Apache Reports Record Quarterly Production of 752,000 Boe/d
HOUSTON, Nov. 3, 2011 /PRNewswire/ -- Apache Corporation
reported production of 752,000 barrels of oil equivalent (boe) per day and earnings of $983 million, or $2.50 per diluted share, for the three-month period ending Sept. 30, 2011. These compare with production of 667,000 boe per day and net income of $765 million, or $2.12 per diluted share, for the same period in the prior year.Excluding certain items that management believes affect the comparability of operating results, Apache reported adjusted earnings* of $1.2 billion in third quarter 2011 compared with $797 million in the year-earlier period. On a per-share basis, adjusted earnings were $2.95 in the third quarter compared with $2.20 per diluted share in the prior-year period. Oil and gas revenues for third quarter 2011 were $4.3 billion, a 41 percent increase from $3.0 billion for the same period last year. Cash from operations before changes in operating assets and liabilities* were $2.7 billion, up 35 percent from the prior year's $2.0 billion.
'Apache had a very productive quarter, both in operations and commercial activity,' said G. Steven Farris, chairman and chief executive officer. 'For the sixth consecutive quarter, we achieved record daily production on an equivalent basis. We've commenced development of the Balnaves oil field offshore Western Australia. We've extended the productive range of our holdings in Egypt's remote Western Desert with new producers in the Faghur Basin. We continue to drill from the extensive, multiyear inventory of drillable locations we have developed in the Permian, Central, Gulf of Mexico and Canadian regions of North America. Domestically, the recent focus has obviously been on higher-margin oil and liquids-rich opportunities. This operational flexibility is a competitive advantage of Apache's portfolio model.
'Apache made great progress commercially as well during the quarter. We announced the acquisition of ExxonMobil's Beryl and other selected fields in the U.K. sector of the North Sea, expanding our presence in this region. In Australia, the partner-operated Wheatstone Project advanced to development. This is Apache's first liquefied natural gas (LNG) project, and we expect it will enable us to monetize an estimated 2 trillion cubic feet of natural gas resource from the Brunello, Julimar, and Balnaves fields, which also are in development, at premium prices pegged to the worldwide market for LNG, creating additional value at those discoveries,' Farris said.
Liquid hydrocarbons represented 50 percent of production and 78 percent of revenues. Apache benefited from higher oil prices for both its international production indexed to Dated Brent benchmarks and sweet crudes from the Gulf of Mexico, which continue to receive a meaningful premium per barrel compared with production benchmarked to West Texas Intermediate prices.
Apache Corporation is an oil and gas exploration and production company with operations in the United States, Canada, Egypt, the United Kingdom North Sea, Australia and Argentina. From time to time, Apache posts announcements, operational updates and investor information, and copies of all press releases on its Web site, www.apachecorp.com.
*Cash from operations before changes in operating assets and liabilities and adjusted earnings are non-GAAP measures. Please see reconciliations below. For supplemental and non-GAAP information, please go to http://www.apachecorp.com/financialinfo.
NOTE: Apache will conduct a conference call to discuss its third-quarter 2011 results at 1 p.m. Central time on Thursday, Nov. 3. The call will be webcast from Apache's website, www.apachecorp.com. The webcast replay and podcast will be archived on Apache's website. The conference call will be available for delayed playback by telephone for one week beginning at approximately 3 p.m. on Nov. 3. To access the telephone playback, dial 800-642-1687 or 706-645-9291 for international calls and provide Apache's confirmation code, 21273208.
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by words such as 'anticipates,' 'intends,' 'plans,' 'seeks,' 'believes,' 'estimates,' 'expects,' and similar references to future periods. Any matters that are not historical facts are forward-looking and, accordingly, involve estimates, assumptions, risks and uncertainties. These risks include, but are not limited to the volatility of oil and natural gas prices, uncertainties inherent in estimating oil and natural gas reserves, drilling risks, risks related to development of the partner-operated Wheatstone LNG project, and other risks, uncertainties and factors discussed in Apache's 2010 Form 10-K as amended by Amendment No. 1 to our annual report on Form 10-K/A, on our Web site and in our other public filings and press releases. There is no assurance that Apache's expectations will be realized, and actual results may differ materially from those expressed in the forward-looking statements. Unless legally required, Apache assumes no duty to update these statements as of any future date.
APACHE CORPORATION
FINANCIAL INFORMATION
(In millions, except per share data)
For the Quarter For the Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
2011 2010 2011 2010
---- ---- ---- ----
REVENUES
AND
OTHER:
Oil
and
gas
production
revenues $4,282 $3,047 $12,515 $8,709
Other 46 (34) 76 (51)
--- --- --- ---
4,328 3,013 12,591 8,658
----- ----- ------ -----
COSTS
AND
EXPENSES:
Depreciation,
depletion
and
amortization 1,065 787 3,030 2,155
Asset
retirement
obligation
accretion 39 25 114 74
Lease
operating
expenses 661 507 1,946 1,393
Gathering
and
transportation 72 43 221 126
Taxes
other
than
income 244 158 663 522
General
and
administrative 112 89 327 260
Merger,
acquisitions
&
transition 4 8 15 16
Financing
costs,
net 37 59 123 174
--- --- --- ---
2,234 1,676 6,439 4,720
----- ----- ----- -----
INCOME
BEFORE
INCOME
TAXES 2,094 1,337 6,152 3,938
Current
income
tax
provision 473 207 1,692 889
Deferred
income
tax
provision 619 352 1,065 706
--- --- ----- ---
NET
INCOME 1,002 778 3,395 2,343
Preferred
stock
dividends 19 13 57 13
--- --- --- ---
INCOME
ATTRIBUTABLE
TO
COMMON
STOCK $983 $765 $3,338 $2,330
==== ==== ====== ======
NET
INCOME
PER
COMMON
SHARE:
Basic $2.56 $2.14 $8.70 $6.78
Diluted $2.50 $2.12 $8.49 $6.72
WEIGHTED-
AVERAGE
NUMBER
OF
COMMON
SHARES
OUTSTANDING:
Basic 384 357 384 344
Diluted 400 367 400 349
DIVIDENDS
DECLARED
PER
COMMON
SHARE $0.15 $0.15 $0.45 $0.45
APACHE CORPORATION
FINANCIAL INFORMATION
(In millions)
For the Quarter For the Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
2011 2010 2011 2010
---- ---- ---- ----
CAPITAL EXPENDITURES
(1):
Exploration &
Development Costs
United States $688 $421 $1,976 $1,039
Canada 175 228 609 593
--- --- --- ---
North America 863 649 2,585 1,632
--- --- ----- -----
Egypt 197 205 674 510
Australia 127 106 445 401
North Sea 197 207 618 437
Argentina 87 73 245 167
Chile - 6 1 20
Other International 22 - 48 -
--- --- --- ---
International 630 597 2,031 1,535
--- --- ----- -----
Worldwide Exploration
& Development Costs $1,493 $1,246 $4,616 $3,167
------ ------ ------ ------
Gathering,
Transmission and
Processing
Facilities
United States $9 $- $9 $-
Canada 29 35 113 107
Egypt 20 21 74 111
Australia 136 12 255 102
Argentina 3 1 7 2
--- --- --- ---
Total Gathering,
Transmission and
Processing $197 $69 $458 $322
---- --- ---- ----
Capitalized Interest $70 $29 $193 $64
--- --- ---- ---
Capital Expenditures,
excluding
acquisitions $1,760 $1,344 $5,267 $3,553
====== ====== ====== ======
Acquisitions $398 $2,517 $493 $3,550
==== ====== ==== ======
(1) Accrual basis
September 30, December 31,
2011 2010
---- ----
BALANCE SHEET DATA:
Cash and Cash
Equivalents $586 $134
Other Current Assets 3,990 3,346
Property and
Equipment, net 41,136 38,151
Goodwill 1,032 1,032
Other Assets 738 762
Total Assets $47,482 $43,425
======= =======
Short-Term Debt $417 $46
Other Current
Liabilities 3,607 3,478
Long-Term Debt 6,785 8,095
Deferred Credits and
Other Noncurrent
Liabilities 8,770 7,429
Shareholders' Equity 27,903 24,377
Total Liabilities and
Shareholders' Equity $47,482 $43,425
======= =======
Common shares
outstanding at end
of period 384 382
APACHE CORPORATION
FINANCIAL INFORMATION
For the Quarter For the Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
2011 2010 2011 2010
---- ---- ---- ----
PRODUCTION
DATA:
OIL VOLUME -
Barrels per
day
Central 7,873 3,767 6,608 3,027
Permian 51,410 39,374 49,849 37,033
GOM
Deepwater 6,155 1,782 5,859 1,968
GOM Shelf 45,115 44,771 45,483 44,186
GC Onshore 9,800 8,130 9,336 5,855
----- ----- ----- -----
United
States 120,353 97,824 117,135 92,069
Canada 13,027 13,868 14,040 14,252
------ ------ ------ ------
North
America 133,380 111,692 131,175 106,321
------- ------- ------- -------
Egypt 103,289 99,818 103,913 96,387
Australia 39,400 56,876 38,248 48,324
North Sea 57,838 58,764 54,097 58,254
Argentina 9,461 9,645 9,577 9,812
----- ----- ----- -----
International 209,988 225,103 205,835 212,777
------- ------- ------- -------
Total 343,368 336,795 337,010 319,098
======= ======= ======= =======
NATURAL GAS
VOLUME -
Mcf per day
Central 221,193 216,189 220,094 204,446
Permian 181,070 117,557 171,309 101,440
GOM
Deepwater 43,596 19,804 53,557 25,836
GOM Shelf 331,292 330,439 343,214 308,460
GC Onshore 80,842 52,534 77,300 54,464
------ ------ ------ ------
United
States 857,993 736,523 865,474 694,646
Canada 619,897 334,945 633,031 329,443
------- ------- ------- -------
North
America 1,477,890 1,071,468 1,498,505 1,024,089
--------- --------- --------- ---------
Egypt 376,259 380,598 368,898 377,051
Australia 187,852 197,090 183,470 202,473
North Sea 2,497 2,372 2,257 2,483
Argentina 223,929 202,381 209,206 180,219
------- ------- ------- -------
International 790,537 782,441 763,831 762,226
------- ------- ------- -------
Total 2,268,427 1,853,909 2,262,336 1,786,315
========= ========= ========= =========
NGL VOLUME -
Barrels per
day
Central 1,961 592 1,156 529
Permian 12,733 9,426 11,645 5,814
GOM
Deepwater 726 369 760 475
GOM Shelf 4,560 5,079 5,559 3,902
GC Onshore 1,939 1,033 1,881 1,056
----- ----- ----- -----
United
States 21,919 16,499 21,001 11,776
Canada 6,120 2,134 6,220 1,956
----- ----- ----- -----
North
America 28,039 18,633 27,221 13,732
------ ------ ------ ------
Egypt (4) - 66 -
North Sea 14 - 5 -
Argentina 3,008 3,047 3,024 3,151
----- ----- ----- -----
International 3,018 3,047 3,095 3,151
----- ----- ----- -----
Total 31,057 21,680 30,316 16,883
====== ====== ====== ======
BOE per day
Central 46,699 40,390 44,446 37,631
Permian 94,321 68,393 90,045 59,753
GOM
Deepwater 14,148 5,451 15,545 6,749
GOM Shelf 104,890 104,924 108,244 99,498
GC Onshore 25,213 17,918 24,101 15,988
------ ------ ------ ------
United
States 285,271 237,076 282,381 219,619
Canada 122,463 71,827 125,765 71,115
------- ------ ------- ------
North
America 407,734 308,903 408,146 290,734
------- ------- ------- -------
Egypt 165,995 163,251 165,461 159,228
Australia 70,708 89,724 68,826 82,070
North Sea 58,269 59,159 54,478 58,668
Argentina 49,790 46,423 47,471 43,000
------ ------ ------ ------
International 344,762 358,557 336,236 342,966
------- ------- ------- -------
Total 752,496 667,460 744,382 633,700
======= ======= ======= =======
APACHE CORPORATION
FINANCIAL INFORMATION
For the Quarter For the Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
2011 2010 2011 2010
---- ---- ---- ----
PRICING DATA:
AVERAGE OIL PRICE PER BARREL
Central $84.55 $72.43 $90.09 $73.73
Permian 86.67 72.47 91.19 73.78
GOM Deepwater 104.05 76.77 104.50 76.46
GOM Shelf 106.64 75.72 106.52 76.49
GC Onshore 102.66 75.95 103.56 76.88
United States
(1) 93.86 73.67 94.05 74.05
Canada 88.34 69.01 92.77 71.76
North America
(1) 93.32 73.09 93.91 73.74
Egypt (1) 110.96 75.91 111.02 76.15
Australia (1) 113.40 74.80 111.78 74.66
North Sea (2) 101.85 75.25 103.90 76.13
Argentina 69.27 57.31 65.08 56.84
International
(1, 2) 107.03 74.66 107.15 74.91
Total (1,
2) 101.71 74.14 102.00 74.52
AVERAGE NATURAL GAS PRICE
PER MCF
Central $4.67 $4.41 $4.60 $4.76
Permian 5.35 4.64 5.21 5.49
GOM Deepwater 4.03 4.29 4.23 4.55
GOM Shelf 4.62 4.69 4.60 4.96
GC Onshore 4.60 4.71 4.63 4.94
United States
(1) 5.06 5.10 5.02 5.41
Canada (1) 4.49 4.42 4.58 4.72
North America
(1) 4.82 4.89 4.83 5.19
Egypt 4.60 3.57 4.61 3.55
Australia 2.88 2.20 2.71 2.21
North Sea 21.43 16.54 22.87 17.35
Argentina 2.74 1.79 2.57 1.93
International 3.71 2.80 3.65 2.86
Total (1) 4.44 4.01 4.43 4.19
AVERAGE NGL PRICE PER BARREL
Central $51.55 $48.38 $52.79 $45.90
Permian 53.84 34.11 51.00 36.31
GOM Deepwater 54.95 40.93 48.41 45.31
GOM Shelf 53.44 25.84 48.17 38.41
GC Onshore 62.57 64.16 59.62 57.09
United States 54.36 34.11 51.03 39.66
Canada 46.93 34.18 44.47 36.58
North America 52.74 34.12 49.53 39.22
Egypt 33.62 - 66.37 -
North Sea 65.45 - 65.45 -
Argentina 26.45 26.39 28.20 28.98
International 26.62 26.39 29.06 28.98
Total 50.20 33.03 47.44 37.31
(1) Prices reflect the impact of financial
derivative hedging activities.
(2) Prices reflect the impact of the North Sea
fixed-price oil sales contract.
APACHE CORPORATION
FINANCIAL INFORMATION
(In millions, except per share data)
NON-GAAP FINANCIAL MEASURES:
Reconciliation of income attributable to common stock to
adjusted earnings:
--------------------------------------------------------
The press release discusses Apache's adjusted earnings. Adjusted earnings exclude certain items
that management believes affect the comparability of operating results and are meaningful for the
following reasons:
-Management uses adjusted earnings to evaluate the company's operational trends and
performance relative to other oil and gas producing companies.
-Management believes this presentation may be useful to investors who follow the practice
of some industry analysts who adjust reported company earnings for items that may obscure
underlying fundamentals and trends.
-The reconciling items below are the types of items management believes are frequently
excluded by analysts when evaluating the operating trends and comparability of the
company's results.
For the Quarter For the Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
2011 2010 2011 2010
---- ---- ---- ----
Income Attributable to Common Stock (GAAP) $983 $765 $3,338 $2,330
Adjustments:
U.K. tax rate increase 274 - 218 -
Foreign currency fluctuation impact
on deferred tax expense (99) 27 (68) 2
Merger, acquisitions & transition,
net of tax 2 5 9 10
---
Adjusted Earnings (Non-GAAP) $1,160 $797 $3,497 $2,342
====== ==== ====== ======
Net Income per Common Share - Diluted (GAAP) $2.50 $2.12 $8.49 $6.72
Adjustments:
U.K. tax rate increase 0.69 - 0.55 -
Foreign currency fluctuation impact
on deferred tax expense (0.25) 0.07 (0.17) -
Merger, acquisitions & transition,
net of tax 0.01 0.01 0.02 0.03
----
Adjusted Earnings Per Share - Diluted (Non-
GAAP) $2.95 $2.20 $8.89 $6.75
===== ===== ===== =====
Reconciliation of net cash provided by operating activities to cash from operations before changes
in operating assets and liabilities:
--------------------------------------------------------------------------------------------------
The press release discusses Apache's cash from operations before changes in operating assets and
liabilities. It is presented because management believes the information is useful for investors
because it is used internally and widely accepted by those following the oil and gas industry as a
financial indicator of a company's ability to generate cash to internally fund exploration and
development activities, fund dividend programs, and service debt. It is also used by research
analysts to value and compare oil and gas exploration and production companies, and is frequently
included in published research when providing investment recommendations. Cash from operations
before changes in operating assets and liabilities, therefore, is an additional measure of
liquidity, but is not a measure of financial performance under GAAP and should not be considered as
an alternative to cash flows from operating, investing, or financing activities.
The following table reconciles net cash provided by operating activities to cash from operations
before changes in operating assets and liabilities.
For the Quarter For the Nine Months
Ended September 30, Ended September 30,
------------------- -------------------
2011 2010 2011 2010
---- ---- ---- ----
Net cash provided by operating activities $2,447 $1,715 $7,171 $4,800
Changes in operating assets and liabilities 241 269 399 587
--- --- --- ---
Cash from operations before changes in
operating assets and liabilities $2,688 $1,984 $7,570 $5,387
====== ====== ====== ======
APA-F
Apache Corporation
CONTACT: Media, Bill Mintz, +1-713-296-7276, or Robert Dye,
+1-713-296-6662; or Investors, Patrick Cassidy, +1-713-296 6100, or Castlen
Kennedy, +1-713-296 7189, all of Apache Corporation
Web site: http://www.apachecorp.com/
