Anadarko Petroleum 8-K Anadarko Announces First-Quarter Results

Exhibit 99

Anadarko Announces First-Quarter Results

Reaffirms Full-Year Production Guidance,
Updates Significant Activities Offshore Ghana and Gulf of Mexico

HOUSTON--(BUSINESS WIRE)--Anadarko Petroleum Corporation (NYSE:APC) today announced first-quarter 2008 net income available to common stockholders totaled $286 million, or $0.61 per share (diluted). Income from continuing operations totaled $237 million, or $0.50 per share (diluted). The net income results include certain items typically excluded by the investment community in published estimates. In total, these items reduced net income by approximately $440 million, or $0.94 per share (diluted) on an after-tax basis.⁽¹⁾ Cash flow from continuing operations in the first quarter of 2008 was $2.01 billion, and discretionary cash flow totaled $1.87 billion.⁽²⁾

FIRST-QUARTER 2008 OPERATIONAL HIGHLIGHTS

• 8% increase in production over first-quarter 2007 from retained properties
• Record production in the Greater Natural Buttes and the Powder River Basin
• Deepwater discovery offshore Ghana at the Odum-1 exploration well
• Announced sale of the Peregrino and Kaskida fields for $2.1 billion including $300 million of contingent consideration

“As evidenced throughout 2007 and by the first-quarter 2008 operational highlights (above), our balanced portfolio of properties continues to deliver significant organic growth and positive financial results,” Anadarko Chairman, President and CEO Jim Hackett said. “I am pleased with our operating performance through the first three months of 2008, which again exceeded the high end of our production expectations. As a result of this performance, record production in several U.S. onshore fields and our confidence in our portfolio of assets, we are reaffirming our full-year production guidance of 207 million to 212 million BOE (barrels of oil equivalent). This reaffirmation takes into account the anticipated four to six weeks of shut-in production at Independence Hub, where we are working with our partners to repair the third-party-owned export pipeline.

“In addition, I would like to provide an update on several significant developments in our deepwater drilling program. The Mahogany-2 appraisal well, located in 3,540 feet of water on the West Cape Three Points Block offshore Ghana, encountered high-quality stacked reservoir sandstones with approximately 165 feet of net oil-bearing pay. Moreover, the Mahogany-2 well is located approximately seven miles to the northeast and up-dip from the successful Hyedua-1 well on the Deepwater Tano license, indicating a gross oil column of nearly 1,955 feet. We now plan to perform a drillstem test on the Mahogany-2 well to gain a better understanding of the fluid and flow characteristics, which we anticipate will lead us to update our estimated resource range for the area. Also in our deepwater international program, we have made arrangements to move the ‘Deepwater Millennium’ drillship to Brazil to enable us to execute upon our deepwater subsalt program in the Espírito Santo and Campos basins.

“At our K2 unit in the deepwater Gulf of Mexico’s Green Canyon area, we have completed drilling the GC 561 #2 development well. This down-dip appraisal well helped define the extent of the oil-bearing reservoirs that are present in the unit’s six producing wells and also encountered new off-structure, oil-bearing sands. The well is currently being side-tracked to further evaluate the extent of these sands,” Hackett added.

First-quarter 2008 sales volumes of natural gas, crude oil and natural gas liquids totaled 53 million BOE, or 585,000 BOE per day. First-quarter 2008 natural gas sales volumes averaged 2.14 billion cubic feet per day at an average price of $6.17 per thousand cubic feet, including a loss on derivatives of $1.41 per thousand cubic feet. Oil sales volumes in the first quarter averaged 190,000 barrels per day, at an average price of $78.21 per barrel, including a loss on derivatives of $14.80 per barrel. Natural gas liquids sales volumes averaged 39,000 barrels per day, at an average price of $56.42 per barrel.

In the 2007 first quarter, net income available to common stockholders was $1.72 billion, or $3.70 per share (diluted). Income from continuing operations in the first quarter of 2007 totaled $1.7 billion, or $3.64 per share (diluted). The results for the first quarter of 2007 included gains on divestitures of approximately $1.66 billion after income taxes, or $3.56 per share (diluted).

CONFERENCE CALL TOMORROW AT 9 A.M. CDT, 10 A.M. EDT

Anadarko will host a conference call on Tuesday, May 6, at 9 a.m. Central Daylight Time (10 a.m. Eastern Daylight Time) to discuss first-quarter results and the company’s outlook for the remainder of 2008. The dial-in number is 888.713.4205 in the United States or 617.213.4862 internationally. The confirmation number is 89231908. For complete instructions on how to participate in the conference call, or to listen to the live audio webcast and slide presentation, please visit www.anadarko.com. A replay of the call will also be available on the Web site for approximately 30 days following the conference call.

ANADARKO OPERATIONS REPORT

For more details on Anadarko’s operations, please refer to the comprehensive report on first-quarter activity. The report will be available at www.anadarko.com on the Investor Relations page.

FINANCIAL DATA

Nine pages of summary financial data follow, including current hedge positions, financial guidance and supplemental production guidance. All prior-year information has been re-cast to reflect the successful efforts method of accounting.

Anadarko Petroleum Corporation’s mission is to deliver a competitive and sustainable rate of return to shareholders by exploring for, acquiring and developing oil and natural gas resources vital to the world’s health and welfare. As of year-end 2007, Anadarko had 2.4 billion barrels of oil equivalent of proved reserves, making it one of the world’s largest independent oil and natural gas exploration and production companies. For more information about Anadarko, please visit www.anadarko.com.

⁽¹⁾ See the accompanying table for details of certain items included in net income.

⁽²⁾ See the accompanying table for a reconciliation of GAAP to non-GAAP financial measures and a statement indicating why management believes the non-GAAP measures are useful information for investors.

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Anadarko believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this news release, including Anadarko’s ability to successfully meet its revised production guidance, the timely repair of the export pipeline at Independence Hub and the successful completion and commercial operation of the drilling prospects identified in this news release. See “Risk Factors” in the company’s 2007 Annual Report on Form 10-K and other public filings and press releases. Anadarko undertakes no obligation to publicly update or revise any forward-looking statements.

Anadarko Petroleum Corporation
Certain Items Included in Net Income
Quarter Ended March 31, 2008
	Before		After			Per Share
millions except for per-share amounts	Tax		Tax			(diluted)
Unrealized loss on commodity and marketing derivatives	$	481	$	305		$	0.65
Charges associated with 2007 successful efforts conversion*		82		52		$	0.11
Deferred tax expense on pending Brazil divestiture				83		$	0.18
	$	563	$	440		$	0.94
* In the first quarter of 2008, it was determined that adjustments related to the company's 2007 conversion from the full cost to successful efforts method of accounting were necessary. Management concluded that the misstatements were not material and corrected the error in the current period. These adjustments resulted in a decrease to Gains (losses) on divestitures and other, net of $82 million.
Reconciliation of GAAP to Non-GAAP Measures
Below is a reconciliation of cash provided by operating activities (GAAP) to discretionary cash flow (non-GAAP) as required under Regulation G of the Securities Exchange Act of 1934. The company uses discretionary cash flow to demonstrate the company's ability to internally fund capital expenditures and to service or incur additional debt. It is useful in comparisons of oil and gas exploration and production companies because it excludes fluctuations in assets and liabilities.
			Quarter Ended
			March 31
millions			2008			2007
Cash Flow
Net cash provided by operating activities - continuing operations			$	2,008		$	800
Add back:
Change in accounts receivable				(412	)		(1,047	)
Change in accounts payable and accrued expenses				87			460
Change in other items - net				187			(131	)
Discretionary Cash Flow from Continuing Operations			$	1,870		$	82

Anadarko Petroleum Corporation
	Quarter Ended
Summary Financial Information	March 31
millions except per share amounts	2008			2007
Revenues and Other
Gas sales	$	1,199		$	1,075
Oil and condensate sales		1,350			1,071
Natural gas liquids sales		201			157
Gathering, processing and marketing sales		268			361
Gains (losses) on divestitures and other, net		(40	)		2,586
Total		2,978			5,250
Costs and Expenses
Oil and gas operating		245			340
Oil and gas transportation and other		130			112
Exploration		243			139
Gathering, processing and marketing		192			294
General and administrative		204			264
Depreciation, depletion and amortization		810			723
Other taxes		359			335
Impairments		-			12
Total		2,183			2,219
Operating Income		795			3,031
Interest Expense and Other (Income) Expense
Interest expense		227			316
Other (income) expense		(13	)		(29	)
Total		214			287
Income from Continuing Operations Before Income Taxes		581			2,744
Income Tax Expense		344			1,049
Income from Continuing Operations	$	237		$	1,695
Income from Discontinued Operations, net of taxes		50			27
Net Income	$	287		$	1,722
Preferred Stock Dividends		1			1
Net Income Available to Common Stockholders	$	286		$	1,721
Per Common Share
Income from continuing operations - basic	$	0.50		$	3.66
Income from continuing operations - diluted	$	0.50		$	3.64
Income from discontinued operations, net of taxes - basic	$	0.11		$	0.06
Income from discontinued operations, net of taxes - diluted	$	0.11		$	0.06
Net income available to common stockholders - basic	$	0.61		$	3.71
Net income available to common stockholders - diluted	$	0.61		$	3.70
Average Number of Common Shares Outstanding - Basic		468			463
Average Number of Common Shares Outstanding - Diluted		470			465
Exploration Expense
Dry hole expense	$	60		$	33
Impairments of unproved properties		100			74
Geological and geophysical expense		51			13
Exploration overhead and other		32			19
Total	$	243		$	139

Anadarko Petroleum Corporation
	Quarter Ended
Summary Financial Information	March 31
millions	2008			2007
Cash Flow from Operating Activities
Net income	$	287		$	1,722
Less income from discontinued operations, net of taxes		50			27
Depreciation, depletion and amortization		810			723
Deferred income taxes		37			(401	)
Dry hole expense and impairments of unproved properties		160			107
Impairments		-			12
(Gains) losses on divestitures, net		171			(2,598	)
Unrealized (gains) losses on derivatives		488			494
Other noncash items		(33	)		50
Discretionary Cash Flow from Continuing Operations		1,870			82
(Increase) decrease in accounts receivable		412			1,047
Increase (decrease) in accounts payable and accrued expenses		(87	)		(460	)
Other items - net		(187	)		131
Cash provided by (used in) operating activities - continuing operations		2,008			800
Cash provided by (used in) operating activities - discontinued operations		-			11
Net cash provided by (used in) operating activities*	$	2,008		$	811
Capital Expenditures
Capital spending	$	1,037		$	960
Capitalized interest		19			39
Total	$	1,056		$	999
	March 31,			December 31,
	2008			2007
Condensed Balance Sheet
Cash and cash equivalents	$	1,308		$	1,268
Other current assets		2,990			3,218
Current assets held for sale		10			-
Net properties and equipment		36,619			37,451
Other assets		1,133			1,030
Goodwill and other intangible assets		5,140			5,166
Long-term assets held for sale		1,135			318
Total Assets	$	48,335		$	48,451
Current debt	$	396		$	1,396
Other current liabilities		4,221			3,838
Current liabilities associated with assets held for sale		37			-
Long-term debt		11,158			11,151
Midstream subsidiary note to a related party		2,200			2,200
Other long-term liabilities		13,387			13,496
Other long-term liabilities associated with assets held for sale		279			6
Stockholders' equity		16,657			16,364
Total Liabilities and Stockholders' Equity	$	48,335		$	48,451
Capitalization
Total debt	$	13,754		$	14,747
Stockholders' equity		16,657			16,364
Total	$	30,411		$	31,111
Capitalization Ratios
Total debt		45	%		47	%
Stockholders' equity		55	%		53	%

Anadarko Petroleum Corporation
	Quarter Ended
Sales Volumes and Prices	March 31
	2008			2007
Natural Gas
United States
Volumes, billion cubic feet		194			198
Average daily volumes, million cubic feet per day		2,137			2,204
Price per thousand cubic feet excluding derivatives	$	7.58		$	6.24
Realized gain (loss) on derivatives	$	(0.11	)	$	0.85
Unrealized gain (loss) on derivatives	$	(1.30	)	$	(1.67	)
Total gains (losses) on derivatives	$	(1.41	)	$	(0.82	)
Total price per thousand cubic feet	$	6.17		$	5.42
Crude Oil and Condensate
United States
Volumes, million barrels		10			14
Average daily volumes, thousand barrels per day		122			149
Price per barrel excluding derivatives	$	92.59		$	52.81
Realized gain (loss) on derivatives	$	(3.16	)	$	6.13
Unrealized gain (loss) on derivatives	$	(12.39	)	$	(11.28	)
Total gains (losses) on derivatives	$	(15.55	)	$	(5.15	)
Price per barrel	$	77.04		$	47.66
Algeria
Volumes, million barrels		5			6
Average daily volumes, thousand barrels per day		51			71
Price per barrel excluding derivatives	$	98.02		$	59.58
Realized gain (loss) on derivatives	$	(3.80	)	$	-
Unrealized gain (loss) on derivatives	$	(14.23	)	$	(1.93	)
Total gains (losses) on derivatives	$	(18.03	)	$	(1.93	)
Price per barrel	$	79.99		$	57.65
Other International
Volumes, million barrels		2			2
Average daily volumes, thousand barrels per day		17			16
Price per barrel	$	81.08		$	43.60
Total
Volumes, million barrels		17			22
Average daily volumes, thousand barrels per day		190			236
Price per barrel excluding derivatives	$	93.01		$	54.18
Realized gain (loss) on derivatives	$	(3.04	)	$	3.86
Unrealized gain (loss) on derivatives	$	(11.76	)	$	(7.69	)
Total gains (losses) on derivatives	$	(14.80	)	$	(3.83	)
Total price per barrel	$	78.21		$	50.35
Natural Gas Liquids
United States
Volumes, million barrels		4			4
Average daily volumes, thousand barrels per day		39			49
Total price per barrel	$	56.42		$	35.65
Total Barrels of Oil Equivalent (BOE)
Volumes, million BOE		53			59
Average daily volumes, thousand BOE per day		585			652

Anadarko Petroleum Corporation
Financial and Operating Guidance
Continuing Operations
As of May 5, 2008
	2nd Quarter						Full Year
	2008 Forecast						2008 Forecast
	Units						Units
Total Sales (MMBOE)		50		-	52			207		-	212
Crude Oil (MBbl/d):		185		-	195			175		-	185
United States		110		-	115			105		-	110
Algeria		55		-	65			55		-	60
Other International		16		-	18			14		-	15
Natural Gas (MMcf/d):
United States		1,950		-	2,000			2,130		-	2,155
Natural Gas Liquids (MBbl/d):
United States		35		-	38			37		-	39
	$ / Unit						$ / Unit
Price Differentials vs NYMEX (w/o hedges)
Crude Oil ($/Bbl):		(4.00	)	-	(6.00	)		(4.00	)	-	(6.00	)
United States		(4.00	)	-	(6.00	)		(5.00	)	-	(7.00	)
Algeria		0.00		-	(2.00	)		(1.00	)	-	(3.00	)
Other International		(15.00	)	-	(17.00	)		(13.00	)	-	(15.00	)
Natural Gas ($/Mcf):
United States		(1.00	)	-	(1.50	)		(0.75	)	-	(1.20	)

Anadarko Petroleum Corporation
Financial and Operating Guidance
Continuing Operations
As of May 5, 2008
	2nd Quarter					Full Year
	2008 Forecast					2008 Forecast
	$ MM					$ MM
Other Revenues:
Gathering, Processing & Marketing Margins	90		-	100		360		-	400
Minerals and Other	25		-	35		100		-	120
Costs and Expenses:
	$ / Boe					$ / Boe
Oil & Gas Lease Operating	5.25		-	5.75		5.00		-	5.50
Oil & Gas Transportation	2.25		-	2.50		2.25		-	2.50
Depreciation, Depletion and Amortization	14.75		-	15.00		14.75		-	15.00
Production Taxes (% of Revenue)	11.5	%	-	12.5	%	11.5	%	-	12.5	%
	$ MM					$ MM
General and Administrative	185		-	200		750		-	800
Exploration Expense
Non-Cash	150		-	170		850		-	900
Cash	90		-	110		300		-	350
Interest Expense	200		-	210		800		-	825
Other (Income) Expense	(10	)	-	10		(20	)	-	20
Effective Tax Rate	45	%	-	50	%	45	%	-	50	%
Avg. Shares Outstanding (MM)
Basic	469		-	470		469		-	471
Diluted	470		-	472		473		-	475
	$ MM					$ MM
Capital Investment	1,150		-	1,250		4,600		-	4,750
Capital Projects	1,140		-	1,230		4,550		-	4,675
Capitalized Interest	10		-	20		50		-	75

Anadarko Petroleum Corporation
Commodity Hedge Positions (Excluding Natural Gas Basis)
As of May 5, 2008
			Weighted Average Price per MMBtu
		Volume (thousand MMBtu/d)	Floor Sold		Floor Purchased		Ceiling Sold
Natural Gas
	Three-Way Collars
	Remainder of 2008
		500	$	5.00	$	7.50	$	14.26
		900	$	5.50	$	7.50	$	9.14
		1,400	$	5.32	$	7.50	$	10.97
	2009	530	$	5.45	$	7.50	$	11.25
	2010	—	$	—	$	—	$	—
	2011	—	$	—	$	—	$	—
			Weighted Average Price per barrel
		Volume (thousand MBbls/d)	Floor Sold		Floor Purchased		Ceiling Sold
Crude Oil
	Three-Way Collars
	Remainder of 2008
		31	$	34.09	$	49.09	$	87.09
		20	$	45.00		60.00	$	87.38
		35	$	45.00	$	60.00	$	101.39
		86	$	41.07	$	56.07	$	92.98
	2009	48	$	37.51	$	52.51	$	87.04
	2010	18	$	34.18	$	49.19	$	86.76
	2011	3	$	35.00	$	50.00	$	86.00
	2012	2	$	35.00	$	50.00	$	92.50

Anadarko Petroleum Corporation
Natural Gas Basis Hedge Positions
As of May 5, 2008
		Volume (thousand MMBtu/d)	Price per MMBtu
Basis Swaps
Remainder of 2008
	Gulf Coast	560	$	(0.24	)
	Mid Continent	365	$	(1.01	)
	Rocky Mountains	455	$	(1.47	)
	West Texas	35	$	(0.92	)
		1,415	$	(0.85	)
2009
	Gulf Coast	315	$	(0.15	)
	Mid Continent	330	$	(0.85	)
	Rocky Mountains	555	$	(1.25	)
		1,200	$	(0.85	)
2010
	Mid Continent	35	$	(0.61	)
	Rocky Mountains	310	$	(1.13	)
		345	$	(1.08	)
Rockies Export Firm Transportation
As of May 5, 2008
			Daily Volume (MMBtu's) by Pricing Point
Delivery/Pricing Point
Remainder of 2008
	Mid Continent			491
	West Coast			88
	San Juan			15
				594
2009
	Mid Continent			491
	West Coast			88
	San Juan			15
				594
2010
	Mid Continent			491
	West Coast			88
	San Juan			15
				594

Anadarko Petroleum Corporation
Retained Properties Sales
	Q4 2006	Q1 2007	Q2 2007	Q3 2007	Q4 2007	FY 2007
	Actuals	Actuals	Actuals	Actuals	Actuals	Actuals
TOTAL SALES (MMBOE)	48.5	49.2	46.8	46.5	53.1	195.7
Natural Gas (MMcf/d)	1,791.5	1,794.3	1,639.1	1,646.9	2,013.0	1,774.2
Crude Oil (MBbl/d)	203.4	207.9	202.0	192.0	203.8	201.5
Natural Gas Liquids (MBbl/d)	34.2	39.2	39.0	39.4	37.9	38.9
ROCKIES
Natural Gas (MMcf/d)	917.2	934.4	840.4	849.3	909.4	883.2
Crude Oil (MBbl/d)	23.1	23.4	23.8	24.0	26.7	24.5
Natural Gas Liquids (MBbl/d)	16.9	16.2	15.2	15.8	14.7	15.5
Total Sales (MMBOE)	17.4	17.6	16.3	16.7	17.7	68.3
SOUTHERN
Natural Gas (MMcf/d)	639.5	645.3	617.3	565.6	589.4	604.5
Crude Oil (MBbl/d)	12.2	10.9	10.2	8.6	10.2	10.0
Natural Gas Liquids (MBbl/d)	10.3	14.3	14.4	13.8	13.9	14.2
Total Sales (MMBOE)	11.6	11.9	11.6	10.7	11.3	45.6
GULF OF MEXICO
Natural Gas (MMcf/d)	239.7	223.2	200.5	240.0	522.1	297.3
Crude Oil (MBbl/d)	63.0	61.3	67.2	62.8	62.1	63.4
Natural Gas Liquids (MBbl/d)	4.2	4.0	4.6	5.0	6.2	5.0
Total Sales (MMBOE)	9.6	9.2	9.6	9.9	14.3	43.0
INTERNATIONAL / FRONTIER
Natural Gas (MMcf/d)	0.4	0.3	0.3	0.3	0.3	0.3
Crude Oil (MBbl/d)	105.1	112.4	100.8	96.6	104.9	103.6
Natural Gas Liquids (MBbl/d)	-	-	-	-	-	-
Total Sales (MMBOE)	9.7	10.1	9.2	8.9	9.7	37.8

CONTACT:
Anadarko Petroleum Corporation, Houston
Media:
John Christiansen, 832-636-8736
john.christiansen@anadarko.com
or
Paula Beasley, 832-636-8765
paula.beasley@anadarko.com
or
Investors:
John Colglazier, 832-636-2306
john.colglazier@anadarko.com
or
Chris Campbell, CFA, 832-636-8434
chris.campbell@anadarko.com