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of tax), and $1.1 billion in Egypt. The Egyptian impairments resulted in net losses for the year in the applicable concessions, significantly reducing tax expense recorded under our production-sharing contracts. During 2014, the Company recorded asset impairments totaling $1.9 billion in connection with fair value assessments, including $1.3 billion for the impairment of goodwill, $604 million for the impairment of assets held for sale, and other asset impairments. The Company had also recorded $439 million in impairments related to the sale of Australia’s assets, which are classified as discontinued operations in 2014. General and Administrative (G&A) Expenses 2015 vs. 2014 G&A expenses decreased $74 million, or 16 percent, from 2014. On a per-unit basis, G&A expenses decreased $0.16 to $1.93 per boe. These reductions reflect Apache’s intense focus on driving internal efficiencies and bringing overhead in line with the current commodity price environment. In 2015, we rationalized our entire organizational structure, eliminating layers of management, consolidating office locations, and reducing corporate and regional staffing to more closely align with activity levels expected in the future. 2014 vs. 2013 G&A expenses decreased $30 million, or 6 percent, from 2013. On a per-unit basis, G&A expenses increased $0.10 to $2.09 per boe, with the benefit of lower costs partially offset by the impact of lower production. Transaction, Reorganization, and Separation Costs Apache recorded $132 million, $67 million and $33 million of expenses during 2015, 2014, and 2013, respectively, primarily related to divestiture activity and company reorganization, including separation costs, investment banking fees and other associated costs. The charges for 2015 include $53 million for employee separation cost; $42 million associated with office closings, consolidation of office space in Houston, and other reorganization efforts; and $36 million related to the Australia divestiture and other transactions. Financing Costs, Net Financing costs incurred during the period comprised the following: For the Year Ended December 31, 2015 2014 2013 (In millions)

Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ Amortization of deferred loan costs . . . . . . . . . . . . . . . . . . . . . Capitalized interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Loss (gain) on extinguishment of debt . . . . . . . . . . . . . . . . . . . Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

486 11 (227) 39 (10)

$

499 6 (287) (7)

$

560 8 (315) (16) (8)

Total Financing costs, net . . . . . . . . . . . . . . . . . . . . . . . . . . .

299

$

211

$

229

$

2015 vs. 2014 Net financing costs increased $88 million from 2014. The increase is primarily related to a decrease of $60 million in capitalized interest from lower asset balances qualifying for capitalized interest and a $39 million loss on the early extinguishment of debt during 2015, partially offset by a decrease of $13 million in interest expense resulting from lower average debt balances. 2014 vs. 2013 Net financing costs decreased $18 million from 2013. The decrease is primarily related to a $61 million decrease in interest expense as a result of lower average debt balances during 2014, partially offset by a $28 million decrease in capitalized interest resulting from lower property balances and a $16 million gain on extinguishment of debt in 2013.

43

Apache 2015 Summary Annual Report  

Adapting to a changing environment

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