Now that big boys like ConocoPhillips
For the year, Anadarko organically replaced 141% of production, excluding the negative effects of price revisions on reserve calculations. The firm arguably got a bit of a boost from hurricane shut-ins, but it certainly would have been happier to forego the Ike and Gustav show. Free cash flow for the year clocked in at just under $1 billion, and net debt dropped down to 34% of total capitalization.
The fourth quarter was naturally a less pleasant experience for Anadarko. Discretionary cash flow cratered 64% compared to the prior year, and didn't come close to covering capital expenditures. These mismatches are natural over such short time periods, though, and I'm not worried about a widening gap here.
While E&Ps like Chesapeake Energy
Anadarko is thus closer to Apache
In a sense, Anadarko offers a fine balance between Chesapeake's low geopolitical risk and Apache's capital discipline. With a fine deepwater program as a kicker, this remains one of my favorite E&P names.