Anadarko Values Western Gas Partners Stake at $8.4 Billion
HOUSTON (P&GJ) — Anadarko Petroleum disclosed additional details Monday related to the proposed Occidental Petroleum acquisition in a federal filing that values its share of midstream company Western Gas Partners LP at $8.4 billion.
Anadarko included the details in a regulatory filing that said it amended its merger proxy in response to a lawsuit, which alleged its earlier proxy statement did not make adequate financial disclosures. The Woodlands-based company said it "believes that the allegations in the complaint are without merit" and said the additional disclosure was not required.
Following market close today, Western Midstream reported second-quarter net income of $169.6 million, adjusted EBITDA of $432.9 million and distributable cash flow of $335.5 million.
Shareholders are due to vote Aug. 8 on the proposed sale to Houston-based Oxy.
Western Gas completed transactions earlier this year that simplified its structure by combining its two subsidiaries into a single entity named Western Midstream – a master limited partnership that Anadarko formed to acquire, develop and operate midstream assets. The simplified structure set the stage for Anadarko to more easily divest its midstream holdings, and it is widely anticipated that Oxy will sell Anadarko's stake after the merger transaction is complete.
With assets in the Rocky Mountains, Pennsylvania, Texas and New Mexico, Western Midstream is engaged in gathering, compressing, treating, processing and transporting natural gas; gathering, stabilizing and transporting condensate, NGLs and crude oil; and gathering and disposing of produced water for Anadarko and third-party customers. It also buys and sells natural gas, NGLs and condensate for itself and as agent for contract customers.
Operational highlights released today for the second quarter ended June 30, included:
- Achieved record West Texas Complex gas throughput of 1.18 Bcf/d for second quarter
- Achieved record DJ Basin Complex gas throughput of 1.27 Bcf/d for second quarter
- Achieved record DJ Basin oil throughput of 112 MBbls/d for second quarter
- Entered into third-party processing contract for a portion of Latham II capacity fully backed by minimum volume commitments
"After another strong quarter, we continue to be pleased with the complementary assets and robust contract portfolio we have assembled in the Delaware and DJ basins," CEO Robin Fielder said. "We remain focused on safe and efficient operations as we near construction completion of our Latham plant and further expand our gathering systems in the DJ and Delaware basins."
Total natural gas throughput averaged 4.3 Bcf/d for the second quarter of 2019, which was a 2% increase over the first quarter of 2019 and a 10% increase from the second quarter of 2018. Throughput for crude oil, NGLs and produced water assets for the second quarter of 2019 averaged 1,105 MBbls/d, which was flat sequentially and an 84% increase from the second quarter of last year.
Western Gas management has scheduled a conference call with investors Wednesday morning to discuss the second-quarter results.
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