LOON

Company plans to make further shareholder “payments as usual”

The U.S. corporation that holds a one-quarter share of the Deepwater Horizon Macondo oil well license will pay its shareholders a $45 million dividend next week despite BP’s announcement yesterday that it was suspending payment of its annual dividend and placing $20 billion into a U.S. government supervised escrow account to cover anticipated compensation claims from victims of the Gulf oil disaster.

The announcement was reported in the early edition of The Times for June 18th.

Anadarko Petroleum Corporation, with headquarters in The Woodlands, Texas, and offices in Algeria and Latin America is among the world’s largest independent oil and gas exploration companies with 2.3 billion barrels of estimated reserves and a global workforce of 4,300 employees.

Anadarko’s CEO is James T. Hackett, who also sits on the board of directors of Halliburton, the company that has been implicated in the failed cement construction that may have contributed to the April 20th gas explosion on the Deepwater Horizon oil platform which killed 11 workers and unleashed a torrent of oil into the Gulf of Mexico nearly two months ago.  Hackett is also the chair of the Federal Reserve Bank of Dallas.

According to Forbes magazine, Hackett’s total 2009 annual income as CEO of Anadarko Petroleum is U.S. $27, 466,770.00, which included $5.2 million in stock option awards and $12.1 million in “restricted stock awards”.  For his services as a member of the Halliburton board, Hackett received an additional $246,368.00 which included $132,063.00 in stock awards.

In 2005, Wall Street investment analysts were singing Anadarko’s praises as one of the best bets in the energy and exploration market.

Wall Street smitten with Anadarko’s “technical skill” and “long string of successes”

According to a Forbes story from October 11, 2005, New York – Credit Suisse First Boston analyst Jonathan Wolff said after meeting with Hackett that he had “further confidence in the company’s aggressive deepwater program.” The story further noted that “Anadarko recently signed a three-year, $1 billion contract with Transocean to lease deepwater rigs,” about which Wolff commented:

“We think investor fears about Anadarko’s aggressive deepwater program are unfounded. The Street is concerned that Anadarko will overspend and fail at exploration in the Gulf, but we have more confidence in these programs. We think people often forget the technical skill at this company and the long string of successes made throughout its history.”

There is currently no press statement or other news release posted on the company’s website to confirm the Times online report which was published shortly after midnight Greenwich time–tomorrow morning.

But according to the report, Anadarko Petroleum has “confirmed that its dividend of 9 cents per share would be paid on Wednesday,” June 23rd, 2010 and that the company “said it plans to make further payments as usual in September and December.”

More recently on May 13th Anadarko’s CEO was ebullient (sorry,  Curb Your Enthusiasm was on the monitor in the LOON newsroom).

So upbeat in fact that one could scarcely read a hint of stress on Hackett’s determined brow as Bloomberg news reported that Anadarko, as BP’s smaller partner on the Macondo license, could end up “taking the bigger hit” as far as financial fallout was concerned.

Bloomberg business reporter Edward Klump wrote that: “Pound for pound, Anadarko may have to pay more than BP” and “ING Bank NV estimated that costs of the spill may reach $7.8 billion.”  He also pointed out that “Anadarko may have to pay as much as 25 percent of those expenses, which would be almost $2 billion…”.

Klump’s report alluded to its then falling share price on the New York stock exchange since April 20th and a decline in Anadarko’s market value.  He also speculated that Anadarko’s insurance liability could prove precarious.

Loss of stock value “real punishment” Anadarko spokesman says

At the end of the first quarter of 2010, Anadarko had $3.7 billion in cash assets and its $1.3 billion line-of-credit was untouched.  Although the company’s CFO warned during a May 4th conference call with shareholders that there were spending cuts and asset selloffs that could be employed to weather any post-explosion financial storms, Hackett was single-mindedly optimistic.

“We will remain focused on managing through this event, and based on what we know today, we are not currently making any major changes or interruptions to our capital-spending programs or strategic objectives,” the CEO assured Anadarko’s shareholders during the May 4th tele-conference.

According to Anadarko’s manager of external communications John Christiansen: “The company lost almost one quarter of its market value in 20 days. That’s real punishment.”

As things turned out Anadarko emerged the worse none the worse for wear despite the continued worsening of the oil spill it participated in creating and the still untallied costs of cleanup and compensation to the Gulf coast victims.

It was out of concern for those liabilities–if not, the fear of an oil company-free planet–that BP ultimately yielded to pressure from the Obama administration on Wednesday of this week and folded its tent on plans to reward its shareholders.

As part of that agreement, BP’s senior executives Tony Hayward and Carl-Henric Svanberg had assured the White House yesterday that their company would be foregoing payment of the estimated $7.8 billion dividend to BP shareholders and selling off at least $10 billion of the multinational oil company’s assets as part of its commitment to guarantee restitution for the disastrous environmental, economic and human impact of the Deepwater Horizon explosion and spill.

BP’s Carl Henric-Svanberg acknowledges the little people

That commitment was given at a meeting in the White House after which the aristocratic Svanberg promptly proceeded to tell the assembled world media how much BP truly cared for “the small people”.  Oops.  Something was obviously lost in the translation between conversational oligarch and plain English.

The Times story also reported that BP PLC had “declined to comment on whether it expected Anadarko to contribute to the $20 billion…escrow fund designed to compensate Gulf coast residents and businesses….announced after BP officials met President Obama in the White House on Wednesday.”

With a 65 per cent share, BP was the largest partner in the Deepwater Horizon venture which sunk the deepwater Macondo well that is currently leaking thousands of gallons of crude oil into the sensitive gulf waters.  Mitsui, a Japanese company held a 10 per cent interest, and the rig’s owner and operator, Transocean Ltd., a Swiss-based company, held the rest of the shares.

The Anadarko Petroleum Corporation’s website highlights its involvement in “the Deepwater Gulf of Mexico” and touts the company as “the largest independent producer in the deepwater Gulf of Mexico”:

Our deepwater holdings and skill sets position the company to excel with high-impact projects in various stages from exploration prospects and new discoveries, to projects sanctioned for development and producing fields. Anadarko utilizes a hub-and-spoke infrastructure enabling new discoveries to be brought on production safer, faster and at significant cost savings.

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This entry was posted on June 17, 2010 at 9:20 pm and is filed under Current Events, LOON EXTRA!, Our Dying Planet, The Bawdy Politick. You can subscribe via RSS 2.0 feed to this post's comments.

Tags: Anadarko Petroleum, BP, corporate responsibility, Deepwater Horizon, Gulf disaster, Macondo well, Tony Hayward

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