Page 18

improvements across all of its fields over the past decade resulting in significantly improved production efficiency and lower unit operating costs. With basin-wide leading production efficiency, our infrastructure and offtake capabilities have positioned the region to be allocated a higher percentage of capital dollars for drilling and production. The Beryl field, which is a geologically complex area with multiple fields and stacked pay potential, provides for significant exploration opportunity. Following the completion of the first full-field 3-D acquisition since 1997, Apache recently announced two exceptional discoveries in the area, the K and Corona discoveries, and is moving ahead with development and additional exploration efforts. The K discovery encompasses multiple commercial zones across three distinct fault blocks, including one fault block with over 1,500 feet of net pay and is projected to begin production mid-2017. The Corona discovery logged 225 feet vertical depth net pay in reservoir-quality sandstone. Apache has 55 percent and 100 percent working interests in K and Corona, respectively. The 3-D acquisition has also indicated the potential for several future prospects similar to K and Corona on Apache acreage in the Beryl area. In addition to the K and Corona discoveries, Apache also announced an appraisal well drilled approximately 50 miles (80 kilometers) south of the Forties complex. The Seagull discovery logged 672 feet of net oil pay over a 1,092-foot column in Triassic-age sands. Further appraisal work will continue following the recent acquisition of a multi-azimuth 3-D survey. Apache is now operator of the license and has a 35 percent working interest in the project. Marketing We have traditionally sold our North Sea crude oil under term contracts, with a market-based index price plus a premium, which reflects the higher market value for term arrangements. Natural gas from the Beryl field is processed through the SAGE gas plant operated by Apache. The gas is sold to a third party at the St. Fergus entry point of the national grid on a National Balancing Point index price basis. The condensate mix from the SAGE plant is processed further downstream. The split streams of propane and butane are sold on a monthly entitlement basis, and condensate is sold on a spot basis at the Braefoot Bay terminal using index pricing less transportation. Australia/Argentina During the second quarter of 2015, Apache completed the sale of its Australian LNG business and oil and gas assets. In March 2014, Apache completed the sale of all of its operations in Argentina. Results of operations and consolidated cash flows for the divested Australia assets and Argentina operations are reflected as discontinued operations in the Company’s financial statements for all periods presented in this Annual Report on Form 10-K. Other Exploration New Ventures Apache’s global New Ventures team provides exposure to new growth opportunities by looking outside of the Company’s traditional core areas and targeting higher-risk, higher-reward exploration opportunities located in frontier basins as well as new plays in more mature basins. Plans for 2016 include continued analysis and review of our deepwater prospects in offshore Suriname. Major Customers In 2015, 2014, and 2013 purchases by Royal Dutch Shell plc and its subsidiaries accounted for 11 percent, 19 percent, and 24 percent, respectively, of the Company’s worldwide oil and gas production revenues. Drilling Statistics Worldwide in 2015 we participated in drilling 693 gross wells, with 660 (95 percent) completed as producers. Historically, our drilling activities in the U.S. have generally concentrated on exploitation and 7

Apache 2015 Summary Annual Report  

Adapting to a changing environment

Read more
Read more
Similar to
Popular now
Just for you