2013 2nd quarter earnings release operations supplement · apache second-quarter 2013 earnings...

2013 2nd Quarter

EARNINGS RELEASE OPERATIONS SUPPLEMENT

APACHE SECOND-QUARTER 2013 EARNINGS RELEASE OPERATIONS SUPPLEMENT

TABLE OF CONTENTS Overview ............................................................................................................................................................................... 2

NORTH AMERICA .............................................................................................................................................................. 5

Permian......................................................................................................................................................................... 5

Central .......................................................................................................................................................................... 8

Gulf Coast Onshore ..................................................................................................................................................... 11

Gulf of Mexico Shelf.................................................................................................................................................... 13

Gulf of Mexico Deepwater .......................................................................................................................................... 14

Canada ........................................................................................................................................................................ 15

INTERNATIONAL ............................................................................................................................................................. 18

Egypt ........................................................................................................................................................................... 18

Australia ...................................................................................................................................................................... 21

North Sea .................................................................................................................................................................... 23

Argentina .................................................................................................................................................................... 24

1


NOTICE TO INVESTORS This operations supplement contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act

of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended and, whenever possible, are identified by

use of the words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to

future periods. Any matters that are not historical facts are forward-looking and, accordingly, involve estimates, assumptions, risks

and uncertainties, including, without limitation, our assumptions about the market prices of oil, natural gas, NGLs and other

products or services, our commodity hedging arrangements, the supply and demand for oil, natural gas, NGLs and other products or

services, production and reserve levels, drilling risks, economic and competitive conditions, the availability of capital resources,

capital expenditure and other contractual obligations, and our ability to complete, test and produce the wells identified in this

supplement. Because such statements involve risks and uncertainties, Apache’s actual results and performance may differ

materially from the results expressed or implied by the forward-looking statements contained in this Supplement. Other important

factors that could cause actual results to differ materially from expected results are described in “Risk Factors” in our most recently

filed Annual Report on Form 10-K, recent Quarterly Reports on Form 10-Q and amendments thereto, available on our Web site and

in our other public filings and press releases. There is no assurance that Apache's expectations will be realized, and readers are

cautioned not to place undue reliance on forward looking statements, which speak only as of the date hereof. Unless otherwise

required by law, we assume no duty to update these statements as of any future date.

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 operational update supplement, such as “resources,” “potential resources,” “resource potential,”

“reserves potential,” 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, 2012, available from Apache at www.apachecorp.com or by writing Apache at: 2000

Post Oak Blvd., Suite 100, Houston, Texas 77056 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling

1-800-SEC-0330 or from the SEC's website at www.sec.gov.

Certain information provided in this supplement includes financial measurements that are not required by, or presented in

accordance with, generally accepted accounting principles (GAAP), including these measures: adjusted earnings, pre-tax margin, and

cash from operations. These non-GAAP measures should not be considered as alternatives to GAAP measures, such as net income or

cash from operating activities, and may be calculated differently from, and therefore may not be comparable to, similarly titled

measures used at other companies. Reconciliation to the most directly comparable GAAP financial measure has been provided.

None of the information contained in this document has been audited by any independent auditor. This supplemental document is

prepared as a convenience for securities analysts and investors and may be useful as a reference tool. Apache intends to continue to

publish this supplement in conjunction with our quarterly earnings release, but may elect to modify the format or discontinue

publication at any time, without notice to securities analysts or investors.

2


APACHE WORLDWIDE OPERATIONS

Overview Focused North America onshore program yielding significant production

growth; North America onshore liquids production grew 6 percent over the

first quarter 2013 and 42 percent over the second quarter 2012

Apache averaged 116 rigs world-wide during the second quarter, 73 of which were onshore North American rigs.

The company completed 343 gross wells during the quarter.

248, or 72 percent, of the gross wells completed were located onshore North America and were drilled with a 99

percent success rate.

North America onshore regions, which include Permian, Central, Gulf Coast Onshore and Canada, collectively grew

liquids production 6 percent over the first quarter of 2013 (24 percent on an annualized basis) to 175 Mbbls per

day.

The Permian and Central regions were the main drivers of North America onshore liquids growth.

These two regions drilled 215 gross wells, or 63 percent of the total.

Permian and Central combined to grow liquids production 8,000 barrels per day over the first quarter of 2013,

or 6 percent, to over 136 Mbbls per day, which represented 32 percent of total worldwide liquids production.

Combined total production from the Permian and Central regions was 214 Mboe per day, representing over 27

percent of total company production.

Total worldwide net daily production of oil, natural gas, and natural gas liquids averaged 790 Mboe per day in the

second quarter with liquids production comprising 54 percent of the total.

3


12%

15%

4%

14%13%

2%

19%

9%

7% 5%

40% 41%

12%7%

SECOND-QUARTER PRODUCTION BY REGION

790 Mboe/d

North America International Liquids Natural Gas

Australia Argentina

Canada

Permian

Central

GOM Shelf

GOM DW GC Onshore

North Sea

Egypt

SECOND-QUARTER PRODUCTION BY PRODUCT

790 Mboe/d

SECOND-QUARTER REVENUE BY PRODUCT

$4.1 Billion

International Liquids

North American

Liquids

North American Gas

International Gas

International Liquids $1.7 Bn

North American

Liquids $1.7 Bn

North American Gas

$0.5 Bn

International Gas

$0.3 Bn

N.A. Onshore

45%

24% 30%

29%

17%

4


2Q

2012

2Q

2013

Inc

(Dec)

% Inc

(Dec)

Total Company 774 790 16 2%

Total Company - Egypt Without Tax 727 751 24 3%

Total Excluding Egypt 616 642 26 4%

North Sea 79 73 -6 -8%

% Liquids 50% 54%

GOM Offshore 113 112 -1 -1%

Other International Regions 116 100 -16 -14%

U.S. Onshore Gas 83 95 12 14%

42%N.A. Onshore Liquids 123 175 52

-15%Canada Gas 102 87 -15

0

100

200

300

400

500

600

700

800

900

2Q 2012 2Q 2013

MBOE/D

56

91

104

123

0

20

40

60

80

100

120

140

160

180

200

220

2Q 2012 2Q 2013

7090

21

46

0

20

40

60

80

100

120

140

160

180

200

220

2Q 2012 2Q 2013

2Q 2012 VERSUS 2Q 2013 PRODUCTION COMPARSION

CENTRAL AND PERMIAN PRODUCTION

42%

16%

4%

31%

2% 774

616

790

642

160

214

91

136 Permian

Central Oil

Liquids

NGLs

57% % Liquids

123

175 206

270 308

357

65%

18%

29%

124%

727 751 3%

34%

50%

Total Production (Mboe/d) Liquids Production (Mbbls/d)

64%

5


NORTH AMERICA Permian Second-quarter 2013 production in the Permian Region averaged 123,246

Boe/d (74 percent liquids), increasing 18 percent over the second quarter

of 2012.

Production was affected by unplanned facility downtime resulting in

deferred production of approximately 2,070 Boe/d.

For the quarter, the Permian Region averaged 41 drilling rigs, spud 214

gross wells (excluding injector wells) of which 58 were horizontal and

completed 128 gross (102 net) wells.

In addition to Deadwood, drilling at Barnhart is now leading the region in

production growth along with Yeso and Three Bar.

PERMIAN KEY STATS

Second-Quarter 2013

Q2 Production: 123,246 Boe/d

Q2 Wells Completed: 128 wells, 102 net

Q2 Wells Spud: 214 gross

Q2 Rigs: Avg 41 rigs

APACHE PERMIAN REGION ACREAGE AND KEY PLAYS

6


Permian (Continued) MIDLAND BASIN VERTICAL Apache has an estimated 1.1 million gross acres (625,000 net) in the Midland Basin Vertical play area with an

estimated 1.7 Bboe of resource potential from over 17,800 identified drilling locations.

During the second quarter, Apache focused on building inventory in the vertical Fusselman play.

The Fusselman program has benefitted from utilizing high-graded 3D seismic and refocused interpretation.

Apache continues to focus on further core exploitation and expansion of the Fusselman potential to the northeast.

During the second quarter, four Fusselman wells averaged approximately 300 Boe/d (70% oil).

The Deadwood Plant continues to process at capacity and an additional delivery point has been upgraded to

increase capacity and effectively eliminate any gas takeaway constraints for the foreseeable future.

NORTHWEST SHELF - YESO Apache has approximately 105,000 gross acres (70,000 net) in the Yeso play with 1,800 identified locations and an

estimated 108 MMboe of resource potential.

During the second quarter of 2013, 27 new vertical wells were brought on production, and completion activity on

the eight horizontal wells drilled to date should commence in the third quarter.

Oil production from the 2013 Yeso drilling program doubled from approximately 1,500 Bo/d and 3.2 MMcf/d to approximately 3,000 Bo/d and 6.3 MMcf/d during the second quarter.

WOLFCAMP SHALE

Apache has an estimated 450,000 gross acres (345,000 net) prospective for Wolfcamp Shale development with an

estimated 347 MMboe of resource potential from 971 identified drilling locations.

Second-quarter 2013 activity was focused on the Barnhart area (Irion County) where six horizontal rigs drilled

Upper and Middle Wolfcamp laterals and a single vertical rig completed drilling delineation and test wells.

As of the end of the second quarter, Apache drilled 37 wells in 2013 and is expected to have drilled 83 wells by

year-end.

CLINE SHALE Apache has an estimated 650,000 gross acres (520,000 net) prospective for Cline Shale development with an

estimated 642 MMboe of resource potential from 2,300 identified drilling locations.

For 2013, 11 wells have been drilled targeting the Lower Cline in the Deadwood area and 28 additional wells are

planned for the remainder of the year.

Using one of the largest Cline Shale petrophysical databases in the industry, Apache has increased its Lower Cline

Shale inventory and continues to improve drilling results and well performance.

CENTRAL BASIN PLATFORM (CBP) Apache has an estimated 1.7 million gross acres (780,000 net) in the CBP with an estimated 690 MMboe of

resource potential from nearly 9,800 identified drilling locations.

In the Three Shallow Bar Unit, two additional drilling rigs were deployed for a total of three active drilling rigs

during the second quarter.

7


Permian (Continued)

By the end of the second quarter, the Three Bar Shallow Unit had produced 548 Mbbls of oil with a combined

average rate of 2,975 Bo/d and 6,200 Mcf/d from seven completed wells.

Four remaining wells will be spud during the third quarter to complete the first phase of development.

PERMIAN WELL HIGHLIGHTS

Second-Quarter 2013

PLAY/TARGET WELL NAME TVD LATERAL IP (30-Day)

Midland Basin – Wolfberry Augusta Barrow 2301 11,100’ N/A 248 Boe/d

Midland Basin – Fusselman ED Books 35 #9 10,460’ N/A 362 Boe/d

Eagle 36 #1 10,417’ N/A 336 Boe/d

Midland Basin – Wolfwood Woodpecker 36 #2 10,450’ N/A 310 Boe/d

Heidi 37 #3 10,185’ N/A 223 Boe/d

Midland Basin – Lower Cline (Hz) Hammerhead 33 #4 9,330’ 4,445’ 286 Boe/d

Midland Basin – Upper Wolfcamp (Hz) Sugg 1110 H31U 6,276’ 7,800’ 422 Boe/d

Sugg 1110 H51U 6,276’ 7,800’ 454 Boe/d

Central Basin Platform – Wichita Albany (Hz) Three Bar SU #113H 7,085’ 6,000’ 1,012 Boe/d (tested)

Northwest Shelf - Yeso A State 56 6,384’ N/A 211 Boe/d

8


Central Second-quarter 2013 production in the Central Region was 90,888 Boe/d,

up 5.4 percent over the first quarter of 2013 and up 65 percent over the

second quarter of 2012.

Liquids production increased 12 percent over the first quarter of 2013 to

45 Mbbl/d, up nearly three times over second quarter of 2012.

Liquids now make up nearly half of the region’s total production.

For the quarter, the Central Region averaged 28 drilling rigs and drilled 87

gross (62 net) wells.

Apache continues to work numerous plays across its 1.9 million gross acreage position focusing on the liquids-rich

Granite Wash and the oily Tonkawa, Marmaton, Cottage Grove, Cleveland and Canyon Wash plays.

CENTRAL WELL HIGHLIGHTS

Second-Quarter 2013

PLAY/TARGET WELL NAME COUNTY, ST TVD IP

Cleveland Flathers 232 #1H Ochiltree, TX 7,783’ 699 Bo/d, 1,135 Mcf/d

Mekeel 303 #3H Ochiltree, TX 7,530’ 665 Bo/d, 500 Mcf/d

Tonkawa

Chenette 2-9H Roger Mills, OK 8,701’ 621 Bo/d, 703 Mcf/d

Woodie 1-25H Roger Mills, OK 8,437’ 446 Bo/d, 407 Mcf/d

Beavin #2-13H Roger Mills, OK 9,138’ 468 Bo/d, 677 Mcf/d

Allen 2-15 Roger Mills, OK 8,538’ 384 Bo/d, 814 Mcf/d

Canyon Wash Boys Ranch 116 #10 Oldham, TX 9,596’ 984 Bo/d, 1,300 Mcf/d

Bivins-LIT 115R Oldham, TX 9,677’ 1,237 Bo/d, 1,000 Mcf/d

Marmaton

Bessie Unit 1-1H Roger Mills, OK 9,329’ 346 Bo/d, 1,514 Mcf/d

Mamie 5-4HC-N Roger Mills, OK 11,225’ 414 Bo/d, 8,400 Mcf/d

Burns Family Trust 1-3H Roger Mills, OK 11,150’ 689 Bo/d, 7,000 Mcf/d

Hawkins #1-6H Roger Mills, OK 11,127’ 713 Bo/d, 10,055 Mcf/d

Marmaton Wash Webb Trust 1-1H Beckham, OK 12,937’ 686 Bo/d, 7,633 Mcf/d

Smith 2-17H Beckham, OK 13,101’ 440 Bo/d, 6,076 Mcf/d

Sweetwater Tyler 55 7H Wheeler, TX 11,536’ 355 Bo/d, 2,149 Mcf/d

Cottage Grove Stiles 3 #23-3H Wheeler, TX 10,641’ 644 Bo/d, 874 Mcf/d

Granite Wash Moore 62 SL 11H Wheeler, TX 13,116 144 Bo/d, 3,900 Mcf/d

Bartz 19 SL #25-19H Wheeler, TX 13,981 103 Bo/d, 4,500 Mcf/d

CENTRAL KEY STATS

Second-Quarter 2013


Q2 Wells: 87 wells, 62 net


9


Central (Continued)

GRANITE WASH Apache holds approximately 828,000 gross (418,000 net) acres prospective for the Granite Wash with an

estimated resource potential of 4.5 Bboe from 22,800 drilling locations.

Second-quarter 2013 production in the Granite Wash was 31,673 Boe/d (48 percent liquids).

During the quarter, Apache drilled and completed 22 gross (16 net) Granite Wash wells, for a total of 495 gross

(217 net) wells now on production in the play.

TONKAWA Apache holds an estimated 810,000 gross (310,000 net) acres prospective for the Tonkawa with an estimated

resource potential of 202 MMboe from 2,800 drilling locations.

Second-quarter 2013 production in the Tonkawa was 8,791 Boe/d (70 percent liquids).

During the quarter, Apache drilled and completed 25 gross (15 net) Tonkawa wells, for a total of 380 gross (156

net) wells now on production in the play.

APACHE CENTRAL REGION ACREAGE AND KEY PLAYS

10


Central (Continued)

MARMATON Apache holds an estimated 662,000 gross (512,000 net) acres in the Marmaton with an estimated resource

potential of 161 MMboe from 1,593 drilling locations.

Second-quarter 2013 production in the Marmaton was 12,532 Boe/d (49 percent liquids).

During the quarter, Apache drilled and completed 10 gross (five net) Marmaton wells, for a total of 123 gross (56

net) wells now on production in the play.

CLEVELAND Apache holds an estimated 768,000 gross (438,000 net) acres in the oil-rich Cleveland play with an estimated

resource potential of 195 MMboe from 2,302 drilling locations.

Second-quarter 2013 production in the Cleveland was 4,292 Boe/d (70 percent total liquids / 75 percent oil).

During the quarter, Apache drilled and completed eight gross (seven net) Cleveland wells, for a total of 188 gross


COTTAGE GROVE Apache holds an estimated 238,000 gross (100,000 net) acres in the oil-rich Cottage Grove.

Second-quarter 2013 production in the Cottage Grove was 4,343 Boe/d (81 percent liquids / 63 percent oil).

During the quarter, Apache drilled and completed seven gross (six net) Cottage Grove wells, for a total of 36 gross


CANYON WASH Apache holds an estimated 147,000 gross (~100,000 net) acres prospective for the Canyon Wash in the Bivins

Ranch area (Whittenburg Basin) with an estimated 101 MMboe of resource potential from 1,016 drilling locations.

Second-quarter 2013 production in the Canyon Wash was 3,506 Boe/d (81 percent liquids / 62 percent oil).

During the quarter, Apache drilled and completed six gross (three net) Canyon Wash wells, for a total of 19 gross


11


Gulf Coast Onshore Second-quarter 2013 production in the Gulf Coast Onshore Region

averaged 30,998 Boe/d, 4 percent higher than the first quarter of 2013

and 23 percent higher than the second quarter of 2012.

Gas production grew during the second quarter to 107 MMcf/d,

primarily due to increasing gross gas sales at Atchafalaya Bay Field.

Year-to-date at Atchafalaya Bay Field, gross gas capacity has increased

by 60 MMcf/d to 200 MMcf/d.

Increases in oil production were driven by new drilling activity in the South Pass 24 field, along with positive results

from drilling activity at the Golden Meadow Field.

Apache averaged two operated drilling rigs and two non-operated rigs while drilling a total of 23 gross (22 net)

wells.

GULF COAST ONSHORE KEY STATS

Second-Quarter 2013 Q2 Production: 30,998 Boe/d


Q2 Rigs: Avg 2 rigs

APACHE GULF COAST ONSHORE REGION ACREAGE AND KEY PROJECTS

12


Gulf Coast Onshore (Continued)

GULF COAST ONSHORE WELL HIGHLIGHTS Second-Quarter 2013

PLAY/TARGET WELL NAME TD IP

Upper Miocene S/L 2485 U-19 # 3ST 8,850’ 100 Bo/d, 4,000 Mcf/d

Vicksburg Slick State B #14 7,093’ 10 Bo/d, 1,700 Mcf/d

Golden Meadow Field

Laterre #337 2,840’ 211 Bo/d, 41 Mcf/d

LL&E #249 2,846’ 151 Bo/d, 314 Mcf/d

Laterre #341 2,892’ 165 Bo/d, 18 Mcf/d

13


Gulf of Mexico Shelf Second-quarter 2013 production in the Gulf of Mexico Shelf was 99,082

Boe/d, an 8 percent increase from the first quarter of 2013.

During the quarter, Apache averaged six rigs and drilled a total of five

operated wells.

Apache’s shallow-water sub-salt exploration play, the Heron well (Main

Pass Block 295), is currently preparing to drill out from casing run to

10,510 feet MD / 10,500 feet TVD, targeting multiple sands trapped

against a salt dome. The well has initially encountered 76 feet of net oil pay in two sands, as identified with

wireline logging equipment. Drilling continues toward deeper primary targets with a proposed depth of 20,000

feet TVD.

WAZ and short cable seismic acquisitions will continue to enhance imaging to aid the exploration / exploitation of

the emerging sub-salt play.

GOM SHELF KEY STATS Second-Quarter 2013



Q2 Rigs: Avg 6 rigs

APACHE GULF OF MEXICO SHELF REGION LEASEHOLDS AND KEY PROJECTS

14


Gulf of Mexico Deepwater Second-quarter 2013 production in the Gulf of Mexico Deepwater was

13,545 Boe/d, a 2 percent increase from the first quarter of 2013.

Apache plans to drill the San Marcos Prospect in August when the Ensco

8505 rig arrives.

LUCIUS DEVELOPMENT During the quarter, the KC919-5 well and the KC919-6 well in the Lucius field encountered approximately 650 feet

and 665 feet of total net pay, respectively, in the Pliocene and Miocene objectives with all sands full to base as

expected. The Miocene sands were not geologic objectives in the KC919-6 well as they will be produced in an

offset well. Additionally, drilling activities at the KC875-3 development well are expected to begin during the third

quarter. First production remains on schedule for the second half of 2014.

The Lucius spar fabrication is complete, and the hull was successfully delivered to Gulf of Mexico during the second

quarter and is expected to be towed to location for installation in mid-August. The topsides facilities, which are

being constructed in Ingleside, Texas, are 68 percent complete and are scheduled to be lifted onto the spar in early

2014.

First production is anticipated in the second half of 2014.

HEIDELBERG The spar will be an 80,000 Bo/d Lucius look-a-like facility and is currently being fabricated.

Initial production is expected in 2016.

GOM DW KEY STATS Second-Quarter 2013


Q2 Wells: 1 well

Q2 Rigs: Avg 1 rig

APACHE GULF OF MEXICO DEEPWATER REGION ACREAGE AND KEY ASSETS

15


Canada Second-quarter 2013 production in Canada was 112,059 Boe/d, up 2

percent from the first quarter of 2013.

84 percent of the region’s increase in production was from liquids additions.

Natural gas production remained steady, averaging 521 MMcf/d, up slightly

from first-quarter 2013 volumes of 519 MMcf/d.

During the second quarter and the traditional “break up period,” the region

operated an average of one drilling rig and drilled eight gross (seven net)

wells.

Apache continues to focus its development activities on the oil and liquids-rich Bluesky, Sparky, Viking and

Dunvegan plays.

BLUESKY (LIQUIDS-RICH HORIZONTAL PROGRAM) In the second quarter of 2013, Apache completed four wells with production rates ranging from 300 Boe/d to 850

Boe/d.

Bluesky has made a significant impact in the Kaybob area which saw overall production grow approximately 50

percent over the past two years.

CANADA KEY STATS Second-Quarter 2013



Q2 Rigs: Avg 1 rig

APACHE CANADA REGION ACREAGE AND KEY BASINS

Bluesky

16


Canada (Continued)

*Less than 30 day rate

CANADA WELL HIGHLIGHTS Second-Quarter 2013

PLAY/TARGET WELL NAME TVD Lateral Length IP

Bluesky 12-12-057-20W5 9,055’ 6,453 102 Bo/d, 97 Ngl/d, 3,691 Mcf/d*

02/16-10-57-20W5 9,094’ 4,107 100 Bo/d, 96 Ngl/d, 3,641 Mcf/d

Glazier Sparky 15-15-36-5W4 2,926 3,313 145 Bo/d, 179 Mcf/d

17


Canada (Continued)

KITIMAT LNG PROJECT (50% APA) During the second quarter, Kitimat Upstream maintained production and continued active drilling resulting in two

tenure wells, both in Liard.

One of the aforementioned wells, with offset wells, is estimated to have over 500 Bcf per section, the highest

estimated original gas in place per section of any Apache well to date.

A 102-square-mile 3D seismic program was completed in Horn River and will be reprocessed and interpreted.

At 54 ̊ ̊ north, Kitimat is one of North America’s closest ports to Asian markets.

Kitimat-Tokyo3,988 nm, 10 daysQatar-Tokyo6,500 nm, 16 days

0 100

KM

Liard

18


EGYPT KEY STATS Second-Quarter 2013

Q2 Gross Production: 343,538 Boe/d

Q2 Net Production:

With Tax: 147,551 Boe/d

% of Gross: 43.0%

Without Tax: 108,919 Boe/d

% of Gross: 31.7%

Q2 Wells: 70 well, 67 net


INTERNATIONAL Egypt In Egypt, Apache’s operations continue unabated. The

region averaged 27 rigs and reported quarterly average

gross oil production of 193,341 Bo/d and gross gas

production of 901 MMcf/d, for a total of 343,538 Boe/d.

Total gross production decreased from the first quarter of

2013 primarily as a result of higher than anticipated decline

rates for newly drilled and producing wells.

Oil production was constrained in the Qarun operating area

due to increasing water cuts in the Yussif, East Beni Suef

and Heba Ridge Ridge areas, which decreased production

by approximately 2,500 Bo/d quarter-over-quarter.

The decrease in gross gas production from the previous quarter was primarily due to a shutdown at Abu Gharadig

Gas Plant for an upgrade and repairs to a 24-inch pipeline.

Across the region, Apache drilled a total of 70 gross (67 net) wells in the second quarter including several

significant exploration discoveries:

Riviera SW-1X on the southern flank of the Abu Gharadig Basin test-flowed 5,822 barrels of oil and 2.8 million

cubic feet of gas per day from a Lower Bahariya sand with 24 feet of net pay. Drilling and completion costs for

the well were $5.0 million. Apache has a 100-percent working interest in the WD 30 Development Lease.

Narmer-1X is a stratigraphic trap that is separated from the Neilos Oil Field located 5 miles (8 km) to the east.

The well test-flowed 1,166 bbls of oil and 400 Mcf of gas per day. Although appraisal wells are required, the

trap is estimated to exceed 1,000 acres. Drilling costs for the well were $3.11 MM, with completion pending.

Apache has a 100-percent working interest in the Khalda Offset Concession.

In the Qarun area significant operational advancements were made. The average completion and workover rig

time was decreased from 15 to 12 days through casing redesigns, more artificial lift, and improved drilling

performance.

19


Egypt (Continued)

EGYPT WELL HIGHLIGHTS Second-Quarter 2013

PLAY/TARGET WELL NAME TVD IP

SAFA WKAL-N-3X 14,504’ 3,485 Bo/d

L Bahariya (NC) Riviera SW-1X 12,570’ 1,832 Bo/d

L Bahariya (REC) MRZK 7 6,400’ 2,284 Bo/d

AEB (REC) WKAL A6 12,359’ 1,193 Bo/d

Jade 6 12,950’ 1,332 Bo/d

APACHE EGYPT REGION ACREAGE AND KEY BASINS

Narmer 1-X SIWA-R-1X Riviera SW-1X

WKAL-T-1X

FALAK NW-1X Jade N-2X

Buchis W-2X

20


Egypt (Continued)

EGYPT PRODUCTION DETAIL

2Q 2013 2Q 2012

Oil (MBbls/d) Gas (Mcf/d) Oil (MBbls/d) Gas (Mcf/d)

Gross Production 193,341 901,181 214,073 894,709

Net Production With Tax 88,002 357,291 98,922 358,985

% of Gross 46% 40% 46% 40%

Net Production Without Tax 64,608 265,862 68,217 258,618

% of Gross 33% 30% 32% 29%

21


APACHE AUSTRALIA REGION ACREAGE AND KEY PROJECTS

Australia Second-quarter 2013 production was 57,147 Boe/d, up 3 percent from

the first quarter of 2013.

During the second quarter, the region operated an average of three

drilling rigs and drilled two gross wells.

The Bianchi-1 vertical gas exploration well in WA-49-R was spudded by

the Ocean America semi-submersible rig on April 12, 2013 and is

currently completing operations. Located 6.4 km north of the Zola-1 gas discovery, Bianchi-1 tested the Triassic-

aged Mungaroo Formation and was drilled to a total depth of 5,400 meters subsea. Wireline logging and pressure

testing has confirmed 112 meters (367 feet) of net gas pay between 4,748 meters and 5,343 meters in the primary

target.

The region continues to benefit from the increase in gas prices associated with the new Reindeer and Devil Creek

developments. Spot sales for the quarter also increased supported by the flexible supply options multiple facilities

can deliver.

AUSTRALIA KEY STATS Second-Quarter 2013



Q2 Rigs: Avg 3 rigs

22


Australia (Continued)

MACEDON During the quarter, installation and pre-commissioning of the subsea infrastructure and offshore pipeline was

completed and preparations are being made to dewater the pipeline when the plant is ready to receive gas.

The BHP-operated Macedon Project is reported to be over 98 percent complete and on schedule for first gas late

in the third quarter of 2013.

Apache expects net daily production of 35 MMcf/d.

BALNAVES During the quarter, installation and tensioning of 6 – 35 tonne anchors and associated chains were completed.

All contracts have been executed, and the project remains on schedule for 2014 first production.

CONISTON During the quarter, the subsea packages were completed and the installation campaign, using the EMAS operated

installation vessel Boa Sub C, began in May. It is scheduled for completion the first week of August 2013.

The project remains on schedule for 2014 first production following the completion of the Ningaloo Vision shipyard

work.

JULIMAR (WHEATSTONE LNG) The Wheatstone LNG project has over 80 percent of its offtake secured under long-term sales contracts.

Top-hole drilling of the Julimar development wells has resumed as part of a phased drilling program.

Miles Apache Acreage

23


APACHE NORTH SEA REGION ACREAGE AND KEY PROJECTS

North Sea Second-quarter 2013 production in the North Sea was

72,936 Boe/d, down 8 percent from the first quarter of

2013, due partially to deferred production as a result of

unplanned facilities maintenance at the Forties Field.

During the second quarter, the region operated an average

of four drilling rigs and drilled four gross wells.

The Forties Bravo platform development well 21/10-B55Z

was successfully drilled into the Delta Channel and

encountered 348 feet measured depth net oil pay along a

horizontal completion hole. The well came on line at the end

of June with initial rate of 3,960 Bo/d.

The PGS Beryl 3D seismic acquisition program was

completed in the third quarter of 2013, which encompasses

the Beryl area development acreage as well as adjacent

exploration licenses that were awarded to Apache in

January 2013. This is the first Beryl field-wide seismic survey

since 1997.

The Forties Alpha Satellite Platform (FASP) topsides package

and linking bridge to the main Forties Alpha platform were

installed in June. This new platform provides 18 additional

drilling slots as well as gas lift, separation, power generation,

and export pumping. First oil from drilling is expected in the

fourth quarter of 2013.

In July, the Bacchus B-1 development well logged 2,057 feet

(measured depth) net oil pay along a horizontal wellbore in

high quality Jurassic aged Fulmar sandstone. The B-1 well successfully delineated and developed the Bacchus far

western fault block, which was found to be in pressure communication with the B-2 producer which was drilled

last year. Production commenced from B-1 during the fourth week of July adding 9,400 Bo/d of new rate taking

the field to 17,600 Bo/d with plans to further optimize rate and operating conditions of the subsea infrastructure.

This is the third successful development well in Bacchus Field. A new 3D seismic survey will be acquired over

Bacchus in the third quarter of 2013 to identify further development opportunities.

NORTH SEA KEY STATS Second-Quarter 2013



Q2 Rigs: Avg 4 rigs

24


APACHE ARGENTINA REGION ACREAGE AND KEY BASINS

Argentina Second-quarter 2013 production in Argentina was 42,359 Boe/d, down

2.6 percent from the first quarter of 2013, due to natural production

declines and moderate drilling activity.

Net “Gas Plus” sales averaged 88 MMcf/d at $5.02 per Mcf.

During the quarter, the region operated two rigs and drilled 11 gross

(eight net) wells, each located in the Neuquén Basin.

In late June, a third drilling rig was contracted in the Neuquen Basin for a

four month duration to drill up to nine shallow wells (<1500 m) in order to take advantage of new prospect

inventory.

Four new vertical development well completions were made during

the second quarter, each with multi-stage fractures in the Lajas

reservoir, resulting in a combined 30-day IP of 10.9 MMcf/d and

1,000 Bo/d.

Also during the quarter, Apache completed and tested three

exploration wells (one operated and two non-operated), targeting the

Vaca Muerta shale oil and wet gas trends. To date, eight gross wells

have been drilled and tested in the play.

The region is currently working on a strategy for future Vaca Muerta

exploration activity across Apache’s vast acreage position. Apache

holds approximately 1.3 million net acres in the Vaca Muerta shale

window, of which over 800,000 net acres are in the oil and wet gas

window of the play.

Additional activity in the second quarter focused on recompletions in

the Neuquén basin, targeting both oil and gas reservoirs (Lajas,

Lotena and Centenario reservoirs) and increased lift capacity jobs in

several fields in both Austral and Neuquén basins.

ARGENTINA KEY STATS Second-Quarter 2013



Q2 Rigs: Avg 2 rigs

2013 2nd quarter earnings release operations supplement · apache second-quarter 2013 earnings...

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