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October 2017 Update Webcast – Apache Corp

Apache Corp · Oct 9, 2017 · 60 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. October 2017 Update Webcast – Apache Corp – slide 1
  2. October 2017 Update Webcast – Apache Corp – slide 2
    Corporate overview and 2h17 guidance alpine high update  
  3. October 2017 Update Webcast – Apache Corp – slide 3
  4. October 2017 Update Webcast – Apache Corp – slide 4
    2017 & 2018 PLAN 2017 Plan ? $50/bbl WTI & $3.25/Mcf Henry Hub $3.1 bn capex ? $500 mm Alpine High infrastructure spend $600 mm upstream outspend 2018 Plan $55/bbl WTI g $3/Mcf Henry Hub ? $3.1 bn capex $500 mm Alpine High…
  5. October 2017 Update Webcast – Apache Corp – slide 5
    REGION UPDATE Permian Other Lower 48 Egypt North Sea Suriname Returned to growth in 3Q17 Alpine High production ramp Strong oil production growth in southern Midland Basin Production has stabilized Drilling limited to acreage retention…
  6. October 2017 Update Webcast – Apache Corp – slide 6
    NORTH AMERICA GUIDANCE UPDATE Impacts of Hurricane Harvey ? Operational disruptions from Hurricane Harvey relatively minor Second order impacts of Hurricane Harvey more significant ? delaying delivery of equipment and services: Hidalgo…
  7. October 2017 Update Webcast – Apache Corp – slide 7
    PERMIAN UPDATE ? Permian production bottomed in 2Q17, Midland/Delaware Oil Production Outlook significant growth ramp has commenced Mboe/d Delivering on unconventional oil production 4Q17 Midland+Delaware oil production tracking at…
  8. October 2017 Update Webcast – Apache Corp – slide 8
    INTERNATIONAL GUIDANCE UPDATE ? Revising International production outlook Previous Range Updated Range Extended 3Q17 maintenance turnarounds in Mboe/d North Sea ? North Sea dry hole in Beryl area impacts 4Q17 production ? Recent…
  9. October 2017 Update Webcast – Apache Corp – slide 9
  10. October 2017 Update Webcast – Apache Corp – slide 10
    ALPINE HIGH UPDATE Where we began Accomplishments over the last year Where we are today ? Attractive economics ? Increased location count ? Significant oil associated with the wet gas play Key Alpine High play parameters apache Summary…
  11. October 2017 Update Webcast – Apache Corp – slide 11
    PALEOGEOGRAPHIC RECONSTRUCTION Woodford Time Same geologic age as Arkoma Woodford and SCOOP / STACK Similar depositional environment 
  12. October 2017 Update Webcast – Apache Corp – slide 12
    GEOLOGY OF THE SOUTHERN DELAWARE BASIN 5.000\' 10.000\' WET GAS 15,000\' 20,000\' DRY GAS 25.000\' 30,000 apache South West Alpine High: Alpine High Bone Springs / Wolfcamp Penn / Barnett / Woodford Stable shelf (Paleo high)…
  13. October 2017 Update Webcast – Apache Corp – slide 13
    ALPINE HIGH: A YEAR AGO ALPINE HIGH KEY HIGHLIGHTS World Class Resource Play 307,000 Contiguous Net Acres Wet Gas and Oil Column 20+ Years Of Drilling ? Methodically accumulated over the last 18 months, ?20% of Co. Apache controls…
  14. October 2017 Update Webcast – Apache Corp – slide 14
    KEY ACTIVITIES AND LEARNINGS ? More than 70 wells drilled by Apache on the Alpine High ? Extensive geographic and stratigraphic delineation of the fairway ? High-graded acreage position ? Commenced and progressed extensive…
  15. October 2017 Update Webcast – Apache Corp – slide 15
    INDUSTRY ACTIVITY HAS INCREASED SIGNIFICANTLY SINCE ANNOUNCEMENT September 2016 September 2017 20 Miles APA Operated Rig Competitor Permit Wells 20 Miles * Competitor Wells Drilled/Drilling Apache Acreage Outline One…
  16. October 2017 Update Webcast – Apache Corp – slide 16
    ALPINE HIGH Middle Permian Paleostructure Map Critical Aspects ? Regional anomaly ? Stable Devonian shelf Subsiding eastern limb Later thrust of Davis Mountains
  17. October 2017 Update Webcast – Apache Corp – slide 17
    DIVIDING ALPINE HIGH INTO THREE SETTINGS ALPINE HIGH FAIRWAY Northern Flank Crest Southern Flank N56% Of Alpine High acreage 54% of Alpine High wells drilled to date Activity driven primarily by lease expiration Over-pressured…
  18. October 2017 Update Webcast – Apache Corp – slide 18
    STRUCTURAL CROSS SECTION OF ALPINE HIGH 7,500\' 8,500\' 9,500\' 10,500\' 11,500\' 13,500\' NORTHERN FLANK OIL O O o ET GAS DRY GAS CREST \"60 miles SOUTHERN FLANK Evaporites Transgressive Parasequences Transgressive Source Interval…
  19. October 2017 Update Webcast – Apache Corp – slide 19
    DISTINCT SOURCE ROCK AND PARASEQUENCE INTERVALS High frequency, rapidly rising and falling sea level environment UNCONFORMITY Tranquil marine environment, gradually rising worldwide sea level conditions Woodford + Barnett + Penn ?…
  20. October 2017 Update Webcast – Apache Corp – slide 20
    4,000\' - 5,000\' OF STACKED POTENTIAL PAY MONT BLANC IH 20 Miles Delaware Basin Stratigraphy SPANISH TRAIL IH The stacked pay potential at Alpine High can be seen on the logs of two wells. These were drilled 20 miles apart, and there…
  21. October 2017 Update Webcast – Apache Corp – slide 21
    ALPINE HIGH MATURITY MODEL Transgressive Source Rock Interval 8,000\' | 9,000\' | 10,000\' | 11,000\' | 12,000\' | 13,000\' 14,000\' 4JdChe Redwood Unit Penn ? 1.000 Barnett Weissmies unit Bamett ?C API / 1.440 Upper Woodford ? 54?AP1/…
  22. October 2017 Update Webcast – Apache Corp – slide 22
    ALPINE HIGH MATURITY MODEL Parasequences 8,000\' 9,000\' 10,000\' 11,000\' Cypress Unit Upper Wolfcamp 1355 BTU Wolfcamp ? 1379 BTU Sycamore Unit Upper Wolfcamp 1327 BTU Source Roc* Parasequences Mont Blanc Unit 3rd Bone Spring ?43*…
  23. October 2017 Update Webcast – Apache Corp – slide 23
    KEY PLAY PARAMETERS Structural History Thermal Maturity Reservoir Quality Impact of Deep Seated Faults Seal Integrity of Source Rock Shallow Geologic Complexities 4JdChe ? Initial parameters confirmed and discussed in September 2016 ?…
  24. October 2017 Update Webcast – Apache Corp – slide 24
    ALPINE HIGH LANDING ZONES Confirmed Landing Zones 1 Formation Bone Spring Pennsylvanian Barnett Woodford 3 1 2 3 Landing Zones In Testing ? Number of viable landing zones will vary locally across Alpine High fairway ? Further upside in…
  25. October 2017 Update Webcast – Apache Corp – slide 25
    CURRENT LOCATION COUNT OF 5,000+ Location Distribution Formation Bone Spring Wolfcamp Pennsylvanian Barnett Woodford Wet Gas Additional Location Potential 3,500+ Dry Gas Additional Location Potential 1,000+ Oil 500+ Here we have…
  26. October 2017 Update Webcast – Apache Corp – slide 26
    GEOLOGIC HIGH-GRADING Seismic View of Deep Complexities Elevated Complexity Low Level Complexity Shallow and/or Deep Complexities Alpine HIGH PLAY JEFF DAVIS Culberson We are also working to continually high grade our acreage…
  27. October 2017 Update Webcast – Apache Corp – slide 27
    ACREAGE STATUS AND CONSIDERATIONS ? Apache has leased new acreage over the past year and identified a small area where we will minimize drilling Added acreage in higher quality areas Allowing some acreage with deep and / or shallow…
  28. October 2017 Update Webcast – Apache Corp – slide 28
  29. October 2017 Update Webcast – Apache Corp – slide 29
    CHARACTERIZING THE WET GAS PLAY ? Predominantly in the transgressive source interval ? At least 3,500 well locations ? Oil mix up to 110+ bbls per MMcf ? Gas BTU content up to 1,500 ? Highly economic
  30. October 2017 Update Webcast – Apache Corp – slide 30
    WET GAS WELL PERFORMANCE 10 10 BLACK HAWK STATE  BLANC ?MONT BLANC #203CH Note : Cumulative Gas Production, MMcf BLACK HAWK ST MONT BLANC #101AH CHINOOK #101AH MONT BLANC HUNTER #102CH  MOUT BLANC KING OH  MONT BLANC…
  31. October 2017 Update Webcast – Apache Corp – slide 31
    WET GAS WELL SUMMARY DATA Denotes new disclosure 30-Day Peak IP Cumulative well Name BLACK HAWK STATE CHINOOK#IOIAH UNT HUNTER #101AH UNT HUNTER #102CH BLACK HAWK STATE#IH WEISSMIES WEISSMIES UN A F3H FOXSTATE #101BH +0 MT BLANC #202AH…
  32. October 2017 Update Webcast – Apache Corp – slide 32
    WET GAS PLAY: FULLY BURDENED ECONOMICS Development Scenario (4,400\' Lateral) Typical Well 9 Upper Range Well / well (Bcfe) 15 EUR / Well (Bcfe) 16 21 Fully Burdened Economics @ $50 WTI / $3.00 HHub Fully Burdened Economics @ $50 WTI /…
  33. October 2017 Update Webcast – Apache Corp – slide 33
    ALPINE HIGH WET GAS WELLS Comparison To SCOOP/STACK 100.000 10 10 ?BLACK N WK STATE ?FOX STATE *101 ?MO NT BLANC H ?MO MT BLANC #202A H ?WEISSMIESUN A Source: IDer1ic/ ?rd Drilirg Info. Note: Gross w e\" 4Jdche Alpine High vs.…
  34. October 2017 Update Webcast – Apache Corp – slide 34
    CHARACTERIZING THE DRY GAS PLAY ? Predominantly in the Woodford and Barnett formations on the Northern Flank At least 1,000 well locations BTU content less than 1,050 ? Low well costs and high EURs
  35. October 2017 Update Webcast – Apache Corp – slide 35
    DRY GAS WELL PERFORMANCE Cumulative Gas Production, MMcf ?CYPRESS STATE #101CH CYPRESS STATE *102AH  REDWOOD  RECANOOO SPRUCE STATE *201AH 
  36. October 2017 Update Webcast – Apache Corp – slide 36
    DRY GAS WELL SUMMARY Denotes new disclosure well Name EDWOOD SPRUCE STATE #201AH ESS STATE #102AH REDWOOD ESS STATE #101CH apache Target Barnett Woodford Setting Northern Depth 13,270 13,370 13,920 13,970 14,140 Treated Lateral Length…
  37. October 2017 Update Webcast – Apache Corp – slide 37
    DRY GAS PLAY: FULLY BURDENED ECONOMICS Development Scenario Typical Well / Well (Bcfe) 17 23 Fully Burdened Economics @ $50 WTI / $3.00 HHub NPV-IO ($ MM) BTAX IRR Product Mix % Oil (Mbbls) % NGL (Mbbls) well cost ($ MM) Single Well…
  38. October 2017 Update Webcast – Apache Corp – slide 38
    <p>ALPINE HIGH DRY GAS WELLS Comparison To Marcellus ALPINE HIGH DRY GAS WELLS Alpine High vs. Marcellus Alpine High(l) Ave Lateral Length 4,600 Ave Well Costs $5.5 Marcellus 7,500 $7.0 10 .?CYPRESS STATE #101CH ?REDWOOD #3H…
  39. October 2017 Update Webcast – Apache Corp – slide 39
    CHARACTERIZING THE PARASEQUENCE OIL PLAY The Wolfcamp and Bone Springs is present across majority of Alpine High ? Extremely thick interval with multiple landing targets API gravity ranges from 410 to 450 ? Current location count of…
  40. October 2017 Update Webcast – Apache Corp – slide 40
    1,000 PARASEQUENCE TEST: MONT BLANC 21-1 3rd Bone Spring: 9,130\' TVD / 4,561\' Treated Lateral Gas Rate ? Water Rate ? First oil parasequence test ? Objective: test oil productivity in parasequence API 43 Oil ? Was not drilled on…
  41. October 2017 Update Webcast – Apache Corp – slide 41
    PARASEQUENCE TESTS: SYCAMORE UNIT 401H Upper Wolfcamp: 9,420\' TVD / 7,237\' Treated Lateral 10.1\" 100 Objective: testing proximity to deep complexities Intentionally drilled close to complexity, resulted in Gas Rate ? Water Rate ?…
  42. October 2017 Update Webcast – Apache Corp – slide 42
    PARASEQUENCE TEST: CYPRESS STATE 401H & 402H 401H: Upper Wolfcamp / 9,210\' TVD / 4,590\' Treated Lateral / 440APl 402H: Wolfe-amp / 9,700\' TVD / 4,500\' Treated Lateral / 450 API Cypress State 402H 100 Days on Production Cypress…
  43. October 2017 Update Webcast – Apache Corp – slide 43
    EXAMPLE PAD: SPACING CONFIGURATION Barnett A Barnett B BarnettC 330\' 730\' TLC -2715\' to 101CH -2715\' to Woodford A 400\' TU Woodford3 730\' TLC Woodford C Est Avg Target 400\' TLL Mississippi Lime Woodford B Woodford C
  44. October 2017 Update Webcast – Apache Corp – slide 44
    NORTHERN FLANK DEVELOPMENT EXAMPLE POPLAR UNIT 12 WELLS 800 FT SPACING REDWOOD UNIT 660 FEET SPACING BLACKFOOT UNIT 24 WELLS 660 FT SPACING To date, 
  45. October 2017 Update Webcast – Apache Corp – slide 45
    DRILLING, COMPLETION AND COST OPTIMIZATION Drilling design optimization Drillbit, bottom-hole assembly, drilling fluid Eliminating casing strings in some areas ? Targeting, pattern tests, spacing tests and completion design…
  46. October 2017 Update Webcast – Apache Corp – slide 46
    KEY AREAS OF FOCUS GOING FORWARD Continue to progress drilling and completion optimizations Conducting spacing and pattern tests Testing new landing zones Lateral length and completion designs ? Efficiencies from pad drilling and…
  47. October 2017 Update Webcast – Apache Corp – slide 47
  48. October 2017 Update Webcast – Apache Corp – slide 48
    ALPINE HIGH INFRASTRUCTURE Delivered First Gas Ahead of Schedule 2016 July Aug Sept Oct Nov Jan Start Civil Work Central Processing Facility #1 Takeaway pipe First Gas Sales and Sales Tie-ln Complete 50 MMcf/d CPF #1 5.5 Months…
  49. October 2017 Update Webcast – Apache Corp – slide 49
    30\" TRUNKLINE ~ 70 Miles of Pipe ? Five Segments Northern Sales Connection Sales Pipeline CULBERSON ALPINE HIGH PLAY JEFF DAVIS WARD WAHA HU PECOS Southern Sales Connection The backbone of Alpine High?s infrastructure system is a gas…
  50. October 2017 Update Webcast – Apache Corp – slide 50
    ALPINE HIGH INFRASTRUCTURE Buildout of Wet Gas Processing Capacity 2016 Commence Construction July Aue Sept \' Oct - 50 MMd/d 30 MMd/d Segment I Segment 2 Trunkline and North Sales Complete In Complete 5.5 Months 6 Months 7 Months 8…
  51. October 2017 Update Webcast – Apache Corp – slide 51
    ALPINE HIGH INFRASTRUCTURE Future Plans and Optionality ? Oil and NGL pipelines ? Potential third gas transport line ? Potential for midstream monetization Alpine High upstream will enable extensive midstream enterprise Significant…
  52. October 2017 Update Webcast – Apache Corp – slide 52
    MARKETING Natural Gas Oil NGLs Selling into Mexico via Comanche Trails pipeline ? Expanding marketing periphery Transport away from Waha Selling on alternative basis ? Selling at Midland index Less: transport costs just under $3.00/bbl…
  53. October 2017 Update Webcast – Apache Corp – slide 53
  54. October 2017 Update Webcast – Apache Corp – slide 54
    ALPINE HIGH PRODUCTION Significant ramp in Alpine High production since first sales in May 2017 ? Exceeded June and September 2017 targets of 50 MMcf/d and 100 MMcf/d, respectively Alpine High will replace divested Canadian production…
  55. October 2017 Update Webcast – Apache Corp – slide 55
    CONCLUDING THOUGHTS ? Focus on maximizing value from Alpine High ?Southern Midland basin driving strong oil growth ? International exposure to Brent crude pricing, exciting drilling opportunities in North Sea and Egypt ?2018 and 2019…
  56. October 2017 Update Webcast – Apache Corp – slide 56
  57. October 2017 Update Webcast – Apache Corp – slide 57
    ALPINE HIGH PARASEQUENCE COMPARISON Southern Delaware Basin Offset Operator 10,000 1,000 100 ?sycamore #401AH (UWC) ? Alpine High Oil performance compared to Offset southern Delaware Wolfcamp/Bone Springs field ? Performance of early,…
  58. October 2017 Update Webcast – Apache Corp – slide 58
    WATER RATE COMPARISON Alpine High Source Rock Versus Pecos Bend Area 10,000 1,000 100 producing Time, Days Alpine High Water Production Pecos Bend Wolfcamp/Bone Springs 1,000
  59. October 2017 Update Webcast – Apache Corp – slide 59
    ALPINE HIGH FLUID DISTRIBUTION Para-Sequence Oil TSI Wet Gas TSI Dry Gas 10 MILES
  60. October 2017 Update Webcast – Apache Corp – slide 60
    ALPINE HIGH PRODUCTION Sales Volumes Current Production W/ MRU\'s (BOE/d) Current Production w/ cryo\'s (BOE/d) Formation 3rd Bone Springs & Wolfcamp Penn Woodford & Barnett TOTAL: Active Producing Wells 5 4 25 Gross 1,980…

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