Anadarko 3Q Profit Tumbles; Volume Increases

Anadarko Petroleum Corp. said Monday its profit plunged during the third quarter, but that sales volume will jump this year even though spending has declined.

All oil and gas companies saw profit and revenue plunge from July to September because they are being compared to one of the most lucrative periods in industry history a year ago.

Still, The Woodlands, Texas-based Anadarko was among a number of oil companies that made what could be sizable finds in the third quarter. Last month, Anadarko said it struck oil in deep waters off West Africa.

The company reported net income of $200 million, or 40 cents a share, which included $251 million in special items that tacked on 51 cents per share. Excluding those items, Anadarko posted a loss of $51 million, or 11 cents a share.

A year ago, Anadarko had net income of $2.16 billion, or $4.62 a share, in large part due to non-cash hedging gains.

Revenue tumbled to $2.7 billion from $6.15 billion a year ago during the same period, the company said.

For the quarter, Anadarko produced 57 million barrels of oil equivalent, up from 51 million barrels of oil equivalent a year ago.

The results were released after the markets closed.

For the year, Anadarko forecast sales volume of about 220 million barrels of oil equivalent, up from a previous estimate of 210 million barrels of oil equivalent. It has not released a 2010 forecast.

The rise in volume is due both to less violent weather in the Gulf of Mexico this year and better operating performance, said CEO Jim Hackett.

Analysts said the performance was better than expected. "The rally in oil prices has helped; natural gas prices really haven't yet but we're expecting that into next year," said David Heikkinen, an analyst with Tudor Pickering & Co.

Suntrust Robinson Humphrey analyst John Gerdes said he believes Anadarko hit the bottom and began recovering from the recession at least six months ago. "The execution in their U.S. business has been superb this year," he said. "Now, you're seeing that."