APACHE REVIEW JEFFERIES INTERNATIONAL NOVEMBER 16 17
3Q 2011 RESULTS 752 MBOE/D net Apache record 983 MM net income Up 28 % YOY 1.2 BN* adjusted earnings Up 46 % YOY 2.7 BN* cash flow Apache record *Cash from operations before changes in operating assets and liabilities and…
3Q 2011: FINANCIAL STRENGTH Capex: 1.88 BN Debt: Paid down 650 MM in 3Q 20.5% debt/cap Down from 23% at end of 2Q11, and 25% at EOY 2010 4
DRIVEN BY A UNIQUE CULTURE Relentless pursuit of opportunity Sense of urgency Empower Apaches to make decisions that create value Independent thinking: dont follow the herd Balanced, financially conservative 6
CONSISTENT RATE OF RETURN FOCUS 14.0% 2010 ROACE 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% A APA C D E F G H I J 7 Peers displayed: Anadarko, Chesapeake, Devon, Encana, EOG, Newfield, Noble, Occidental and Talisman
PERFORMANCE ACROSS THE CYCLE ROR AT Rate of Return on Drilling Program /BOE 100 40% Drilling WTI Capital ROR 90 35% 80 30% 70 25% All Costs 60 ROR 20% 50 HH NatGas 40 15% 30 10% 20 5% 10 0% 0 2003 2004 2005 2006…
STRENGTH IN BALANCE, REACH Hydrocarbon Province Product, Market Argentina Permian 50 MBOE/D 94 MBOE/D N. America Central Liquids 47 MBOE/D 21% N. America Egypt Gulf Coast 166 MBOE/D 25 MBOE/D NatGas 33% Canada 122 MBOE/D…
GENERATE VALUE ACROSS THE E&P SPECTRUM Broad capability set, long track record of operational delivery enable balanced value creation for Apache North America Egypt Australia North Sea Argentina W. Australia Exploration GOM, WCSB…
3Q 2011: STEADY, BROAD BASED PROGRESS Region 3Q Rigs Highlight Permian 24 132 new wells spud, horizontal redevelopment of Deadwood Central 9 Granite Wash, horizontal oil plays, Bivins Ranch new venture play GOM Shelf 5 100%…
OPPORTUNITY SET: A BROAD PORTFOLIO Permian CBP Horizontals Deepwater Heidelberg Australia Julimar/Wheatstone Eunice Area NM Exploration Zola Deadwood GC Onshore Gulf Coast Onshore Exploration Spraberry Canada Enhanced Oil Recovery…
AUSTRALIA REGION REVIEW Apache 3 acreage holder in Carnarvon Basin Indian Ocean 6.7 MM gross acres in Carnarvon Prolific area Similar size to GOM, 5% of wells 71 MBOE/D (3Q 2011) Project pipeline from exploration Projects…
PROJECTS DRIVING FUTURE GROWTH 15
REINDEER / DEVIL CREEK APA WI: 55% (Operator) First Gas Forecast: YE2011 Current Progress: Commissioning Current Forecast 1,005 MM (32 in 2012+) Partner: Santos 45% WAs third domestic gas hub (1st greenfield gas plant in…
MACEDON APA WI: 28.57% (Non Operator) First Gas Target: 2013 Current Progress: 39% (Sept11) Project Cost Estimate 1,500 MM gross 429 MM net Partner: BHP Billiton (Op) 71.43% FID: Sept 2010 Apaches 3rd WA domestic gas…
CONISTON APA WI: 45.675% (Operator) First Oil Target: Q4 2013 Current Progress: 5% (Sept11) Current Forecast 537 MM gross Partner: INPEX 41.324% Woodside 13.000% FID: Feb 2011 Board approved in Feb. 2011 All major…
BALNAVES APA WI: 65% (Op) First Oil Target: Q1 2014 Current Progress: 2% (Sept11) Current Forecast 438 MM gross 293 MM net Partner: Kufpec 35% FID: July 2011 FPSO contract was signed with Bumi Armada 30Sep11 Field…
JULIMAR / WHEATSTONE APA WI: 65% (Julimar Operator) First Gas Target: First LNG Cargo 31Dec16 Current Progress: 5% (Sept11) Current Forecast: 4,000 MM net (for field and facility development) Partner: KUFPEC 35% FID: Sept…
GREATER EAST SPAR APA WI: 55% (Op) Spar2 Halyard (Ph 1) Beam First Gas Target: Q4 2013 Current Progress: PreFID Current Forecast 115 MM gross New PLEM and 65 MM net New PLEM and cooling coils Partner: Santos 45% reconfigure…
EXPLORATION RUNNING ROOM Northern Exmouth Outer Barrow/ Plateau Rankin Arch 2.4 MM gross acres 1.0 MM gross acres Pursuing LNGscale Continued gas opportunities exploration for La Rocca1 learnings domestic and LNGscale…
20122014 E&D DRILLING OPPORTUNITIES 23
2011 EXPLORATION: ZOLA DISCOVERY March 2011 field discovery 410 net gas pay APA operator, 30.25% WI Near existing + future infrastructure Next step: field appraisal Initial composition analysis indicates 2030% inerts…
2011 EXPLORATION: BALNAVES DEEP DISCOVERY April 2011 discovery beneath Balnaves oil pool: 86 oil pay, 276 gas pay APA operator, 65% WI Current estimate: 370 BCF P50 Area = Increases JulimarBrunello 5,400 Acres complex to 2.5…
OUR KEY MESSAGES TODAY 3Q underlines strength of operations, value of portfolio Focus unchanged: Rate of return Portfolio balance Balance sheet strength Profitable long term growth Structural price upside Robust multiyear growth…
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