Apache Corporation Announces First-Quarter 2017 Financial and Operational Results

  • Delivered first-quarter production of 481,000 barrels of oil equivalent (Boe) per day and adjusted production of 398,000 Boe per day, which excludes Egypt noncontrolling interest, Egypt tax barrels and 1,100 Boe per day of divested volumes;
  • Returned to profitability with GAAP earnings of $213 million or $0.56 per diluted common share and adjusted earnings of $31 million or $0.08 per share;
  • Delivered capital costs and lease operating expenses (LOE) below plan and lowered LOE per Boe guidance for full-year 2017;
  • Closed on $466 million of noncore asset sales; and
  • Announcing delivery of first gas at Alpine High midstream, two months ahead of schedule. As a result, raising North American production guidance to 256,000 to 264,000 Boe per day for full-year 2017.

HOUSTON, May 4, 2017 – Apache Corporation (NYSE: APA) (Nasdaq: APA) today announced its financial and operational results for the first quarter 2017.

Apache reported earnings of $213 million or $0.56 per diluted common share during the first quarter of 2017. These results include a number of items outside of core earnings that are typically excluded by the investment community in their published earnings estimates. When adjusted for these and certain additional items that impact the comparability of results, Apache’s first-quarter earnings totaled $31 million or $0.08 per share.

Net cash provided by operating activities was $455 million, compared to $239 million in the first quarter of 2016, and adjusted earnings before interest, taxes, depreciation, depletion, amortization and exploration expenses (adjusted EBITDAX) was $999 million, compared to $552 million in the first quarter of 2016. Apache ended the quarter with $1.5 billion of cash, up from $1.4 billion at the end of the fourth quarter of 2016.

John J. Christmann IV, Apache's chief executive officer and president said, “During the first quarter, we delivered strong results and made notable progress toward our 2017 strategic objectives. Earlier this year, we outlined a plan to deliver returns-focused growth by budgeting conservatively, investing to sustain free cash flow internationally, and increasing investment in the Midland and Delaware basins. We are maintaining a razor-sharp focus on costs and well optimization and actively managing our portfolio.

“During the quarter, we continued ramping up activity in our core Midland Basin acreage and are beginning to see significant cost benefits associated with our development drilling in the area. We are looking forward to the growing contribution these assets will have in the quarters to come.

“At Alpine High, testing and delineation have continued with strong results that reinforce our confidence in this world-class resource play. In today’s financial and operational supplement, we included three new test wells, two of which delivered our highest 24-hour oil rates and highest oil cuts to date in the Woodford and the Barnett formations.

“We also made excellent progress on our midstream buildout and initiated production from the play two months ahead of schedule. This has enabled us to raise our North American production guidance to 256,000 to 264,000 Boe per day for the full-year, and, more importantly, gives us the facilities to transition to a more optimized program.

“Optimization activities in the Woodford, Barnett and Pennsylvanian source interval include well spacing and pattern tests, targeted wellbore placement, enhanced completion designs and, in some cases, longer laterals. Our enhanced completions will feature larger fracs with more stages, more fluid and higher sand concentrations. Following extensive, integrated analysis, we are also conducting an appraisal program in the Wolfcamp and Bone Spring parasequences. Information collected from this program, coupled with the extensive knowledge we have gained from our thorough evaluation of the source interval, will inform the buildout of a comprehensive, long-term, full-field development plan,” said Christmann.

Financial position and liquidity

Oil and gas capital investment was $646 million during the quarter, with 68 percent focused on the Permian Basin.

During the quarter, the company closed two noncore Permian acreage transactions for cash proceeds of $440 million. In addition, the company closed $26 million in further noncore divestments. Apache continues to evaluate its portfolio and assess opportunities to further streamline its asset base and redeploy capital into its primary growth areas in North America. At the end of the first quarter, Apache’s net debt position was just under $7 billion, a decrease of $200 million from the previous quarter.

First-quarter operational summary                                                      

During the first quarter, Apache operated an average of 30 rigs and drilled and completed 46 gross-operated wells worldwide. Highlights from Apache’s three principal areas include:

  • North America – Apache drilled and completed 25 gross-operated wells in North America during the first quarter and reported production of 252,000 Boe per day.
  • In the Permian Basin, Apache operated an average of 13 rigs and drilled and completed 22 gross-operated wells during the quarter, up from 17 wells drilled and completed in the fourth quarter. Production averaged 148,000 Boe per day.
  • Delaware Basin:
  • At Alpine High, the company averaged four rigs and announced three new test well results, two of which were shallow source rock tests and the other a successful azimuth test in the Woodford formation at the King Hidalgo pad in the Southern portion of the play.
  • The company also continued pad drilling in Pecos Bend with an average of two rigs.
  • Midland Basin:
  • The company averaged six rigs during the quarter and drilled and completed nine gross-operated wells.
  • Activity targeted the Wolfcamp and Spraberry shale formations in the Wildfire, Azalea and Powell fields.
  • North Sea – Production in the North Sea averaged 58,000 Boe per day. Apache operated two platform rigs during the quarter, with one each at the Forties and Beryl fields. In addition, the company has two semi-submersible drilling rigs under rig sharing agreements and operated one during the quarter. The subsea tieback development at Callater progressed with drilling underway on the first production well and facilities installation. Callater remains on schedule to deliver first production in the third quarter of 2017.
  • Egypt – On a net basis and excluding minority interest and tax barrels, Egypt production was 88,000 Boe per day. Apache averaged 11 rigs and drilled and completed 18 wells during the quarter.

Further operational detail can be found in the First-Quarter 2017 Financial and Operational Supplement.

2017 outlook and plan update

Apache’s 2017 capital expenditures are tracking in line with its guidance of $3.1 billion. LOE is tracking below plan, and the company is reducing full-year 2017 LOE guidance range to $8.25 to $8.75 per Boe. Following strong production and drilling results year-to-date and the early startup of gas flows at Alpine High, the company updated its 2017 North American production guidance to 256,000 to 264,000 Boe per day. Further details can be found in the First-Quarter 2017 Financial and Operational Supplement.

“We have responded well to the challenges facing the industry over the last two years, successfully realigning our cost structure to ensure profitability at $50 oil, streamlining our asset base and significantly improving our capital efficiency, well performance and organic growth prospects. We are now well positioned to deliver returns-focused growth, with our first quarter results indicating solid progress toward our objectives,” concluded Christmann.

Conference call

Apache will host a conference call to discuss its first-quarter 2017 results at 1 p.m. Central time, Thursday, May 4. The conference call will be webcast from Apache's website at and, and the webcast replay will be archived there as well. A replay of the conference call will be available for seven days following the call. The number for the replay is 855-859-2056 or 404-537-3406 for international calls. The conference access code is 48380128. Sign up for email alerts to be reminded of the webcast at

Additional Information

Additional information follows, including reconciliations of adjusted earnings, adjusted EBITDAX and net debt (non-GAAP financial measures) to GAAP measures and information regarding adjusted production. Apache’s quarterly supplement is available at

About Apache

Apache Corporation is an oil and gas exploration and production company with operations in the United States, Canada, Egypt and the United Kingdom. Apache posts announcements, operational updates, investor information and copies of all press releases on its website,, and on its Media and Investor Center mobile application, which is available for free download from the Apple App Store and the Google Play Store.

Non-GAAP financial measures

Apache’s financial information includes information prepared in conformity with generally accepted accounting principles (GAAP) as well as non-GAAP information. It is management’s intent to provide non-GAAP financial information to enhance understanding of our consolidated financial information as prepared in accordance with GAAP. Adjusted earnings, adjusted EBITDAX and net debt are non-GAAP measures. This non-GAAP information should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure.

Forward-looking statements

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,” “guidance,” “outlook,” and similar references to future periods. These statements include, but are not limited to, statements about future plans, expectations and objectives for Apache’s operations, including statements about our capital plans, drilling plans, production expectations, asset sales, and monetizations. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See "Risk Factors" in our 2016 Form 10-K filed with the Securities and Exchange Commission for a discussion of risk factors that affect our business. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development or otherwise, except as may be required by law.

Cautionary note to investors

The United States Securities and Exchange Commission ("SEC") permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SEC's definitions for such terms. Apache may use certain terms in this earnings release, such as "resources," "potential resources," "resource potential," "estimated net reserves," "recoverable reserves," and other similar terms that the SEC guidelines strictly prohibit Apache from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality and other factors, and are therefore not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in Apache's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2016, available from Apache at or by writing Apache at: 2000 Post Oak Blvd., Suite 100, Houston, TX 77056 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC's website at


Investor:  (281) 302-2286       Gary Clark

Media:      (713) 296-7276       Castlen Kennedy                                                     


Click here for the full release with quarterly financial statements.

Click here for the First-Quarter 2017 Financial and Operational Supplement.