasonal levels in decades.
Even as it falters, the price recovery has led oil drillers to put rigs back to work. U.S. oil explorers have boosted the number of active rigs drilling for crude by 55 since the end of May to 371, with 14 added last week, according to Baker Hughes Inc. data.
Anadarko also announced the dismissal of 1,000 workers in March and previously cut its dividend.
The earnings were released after the close of regular trading in New York, where shares of Anadarko settled 87 cents higher at $54.74.
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