EX-12.1 4 dex121.htm COMPUTATION OF RATIO AND EARNINGS TO FIXED CHARGES Computation of Ratio and Earnings to Fixed Charges

Exhibit 12.1

ANADARKO PETROLEUM CORPORATION

CONSOLIDATED STATEMENT OF COMPUTATION OF RATIOS OF

EARNINGS TO FIXED CHARGES AND EARNINGS TO

COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS

Six Months Ended June 30, 2006 and Five Years Ended December 31, 2005

 

millions except ratio amounts

    Pro
Forma
June 30,
2006		    Six Months
Ended
June 30,
2006		   

Years Ended December 31

         2005    2004    2003    2002    2001

Gross Income from Continuing Operations

    $ 3,118    $ 1,941    $ 3,611    $ 2,458    $ 1,850    $ 1,219    $ 210

Rentals

      25      8      13      10      8      12      13
                                                

Earnings

      3,143      1,949      3,624      2,468      1,858      1,231      223
                                                

Gross Interest Expense

      941      132      266      428      365      343      268

Rentals

      25      8      13      10      8      12      13
                                                

Fixed Charges

    $ 966    $ 140    $ 279    $ 438    $ 373    $ 355    $ 281
                                                

Preferred Stock Dividends

      3      3      8      8      9      9      14
                                                

Combined Fixed Charges and Preferred Stock Dividends

    $ 969    $ 143    $ 287    $ 446    $ 382    $ 364    $ 295
                                                

Ratio of Earnings to Fixed Charges

      3.25      13.92      12.99      5.63      4.98      3.47      —  
                                                

Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends

      3.24      13.63      12.63      5.53      4.86      3.38      —  
                                                

As a result of the Company’s net loss in 2001, Anadarko’s earnings did not cover fixed charges by $58 million and did not cover combined fixed charges and preferred stock dividends by $72 million.

The following table sets forth our ratio of earnings to fixed charges for the periods indicated (1) on a consolidated historical basis and (2) on a pro forma as adjusted basis to give the effect to (i) the completion of the Kerr-McGee and Western mergers, (ii) the financing of the mergers through borrowings of approximately $22.5 billion under our 364-day term loan agreement, (iii) the completion of this offering and (iv) our application of the estimated proceeds from this offering in the manner described in “Use of Proceeds.”

These ratios were computed by dividing earnings by either fixed charges or combined fixed charges and preferred stock dividends. For this purpose, earnings include income from continuing operations before income taxes and fixed charges. Fixed charges include interest and amortization of debt expenses and the estimated interest component of rentals. Preferred stock dividends are adjusted to reflect the amount of pretax earnings required for payment.