UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2005 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from ____________ to ________________ Commission File Number 0-13546 ------------------ APACHE OFFSHORE INVESTMENT PARTNERSHIP -------------------------------------- (Exact Name of Registrant as Specified in Its Charter) Delaware 41-1464066 ------------------------------ ------------------- (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number) Suite 100, One Post Oak Central 2000 Post Oak Boulevard, Houston, TX 77056-4400 --------------------------------------- ---------- (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, Including Area Code: (713) 296-6000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [_]
PART I - FINANCIAL INFORMATION ITEM 1 - FINANCIAL STATEMENTS APACHE OFFSHORE INVESTMENT PARTNERSHIP STATEMENT OF INCOME (UNAUDITED) FOR THE QUARTER FOR THE SIX MONTHS ENDED JUNE 30, ENDED JUNE 30, ---------------------------- ---------------------------- 2005 2004 2005 2004 ------------ ------------ ------------ ------------ REVENUES: Oil and gas sales $ 3,348,900 $ 3,173,969 $ 6,725,175 $ 6,424,699 Interest income 17,247 6,165 39,635 12,249 ------------ ------------ ------------ ------------ 3,366,147 3,180,134 6,764,810 6,436,948 ------------ ------------ ------------ ------------ EXPENSES: Depreciation, depletion and amortization 448,189 684,091 1,015,225 1,373,297 Asset retirement obligation accretion 11,957 12,096 24,558 24,018 Lease operating costs 290,179 227,161 598,100 425,771 Gathering and transportation expense 41,551 27,128 84,375 62,120 Administrative 107,000 102,000 214,000 204,000 ------------ ------------ ------------ ------------ 898,876 1,052,476 1,936,258 2,089,206 ------------ ------------ ------------ ------------ NET INCOME $ 2,467,271 $ 2,127,658 $ 4,828,552 $ 4,347,742 ============ ============ ============ ============ NET INCOME ALLOCATED TO: Managing Partner $ 570,947 $ 544,883 $ 1,139,360 $ 1,109,162 Investing Partners 1,896,324 1,582,775 3,689,192 3,238,580 ------------ ------------ ------------ ------------ $ 2,467,271 $ 2,127,658 $ 4,828,552 $ 4,347,742 ============ ============ ============ ============ NET INCOME PER INVESTING PARTNER UNIT $ 1,797 $ 1,494 $ 3,495 $ 3,055 ============ ============ ============ ============ WEIGHTED AVERAGE INVESTING PARTNER UNITS OUTSTANDING 1,055.5 1,059.6 1,055.6 1,060.2 ============ ============ ============ ============ The accompanying notes to financial statements are an integral part of this statement. 1
APACHE OFFSHORE INVESTMENT PARTNERSHIP STATEMENT OF CASH FLOWS (UNAUDITED) FOR THE SIX MONTHS ENDED JUNE 30, --------------------------------- 2005 2004 -------------- -------------- CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 4,828,552 $ 4,347,742 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation, depletion and amortization 1,015,225 1,373,297 Asset retirement obligation accretion 24,558 24,018 Dismantlement and abandonment cost - (140,493) Changes in operating assets and liabilities: (Increase) decrease in accrued revenues receivable 198,473 (182,368) Increase (decrease) in accrued operating expenses 20,039 12,175 (Increase) decrease in payable to/receivable from Apache Corporation 191,150 208,679 -------------- -------------- Net cash provided by operating activities 6,277,997 5,643,050 -------------- -------------- CASH FLOWS FROM INVESTING ACTIVITIES: Additions to oil and gas properties (11,870) (827,663) Proceeds from sale of oil and gas properties 136,252 - -------------- -------------- Net cash provided by (used in) investing activities 124,382 (827,663) -------------- -------------- CASH FLOWS FROM FINANCING ACTIVITIES: Repurchase of Partnership Units (3,193) (41,321) Distributions to Investing Partners (4,222,585) (2,121,466) Distributions to Managing Partner (1,238,123) (1,093,123) -------------- -------------- Net cash used in financing activities (5,463,901) (3,255,910) -------------- -------------- NET INCREASE IN CASH AND CASH EQUIVALENTS 938,478 1,559,477 CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 3,333,640 2,271,495 -------------- -------------- CASH AND CASH EQUIVALENTS, END OF PERIOD $ 4,272,118 $ 3,830,972 ============== ============== The accompanying notes to financial statements are an integral part of this statement. 2
APACHE OFFSHORE INVESTMENT PARTNERSHIP BALANCE SHEET (UNAUDITED) JUNE 30, DECEMBER 31, 2005 2004 -------------- -------------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 4,272,118 $ 3,333,640 Accrued revenues receivable 766,848 965,321 Receivable from Apache Corporation - 165,474 -------------- -------------- 5,038,966 4,464,435 -------------- -------------- OIL AND GAS PROPERTIES, on the basis of full cost accounting: Proved properties 183,772,887 184,065,602 Less - Accumulated depreciation, depletion and amortization (177,330,442) (176,315,217) -------------- -------------- 6,442,445 7,750,385 -------------- -------------- $ 11,481,411 $ 12,214,820 ============== ============== LIABILITIES AND PARTNERS' CAPITAL CURRENT LIABILITIES: Accrued operating expenses $ 83,808 $ 63,769 Payable to Apache Corporation 25,676 - -------------- -------------- 109,484 63,769 -------------- -------------- ASSET RETIREMENT OBLIGATION 714,432 858,207 -------------- -------------- PARTNERS' CAPITAL: Managing Partner 108,858 207,621 Investing Partners (1,055.4 and 1,055.7 units outstanding, respectively) 10,548,637 11,085,223 -------------- -------------- 10,657,495 11,292,844 -------------- -------------- $ 11,481,411 $ 12,214,820 ============== ============== The accompanying notes to financial statements are an integral part of this statement. 3
APACHE OFFSHORE INVESTMENT PARTNERSHIP NOTES TO FINANCIAL STATEMENTS (UNAUDITED) The financial statements included herein have been prepared by the Apache Offshore Investment Partnership (the Partnership), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission, and reflect all adjustments which are, in the opinion of management, necessary for a fair statement of the results for the interim periods, on a basis consistent with the annual audited financial statements. All such adjustments are of a normal, recurring nature. Certain information, accounting policies, and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations, although the Partnership believes that the disclosures are adequate to make the information presented not misleading. These financial statements should be read in conjunction with the financial statements and the summary of significant accounting policies and notes thereto included in the Partnership's latest annual report on Form 10-K. 1. RECEIVABLE FROM/PAYABLE TO APACHE CORPORATION The receivable from/payable to Apache Corporation, the Partnership's managing partner (Apache or the Managing Partner), represents the net result of the Investing Partners' revenue and expenditure transactions in the current month. Generally, cash in this amount will be paid by Apache to the Partnership or transferred to Apache in the month after the Partnership's transactions are processed and the net results of operations are determined. 2. RIGHT OF PRESENTMENT As provided in the Partnership Agreement, as amended (the Amended Partnership Agreement), a first right of presentment offer for 2005 of $12,418 per Unit, plus interest to the date of payment, was made to Investing Partners in April 2005, based on a valuation date of December 31, 2004. As a result, the Partnership purchased .25 Units in May 2005 for a total of $3,193. The Investing Partners will have a second right of presentment during the fourth quarter of 2005 based on a valuation date of June 30, 2005. The Partnership is not in a position to predict how many Units will be presented for repurchase during the fourth quarter of 2005 and cannot, at this time, determine if the Partnership will have sufficient funds available to repurchase any Units. The Partnership has no obligation to purchase any Units presented to the extent it determines that it has insufficient funds for such purchases. The Amended Partnership Agreement contains limitations on the number of Units that the Partnership can repurchase, including a limit of 10 percent of the outstanding Units on an annual basis. 3. ASSET RETIREMENT OBLIGATIONS The following table describes changes to the Partnership's asset retirement obligation liability for the six months ended June 30, 2005: Balance at December 31, 2004 $ 858,207 Accretion expense 24,558 Reduction in liability from sale of properties (168,333) ------------ Balance at June 30, 2005 $ 714,432 ============ 4
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS NET INCOME AND REVENUE The Partnership earned $2.5 million during the second quarter of 2005, 16 percent above the net income reported in the second quarter of 2004. Net income per Investing Partner Unit increased to $1,797 in the second quarter of 2005 from $1,494 in the second quarter a year ago. Higher oil and gas prices in the current period more than offset the impact of lower production and higher operating costs. Net income for the first six months of 2005, totaled $4.8 million or $3,495 per Investing Partner Unit. Net income for the same period in 2004 totaled $4.3 million or $3,055 per Investing Partner Unit. Higher oil and gas prices during the first six months of 2005 drove the 11 percent increase in net income from the comparable period in 2004. Total revenues for the second quarter increased six percent from a year ago, increasing from $3.2 million in 2004 to $3.4 million in 2005. For the six months ending June 30, 2005, revenues were $6.8 million, or five percent above the revenues for the same period in 2004 on higher oil and gas prices. The Partnership's oil and gas production volume and price information is summarized in the following table (gas volumes presented in thousand cubic feet (Mcf) per day): FOR THE QUARTER ENDED JUNE 30, FOR THE SIX MONTHS ENDED JUNE 30, ---------------------------------------- ---------------------------------------- INCREASE INCREASE 2005 2004 (DECREASE) 2005 2004 (DECREASE) ---------- ---------- ---------- ---------- ---------- ---------- Gas volume - Mcf per day 3,368 3,640 (7%) 3,420 3,695 (7%) Average gas price - per Mcf $ 6.86 $ 5.97 15% $ 6.79 $ 5.98 14% Oil volume - barrels per day 220 311 (29%) 237 325 (27%) Average oil price - per barrel $ 51.15 $ 37.86 35% $ 49.49 $ 36.50 36% NGL volume - barrels per day 71 63 13% 69 57 21% Average NGL price - per barrel $ 34.14 $ 21.28 60% $ 32.54 $ 23.98 36% OIL AND GAS SALES Natural gas production revenues for the second quarter of 2005 totaled $2.1 million, up six percent from the second quarter of 2004. The Partnership's average realized natural gas price for the second quarter of 2005 increased 15 percent compared to the year-earlier period. The $.89 per Mcf increase in gas price from a year ago positively impacted sales by approximately $.3 million. Natural gas volumes on a daily basis decreased seven percent from a year ago as a result of natural declines at South Timbalier 295 and Matagorda 681/682. The Partnership's crude oil production revenues for the second quarter of 2005 totaled $1.0 million, a four percent decrease from the second quarter of 2004. Oil production for the quarter declined 29 percent from the comparable period in 2004 as a result of natural depletion at South Timbalier 295. A $13.29 per barrel, or 35 percent, increase in the Partnership's average realized oil price favorably impacted oil revenues by $.4 million. Gas sales for the first six months of 2005 of $4.2 million increased four percent, when compared to the same period in 2004. The Partnership's average realized gas prices increased $.81 per Mcf, when compared with the first six months of 2004. Daily gas production for the first six months of 2005 decreased seven percent when compared to the same period in 2004. Declines at South Timbalier 295 and Matagorda 681/682 more than offset production added through drilling at Ship Shoal 258/259 in 2004. For the six months ended June 30, 2005, oil sales decreased two percent from a year ago to $2.1 million. The Partnership's oil sales revenues were favorably impacted by an 36 percent increase in the average realized oil price. Oil production declined 27 percent from a year ago as a result of natural depletion. The Partnership sold an average of 69 barrels per day of natural gas liquids from processing gas during the first six months of 2005, a 21 percent increase over the comparable period in 2004. 5
Declines in oil and gas production can be expected in future periods due to natural depletion. Given the small number of producing wells owned by the Partnership, and their natural depletion, the Partnership's future production will be subject to more volatility than those companies with greater reserves and longer-lived properties. OPERATING EXPENSES The Partnership's depreciation, depletion and amortization (DD&A) rate, expressed as a percentage of oil and gas sales, was approximately 13 percent during the second quarter of 2005 compared to 22 percent during the same period in 2004. This decline in rate reflected the impact of higher oil and gas prices in the current year, reserves added from drilling in the second half of 2004 and the sale of the Partnership's interest in South Pass 83 as discussed under Capital Resources and Liquidity. The Partnership recognized $11,957 of accretion expense on the asset retirement obligation during the second quarter of 2005 and $24,558 for the first six months of 2005. Lease operating expense (LOE) in the second quarter of 2005 increased $63,018 when compared to the second quarter of 2004. The 28 percent increase reflected workover operations on the North Padre Island 976 #A-3 well and repairs to the North Padre Island platform. During the first six months of 2005, LOE totaled $.6 million, up 40 percent from the same period in 2004 on higher repair and maintenance costs and workover costs. Gathering and transportation costs include amounts paid by the Partnership to third parties to transport oil and gas to a purchaser-specified delivery point. Such costs vary based on the volume and distance shipped, and the fee charged by the transporter, which may be price sensitive. The transportation cost may also vary from period to period based on marketing and delivery options utilized by the Partnership to realize the highest net price (gross price less transportation) for either oil or gas. Gathering and transportation costs during the second quarter were up from the second quarter of 2004 as a result of increased volumes from Ship Shoal 258/259. Gathering and transportation costs during the first six months of 2005 were up from a year ago as a result of increased volumes. CAPITAL RESOURCES AND LIQUIDITY The Partnership's primary capital resource is net cash provided by operating activities, which totaled $6.3 million for the first six months of 2005. Net cash provided by operating activities in 2005 was 11 percent above the $5.6 million reported a year ago, reflecting increases in oil and gas prices from 2004. Future cash flows will be influenced by fluctuations in product prices, production levels and operating costs. The Partnership's future financial condition, results of operations and cash from operating activities will largely depend upon prices received for its oil and natural gas production. A substantial portion of the Partnership's production is sold under market-sensitive contracts. Prices for oil and natural gas are subject to fluctuations in response to changes in supply, market uncertainty and a variety of factors beyond the Partnership's control. These factors include worldwide political instability (especially in the Middle East), the foreign supply of oil and natural gas, the price of foreign imports, the level of consumer demand, and the price and availability of alternative fuels. With natural gas accounting for 66 percent of the Partnership's production for the first six months of 2005 and 62 percent of total proved reserves at December 31, 2004, on an energy equivalent basis, the Partnership is affected more by fluctuations in natural gas prices than in oil prices. The Partnership's oil and gas reserves and production will also significantly impact future results of operations and cash from operating activities. The Partnership's production is subject to fluctuations in response to remaining quantities of oil and gas reserves, weather, pipeline capacity, consumer demand, mechanical performance, and workover, recompletion and drilling activities. Declines in oil and gas production can be expected in future years as a result of normal depletion and the Partnership not participating in acquisition or exploration activities. Based on production estimates from independent engineers and current market conditions, the Partnership expects it will be able to meet its liquidity needs for routine operations in the foreseeable future. The Partnership will reduce capital expenditures and distributions to partners as cash from operating activities declines. In the event that future short-term operating cash requirements are greater than the Partnership's financial resources, the Partnership may seek short-term, interest-bearing advances from the Managing Partner as needed. However, the Managing Partner is not obligated to make loans to the Partnership. On an ongoing basis, the Partnership reviews the possible sale of lower value properties prior to incurring associated dismantlement and abandonment cost. In June 2005, the Partnership sold its interest in the South Pass 83 6
field to a third party for $136,252, subject to normal post closing adjustments. The purchaser also assumed all dismantlement and abandonment obligations for the property. The South Pass 83 field had insignificant levels of production at the time of the sale and the divestiture is not expected to materially impact future operating income. CAPITAL COMMITMENTS The Partnership's primary needs for cash are for operating expenses, drilling and recompletion expenditures, future dismantlement and abandonment costs, distributions to Investing Partners, and the purchase of Units offered by Investing Partners under the right of presentment. The Partnership had no outstanding debt or lease commitments at June 30, 2005. The Partnership did not have any contractual obligations as of June 30, 2005, other than the liability for dismantlement and abandonment costs of its oil and gas properties. The Partnership has recorded a separate liability for the fair value of its asset retirement obligations. The Partnership did not participate in any new drilling or recompletion projects during the first half of 2005 and did not have any drilling in progress at December 31, 2004. The Partnership's oil and gas property expenditures during the first half were primarily for seismic costs. Based on information supplied by the operators of the properties, the Partnership anticipates capital expenditures of approximately $.8 million for the remainder of 2005, primarily for drilling two wells at Ship Shoal 258/259. Such estimates may change based on realized prices, drilling results or changes by the operator to the development plan. On March 17, 2005, the Partnership paid distributions to Investing Partners totaling $4.2 million, or $4,000 per Investing Partner unit. The Partnership made a cash distribution to Investing Partners during the first quarter of 2004 of $2,000 per Investing Partner Unit. The amount of future distributions will be dependent on actual and expected production levels, realized and expected oil and gas prices, expected drilling and recompletion expenditures, and prudent cash reserves for future dismantlement and abandonment costs that will be incurred after the Partnership's reserves are depleted. As provided in the Amended Partnership Agreement, a first right of presentment offer for 2005 of $12,418 per Unit was offered to Investing Partners in April 2005, based on a valuation date of December 31, 2004. As a result, the Partnership purchased .25 Units in May 2005 for a total of $3,193. The Investing Partners will have a second right of presentment during the fourth quarter of 2005 based on a valuation date of June 30, 2005. The Partnership is not in a position to predict how many Units will be presented for repurchase during the fourth quarter of 2005 and cannot, at this time, determine if the Partnership will have sufficient funds available to repurchase any Units. The Partnership has no obligation to purchase any Units presented to the extent it determines that it has insufficient funds for such purchases. The Amended Partnership Agreement contains limitations on the number of Units that the Partnership can repurchase, including a limit of 10 percent of the outstanding Units on an annual basis. 7
ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The Partnership's major market risk exposure is in the pricing applicable to its oil and gas production. Realized pricing is primarily driven by the prevailing worldwide price for crude oil and spot prices applicable to its natural gas production. Prices received for oil and gas production have been and remain volatile and unpredictable. The Partnership has not used derivative financial instruments or otherwise engaged in hedging activities during 2004 or the first six months of 2005. The information set forth under "Commodity Risk" in Item 7A of the Partnership's Form 10-K for the year ended December 31, 2004, is incorporated by reference. Information about market risks for the current quarter is not materially different. ITEM 4 - CONTROLS AND PROCEDURES G. Steven Farris, the Managing Partner's President, Chief Executive Officer and Chief Operating Officer, and Roger B. Plank, the Managing Partner's Executive Vice President and Chief Financial Officer, evaluated the effectiveness of the Partnership's disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation and as of the date of that evaluation, these officers concluded that the Partnership's disclosure controls to be effective, providing effective means to insure that information it is required to disclose under applicable laws and regulations is recorded, processed, summarized and reported in a timely manner. Also, no significant changes were made in the Partnership's internal controls over financial reporting during the fiscal quarter ending June 30, 2005 that have materially affected, or are reasonably likely to materially affect, the Partnership's internal control over financial reporting. FORWARD-LOOKING STATEMENTS AND RISK Certain statements in this report, including statements of the future plans, objectives, and expected performance of the Partnership, are forward-looking statements that are dependent on certain events, risks and uncertainties that may be outside the Partnership's control, and which could cause actual results to differ materially from those anticipated. Some of these include, but are not limited to, the market prices of oil and gas, economic and competitive conditions, inflation rates, legislative and regulatory changes, financial market conditions, political and economic uncertainties of foreign governments, future business decisions, and other uncertainties, all of which are difficult to predict. There are numerous uncertainties inherent in estimating quantities of proved oil and gas reserves and in projecting future rates of production and timing of development expenditures. The total amount or timing of actual future production may vary significantly from reserves and production estimates. The drilling of exploratory wells can involve significant risks, including those related to timing, success rates and cost overruns. Lease and rig availability, complex geology and other factors can affect these risks. Fluctuations in oil and gas prices, or a prolonged period of low prices, may substantially adversely affect the Partnership's financial position, results of operations and cash flows. 8
PART II - OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS None. ITEM 2. CHANGES IN SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASES OF EQUITY SECURITIES ISSUER PURCHASES OF EQUITY SECURITIES - -------------------------------------------------------------- TOTAL NUMBER OF UNITS AVERAGE PRICE PERIOD PURCHASED PAID PER UNIT - ------------------------- ------------ ------------- April 1 to April 30, 2005 None N/A May 1 to May 31, 2005 .25 $ 12,418 (1) June 1 to June 30, 2005 None N/A (1) Before interest. Shares are purchased under terms of Amended Partnership Agreement which had previously been announced to Investing Partners in the Partnership. The Amended Partnership Agreement contains limitations on the number of units that can be repurchased including a limit of 10 percent of the Outstanding Units on an annual basis. See Note 2 (Right of Presentment) to the Consolidated Financial Statements for total cash outlays for unit purchases during the quarter and additional limitations. ITEM 3. DEFAULTS UPON SENIOR SECURITIES None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS None. ITEM 5. OTHER INFORMATION None. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K a. Exhibits 31.1 - Certification of Chief Executive Officer 31.2 - Certification of Chief Financial Officer 32.1 - Certification of Chief Executive Officer and Chief Financial Officer b. Reports filed on Form 8-K - None. 9
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. APACHE OFFSHORE INVESTMENT PARTNERSHIP By: Apache Corporation, General Partner Dated: August 8, 2005 /s/ Roger B. Plank ----------------------------------------- Roger B. Plank Executive Vice President and Chief Financial Officer Dated: August 8, 2005 /s/ Thomas L. Mitchell ----------------------------------------- Thomas L. Mitchell Vice President and Controller (Chief Accounting Officer)
EXHIBIT INDEX Exhibits Description of Exhibit - -------- ---------------------- 31.1 - Certification of Chief Executive Officer 31.2 - Certification of Chief Financial Officer 32.1 - Certification of Chief Executive Officer and Chief Financial Officer
EXHIBIT 31.1 CERTIFICATIONS I, G. Steven Farris, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Apache Offshore Investment Partnership; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information ; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ G. Steven Farris - ----------------------------------------------- G. Steven Farris President, Chief Executive Officer and Chief Operating Officer of Apache Corporation, General Partner Date: August 8, 2005
EXHIBIT 31.2 CERTIFICATIONS I, Roger B. Plank, certify that: 1. I have reviewed this quarterly report on Form 10-Q of Apache Offshore Investment Partnership; 2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ Roger B. Plank - ----------------------------------------------------- Roger B. Plank Executive Vice President and Chief Financial Officer of Apache Corporation, General Partner Date: August 8, 2005
EXHIBIT 32.1 APACHE OFFSHORE INVESTMENT PARTNERSHIP BY APACHE CORPORATION, GENERAL PARTNER CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER I, G. Steven Farris, certify that the Quarterly Report of Apache Offshore Investment Partnership on Form 10-Q for the quarterly period ending June 30, 2005, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m or Section 78o (d)) and that information contained in such report fairly represents, in all material respects, the financial condition and results of operations of Apache Offshore Investment Partnership. /s/ G. Steven Farris - -------------------------------------- By: G. Steven Farris Title: President, Chief Executive Officer and Chief Operating Officer I, Roger B. Plank, certify that the Quarterly Report of Apache Offshore Investment Partnership on Form 10-Q for the quarterly period ending June 30, 2005, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m or Section 78o (d)) and that information contained in such report fairly represents, in all material respects, the financial condition and results of operations of Apache Offshore Investment Partnership. /s/ Roger B. Plank - ------------------ By: Roger B. Plank Title: Executive Vice President and Chief Financial Officer