FORWARD-LOOKING STATEMENTS

Transcription

1 December 8, 2015

2 FORWARD-LOOKING STATEMENTS Certain statements in this presentation contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934 including, without limitation, expectations, beliefs, plans and objectives regarding anticipated financial and operating results, asset divestitures, estimated reserves, drilling locations, capital expenditures, price estimates, typical well results and well profiles, type curve, and production and operating expense guidance included in this presentation. Any matters that are not historical facts are forward looking and, accordingly, involve estimates, assumptions, risks and uncertainties, including, without limitation, risks, uncertainties and other factors discussed in our most recently filed Annual Report on Form 10-K, recent Quarterly Reports on Form 10-Q, recent filed Current Reports on Form 8-K available on our website, and in our other public filings and press releases. These forward-looking statements are based on Apache Corporation s (Apache) current expectations, estimates and projections about the company, its industry, its management s beliefs and certain assumptions made by management. No assurance can be given that such expectations, estimates or projections will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed in this presentation, including, Apache s ability to meet its production targets, successfully manage its capital expenditures and to complete, test and produce the wells and prospects identified in this presentation; to successfully plan, secure necessary government approvals, finance, build and operate the necessary infrastructure; and to achieve its production and budget expectations on its projects. Whenever possible, these forward-looking statements are identified by words such as expects, believes, anticipates, projects,, guidance and similar phrases. Because such statements involve risks and uncertainties, Apache s actual results and performance may differ materially from the results expressed or implied by such forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Unless legally required, we assume no duty to update these statements as of any future date. However, you should review carefully reports and documents that Apache files periodically with the Securities and Exchange Commission. 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 presentation, such as resource, resource potential, net resource potential, potential resource, resource base, identified resources, potential net recoverable, potential reserves, unbooked resources, economic resources, net resources, undeveloped resource, net risked resources, inventory 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 December 31, 2014, available from Apache at or by writing Apache at: 2000 Post Oak Blvd., Suite 100, Houston, Texas (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling SEC-0330 or from the SEC's website at 1

3 NORTH SEA EXPLORATION UPDATE CORY LOEGERING, REGION VP AND MANAGING DIRECTOR NORTH SEA 2

4 APACHE TODAY Realigned the organization and streamlined the portfolio Significantly strengthened the balance sheet Aligned activity and capital spend for current price environment Aggressively reducing all facets of the cost structure International will deliver free cash flow with upside potential 3

5 APACHE NORTH SEA IS HIGHLY DIFFERENTIATED Two of the most prolific North Sea hydrocarbon accumulations at Forties and Beryl Significant prior infrastructure investment Best-in-class production efficiency Advantaged pipeline and platform locations Industry-leading operating costs in North Sea 4

6 ~50% OPERATING COST ADVANTAGE Unit Operating Cost ($/Boe) $35 $30 Apache UK North Sea Avg $27.07 $30.49 $25 $22.19 $20 $15 $13.46 $13.76 $17.64 $14.74 $16.66 $13.62 $10 $7.02 $8.03 $10.37 $11.49 $5 $ Source: Oil and Gas UK 2015 Activity Survey 5

7 MORE FUTURE CAPITAL TOWARDS DRILLING Capital (1) Capital (1,2) Infrastructure 44% Drilling and Completion 51% Seismic and Exploration 10% Infrastructure Dummy Data 12% Drilling and Completion 78% Seismic and Exploration 5% (1) Excludes acquisitions. (2) Based on Apache mean-risked reserve and capital spending case. 6

8 FORTIES Largest oil field in the U.K. North Sea 15 miles Acquired in April 2003 from BP for $630 million Field is one large 4-way structural closure Apache has invested $2.3 billion in infrastructure and $2.3 billion on drilling and workovers Forties Field Outline Apache 3Q 15 Net Production 20 miles Estimated OOIP Total Cumulative Gross Production 41,000 Boe/d 5 Billion Boe 2.6 Billion Boe 7

9 FORTIES Exceptional field revival Net Production Net Proved Reserves Years Until Decommission Date Mboe/d MMBoe Years MBoe/d Added MMBoe Produced Extended Decommission Date Several Years At Acquisition (2003) 2014 At Acquisition (2003) 2014 At Acquisition (2003)

10 FORTIES Acquired inventory targets identified at time of acquisition Bravo Charlie Delta Alpha FASP Echo Identified targets 9

11 FORTIES Substantial low-risk inventory remaining 84 targets currently identified 2016 seismic will increase the count Bravo Charlie Alpha FASP Delta Echo All targets drilled by Apache Remaining targets 10

12 FORTIES Significant reserves remain Giant field: 5 billion barrels of original oil in place ~2.6 billion barrels recovered to date (52% Rf) Each 1% additional recovery is ~50 million barrels 4D seismic shoots and increased water injection continuously expands the potential location count 11

13 BERYL AREA Significant growth potential Acquired in January 2012 from ExxonMobil for $1.44 billion APA has invested ~$300 million in infrastructure Exceptional exploration and development success in Q 2015 production of ~26,000 Boe/d L4S: 30-Day IP 9679 Boe/d Beryl Area Recent Well Results Beryl Nevis Ness Buckland Corona discovery BCE: 30-Day IP 6916 Boe/d BDE: 30-Day IP 1071 Boe/d BLA: 30-Day IP 1670 Boe/d ACN: 30-Day IP 9496 Boe/d K discovery Skene 12

14 BERYL AREA Acquired targets targets at time of acquisition Targets at acquisition Platforms 13

15 BERYL AREA New 3D seismic generated 8x inventory increase 81 targets remaining Apache drilled targets Remaining targets Platforms 14

16 BERYL AREA Substantial reserve upside Net Mean Unrisked Reserve (MMBoe) Net MMBoe Unrisked net reserve potential Development Exploration

17 BERYL AREA Callater Discovery (Formerly K) Jurassic 9/ /19-18Z 9/19-18X Empire State Building 1 km Net Reserves (1) Net Unrisked Capital Working Interest 55% Oil % / Gas % ROR (1) NPV10 (1) MMBoe $318 million 40% / 60% >100% $340 - $680 million Pay proven in 3 fault blocks One remaining undrilled block to southeast Over 1,500 feet TVD net pay logged Initial production in 2017 (1) Calculated based on consensus prices as of Nov. 9, 2015, after tax and represents Pmean to P10 estimates. 16

18 BERYL AREA Tertiary injectite portfolio Corona discovery Titan Prospect ~100,000 acres covering the Tertiary play Apache has high working interest across the play Identified multiple drillable prospects in Beryl Area with MMBoe net unrisked reserves Corona is Apache s first injectite discovery Next prospect, Titan, is scheduled for 2016 Tertiary Injectite Area 17

19 100 feet BERYL AREA Corona discovery tertiary injectite Beryl Discovery Appraisal Buckland gas-oil contact Skene Corona oil-water contact development acreage exploration acreage Net Reserves (1) Net Unrisked Capital Working Interest 100% Oil % / Gas % ROR (1) NPV10 (1) 9-19 MMBoe $308 million 98% / 2% >100% $51 - $111 million 225 feet net pay 252 feet net pay Identified on new Beryl 3D APA s first tertiary well in the Beryl Area 362 foot column height Excellent reservoir quality High permeability and porosity (1) Calculated based on consensus prices as of Nov. 9, 2015, after tax and represents Pmean to P10 estimates. 18

20 BERYL AREA SUMMARY Exceptional success in 2015: 89% success rate on 9 wells Plan 3 significant explorations tests in 2016 Relatively quick tieback with high ROR projects Unrisked net reserve potential of MMBoe 19

21 OTHER HIGH IMPACT EXPLORATION Val D Sere Vail Albion Forties Seagull Komodo Isabella Net unrisked MMBoe Net MMBoe Unrisked net reserve potential A B C D E F Pmean values Prospects Additional P10 value 20

22 SEAGULL DISCOVERY 9.3 km 2 Closure 672 feet of oil over a 1,092-foot column Facility constrained flow of 8,700 Bo/d and 16 MMcfp/d 22/29-2Z Seagull 22/ /29-8y Chrysler Building 22/29-8Y Net Reserves (1) Net Unrisked Capital MMBoe $360 million 1,092 ft oil column Working Interest 35% Oil % / Gas % 79% / 21% ROR (1) NPV10 (1) >100% $238 - $393 million Oil Saturation (1) Calculated based on consensus prices as of Nov. 9, 2015, after tax and represents Pmean to P10 estimates. 21

23 APACHE NORTH SEA IS HIGHLY DIFFERENTIATED Forties and Beryl two of the biggest and best hydrocarbon accumulations in the North Sea Extensive inventory of locations is still growing Infrastructure in excellent shape, higher percentage of capital dollars going toward drilling APA s low cost structure and high production efficiency turn marginal economics into high ROR s 22

24 THANK YOU 23