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North American Update – Apache Corp

Apache Corp · Nov 20, 2014 · 110 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. North American Update – Apache Corp – slide 1
  2. North American Update – Apache Corp – slide 2
    TODAYS PRIMARY OBJECTIVES Investment case for stand alone North America Highlight 2014 progress since our Feb. Investor Day Demonstrate our enhanced technical and supply chain capabilities Provide preliminary 2015 and long-term…
  3. North American Update – Apache Corp – slide 3
    KEY UPDATES SINCE FEBRUARY INVESTOR DAY 2014 North American onshore liquids growth tracking at high end of 15-18% guidance Pending S. Louisiana and Anadarko Basin asset sales to raise 1.4 billion Added 1 billion of acreage in key…
  4. North American Update – Apache Corp – slide 4
    HISTORY OF BUILDING PREMIER BUSINESSES Egypt North Sea 1 Oil 1 Efficient Producer Operator Australia Gulf of Mexico* 1 Gas 1 Shelf Supplier in Producer W. Australia * Sold production in 2013, retained 50% deep rights…
  5. North American Update – Apache Corp – slide 5
    HISTORY OF BUILDING PREMIER BUSINESSES Egypt North Sea MBOE/D MBOE/D Forties Production 375 Oil (MBbl/d) 80 Acquired APACHE: 118% above trend 300 Gas (MMcf/d) 70 from BP 60 225 50 150 40 30 75 20 10 0 0 2004…
  6. North American Update – Apache Corp – slide 6
    TRANSFORMATION TO ONSHORE NORTH AMERICA 2009 Production(1) 3Q 2014 Production(2) 34% N.A. 63% N.A. Onshore Onshore International International & GOM & GOM 537 MBOE/D 562 MBOE/D 50% Liquids 60% Liquids N.A. Onshore…
  7. North American Update – Apache Corp – slide 7
    TRANSFORMATION TO ONSHORE NORTH AMERICA Strategic Transactions Monetized GOM Shelf Formed Egypt JV with Sinopec (sold 1/3 interest) Exited Argentina Divested Deepwater GOM development projects Strategic Overview 12
  8. North American Update – Apache Corp – slide 8
    TRANSFORMATION TO ONSHORE NORTH AMERICA North American Onshore International / GOM(1) MBOE/D MBOE/D 350 350 300 300 250 250 200 200 150 150 100 100 50 50 0 0 2009 3Q 2014 2009 3Q 2014 Liquids Natural Gas Liquids Natural Gas…
  9. North American Update – Apache Corp – slide 9
    BUILDING A PREMIER NORTH AMERICAN RESOURCE COMPANY Track record of building premier businesses The right leadership and the right people to create and deliver long-term value in North America Premier acreage positions in four…
  10. North American Update – Apache Corp – slide 10
    PEOPLE 2014 Transformation Appointed John Christmann, COO North America in January Named new regional vice presidents across North America Added an Unconventional Resources Team in San Antonio, expanded office to more than 65…
  11. North American Update – Apache Corp – slide 11
    ACREAGE Size of the Prize TOTAL NORTH AMERICAN ONSHORE Acreage(1): 10.1 MM Gross / 6.4 MM Net Proved Reserves(2): 1.7 BBOE Undeveloped Resource: 13.1 BBOE CANADA CENTRAL PERMIAN GULF COAST (1) Acreage includes pending…
  12. North American Update – Apache Corp – slide 12
    STRATEGY Focused on Organization, Technology and Capital Allocation STRATEGY New integrated team approach with aligned Organization incentives Vertically integrated supply chain Thorough understanding of entire hydrocarbon…
  13. North American Update – Apache Corp – slide 13
    PRELIMINARY 2015 ONSHORE N.A. PLAN 12-16% liquids growth(1) 2015 Regional Capex 8-12% total BOE/D growth(1) 4 Billion Capital budget of 4 Bn Canada 85% of the drilling budget is in 10% 9 primary plays Central Disciplined capital…
  14. North American Update – Apache Corp – slide 14
    5-YEAR ONSHORE N.A. PRODUCTION OUTLOOK Onshore N.A. Liquids Growth of 12%-16% Long-term growth rate unchanged since February 2014 on lower capital budget Driven by oil: Oil mix increases from 45% to 50% Total liquids increases…
  15. North American Update – Apache Corp – slide 15
    RIGHT PEOPLE. RIGHT ACREAGE. RIGHT STRATEGY. 2014 has been a pivotal year in our transformation People: Step change in unconventional expertise and capabilities Acreage: Significant, high-quality acreage in 4 liquids- rich basins…
  16. North American Update – Apache Corp – slide 16
    NORTH AMERICAN OVERVIEW Section Agenda Strategic operating objective People Acreage Strategy Regional summaries Primary plays North American Overview 22
  17. North American Update – Apache Corp – slide 17
    STRATEGIC OPERATING OBJECTIVE: Maximize NPV and ROR Technology Stage Level Innovations Completions Maximize With 3D NPV and Geosteering ROR With 3D Integrated Economic Metrics Team Solutions Global Supply and Inventory Cost…
  18. North American Update – Apache Corp – slide 18
    ACHIEVING OUR OBJECTIVE People: Build the right organization Named 4 new regional vice presidents Added new unconventional group in San Antonio Acreage: Continually high-grade our North American position Added acreage in key…
  19. North American Update – Apache Corp – slide 19
    PEOPLE New Leadership Team John Christmann EVP & COO North America Grady Ables, Tim Sullivan, Steve Keenan, Faron Thibodeaux, RVP Central RVP Canada RVP Unconventional RVP Permian Resources North American Overview 25
  20. North American Update – Apache Corp – slide 20
    PEOPLE Upgraded Unconventional Resource Capabilities Added 100 professionals companywide, 600+ years of combined unconventional resource experience Hired Steve Keenan, RVP Unconventional Resources, in Spring 2014 65 employees in San…
  21. North American Update – Apache Corp – slide 21
    ACREAGE Well Positioned in Four Liquids-Rich Basins TOTAL NORTH AMERICAN ONSHORE Acreage(1): 10.1 MM Gross / 6.4 MM Net Proved Reserves(2): 1.7 BBOE Undeveloped Resource: 13.1 BBOE CANADA CENTRAL Acreage: 3.7 MM Gross / 2.8 MM Net…
  22. North American Update – Apache Corp – slide 22
    ACREAGE Top-Tier Unconventional Liquids Reservoirs North American Resource Plays Wolfcamp Duvernay Canyon Lime Eagle Ford Eagle Ford Bakken (North) (South) Depth (FT) 5,800-8,500 8,000-13,000 7,500-9,500 7,500-13,500 6,500-14,500…
  23. North American Update – Apache Corp – slide 23
    ACREAGE Key Additions in 2014 REGION NET ACRES GULF COAST (Eagle Ford) 106,000 CENTRAL (Canyon Lime) 29,000 PERMIAN 27,000 CANADA (Montney) 22,000 Undercover Plays 121,000 TOTAL 305,000 Investing 1 billion in prime…
  24. North American Update – Apache Corp – slide 24
    ACREAGE Newly Announced Non-Core Property Sales Net current production of 21.5 MBOE/D (62% gas & NGLs) South Louisiana Selling 90K acres, retaining 275K mineral acres Non-core mature fields with high decline rates and short…
  25. North American Update – Apache Corp – slide 25
    STRATEGY Focused on Organization, Technology and Capital Allocation STRATEGY New integrated team approach with aligned Organization incentives Vertically integrated supply chain Thorough understanding of entire hydrocarbon…
  26. North American Update – Apache Corp – slide 26
    ORGANIZATION Integrated Team Approach With Aligned Incentives Geology Petrophysics Geophysics Reservoir Facilities and and Production Marketing MAXIMIZE RECOVERY, NPV AND ROR Completions and Land Supply Chain Drilling…
  27. North American Update – Apache Corp – slide 27
    ORGANIZATION Innovative Supply Chain Solutions Equipment Equipment Maximizing NPV and ROR by Minimizing Costs Sand Water Chemicals North American Overview 33
  28. North American Update – Apache Corp – slide 28
    TECHNOLOGY Maximizing Recovery and Minimizing Cost Emphasis on understanding the entire hydrocarbon system Key innovations and technology Integration of 3D seismic data Drilling Geosteering Completions Customize completions to…
  29. North American Update – Apache Corp – slide 29
    CAPITAL ALLOCATION Driving Higher Returns and Aggregate NPV Previous Methodology Current Methodology Capital allocated to REGIONS Capital allocated to PLAYS Individual REGION PORTFOLIOS One NORTH AMERICAN PORTFOLIO Capex = 4 Bn…
  30. North American Update – Apache Corp – slide 30
    CAPITAL ALLOCATION Play Ranking Metrics Rate of Return (ROR) Eagle Ford Wolfcamp SMB Net Present Value (NPV) Canyon Lime Increasing Impact Delaware Basin Impact Wolfcamp Barnhart (repeatability & scale) Duvernay CBP…
  31. North American Update – Apache Corp – slide 31
    NORTH AMERICAN ONSHORE REGIONS PERMIAN CENTRAL UNCONVENTIONAL RESOURCES TEAM San Antonio GULF COAST CANADA North American Overview 38
  32. North American Update – Apache Corp – slide 32
    PERMIAN REGION Large acreage position of 1.7 MM net acres (3.3 MM gross acres) Focusing capital on 5 865K net acres primary plays: 605K net acres Central Barnhart Wolfcamp 230K net acres Basin Platform Midland SMB Wolfcamp…
  33. North American Update – Apache Corp – slide 33
    PERMIAN Multiple Productive Horizons Delaware Basin CBP/NW Shelf Midland Basin Leonard Lime Mountain Group Bell Canyon Tansil Delaware Cherry Canyon Yates Seven Rivers Leonard Bushy Canyon Guadalupe Bone Spring…
  34. North American Update – Apache Corp – slide 34
    PERMIAN Strong Position Built Over 23 Years 2000 Acquired long-lived producing 1991 properties in the Permian Basin Enters Permian through from Collins & Ware, Inc. 2009 acquisition of MW Petroleum Acquired 9 oil and gas assets from…
  35. North American Update – Apache Corp – slide 35
    PERMIAN Exceptional Organic Production Growth MBOE/D 160 BP and Mariner acquisitions 2014 YTD Net closed in 4Q 2010 140 Growth Drivers Production Adds Barnhart 11,520 BOE/D 120 Delaware Basin 5,500 BOE/D 100 SMB 5,830 BOE/D 80…
  36. North American Update – Apache Corp – slide 36
    PERMIAN Comparative Positioning 230 230 230 230 230 230 220 220 220 220 220 220 210 210 210 210 210 210 200 200 200 200 200 200 190 190 190 190 190 190 180 180 Gas & 180 180 180 180 170 170 170 170 170 170 160 160 NGLs 160 160 160…
  37. North American Update – Apache Corp – slide 37
    PERMIAN 1 Oil Production Growth Leader YTD 2014 over YTD 2013 30% 29% % Oil Production Growth 0% Note: YTD refers to first nine months. North American Overview 44
  38. North American Update – Apache Corp – slide 38
    GULF COAST REGION Transformed to unconventional region in 1 year Exiting South Louisiana (retaining 275,000 mineral acres) Reporting to Unconventional Resources Team in San Antonio Expanded Eagle Ford position to 288,000 net acres…
  39. North American Update – Apache Corp – slide 39
    CENTRAL REGION New region VP; operations VP; and drilling, reservoir, completions and drilling engineering managers Addressed operational issues and anticipate sequential production increase in 4Q 2014 Anadarko Basin:…
  40. North American Update – Apache Corp – slide 40
    CENTRAL REGION Multiple Stacked Plays Granite Wash Cleveland Tonkawa Canyon Lime Cottage Grove Marmaton North American Overview 47
  41. North American Update – Apache Corp – slide 41
    CANADA REGION Applying U.S. unconventional mindset and supply-chain approach to maximize recovery and reduce costs High-graded position over last 2 years Divested approximately 2/3 of well count, 1/3 of acreage and 1/3 of…
  42. North American Update – Apache Corp – slide 42
    NORTH AMERICAN PRIMARY PLAYS Nine Primary Plays Barnhart Wolfcamp SMB Wolfcamp CBP/NW Shelf Horizontals CBP/NW Shelf Verticals Delaware Basin Horizontals Eagle Ford Canyon Lime Duvernay Montney North American Overview 49
  43. North American Update – Apache Corp – slide 43
    NORTH AMERICAN PRIMARY PLAYS Section Agenda 9 primary plays Barnhart Wolfcamp SMB Wolfcamp CBP/NW Shelf Horizontals CBP/NW Shelf Verticals Delaware Basin Horizontals Eagle Ford Canyon Lime Duvernay Montney North American wrap-up North…
  44. North American Update – Apache Corp – slide 44
    TECHNICAL LIFE CYCLE Current Status of Nine Primary Plays Understanding Testing & Early Concept Hydrocarbon Acquiring Data Delineation Full Field Growth System Development CBP/NW SHELF VERTICAL CBP/NW SHELF HORIZONTAL BARNHART…
  45. North American Update – Apache Corp – slide 45
    2015 NORTH AMERICAN CAPITAL PLAN Capex: 4 Bn 9 Primary Plays Barnhart Wolfcamp Canada 10% SMB Wolfcamp CBP/NW Shelf Horizontals Central 15% CBP/NW Shelf Verticals Permian Delaware Basin Horizontals Gulf Coast 55% Eagle Ford…
  46. North American Update – Apache Corp – slide 46
    MIDLAND BASIN WOLFCAMP 330,000 net acres Midland Basin Wolfcamp Shale Two key focus areas Barnhart (40,000 net acres) Southern Midland Glasscock Barnhart Field Irion County Midland Basin Southern Midland Basin Upton…
  47. North American Update – Apache Corp – slide 47
    MIDLAND BASIN WOLFCAMP Key Offset Well Results 30-Day IP Rates, Normalized to 7,500 Shackelton 31W 3H Eastland 15 2WH 1,643 BOE/D(1) 1,124 BOE/D(1) ET ODaniel 2H Martin Howard Lumberjack 32 3H 2,598 BOE/D (24hr) 1,341 BOE/D…
  48. North American Update – Apache Corp – slide 48
    MIDLAND BASIN WOLFCAMP Recent Acreage Transactions Marketing now Martin Howard Current 37,500/acre 34,500/acre Sep 2014 Ector Midland Glasscock Feb 2014 34,900/acre Multiple Jul 2014 33,800/acre Undisclosed 20,800/acre…
  49. North American Update – Apache Corp – slide 49
    BARNHART AREA WOLFCAMP Maximizing Recovery and Minimizing Cost Acres 40,000 net Planned 2015 Rigs 4 Planned 2015 Wells 50 Inventory 600 locations Current Production 29,600 BOE/D, gross Barnhart Field Midland Glasscock Enhanced…
  50. North American Update – Apache Corp – slide 50
    BARNHART AREA WOLFCAMP Maximizing Recovery Cumulative Production (MBOE) Proppant (LBS/FT) 100 89% 3Q2013 4Q2013 1Q2014 2Q2014 3Q2014 Old design 50 Higher sand loading is driving higher returns Completion innovations have…
  51. North American Update – Apache Corp – slide 51
    BARNHART AREA WOLFCAMP Minimizing Cost Centralized hub-and-spoke frac water handling and storage 1.5 million barrels of capacity Recycling 100% of produced Hub-and-Spoke water 20% savings by recycling water Water savings, fewer…
  52. North American Update – Apache Corp – slide 52
    BARNHART WOLFCAMP Type Curve and Economics BOE/D Wolfcamp Shale: Barnhart Drilling Economics 600 D+C Cost MM 7.1 500 EUR MBOE 600 400 30-Day IP Rate (BOE/D) 558 % Oil / Gas / NGL 50% / 24% / 26% 300 WI / NRI 86% / 65% 200 ROR…
  53. North American Update – Apache Corp – slide 53
    BARNHART AREA WOLFCAMP Natural Gas Oil MCF/D Gross Monthly Production BBLS/D 90,000 18,000 80,000 16,000 70,000 14,000 60,000 12,000 50,000 10,000 40,000 8,000 30,000 6,000 20,000 4,000 10,000 2,000 - - North…
  54. North American Update – Apache Corp – slide 54
    SOUTHERN MIDLAND BASIN WOLFCAMP Focused Transition From Barnhart to SMB Rigs 12 Wolfcamp Rig Count 9 - 12 10 8 6 4 2 0 2013 2014 2015 Barnhart SMB North American Primary Plays 62
  55. North American Update – Apache Corp – slide 55
    SOUTHERN MIDLAND BASIN WOLFCAMP Maximizing Recovery and Minimizing Costs Acres 200,000 net Planned 2015 Rigs 9-12 rigs Glasscock Wildfire Planned 2015 Wells 115 wells Midland Scottish Rite Hospital Inventory 2,900 locations…
  56. North American Update – Apache Corp – slide 56
    SOUTHERN MIDLAND BASIN WOLFCAMP Type Curve and Economics BOE/D Wolfcamp Shale: Southern Midland Basin 1,000 Drilling Economics D+C Cost MM 7.9 800 EUR MBOE 702 30-Day IP Rate (BOE/D) 901 600 % Oil / Gas / NGL 58% / 18% / 24% 400…
  57. North American Update – Apache Corp – slide 57
    SOUTHERN MIDLAND BASIN WOLFCAMP Natural Gas Oil MCF/D Gross Monthly Production BBL/D 20,000 9,000 18,000 8,000 16,000 7,000 14,000 6,000 12,000 5,000 10,000 4,000 8,000 3,000 6,000 4,000 2,000 2,000 1,000 - - North…
  58. North American Update – Apache Corp – slide 58
    CENTRAL BASIN PLATFORM / NORTHWEST SHELF Maximizing Recovery and Minimizing Cost Acres 865,000 net Planned 2015 Rigs 10 rigs (7 Hz, 3 Vt) Planned 2015 Wells 195 wells (105 Hz, 95 Vt) Northwest Shelf Inventory 1,000 Hz locations…
  59. North American Update – Apache Corp – slide 59
    CENTRAL BASIN PLATFORM / NORTHWEST SHELF Type Curve and Economics BOE/D HORIZONTALS BOE/D VERTICALS 600 600 500 500 400 400 300 300 200 200 100 100 0 0 0 6 12 18 24 30 36 42 48 54 60 0 6 12 18 24 30 36 42 48 54 60 Month Month…
  60. North American Update – Apache Corp – slide 60
    DELAWARE BASIN HORIZONTALS Maximizing Recovery and Minimizing Cost Acres 230,000 net Lea Planned 2015 Rigs 4-5 rigs Pecos Bend Eddy Planned 2015 Wells 30 wells Inventory 1,400 Hz locations Loving Winkler WAHA Current Production…
  61. North American Update – Apache Corp – slide 61
    DELAWARE BASIN HORIZONTALS Type Curve and Economics BOE/D Delaware Basin Horizontals 1,000 Drilling Economics D+C Cost MM 8.0 800 EUR MBOE 554 30-Day IP Rate (BOE/D) 888 600 % Oil / Gas / NGL 55% / 23% / 22% 400 WI / NRI 93% /…
  62. North American Update – Apache Corp – slide 62
    DELAWARE BASIN HORIZONTAL PRODUCTION Natural Gas Oil MCF/D Gross Monthly Production BBL/D 25,000 8,000 7,000 20,000 6,000 15,000 5,000 4,000 10,000 3,000 2,000 5,000 1,000 0 0 Jun-13 Jun-14 Aug-13 Sep-13…
  63. North American Update – Apache Corp – slide 63
    EAGLE FORD Maximizing Recovery and Minimizing Cost Grant 1H 1,292 BOE/D(1) Robertson Acres 288,000 net 5,910 lateral Planned 2015 Rigs 12 (7) Brazos Planned 2015 Wells 90 wells Grant 2H College Station Inventory(2) 3,000 Hz…
  64. North American Update – Apache Corp – slide 64
    EAGLE FORD Dominant Position Robertson Brazos Anadarko Grimes Burleson Clayton Williams Lee Devon Washington EOG Austin Fayette Halcon Colorado Laredo Energy Gonzales Apache Acreage: Lavaca 551,000 Gross…
  65. North American Update – Apache Corp – slide 65
    EAGLE FORD Successful Downspacing Tests at Reveille Reveille Pad Encouraging early results for 500 1,000 Spacing spacing tests Wells Potential for further downspacing 15,000 12,500 Cumulative Production (BOE) 10,000 500'…
  66. North American Update – Apache Corp – slide 66
    EAGLE FORD Type Curve and Economics Eagle Ford (Area A) Eagle Ford (Area B) BOE/D BOE/D 1,600 1,600 Grant 2H (IP 1,614 BOE/D) 1,400 1,400 Grant 1H (IP 1,292 BOE/D) 1,200 1,200 1,000 1,000 800 800 600 600 400 400 200 200 0 0 0 6…
  67. North American Update – Apache Corp – slide 67
    EAGLE FORD Major Growth Driver in 2015 BOE/D Rigs 45,000 14 40,000 12 35,000 10 30,000 25,000 8 20,000 6 15,000 4 10,000 2 5,000 0 0 4Q13 1Q13 2Q14 3Q14 4Q14 1Q15P 2Q15P 3Q15P 4Q15P North American Primary Plays 75
  68. North American Update – Apache Corp – slide 68
    CANYON LIME Maximizing Recovery and Minimizing Cost Acres 130,000 net Planned 2015 Rigs 4-5 rigs Bivins East 41-1H* Planned 2015 Wells 35 horizontal wells 30-Day IP: 787 BOE/D Lateral length: 5,500 Inventory 800 Hz locations Cum…
  69. North American Update – Apache Corp – slide 69
    CANYON LIME Type Curve and Economics BOE/D Canyon Lime 1,200 Drilling Economics D+C Cost MM 8.5 1,000 EUR MBOE 377 800 30-Day IP Rate (BOE/D) 1,021 % Oil / Gas / NGL 50% / 20% / 30% 600 WI / NRI 85% / 64% 400 ROR 63% 200 BFIT…
  70. North American Update – Apache Corp – slide 70
    DUVERNAY AND MONTNEY Maximizing Recovery and Minimizing Cost APA Acreage Montney Wapiti Area Duvernay Kaybob Area Alberta Montney Duvernay Acres 148,000 net Acres 177,600 net Planned 2015 Rigs 1 rig Planned 2015 Rigs 2 rigs…
  71. North American Update – Apache Corp – slide 71
    DUVERNAY Maximizing Recovery and Minimizing Cost Currently drilling seven 100/02-28-062-20W5 well pad: testing 6 and IP: 1,963 BOE/D* 8 wells per section with 1-mile lateral Testing 1.5-mile lateral in 2015 Smoke…
  72. North American Update – Apache Corp – slide 72
    DUVERNAY Minimizing Cost Science Completions 20.0 Well Optimization Well Cost & Savings, MM Supply Chain 15.0 5.1 Optimization 1.2 10.0 18.1 13.0 11.8 5.0 - 2014 2015 2016+ *All capital in MM USD. Excludes…
  73. North American Update – Apache Corp – slide 73
    MONTNEY Maximizing Recovery and Minimizing Cost 9W6 8W6 7W6 6W6 5W6 70 Plan to test Lower Montney in Q1 2015 69 Potential to increase MONTNEY TYPE LOG GR MD ResD location inventory by 50% Nordegg 68 Testing 1.5-mile lateral…
  74. North American Update – Apache Corp – slide 74
    DUVERNAY AND MONTNEY Type Curve and Economics BOE/D Duvernay BOE/D Montney 1,800 1,800 1,600 1,600 1,400 1,400 1,200 1,200 1,000 1,000 800 800 600 600 400 400 200 200 0 0 0 6 12 18 24 30 36 42 48 54 60 0 6 12 18 24 30 36 42 48…
  75. North American Update – Apache Corp – slide 75
    NORTH AMERICAN PRIMARY PLAYS 2015 2015 GROSS WELL NPV per WELL PLAY RIGS WELLS COST (MM) (MM) SMB Wolfcamp 9 to 12 115 7.9 6.1 CBP/NW Shelf Horizontals 7 105 5.1 4.0 CBP/NW Shelf Verticals 3 90 2.0 2.0 Eagle Ford A 10 75 8.4 3.5 Barnhart…
  76. North American Update – Apache Corp – slide 76
    TECHNICAL DISCUSSION AND CASE STUDIES Section Agenda Our approach Canyon Lime case study Eagle Ford case study Supply chain Technical Discussion and Case Studies 86
  77. North American Update – Apache Corp – slide 77
    THE CAPACITY OF THE INDIVIDUAL IS INFINITE. LIMITATIONS ARE LARGELY OF HABIT, CONVENTION, ACCEPTANCE OF THINGS AS THEY ARE, FEAR OR LACK OF SELF CONFIDENCE. - RAYMOND PLANK 1964 Canyon Lime drilling at Bivins Ranch.
  78. North American Update – Apache Corp – slide 78
    CONTRASTING CONVENTIONAL & UNCONVENTIONAL Hydrocarbon Accumulation CONVENTIONAL Hydrocarbon accumulations are controlled by: Migration pathways Reservoir quality Sealing capacity Trap integrity Density fractionation…
  79. North American Update – Apache Corp – slide 79
    CONTRASTING CONVENTIONAL & UNCONVENTIONAL Type and Magnitude of Pore Space Organic Matter Pores Wolf Camp AA Wolfcamp Mixed Pore Eagle Mixed Pore Eagle Ford: Ford Network Network 1 to 5 microns Canyon Lime Canyon…
  80. North American Update – Apache Corp – slide 80
    CONSTRASTING CONVENTIONAL & UNCONVENTIONAL Understanding the Difference UNCONVENTIONAL CONVENTIONAL RESERVOIRS RESERVOIRS DYNAMIC system STATIC system Forces of EXPULSION OPERATIVE Forces of BUOYANCY MAXIMIZING RECOVERY requires…
  81. North American Update – Apache Corp – slide 81
    DEFINING THE HYDROCARBON SYSTEM IS CRITICAL Global factors impacting well productivity: Ro / thermal gradient TOC / hydrocarbon saturation Mineralogy Reservoir thickness Pressure gradient Fluid properties phase behavior Reservoir…
  82. North American Update – Apache Corp – slide 82
    DEFINING THE HYDROCARBON SYSTEM IS CRITICAL Local sweet spot determinants: Stress field aberrations Depletion effects Mechanical stratigraphy & flow mechanisms Structural complexity Effective hydraulic stimulation History of…
  83. North American Update – Apache Corp – slide 83
    UNCONVENTIONAL: MINING OPERATION APACHE MINE 38 Apache is focused on MAXIMIZING recovery. Technical Discussion and Case Studies 93
  84. North American Update – Apache Corp – slide 84
    UNCONVENTIONAL: ASSEMBLY LINE Requires collaboration working in parallel, not in series Apache has implemented an integrated team approach to ensure collaboration. Technical Discussion and Case Studies 94
  85. North American Update – Apache Corp – slide 85
    STRATEGIC OPERATING OBJECTIVE: Maximize NPV and ROR Technology Stage Level Innovations Completions Maximize With 3D NPV and Geosteering ROR With 3D Integrated Economic Metrics Team Solutions Global Supply and Inventory Cost…
  86. North American Update – Apache Corp – slide 86
    INTEGRATED TEAMS Critical Tactical Measure Technology Stage Level Innovations Completions Maximize With 3D NPV and Geosteering ROR With 3D Integrated Economic Metrics Team Solutions Global Supply and Inventory Cost Chain…
  87. North American Update – Apache Corp – slide 87
    INTEGRATED TEAMS New Organizational Approach Geology Petrophysics Geophysics Reservoir Facilities and and Production Marketing MAXIMIZE RECOVERY, NPV AND ROR EXECUTION Completions and Land Supply Chain Drilling and…
  88. North American Update – Apache Corp – slide 88
    CANYON LIME CASE STUDY Technology Stage Level Innovations Completions Maximize With 3D NPV and Geosteering ROR With 3D Integrated Economic Metrics Team Solutions Global Supply and Inventory Cost Chain Ranking Optimization…
  89. North American Update – Apache Corp – slide 89
    CANYON LIME CASE STUDY Bivins East 41-1H Canyon Lime Discovery Well 30-day IP: 787 BOE/D Cum: 54,286 BO (215 Days) Lateral length*: 5,100 Bivins East 94-1H 30-day IP: 1,718 BOE/D Cum: 80,087 BO (175 Days) Lateral length:…
  90. North American Update – Apache Corp – slide 90
    CANYON LIME CASE STUDY Confirmation and Delineation Strategy Minimize penetration of drilling hazards identified on 3D seismic data Experiment with casing design and penetration inclination within Wash Out shale hazard zone Test…
  91. North American Update – Apache Corp – slide 91
    CANYON LIME CASE STUDY Hazard Zones Using 3D Attributes PANHANDLE FIELD SW Cumulative Production: NE 1.4 BBO, 8.1 TCF Lost Circulation Zones (Pg = 0.361 PSI/FT) Technical Discussion and Case Studies 101
  92. North American Update – Apache Corp – slide 92
    CANYON LIME CASE STUDY Geosteering with 3D Drilled 6 new wells using 3D attributes No circulation losses occurred 100% within target zone, average lateral length of 6,000 feet Average spud to TD = 37 days Average drilling cost…
  93. North American Update – Apache Corp – slide 93
    CANYON LIME CASE STUDY Reducing Drilling Time Using 3D Seismic Bivins Ranch: Depth vs. Days Average reduction of 23 days per well. Avg. (5) Vertical wells planned without 3D seismic integration Avg. (4) Hz wells planned without…
  94. North American Update – Apache Corp – slide 94
    CANYON LIME CASE STUDY Stage Level Completions Using 3D Seismic Generated Definitive Attributes Identified drilling and completions hazards Identified locations of enhanced system porosity and permeability Correlated completions…
  95. North American Update – Apache Corp – slide 95
    CANYON LIME CASE STUDY Development Strategy and Testing the Hazard 600 Total Locations (100 probable locations within Hazard Polygon) 2014 Wells 2015 Wells 2016+ Wells Wells in HZD Pipelines Technical Discussion and…
  96. North American Update – Apache Corp – slide 96
    CANYON LIME CASE STUDY Development Strategy and Testing the Hazard 800 Total Locations (100 probable & 200 possible locations within Hazard Polygon) 2014 Wells 2015 Wells 2016+ Wells Wells in HZD Pipelines Technical…
  97. North American Update – Apache Corp – slide 97
    EAGLE FORD CASE STUDY Technology Stage Level Innovations Completions Maximize With 3D NPV and Geosteering ROR With 3D Integrated Economic Metrics Team Solutions Global Supply and Inventory Cost Chain Ranking Optimization…
  98. North American Update – Apache Corp – slide 98
    EAGLE FORD CASE STUDY Acreage: 551,000 Gross Robertson 288,000 Net Brazos Burleson D C Lee Grimes B Washington Bastrop Austin Fayette Walker Colorado Gonzales A Lavaca APA Acreage Technical Discussion…
  99. North American Update – Apache Corp – slide 99
    EAGLE FORD CASE STUDY San Marcos Arch Cross Section A B C D AMMEX PETROLEUM CORP BROWNING OIL COMPANY INCORPORATED APACHE CORP AMOCO PROD CO STEFANIE ANGELA MARIA ELSIK TEXAS A&M 1 1 4H (EF) PILOT 1 GIDDINGS GIDDINGS GIDDINGS…
  100. North American Update – Apache Corp – slide 100
    EAGLE FORD CASE STUDY Testing the Play Experimental Parameters: Fluid systems Well spacing evaluation (Reveille and Brazos River) Perforation density Stage length Proppant type and loading Well bore geometry: toe up and down…

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