Walker, Texas danger

21 September 2017 By Lauren Silva Laughlin Follow @TheRealLSL

The oil firm is spending $2.5 bln to repurchase stock. Yet it’s unlikely to make money until 2020 and has $15 bln of debt. The buyback plan is an admission it can’t find profitable investments. It also implies CEO Al Walker is hoping for the oil price to rise or a takeover.

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Anadarko said on Sept. 20 it would buy back $2.5 billion of shares by the end of 2018. The share repurchase represents roughly 10 percent of the company’s shares at the current value, the company said.

On July 24, Anadarko said it lost $415 million in the second quarter, more than analysts expected, though the company’s oil sales volume increased 12 percent over the same quarter in 2016. The company hit record sales volume from the Delaware Basin in West Texas of 33,000 barrels a day, a 52 percent increase from the previous year.

On the same day, Anadarko also said it would cut capital expenditure by $300 million in 2018 as “current market conditions require lower capital intensity given the volatility of margins.”

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