Anadarko Petroleum has signed an agreement to acquire the deepwater Gulf of Mexico assets of Freeport-McMoRan Oil & Gas, a unit of mining firm Freeport-McMoRan, for $2bn.

Under the terms of the deal, Anadarko will acquire oil assets in the Gulf of Mexico, boosting its output in the region to about 155,000 barrels of oil equivalent a day.

Scheduled to be completed by the end of this year, the transaction is subject to customary closing conditions.

Anadarko expects the assets to generate substantial free cash flow while boosting its US onshore activity in the Delaware and DJ basins.

Freeport-McMoRan president and CEO Richard Adkerson said: "With our announced asset sale transactions combined with cash flows from operations and previously announced at-the-market equity transactions, we are on track to achieve our stated balance sheet objectives.

“We look forward to closing both the Deepwater GOM transaction and the previously announced Tenke transaction during 2016 and to continuing to execute our plans to enhance long-term value for shareholders.”

The divestment brings Freeport McMoRan’s total asset sale transactions to over $6bn in 2016 and is part of its efforts to reduce debt and focus on global copper business.

Anadarko chairman, president and CEO Al Walker said: "This immediately accretive, bolt-on transaction strengthens our industry-leading position in the Gulf of Mexico and is a catalyst for the company's oil-growth objectives, with quality assets being acquired at an attractive price to create significant value.”

Anadarko plans to add two rigs in each play later this year. It also intends to more than double its production to at least 600,000 BOE per day collectively from Delaware and DJ basins over the next five years.

Walker added: “This increased activity would drive a company-wide 10%-12% compounded annual growth rate in oil volumes over the same time horizon in a $50 to $60 oil-price environment, while investing within cash flows.”

Image: Anadarko Petroleum's has opertions in Gulf of Mexico. Photo: courtesy of Anadarko Petroleum Corporation.