Anadarko sells Canadian unit for $4.2B; deal does not include Mackenzie leases

Anadarko Petroleum said Sept. 14 that it has agreed to sell its Canadian subsidiary for about $4.24 billion to Canadian Natural Resources.

The sale fulfills Anadarko’s June announcement to sell Anadarko Canada, the first of several asset sales expected in connection with the completion in August of two major acquisitions, Kerr McGee and Western Gas Resources. Anadarko bought Kerr McGee for $16.4 billion and spent $4.7 billion for Western Gas.

Anadarko’s chief executive, Jim Hackett, said selling the Canadian unit would help the company refocus its portfolio and reduce debt.

The deal is expected to close by the end of October, about two months earlier than predicted.

“It’s certainly a positive to be able to begin reducing their debt sooner, and that’s an important signal to the market,” said Tom Covington, an analyst with A.G. Edwards.

“What they are doing is trading out lower-growth Canadian properties for higher growth properties acquired from Kerr McGee and Western Gas,” he said. “That’s how out to look at this transaction.”

Shares of Anadarko fell 88 cents, 2 percent, to $44.32 in afternoon trading on the New York Stock Exchange.

The sale of the Canadian business excludes Anadarko’s interests in the Mackenzie Delta and other Canadian arctic frontier properties. Those properties remain on the sale block, the company said.

Analysts expect more sales, perhaps even before year’s end, including some high-profile Gulf of Mexico deep-water assets under development.

“They are asking themselves, how much concentration do they want to have in the Gulf of Mexico, thinking of the hurricane risk and the concentration risk in one region,” said Dave Heikkinen, an analyst with Pickering Energy Partners.

—The Associated Press