UPDATE 2-Anadarko plans big $5 bln share buyback
(Updates share price, adds share details, background)
HOUSTON, Aug 25 (Reuters) - Anadarko Petroleum Corp (APC.N) the oil and gas company, authorized the repurchase of $5 billion of its shares, or about 18 percent of the outstanding stock, at current prices.
The news pushed its shares 2 percent higher to $59.11 in extended trade on Monday.
The Houston company also said it expects oil and gas production in the third quarter to be above the midpoint of its prior forecast for 51 million to 54 million barrels of oil equivalent.
Anadarko will repurchase about $600 million worth of shares prior to the end of 2008, using cash flow from operations. As of June 30, Anadarko had free cash flow of nearly $2 billion.
The share buyback plan extends through August 2011 and replaces a prior $1 billion share buyback program from 2005, the company said.
Tumbling crude oil and natural gas prices have sunk shares of U.S. exploration and production companies in recent weeks, leaving buyback programs as an attractive means of boosting value.
Since reaching a 2008 intraday peak of $81.36 on May 21, shares of Anadarko have dropped about 25 percent, compared with a 19 percent decline in the America Stock Exchange index of natural gas companies .XNG. (Reporting by Anna Driver in Houston; Editing by Gary Hill)
