Investors Are Bullish On Anadarko Petroleum Following 2016 Capital Program

Shares of Anadarko Petroleum Corporation (NYSE: APC) were trading higher by nearly 5 percent Tuesday afternoon after the company announced its 2016 capital program.

Anadarko said that it plans on selling $3 billion of assets in 2016 and slash its spending on new wells and other projects by half given the ongoing weakness in the oil and natural gas markets.

Anadarko continued that its U.S. onshore activities will be reduced the most by almost $2.5 billion in capital investments year-over-year and will lower its U.S. onshore rig count by 80 percent to 5 operated rigs, from an average of 25 in 2015.

Anadarko is now projecting that its total 2016 capital expenditures will be $2.6 billion to $2.8 billion - nearly 50 percent lower than it was in 2015. The company also added that it expects its recent dividend reduction to provide approximately $450 million in incremental cash this year.

"In 2016, we will continue our disciplined and focused approach, preserving and building value by leveraging our best-in-class capital allocation, enhancing operational efficiencies and continuing an active monetization program," said Al Walker, Anadarko Chairman, President and CEO.

"We are committed to again investing well within cash inflows from a combination of anticipated discretionary cash flow and our ongoing monetizations, with the expectation of also reducing net debt during the year."