Anadarko Petroleum posted a loss of $1.25 billion in the fourth quarter. The Texas-based company plans to slash nearly half of its budget next year as it weathers plunging oil prices.
For the year, Anadarko posted losses of $6.69 billion, or $13.18 per share.
Anadarko CEO Al Walker said the company’s decision not to expand drilling programs in 2015 paid off because oil and gas markets have not yet recovered from a prolonged slump.
“We did not expect oil prices to recover in 2015 and believed it could take well into 2016 before markets would stabilize on a sustained basis, costs would become more aligned with the new operating environment and investments in short-cycle assets would be more attractive,” Walker wrote in a statement. “Therefore, value enhancement drove our capital-allocation philosophy.”
Anadarko expects to spend $2.8 billion in capital this year, about 50 percent less than last year. In 2015, the company cut its capital budget by 40 percent.
Since the start of the year, Anadarko shares have fallen 21 percent. Anadarko shares sat at $38.22 on Monday evening, down 53 percent over the past year.
In 2015, the company increased its percentage of capital investments in longer cash cycle opportunities, such as advancing large-scale deepwater projects and exploration. Onshore investments were primarily allocated toward the Wattenberg field in northeastern Colorado and the Delaware Basin in West Texas.
In the Wattenberg field, Anadarko reduced drilling-costs-per-foot by 50 percent and completion costs by 32 percent, relative to 2014.