ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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41-0747868
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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Large accelerated filer
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ý
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Accelerated filer
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¨
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Number of shares of registrant’s common stock outstanding as of July 31, 2016
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379,423,069
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TABLE OF CONTENTS
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DESCRIPTION
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Item
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Page
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PART I - FINANCIAL INFORMATION
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1.
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2.
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3.
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4.
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PART II - OTHER INFORMATION
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1.
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1A.
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2.
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3.
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4.
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5.
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6.
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•
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the market prices of oil, natural gas, NGLs, and other products or services;
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•
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our commodity hedging arrangements;
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•
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the integration of acquisitions;
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•
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the supply and demand for oil, natural gas, NGLs, and other products or services;
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•
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production and reserve levels;
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•
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drilling risks;
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•
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economic and competitive conditions;
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•
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the availability of capital resources;
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•
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capital expenditure and other contractual obligations;
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•
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currency exchange rates;
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•
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weather conditions;
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•
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inflation rates;
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•
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the availability of goods and services;
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•
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legislative or regulatory changes;
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•
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the impact on our operations from changes in the Egyptian government;
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•
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terrorism or cyber attacks;
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•
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occurrence of property acquisitions or divestitures;
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•
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the securities or capital markets and related risks such as general credit, liquidity, market, and interest-rate risks; and
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•
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other factors disclosed under Items 1 and 2—Business and Properties—Estimated Proved Reserves and Future Net Cash Flows, Item 1A—Risk Factors, Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations, Item 7A—Quantitative and Qualitative Disclosures About Market Risk and elsewhere in our most recently filed Annual Report on Form 10-K, other risks and uncertainties in our
second
-quarter
2016
earnings release, other factors disclosed under Part II, Item 1A—Risk Factors of this Quarterly Report on Form 10-Q, and other filings that we make with the Securities and Exchange Commission.
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For the Quarter Ended June 30,
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For the Six Months Ended June 30,
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||||||||||||
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2016
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2015*
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2016
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2015 *
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||||||||
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(In millions, except per common share data)
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||||||||||||||
REVENUES AND OTHER:
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||||||||
Oil and gas production revenues
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||||||||
Oil revenues
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$
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1,118
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|
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$
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1,618
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|
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$
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1,940
|
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$
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2,911
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Gas revenues
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209
|
|
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315
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|
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432
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623
|
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||||
Natural gas liquids revenues
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59
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|
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58
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|
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101
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|
|
116
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||||
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1,386
|
|
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1,991
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2,473
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|
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3,650
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||||
Other
|
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(21
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)
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28
|
|
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(24
|
)
|
|
22
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||||
Gain on divestitures
|
|
17
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|
|
227
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|
|
16
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209
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||||
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1,382
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2,246
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2,465
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3,881
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OPERATING EXPENSES:
|
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Lease operating expenses
|
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359
|
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|
467
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737
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948
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||||
Gathering and transportation
|
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52
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|
|
49
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|
|
104
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|
|
105
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||||
Taxes other than income
|
|
65
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|
|
55
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|
|
76
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|
|
128
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|
||||
Exploration
|
|
91
|
|
|
225
|
|
|
186
|
|
|
483
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||||
General and administrative
|
|
103
|
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|
111
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|
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196
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|
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195
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Depreciation, depletion, and amortization:
|
|
|
|
|
|
|
|
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Oil and gas property and equipment
|
|
629
|
|
|
711
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1,265
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1,454
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||||
Other assets
|
|
40
|
|
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83
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|
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82
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|
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166
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|
||||
Asset retirement obligation accretion
|
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38
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|
36
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76
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72
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Impairments
|
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173
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512
|
|
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173
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2,424
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||||
Transaction, reorganization, and separation
|
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9
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66
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|
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24
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120
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Financing costs, net
|
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104
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|
117
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|
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209
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|
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241
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||||
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1,663
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2,432
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3,128
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6,336
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LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
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(281
|
)
|
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(186
|
)
|
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(663
|
)
|
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(2,455
|
)
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Current income tax provision
|
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144
|
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|
900
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134
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848
|
|
||||
Deferred income tax benefit
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(225
|
)
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(169
|
)
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(226
|
)
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(1,318
|
)
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NET LOSS FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
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(200
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)
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(917
|
)
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(571
|
)
|
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(1,985
|
)
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Net income (loss) from discontinued operations, net of tax
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—
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120
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|
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—
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(118
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)
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NET LOSS INCLUDING NONCONTROLLING INTEREST
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(200
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)
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(797
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)
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(571
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)
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(2,103
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)
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Net income attributable to noncontrolling interest
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44
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63
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45
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91
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NET LOSS ATTRIBUTABLE TO COMMON STOCK
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$
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(244
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)
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$
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(860
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)
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$
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(616
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)
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$
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(2,194
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)
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NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS:
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Net loss from continuing operations attributable to common shareholders
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$
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(244
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)
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$
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(980
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)
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$
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(616
|
)
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$
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(2,076
|
)
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Net income (loss) from discontinued operations
|
|
—
|
|
|
120
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|
|
—
|
|
|
(118
|
)
|
||||
Net loss attributable to common shareholders
|
|
$
|
(244
|
)
|
|
$
|
(860
|
)
|
|
$
|
(616
|
)
|
|
$
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(2,194
|
)
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NET LOSS PER COMMON SHARE:
|
|
|
|
|
|
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Basic net loss from continuing operations per share
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|
$
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(0.65
|
)
|
|
$
|
(2.60
|
)
|
|
$
|
(1.63
|
)
|
|
$
|
(5.50
|
)
|
Basic net income (loss) from discontinued operations per share
|
|
—
|
|
|
0.32
|
|
|
—
|
|
|
(0.31
|
)
|
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Basic net loss per share
|
|
$
|
(0.65
|
)
|
|
$
|
(2.28
|
)
|
|
$
|
(1.63
|
)
|
|
$
|
(5.81
|
)
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DILUTED NET LOSS PER COMMON SHARE:
|
|
|
|
|
|
|
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Diluted net loss from continuing operations per share
|
|
$
|
(0.65
|
)
|
|
$
|
(2.60
|
)
|
|
$
|
(1.63
|
)
|
|
$
|
(5.50
|
)
|
Diluted net income (loss) from discontinued operations per share
|
|
—
|
|
|
0.32
|
|
|
—
|
|
|
(0.31
|
)
|
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Diluted net loss per share
|
|
$
|
(0.65
|
)
|
|
$
|
(2.28
|
)
|
|
$
|
(1.63
|
)
|
|
$
|
(5.81
|
)
|
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
|
|
|
|
|
|
|
|
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||||||||
Basic
|
|
379
|
|
|
378
|
|
|
379
|
|
|
377
|
|
||||
Diluted
|
|
379
|
|
|
378
|
|
|
379
|
|
|
377
|
|
||||
DIVIDENDS DECLARED PER COMMON SHARE
|
|
$
|
0.25
|
|
|
$
|
0.25
|
|
|
$
|
0.50
|
|
|
$
|
0.50
|
|
|
|
For the Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015*
|
||||
|
|
(In millions)
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net loss including noncontrolling interest
|
|
$
|
(571
|
)
|
|
$
|
(2,103
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
||||
Loss from discontinued operations
|
|
—
|
|
|
118
|
|
||
Gain on divestitures
|
|
(16
|
)
|
|
(209
|
)
|
||
Exploratory dry hole expense and unproved leasehold impairments
|
|
139
|
|
|
385
|
|
||
Depreciation, depletion, and amortization
|
|
1,347
|
|
|
1,620
|
|
||
Asset retirement obligation accretion
|
|
76
|
|
|
72
|
|
||
Impairments
|
|
173
|
|
|
2,424
|
|
||
Provision (benefit) from deferred income taxes
|
|
(226
|
)
|
|
(1,318
|
)
|
||
Other
|
|
91
|
|
|
26
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Receivables
|
|
237
|
|
|
333
|
|
||
Inventories
|
|
1
|
|
|
74
|
|
||
Drilling advances
|
|
(30
|
)
|
|
118
|
|
||
Deferred charges and other
|
|
(65
|
)
|
|
(81
|
)
|
||
Accounts payable
|
|
(118
|
)
|
|
(410
|
)
|
||
Accrued expenses
|
|
(57
|
)
|
|
505
|
|
||
Deferred credits and noncurrent liabilities
|
|
2
|
|
|
69
|
|
||
NET CASH PROVIDED BY CONTINUING OPERATING ACTIVITIES
|
|
983
|
|
|
1,623
|
|
||
NET CASH PROVIDED BY DISCONTINUED OPERATIONS
|
|
—
|
|
|
159
|
|
||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
983
|
|
|
1,782
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Additions to oil and gas property
|
|
(925
|
)
|
|
(2,783
|
)
|
||
Leasehold and property acquisitions
|
|
(118
|
)
|
|
(128
|
)
|
||
Additions to gas gathering, transmission, and processing facilities
|
|
—
|
|
|
(94
|
)
|
||
Proceeds from sale of Kitimat LNG
|
|
—
|
|
|
854
|
|
||
Proceeds from sale of other oil and gas properties
|
|
48
|
|
|
119
|
|
||
Other, net
|
|
29
|
|
|
(67
|
)
|
||
NET CASH USED IN CONTINUING INVESTING ACTIVITIES
|
|
(966
|
)
|
|
(2,099
|
)
|
||
NET CASH PROVIDED BY DISCONTINUED OPERATIONS
|
|
—
|
|
|
4,372
|
|
||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
|
|
(966
|
)
|
|
2,273
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Commercial paper and bank credit facilities, net
|
|
—
|
|
|
(1,570
|
)
|
||
Distributions to noncontrolling interest
|
|
(93
|
)
|
|
(40
|
)
|
||
Dividends paid
|
|
(189
|
)
|
|
(189
|
)
|
||
Other
|
|
(1
|
)
|
|
15
|
|
||
NET CASH USED IN FINANCING ACTIVITIES
|
|
(283
|
)
|
|
(1,784
|
)
|
||
|
|
|
|
|
||||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
|
(266
|
)
|
|
2,271
|
|
||
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
|
|
1,467
|
|
|
679
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
1,201
|
|
|
$
|
2,950
|
|
|
|
|
|
|
||||
SUPPLEMENTARY CASH FLOW DATA:
|
|
|
|
|
||||
Interest paid, net of capitalized interest
|
|
$
|
206
|
|
|
$
|
218
|
|
Income taxes paid, net of refunds
|
|
201
|
|
|
278
|
|
|
|
June 30, 2016
|
|
December 31, 2015*
|
||||
|
|
(In millions)
|
||||||
ASSETS
|
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,201
|
|
|
$
|
1,467
|
|
Receivables, net of allowance
|
|
1,016
|
|
|
1,253
|
|
||
Inventories
|
|
530
|
|
|
570
|
|
||
Drilling advances
|
|
202
|
|
|
172
|
|
||
Prepaid assets and other
|
|
343
|
|
|
290
|
|
||
|
|
3,292
|
|
|
3,752
|
|
||
PROPERTY AND EQUIPMENT:
|
|
|
|
|
||||
Oil and gas, on the basis of successful efforts accounting:
|
|
|
|
|
||||
Proved properties
|
|
42,469
|
|
|
41,728
|
|
||
Unproved properties and properties under development, not being amortized
|
|
2,285
|
|
|
2,277
|
|
||
Gathering, transmission and processing facilities
|
|
862
|
|
|
1,052
|
|
||
Other
|
|
1,098
|
|
|
1,093
|
|
||
|
|
46,714
|
|
|
46,150
|
|
||
Less: Accumulated depreciation, depletion, and amortization
|
|
(26,571
|
)
|
|
(25,312
|
)
|
||
|
|
20,143
|
|
|
20,838
|
|
||
OTHER ASSETS:
|
|
|
|
|
||||
Deferred charges and other
|
|
911
|
|
|
910
|
|
||
|
|
$
|
24,346
|
|
|
$
|
25,500
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
544
|
|
|
$
|
618
|
|
Other current liabilities (Note 5)
|
|
1,026
|
|
|
1,223
|
|
||
|
|
1,570
|
|
|
1,841
|
|
||
LONG-TERM DEBT
|
|
8,719
|
|
|
8,716
|
|
||
DEFERRED CREDITS AND OTHER NONCURRENT LIABILITIES:
|
|
|
|
|
||||
Income taxes
|
|
2,308
|
|
|
2,529
|
|
||
Asset retirement obligation
|
|
2,706
|
|
|
2,562
|
|
||
Other
|
|
347
|
|
|
362
|
|
||
|
|
5,361
|
|
|
5,453
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 9)
|
|
|
|
|
||||
EQUITY:
|
|
|
|
|
||||
Common stock, $0.625 par, 860,000,000 shares authorized, 412,532,393 and 411,218,105 shares issued, respectively
|
|
258
|
|
|
257
|
|
||
Paid-in capital
|
|
12,487
|
|
|
12,619
|
|
||
Accumulated deficit
|
|
(2,596
|
)
|
|
(1,980
|
)
|
||
Treasury stock, at cost, 33,174,414 and 33,183,930 shares, respectively
|
|
(2,888
|
)
|
|
(2,889
|
)
|
||
Accumulated other comprehensive loss
|
|
(119
|
)
|
|
(119
|
)
|
||
APACHE SHAREHOLDERS’ EQUITY
|
|
7,142
|
|
|
7,888
|
|
||
Noncontrolling interest
|
|
1,554
|
|
|
1,602
|
|
||
TOTAL EQUITY
|
|
8,696
|
|
|
9,490
|
|
||
|
|
$
|
24,346
|
|
|
$
|
25,500
|
|
|
|
Common
Stock
|
|
Paid-In
Capital
|
|
Retained Earnings (Accumulated Deficit)
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
Loss
|
|
APACHE
SHAREHOLDERS’
EQUITY
|
|
Non
Controlling
Interest
|
|
TOTAL
EQUITY
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2014 previously reported
|
|
$
|
256
|
|
|
$
|
12,438
|
|
|
$
|
16,249
|
|
|
$
|
(2,890
|
)
|
|
$
|
(116
|
)
|
|
$
|
25,937
|
|
|
$
|
2,200
|
|
|
$
|
28,137
|
|
Effect of change in accounting principle
|
|
—
|
|
|
152
|
|
|
(7,594
|
)
|
|
—
|
|
|
—
|
|
|
(7,442
|
)
|
|
(154
|
)
|
|
(7,596
|
)
|
||||||||
BALANCE AT DECEMBER 31, 2014 as recast
|
|
$
|
256
|
|
|
$
|
12,590
|
|
|
$
|
8,655
|
|
|
$
|
(2,890
|
)
|
|
$
|
(116
|
)
|
|
$
|
18,495
|
|
|
$
|
2,046
|
|
|
$
|
20,541
|
|
Net income (loss)
|
|
—
|
|
|
—
|
|
|
(2,194
|
)
|
|
—
|
|
|
—
|
|
|
(2,194
|
)
|
|
91
|
|
|
(2,103
|
)
|
||||||||
Distributions to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(40
|
)
|
|
(40
|
)
|
||||||||
Common dividends ($0.50 per share)
|
|
—
|
|
|
—
|
|
|
(189
|
)
|
|
—
|
|
|
—
|
|
|
(189
|
)
|
|
—
|
|
|
(189
|
)
|
||||||||
Other
|
|
1
|
|
|
45
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
47
|
|
|
—
|
|
|
47
|
|
||||||||
BALANCE AT JUNE 30, 2015
|
|
$
|
257
|
|
|
$
|
12,635
|
|
|
$
|
6,272
|
|
|
$
|
(2,889
|
)
|
|
$
|
(116
|
)
|
|
$
|
16,159
|
|
|
$
|
2,097
|
|
|
$
|
18,256
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
BALANCE AT DECEMBER 31, 2015 previously reported
|
|
$
|
257
|
|
|
$
|
12,467
|
|
|
$
|
(7,153
|
)
|
|
$
|
(2,889
|
)
|
|
$
|
(116
|
)
|
|
$
|
2,566
|
|
|
$
|
1,662
|
|
|
$
|
4,228
|
|
Effect of change in accounting principle
|
|
—
|
|
|
152
|
|
|
5,173
|
|
|
—
|
|
|
(3
|
)
|
|
5,322
|
|
|
(60
|
)
|
|
5,262
|
|
||||||||
BALANCE AT DECEMBER 31, 2015 as recast
|
|
$
|
257
|
|
|
$
|
12,619
|
|
|
$
|
(1,980
|
)
|
|
$
|
(2,889
|
)
|
|
$
|
(119
|
)
|
|
$
|
7,888
|
|
|
$
|
1,602
|
|
|
$
|
9,490
|
|
Net income (loss)
|
|
—
|
|
|
—
|
|
|
(616
|
)
|
|
—
|
|
|
—
|
|
|
(616
|
)
|
|
45
|
|
|
(571
|
)
|
||||||||
Distributions to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(93
|
)
|
|
(93
|
)
|
||||||||
Common dividends ($0.50 per share)
|
|
—
|
|
|
(189
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(189
|
)
|
|
—
|
|
|
(189
|
)
|
||||||||
Other
|
|
1
|
|
|
57
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
59
|
|
|
—
|
|
|
59
|
|
||||||||
BALANCE AT JUNE 30, 2016
|
|
$
|
258
|
|
|
$
|
12,487
|
|
|
$
|
(2,596
|
)
|
|
$
|
(2,888
|
)
|
|
$
|
(119
|
)
|
|
$
|
7,142
|
|
|
$
|
1,554
|
|
|
$
|
8,696
|
|
1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
|
Quarter Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(In millions)
|
||||||||||||||
Oil and Gas Property:
|
|
|
|
|
|
|
|
|
||||||||
Proved
|
|
$
|
68
|
|
|
$
|
349
|
|
|
$
|
68
|
|
|
$
|
2,261
|
|
Unproved
|
|
66
|
|
|
148
|
|
|
108
|
|
|
316
|
|
2.
|
CHANGE IN ACCOUNTING PRINCIPLE
|
|
Changes to the Statement of Consolidated Operations
|
||||||||||
For the Quarter Ended June 30, 2016
|
Under Full Cost
|
|
Changes
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions, except per share data)
|
||||||||||
Oil revenues
|
$
|
1,062
|
|
|
$
|
56
|
|
|
$
|
1,118
|
|
Natural gas revenues
|
218
|
|
|
(9
|
)
|
|
209
|
|
|||
NGL revenues
|
59
|
|
|
—
|
|
|
59
|
|
|||
Oil and gas production revenues
|
1,339
|
|
|
47
|
|
|
1,386
|
|
|||
Other
|
(22
|
)
|
|
1
|
|
|
(21
|
)
|
|||
Gain on divestiture
|
5
|
|
|
12
|
|
|
17
|
|
|||
Exploration
|
—
|
|
|
91
|
|
|
91
|
|
|||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
||||||
Oil and Gas Property and Equipment
|
|
|
|
|
|
||||||
Recurring
|
507
|
|
|
122
|
|
|
629
|
|
|||
Additional
|
671
|
|
|
(671
|
)
|
|
—
|
|
|||
Impairments
|
105
|
|
|
68
|
|
|
173
|
|
|||
Financing costs, net
|
90
|
|
|
14
|
|
|
104
|
|
|||
Current income tax provision
|
25
|
|
|
119
|
|
|
144
|
|
|||
Deferred income tax provision (benefit)
|
(120
|
)
|
|
(105
|
)
|
|
(225
|
)
|
|||
NET LOSS FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
(622
|
)
|
|
422
|
|
|
(200
|
)
|
|||
Net income (loss) attributable to noncontrolling interest
|
(21
|
)
|
|
65
|
|
|
44
|
|
|||
NET LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(601
|
)
|
|
357
|
|
|
(244
|
)
|
|||
Net income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|||
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(601
|
)
|
|
357
|
|
|
(244
|
)
|
|||
|
|
|
|
|
|
||||||
Per common share
|
|
|
|
|
|
||||||
Basic net loss from continuing operations per share
|
$
|
(1.58
|
)
|
|
$
|
0.93
|
|
|
$
|
(0.65
|
)
|
Basic net loss from discontinued operations per share
|
—
|
|
|
—
|
|
|
—
|
|
|||
Basic net loss per share
|
$
|
(1.58
|
)
|
|
$
|
0.93
|
|
|
$
|
(0.65
|
)
|
|
|
|
|
|
|
||||||
Diluted net loss from continuing operations per share
|
$
|
(1.58
|
)
|
|
$
|
0.93
|
|
|
$
|
(0.65
|
)
|
Diluted net loss from discontinued operations per share
|
—
|
|
|
—
|
|
|
—
|
|
|||
Diluted net loss per share
|
$
|
(1.58
|
)
|
|
$
|
0.93
|
|
|
$
|
(0.65
|
)
|
|
Changes to the Statement of Consolidated Operations
|
||||||||||
For the Quarter Ended June 30, 2015
|
Under Full Cost
|
|
Changes*
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions, except per share data)
|
||||||||||
Oil revenues
|
$
|
1,599
|
|
|
$
|
19
|
|
|
$
|
1,618
|
|
Natural gas revenues
|
295
|
|
|
20
|
|
|
315
|
|
|||
NGL revenues
|
58
|
|
|
—
|
|
|
58
|
|
|||
Oil and gas production revenues
|
1,952
|
|
|
39
|
|
|
1,991
|
|
|||
Other
|
25
|
|
|
3
|
|
|
28
|
|
|||
Gain on divestiture
|
—
|
|
|
227
|
|
|
227
|
|
|||
Exploration
|
—
|
|
|
225
|
|
|
225
|
|
|||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
||||||
Oil and Gas Property and Equipment
|
|
|
|
|
|
||||||
Recurring
|
923
|
|
|
(212
|
)
|
|
711
|
|
|||
Additional
|
5,816
|
|
|
(5,816
|
)
|
|
—
|
|
|||
Impairments
|
—
|
|
|
512
|
|
|
512
|
|
|||
Financing costs, net
|
63
|
|
|
54
|
|
|
117
|
|
|||
Current income tax provision (benefit)
|
665
|
|
|
235
|
|
|
900
|
|
|||
Deferred income tax provision (benefit)
|
(1,525
|
)
|
|
1,356
|
|
|
(169
|
)
|
|||
NET LOSS FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
(4,832
|
)
|
|
3,915
|
|
|
(917
|
)
|
|||
Net income attributable to noncontrolling interest
|
36
|
|
|
27
|
|
|
63
|
|
|||
NET LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(4,868
|
)
|
|
3,888
|
|
|
(980
|
)
|
|||
Net loss from discontinued operations
|
(732
|
)
|
|
852
|
|
|
120
|
|
|||
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(5,600
|
)
|
|
4,740
|
|
|
(860
|
)
|
|||
|
|
|
|
|
|
||||||
Per common share
|
|
|
|
|
|
||||||
Basic net loss from continuing operations per share
|
$
|
(12.89
|
)
|
|
$
|
10.29
|
|
|
$
|
(2.60
|
)
|
Basic net loss from discontinued operations per share
|
(1.94
|
)
|
|
2.26
|
|
|
0.32
|
|
|||
Basic net loss per share
|
$
|
(14.83
|
)
|
|
$
|
12.55
|
|
|
$
|
(2.28
|
)
|
|
|
|
|
|
|
||||||
Diluted net loss from continuing operations per share
|
$
|
(12.89
|
)
|
|
$
|
10.29
|
|
|
$
|
(2.60
|
)
|
Diluted net loss from discontinued operations per share
|
(1.94
|
)
|
|
2.26
|
|
|
0.32
|
|
|||
Diluted net loss per share
|
$
|
(14.83
|
)
|
|
$
|
12.55
|
|
|
$
|
(2.28
|
)
|
|
Changes to the Statement of Consolidated Operations
|
||||||||||
For the Six Months Ended June 30, 2016
|
Under Full Cost
|
|
Changes*
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions, except per share data)
|
||||||||||
Oil revenues
|
$
|
1,857
|
|
|
$
|
83
|
|
|
$
|
1,940
|
|
Natural gas revenues
|
441
|
|
|
(9
|
)
|
|
432
|
|
|||
NGL revenues
|
101
|
|
|
—
|
|
|
101
|
|
|||
Oil and gas production revenues
|
2,399
|
|
|
74
|
|
|
2,473
|
|
|||
Other
|
(27
|
)
|
|
3
|
|
|
(24
|
)
|
|||
Gain on divestiture
|
3
|
|
|
13
|
|
|
16
|
|
|||
Exploration
|
—
|
|
|
186
|
|
|
186
|
|
|||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
||||||
Oil and Gas Property and Equipment
|
|
|
|
|
|
||||||
Recurring
|
1,059
|
|
|
206
|
|
|
1,265
|
|
|||
Additional
|
1,159
|
|
|
(1,159
|
)
|
|
—
|
|
|||
Impairments
|
105
|
|
|
68
|
|
|
173
|
|
|||
Financing costs, net
|
180
|
|
|
29
|
|
|
209
|
|
|||
Current income tax provision
|
61
|
|
|
73
|
|
|
134
|
|
|||
Deferred income tax provision (benefit)
|
(301
|
)
|
|
75
|
|
|
(226
|
)
|
|||
NET LOSS FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
(1,183
|
)
|
|
612
|
|
|
(571
|
)
|
|||
Net income (loss) attributable to noncontrolling interest
|
(93
|
)
|
|
138
|
|
|
45
|
|
|||
NET LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(1,090
|
)
|
|
474
|
|
|
(616
|
)
|
|||
Net income (loss) from discontinued operations
|
—
|
|
|
—
|
|
|
—
|
|
|||
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(1,090
|
)
|
|
474
|
|
|
(616
|
)
|
|||
|
|
|
|
|
|
||||||
Per common share
|
|
|
|
|
|
||||||
Basic net loss from continuing operations per share
|
$
|
(2.88
|
)
|
|
$
|
1.25
|
|
|
$
|
(1.63
|
)
|
Basic net loss from discontinued operations per share
|
—
|
|
|
—
|
|
|
—
|
|
|||
Basic net loss per share
|
$
|
(2.88
|
)
|
|
$
|
1.25
|
|
|
$
|
(1.63
|
)
|
|
|
|
|
|
|
||||||
Diluted net loss from continuing operations per share
|
$
|
(2.88
|
)
|
|
$
|
1.25
|
|
|
$
|
(1.63
|
)
|
Diluted net loss from discontinued operations per share
|
—
|
|
|
—
|
|
|
—
|
|
|||
Diluted net loss per share
|
$
|
(2.88
|
)
|
|
$
|
1.25
|
|
|
$
|
(1.63
|
)
|
|
Changes to the Statement of Consolidated Operations
|
||||||||||
For the Six Months Ended June 30, 2015
|
Under Full Cost
|
|
Changes*
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions, except per share data)
|
||||||||||
Oil revenues
|
$
|
2,879
|
|
|
$
|
32
|
|
|
$
|
2,911
|
|
Natural gas revenues
|
595
|
|
|
28
|
|
|
623
|
|
|||
NGL revenues
|
116
|
|
|
—
|
|
|
116
|
|
|||
Oil and gas production revenues
|
3,590
|
|
|
60
|
|
|
3,650
|
|
|||
Other
|
17
|
|
|
5
|
|
|
22
|
|
|||
Gain on divestiture
|
—
|
|
|
209
|
|
|
209
|
|
|||
Exploration
|
—
|
|
|
483
|
|
|
483
|
|
|||
General and administrative
|
193
|
|
|
2
|
|
|
195
|
|
|||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
||||||
Oil and Gas Property and Equipment
|
|
|
|
|
|
||||||
Recurring
|
1,922
|
|
|
(468
|
)
|
|
1,454
|
|
|||
Additional
|
13,036
|
|
|
(13,036
|
)
|
|
—
|
|
|||
Impairments
|
—
|
|
|
2,424
|
|
|
2,424
|
|
|||
Financing costs, net
|
133
|
|
|
108
|
|
|
241
|
|
|||
Current income tax provision (benefit)
|
580
|
|
|
268
|
|
|
848
|
|
|||
Deferred income tax provision (benefit)
|
(4,460
|
)
|
|
3,142
|
|
|
(1,318
|
)
|
|||
NET LOSS FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
(9,336
|
)
|
|
7,351
|
|
|
(1,985
|
)
|
|||
Net income attributable to noncontrolling interest
|
51
|
|
|
40
|
|
|
91
|
|
|||
NET LOSS FROM CONTINUING OPERATIONS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(9,387
|
)
|
|
7,311
|
|
|
(2,076
|
)
|
|||
Net loss from discontinued operations
|
(864
|
)
|
|
746
|
|
|
(118
|
)
|
|||
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS
|
(10,251
|
)
|
|
8,057
|
|
|
(2,194
|
)
|
|||
|
|
|
|
|
|
||||||
Per common share
|
|
|
|
|
|
||||||
Basic net loss from continuing operations per share
|
$
|
(24.88
|
)
|
|
$
|
19.38
|
|
|
$
|
(5.50
|
)
|
Basic net loss from discontinued operations per share
|
(2.29
|
)
|
|
1.98
|
|
|
(0.31
|
)
|
|||
Basic net loss per share
|
$
|
(27.17
|
)
|
|
$
|
21.36
|
|
|
$
|
(5.81
|
)
|
|
|
|
|
|
|
||||||
Diluted net loss from continuing operations per share
|
$
|
(24.88
|
)
|
|
$
|
19.38
|
|
|
$
|
(5.50
|
)
|
Diluted net loss from discontinued operations per share
|
(2.29
|
)
|
|
1.98
|
|
|
(0.31
|
)
|
|||
Diluted net loss per share
|
$
|
(27.17
|
)
|
|
$
|
21.36
|
|
|
$
|
(5.81
|
)
|
|
Changes to the Statement of Consolidated Cash Flows
|
||||||||||
For the Six Months Ended June 30, 2016
|
Under Full Cost
|
|
Changes*
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions)
|
||||||||||
Net loss including noncontrolling interest
|
$
|
(1,183
|
)
|
|
$
|
612
|
|
|
$
|
(571
|
)
|
Gain on divestitures, net
|
(3
|
)
|
|
(13
|
)
|
|
(16
|
)
|
|||
Exploratory dry hole expense and unproved leasehold impairments
|
—
|
|
|
139
|
|
|
139
|
|
|||
Depreciation, depletion, and amortization
|
2,300
|
|
|
(953
|
)
|
|
1,347
|
|
|||
Impairments
|
105
|
|
|
68
|
|
|
173
|
|
|||
Provision for (benefit from) deferred income taxes
|
(301
|
)
|
|
75
|
|
|
(226
|
)
|
|||
Changes in operating assets and liabilities
|
(28
|
)
|
|
(2
|
)
|
|
(30
|
)
|
|||
Net cash provided by operating activities
|
1,057
|
|
|
(74
|
)
|
|
983
|
|
|||
Additions to oil and gas property
|
(999
|
)
|
|
74
|
|
|
(925
|
)
|
|||
Net cash used in investing activities
|
(1,040
|
)
|
|
74
|
|
|
(966
|
)
|
|||
NET INCREASE (DECREASE) IN CASH
|
(266
|
)
|
|
—
|
|
|
(266
|
)
|
|||
BEGINNING CASH BALANCE
|
1,467
|
|
|
—
|
|
|
1,467
|
|
|||
ENDING CASH BALANCE
|
1,201
|
|
|
—
|
|
|
1,201
|
|
|
Changes to the Statement of Consolidated Cash Flows
|
||||||||||
For the Six Months Ended June 30, 2015
|
Under Full Cost
|
|
Changes*
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions)
|
||||||||||
Net loss including noncontrolling interest
|
$
|
(10,200
|
)
|
|
$
|
8,097
|
|
|
$
|
(2,103
|
)
|
Loss from discontinued operations
|
864
|
|
|
(746
|
)
|
|
118
|
|
|||
Gain on divestitures, net
|
—
|
|
|
(209
|
)
|
|
(209
|
)
|
|||
Exploratory dry hole expense and unproved leasehold impairments
|
—
|
|
|
385
|
|
|
385
|
|
|||
Depreciation, depletion, and amortization
|
15,124
|
|
|
(13,504
|
)
|
|
1,620
|
|
|||
Impairments
|
—
|
|
|
2,424
|
|
|
2,424
|
|
|||
Provision for (benefit from) deferred income taxes
|
(4,460
|
)
|
|
3,142
|
|
|
(1,318
|
)
|
|||
Changes in operating assets and liabilities
|
311
|
|
|
297
|
|
|
608
|
|
|||
Net cash provided by operating activities - continuing operations
|
1,737
|
|
|
(114
|
)
|
|
1,623
|
|
|||
Net cash provided by operating activities - discontinued operations
|
196
|
|
|
(37
|
)
|
|
159
|
|
|||
Additions to oil and gas property
|
(2,987
|
)
|
|
204
|
|
|
(2,783
|
)
|
|||
Net cash used in investing activities - continuing operations
|
(2,303
|
)
|
|
204
|
|
|
(2,099
|
)
|
|||
Net cash provided by investing activities - discontinued operations
|
4,335
|
|
|
37
|
|
|
4,372
|
|
|||
NET INCREASE (DECREASE) IN CASH
|
2,181
|
|
|
90
|
|
|
2,271
|
|
|||
BEGINNING CASH BALANCE
|
769
|
|
|
(90
|
)
|
|
679
|
|
|||
ENDING CASH BALANCE
|
2,950
|
|
|
—
|
|
|
2,950
|
|
|
Changes to the Consolidated Balance Sheet
|
||||||||||
June 30, 2016
|
Under Full Cost
|
|
Changes
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions)
|
||||||||||
PROPERTY AND EQUIPMENT:
|
|
|
|
|
|
||||||
Property and equipment - cost
|
$
|
94,657
|
|
|
$
|
(47,943
|
)
|
|
$
|
46,714
|
|
Less: Accumulated depreciation, depletion, and amortization
|
(81,920
|
)
|
|
55,349
|
|
|
(26,571
|
)
|
|||
PROPERTY AND EQUIPMENT, NET
|
12,737
|
|
|
7,406
|
|
|
20,143
|
|
|||
Deferred charges and other
|
937
|
|
|
(26
|
)
|
|
911
|
|
|||
TOTAL ASSETS
|
16,966
|
|
|
7,380
|
|
|
24,346
|
|
|||
Deferred income taxes
|
796
|
|
|
1,512
|
|
|
2,308
|
|
|||
Paid-in capital
|
12,342
|
|
|
145
|
|
|
12,487
|
|
|||
Accumulated deficit
|
(8,243
|
)
|
|
5,647
|
|
|
(2,596
|
)
|
|||
Accumulated other comprehensive loss
|
(116
|
)
|
|
(3
|
)
|
|
(119
|
)
|
|||
Noncontrolling interest
|
1,475
|
|
|
79
|
|
|
1,554
|
|
|||
TOTAL EQUITY
|
2,828
|
|
|
5,868
|
|
|
8,696
|
|
|
Changes to the Consolidated Balance Sheet
|
||||||||||
December 31, 2015
|
Under Full Cost
|
|
Changes*
|
|
As Reported Under Successful Efforts
|
||||||
|
(In millions)
|
||||||||||
PROPERTY AND EQUIPMENT:
|
|
|
|
|
|
||||||
Property and equipment - cost
|
$
|
93,825
|
|
|
$
|
(47,675
|
)
|
|
$
|
46,150
|
|
Less: Accumulated depreciation, depletion, and amortization
|
(79,706
|
)
|
|
54,394
|
|
|
(25,312
|
)
|
|||
PROPERTY AND EQUIPMENT, NET
|
14,119
|
|
|
6,719
|
|
|
20,838
|
|
|||
TOTAL ASSETS
|
18,781
|
|
|
6,719
|
|
|
25,500
|
|
|||
Deferred income taxes
|
1,072
|
|
|
1,457
|
|
|
2,529
|
|
|||
Paid-in capital
|
12,467
|
|
|
152
|
|
|
12,619
|
|
|||
Accumulated deficit
(1)
|
(7,153
|
)
|
|
5,173
|
|
|
(1,980
|
)
|
|||
Accumulated other comprehensive loss
|
(116
|
)
|
|
(3
|
)
|
|
(119
|
)
|
|||
Noncontrolling interest
|
1,662
|
|
|
(60
|
)
|
|
1,602
|
|
|||
TOTAL EQUITY
|
4,228
|
|
|
5,262
|
|
|
9,490
|
|
3.
|
ACQUISITIONS AND DIVESTITURES
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues and other from discontinued operations
|
|
$
|
—
|
|
|
$
|
101
|
|
|
$
|
—
|
|
|
$
|
288
|
|
Impairment on Woodside sale
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(49
|
)
|
Loss on Consortium sale
|
|
—
|
|
|
(139
|
)
|
|
—
|
|
|
(139
|
)
|
||||
Income from divested Australian operations
|
|
—
|
|
|
18
|
|
|
—
|
|
|
28
|
|
||||
Income tax benefit
|
|
—
|
|
|
241
|
|
|
—
|
|
|
42
|
|
||||
Income (loss) from Australian discontinued operations, net of tax
|
|
$
|
—
|
|
|
$
|
120
|
|
|
$
|
—
|
|
|
$
|
(118
|
)
|
5.
|
OTHER CURRENT LIABILITIES
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
|
|
(In millions)
|
||||||
Accrued operating expenses
|
|
$
|
120
|
|
|
$
|
139
|
|
Accrued exploration and development
|
|
475
|
|
|
637
|
|
||
Accrued compensation and benefits
|
|
99
|
|
|
166
|
|
||
Accrued interest
|
|
146
|
|
|
144
|
|
||
Accrued income taxes
|
|
54
|
|
|
47
|
|
||
Current debt
|
|
1
|
|
|
1
|
|
||
Current asset retirement obligation
|
|
36
|
|
|
36
|
|
||
Other
|
|
95
|
|
|
53
|
|
||
Total Other current liabilities
|
|
$
|
1,026
|
|
|
$
|
1,223
|
|
6.
|
ASSET RETIREMENT OBLIGATION
|
|
|
(In millions)
|
||
Asset retirement obligation at December 31, 2015
|
|
$
|
2,598
|
|
Liabilities incurred
|
|
6
|
|
|
Liabilities acquired
|
|
34
|
|
|
Liabilities settled
|
|
(31
|
)
|
|
Accretion expense
|
|
76
|
|
|
Revisions in estimated liabilities
|
|
59
|
|
|
Asset retirement obligation at June 30, 2016
|
|
2,742
|
|
|
Less current portion
|
|
36
|
|
|
Asset retirement obligation, long-term
|
|
$
|
2,706
|
|
7.
|
DEBT AND FINANCING COSTS
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
|
|
(In millions)
|
||||||||||||||
Commercial paper and committed bank facilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Notes and debentures
|
|
8,720
|
|
|
9,393
|
|
|
8,717
|
|
|
8,330
|
|
||||
Total Debt
|
|
$
|
8,720
|
|
|
$
|
9,393
|
|
|
$
|
8,717
|
|
|
$
|
8,330
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(In millions)
|
||||||||||||||
Interest expense
|
|
$
|
116
|
|
|
$
|
123
|
|
|
$
|
232
|
|
|
$
|
251
|
|
Amortization of deferred loan costs
|
|
2
|
|
|
2
|
|
|
3
|
|
|
4
|
|
||||
Capitalized interest
|
|
(12
|
)
|
|
(5
|
)
|
|
(23
|
)
|
|
(9
|
)
|
||||
Interest income
|
|
(2
|
)
|
|
(3
|
)
|
|
(3
|
)
|
|
(5
|
)
|
||||
Financing costs, net
|
|
$
|
104
|
|
|
$
|
117
|
|
|
$
|
209
|
|
|
$
|
241
|
|
8.
|
INCOME TAXES
|
9.
|
COMMITMENTS AND CONTINGENCIES
|
10.
|
CAPITAL STOCK
|
|
|
For the Quarter Ended June 30,
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
||||||||||||||||||
|
|
Loss
|
|
Shares
|
|
Per Share
|
|
Income (Loss)
|
|
Shares
|
|
Per Share
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss from continuing operations
|
|
$
|
(244
|
)
|
|
379
|
|
|
$
|
(0.65
|
)
|
|
$
|
(980
|
)
|
|
378
|
|
|
$
|
(2.60
|
)
|
Income (loss) from discontinued operations
|
|
—
|
|
|
379
|
|
|
—
|
|
|
120
|
|
|
378
|
|
|
0.32
|
|
||||
Loss attributable to common stock
|
|
$
|
(244
|
)
|
|
379
|
|
|
$
|
(0.65
|
)
|
|
$
|
(860
|
)
|
|
378
|
|
|
$
|
(2.28
|
)
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stock options and other
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss from continuing operations
|
|
$
|
(244
|
)
|
|
379
|
|
|
$
|
(0.65
|
)
|
|
$
|
(980
|
)
|
|
378
|
|
|
$
|
(2.60
|
)
|
Income (loss) from discontinued operations
|
|
—
|
|
|
379
|
|
|
—
|
|
|
120
|
|
|
378
|
|
|
0.32
|
|
||||
Loss attributable to common stock
|
|
$
|
(244
|
)
|
|
379
|
|
|
$
|
(0.65
|
)
|
|
$
|
(860
|
)
|
|
378
|
|
|
$
|
(2.28
|
)
|
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||||
|
|
2016
|
|
2015
|
||||||||||||||||||
|
|
Loss
|
|
Shares
|
|
Per Share
|
|
Loss
|
|
Shares
|
|
Per Share
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss from continuing operations
|
|
$
|
(616
|
)
|
|
379
|
|
|
$
|
(1.63
|
)
|
|
$
|
(2,076
|
)
|
|
377
|
|
|
$
|
(5.50
|
)
|
Loss from discontinued operations
|
|
—
|
|
|
379
|
|
|
—
|
|
|
(118
|
)
|
|
377
|
|
|
(0.31
|
)
|
||||
Loss attributable to common stock
|
|
$
|
(616
|
)
|
|
379
|
|
|
$
|
(1.63
|
)
|
|
$
|
(2,194
|
)
|
|
377
|
|
|
$
|
(5.81
|
)
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stock options and other
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
|
||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Loss from continuing operations
|
|
$
|
(616
|
)
|
|
379
|
|
|
$
|
(1.63
|
)
|
|
$
|
(2,076
|
)
|
|
377
|
|
|
$
|
(5.50
|
)
|
Loss from discontinued operations
|
|
—
|
|
|
379
|
|
|
—
|
|
|
(118
|
)
|
|
377
|
|
|
(0.31
|
)
|
||||
Loss attributable to common stock
|
|
$
|
(616
|
)
|
|
379
|
|
|
$
|
(1.63
|
)
|
|
$
|
(2,194
|
)
|
|
377
|
|
|
$
|
(5.81
|
)
|
11.
|
BUSINESS SEGMENT INFORMATION
|
|
|
United
States
|
|
Canada
|
|
Egypt
(1)
|
|
North Sea
|
|
Other
International
|
|
Total
(3)
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Quarter Ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil and Gas Production Revenues
|
|
$
|
520
|
|
|
$
|
73
|
|
|
$
|
542
|
|
|
$
|
251
|
|
|
$
|
—
|
|
|
$
|
1,386
|
|
Operating Income (Loss)
(2)
|
|
$
|
(109
|
)
|
|
$
|
(57
|
)
|
|
$
|
220
|
|
|
$
|
(115
|
)
|
|
$
|
—
|
|
|
$
|
(61
|
)
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain (loss) on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
17
|
|
|||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
(21
|
)
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(103
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(9
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(104
|
)
|
|||||||||||
Loss Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(281
|
)
|
||||||||||
For the Six Months Ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil and Gas Production Revenues
|
|
$
|
929
|
|
|
$
|
156
|
|
|
$
|
934
|
|
|
$
|
454
|
|
|
$
|
—
|
|
|
$
|
2,473
|
|
Operating Income (Loss)
(2)
|
|
$
|
(267
|
)
|
|
$
|
(118
|
)
|
|
$
|
261
|
|
|
$
|
(101
|
)
|
|
$
|
(1
|
)
|
|
$
|
(226
|
)
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain (loss) on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
16
|
|
|||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
(24
|
)
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(196
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(24
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(209
|
)
|
|||||||||||
Loss Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(663
|
)
|
||||||||||
Total Assets
|
|
$
|
12,383
|
|
|
$
|
2,070
|
|
|
$
|
5,520
|
|
|
$
|
4,326
|
|
|
$
|
47
|
|
|
$
|
24,346
|
|
|
|
United
States
|
|
Canada
|
|
Egypt
(1)
|
|
North Sea
|
|
Other
International
|
|
Total
(3)
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Quarter Ended June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil and Gas Production Revenues
|
|
$
|
767
|
|
|
$
|
138
|
|
|
$
|
703
|
|
|
$
|
383
|
|
|
$
|
—
|
|
|
$
|
1,991
|
|
Operating Income (Loss)
(2)
|
|
$
|
(363
|
)
|
|
$
|
(78
|
)
|
|
$
|
335
|
|
|
$
|
(40
|
)
|
|
$
|
(1
|
)
|
|
$
|
(147
|
)
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain (loss) on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
227
|
|
|||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
28
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(111
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(66
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(117
|
)
|
|||||||||||
Loss From Continuing Operations Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(186
|
)
|
||||||||||
For the Six Months Ended June 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil and Gas Production Revenues
|
|
$
|
1,427
|
|
|
$
|
271
|
|
|
$
|
1,256
|
|
|
$
|
696
|
|
|
$
|
—
|
|
|
$
|
3,650
|
|
Operating Income (Loss)
(2)
|
|
$
|
(2,382
|
)
|
|
$
|
(174
|
)
|
|
$
|
499
|
|
|
$
|
(72
|
)
|
|
$
|
(1
|
)
|
|
$
|
(2,130
|
)
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain (loss) on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
209
|
|
|||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
22
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(195
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(120
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(241
|
)
|
|||||||||||
Loss From Continuing Operations Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(2,455
|
)
|
||||||||||
Total Assets
|
|
$
|
20,367
|
|
|
$
|
3,932
|
|
|
$
|
7,435
|
|
|
$
|
4,488
|
|
|
$
|
580
|
|
|
$
|
36,802
|
|
(1)
|
Includes a noncontrolling interest in Egypt.
|
(2)
|
Operating Income (Loss) consists of oil and gas production revenues less lease operating expenses, gathering and transportation costs, taxes other than income, exploration costs, depreciation, depletion, and amortization, asset retirement obligation accretion, and impairments. The operating income (loss) of U.S., Canada, and North Sea includes asset impairments totaling
$125 million
,
$9 million
, and
$105 million
, respectively, for the second quarter of 2016. The operating income (loss) of U.S., Canada, and North Sea includes asset impairments totaling
$166 million
,
$10 million
, and
$105 million
, respectively, for the first six months of 2016. The operating income (loss) of U.S., Canada, Egypt, and North Sea includes asset impairments totaling
$465 million
,
$27 million
,
$5 million
, and
$163 million
, respectively, for the second quarter of 2015. The operating income (loss) of U.S., Canada, Egypt, and North Sea include asset impairments totaling
$2.4 billion
,
$54 million
,
$267 million
, and
$13 million
, respectively, for the first six months of 2015.
|
(3)
|
Amounts for 2015 have been restated to exclude Australia discontinued operations.
|
12.
|
SUPPLEMENTAL GUARANTOR INFORMATION
|
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
REVENUES AND OTHER:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Oil and gas production revenues
|
|
$
|
270
|
|
|
$
|
—
|
|
|
$
|
1,116
|
|
|
$
|
—
|
|
|
$
|
1,386
|
|
Equity in net income of affiliates
|
|
(76
|
)
|
|
6
|
|
|
—
|
|
|
70
|
|
|
—
|
|
|||||
Other
|
|
(22
|
)
|
|
9
|
|
|
(8
|
)
|
|
—
|
|
|
(21
|
)
|
|||||
Gain (loss) on divestiture
|
|
(1
|
)
|
|
—
|
|
|
18
|
|
|
—
|
|
|
17
|
|
|||||
|
|
171
|
|
|
15
|
|
|
1,126
|
|
|
70
|
|
|
1,382
|
|
|||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Lease operating expenses
|
|
66
|
|
|
—
|
|
|
293
|
|
|
—
|
|
|
359
|
|
|||||
Gathering and transportation
|
|
10
|
|
|
—
|
|
|
42
|
|
|
—
|
|
|
52
|
|
|||||
Taxes other than income
|
|
22
|
|
|
—
|
|
|
43
|
|
|
—
|
|
|
65
|
|
|||||
Exploration
|
|
76
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
91
|
|
|||||
General and administrative
|
|
86
|
|
|
—
|
|
|
17
|
|
|
—
|
|
|
103
|
|
|||||
Depreciation, depletion, and amortization
|
|
159
|
|
|
—
|
|
|
510
|
|
|
—
|
|
|
669
|
|
|||||
Asset retirement obligation accretion
|
|
5
|
|
|
—
|
|
|
33
|
|
|
—
|
|
|
38
|
|
|||||
Impairments
|
|
61
|
|
|
—
|
|
|
112
|
|
|
—
|
|
|
173
|
|
|||||
Transaction, reorganization, and separation
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|||||
Financing costs, net
|
|
64
|
|
|
7
|
|
|
33
|
|
|
—
|
|
|
104
|
|
|||||
|
|
558
|
|
|
7
|
|
|
1,098
|
|
|
—
|
|
|
1,663
|
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
|
(387
|
)
|
|
8
|
|
|
28
|
|
|
70
|
|
|
(281
|
)
|
|||||
Provision (benefit) for income taxes
|
|
(143
|
)
|
|
2
|
|
|
60
|
|
|
—
|
|
|
(81
|
)
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
|
(244
|
)
|
|
6
|
|
|
(32
|
)
|
|
70
|
|
|
(200
|
)
|
|||||
Net income (loss) from discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTEREST
|
|
(244
|
)
|
|
6
|
|
|
(32
|
)
|
|
70
|
|
|
(200
|
)
|
|||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
44
|
|
|
—
|
|
|
44
|
|
|||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK
|
|
$
|
(244
|
)
|
|
$
|
6
|
|
|
$
|
(76
|
)
|
|
$
|
70
|
|
|
$
|
(244
|
)
|
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
REVENUES AND OTHER:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Oil and gas production revenues
|
|
$
|
434
|
|
|
$
|
—
|
|
|
$
|
1,557
|
|
|
$
|
—
|
|
|
$
|
1,991
|
|
Equity in net income (loss) of affiliates
|
|
(172
|
)
|
|
35
|
|
|
(1
|
)
|
|
138
|
|
|
—
|
|
|||||
Other
|
|
(7
|
)
|
|
12
|
|
|
4
|
|
|
19
|
|
|
28
|
|
|||||
Gain (loss) on divestiture
|
|
(16
|
)
|
|
—
|
|
|
243
|
|
|
—
|
|
|
227
|
|
|||||
|
|
239
|
|
|
47
|
|
|
1,803
|
|
|
157
|
|
|
2,246
|
|
|||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Lease operating expenses
|
|
108
|
|
|
—
|
|
|
359
|
|
|
—
|
|
|
467
|
|
|||||
Gathering and transportation
|
|
7
|
|
|
—
|
|
|
42
|
|
|
—
|
|
|
49
|
|
|||||
Taxes other than income
|
|
33
|
|
|
—
|
|
|
22
|
|
|
—
|
|
|
55
|
|
|||||
Exploration
|
|
166
|
|
|
—
|
|
|
59
|
|
|
—
|
|
|
225
|
|
|||||
General and administrative
|
|
74
|
|
|
—
|
|
|
18
|
|
|
19
|
|
|
111
|
|
|||||
Depreciation, depletion, and amortization
|
|
232
|
|
|
—
|
|
|
562
|
|
|
—
|
|
|
794
|
|
|||||
Asset retirement obligation accretion
|
|
3
|
|
|
—
|
|
|
33
|
|
|
—
|
|
|
36
|
|
|||||
Impairments
|
|
201
|
|
|
—
|
|
|
311
|
|
|
—
|
|
|
512
|
|
|||||
Transaction, reorganization, and separation
|
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
|||||
Financing costs, net
|
|
116
|
|
|
11
|
|
|
(10
|
)
|
|
—
|
|
|
117
|
|
|||||
|
|
1,006
|
|
|
11
|
|
|
1,396
|
|
|
19
|
|
|
2,432
|
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
|
(767
|
)
|
|
36
|
|
|
407
|
|
|
138
|
|
|
(186
|
)
|
|||||
Provision (benefit) for income taxes
|
|
(79
|
)
|
|
2
|
|
|
808
|
|
|
—
|
|
|
731
|
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
|
(688
|
)
|
|
34
|
|
|
(401
|
)
|
|
138
|
|
|
(917
|
)
|
|||||
Net loss from discontinued operations, net of tax
|
|
(172
|
)
|
|
—
|
|
|
292
|
|
|
—
|
|
|
120
|
|
|||||
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTEREST
|
|
(860
|
)
|
|
34
|
|
|
(109
|
)
|
|
138
|
|
|
(797
|
)
|
|||||
Net income attributable to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
63
|
|
|
—
|
|
|
63
|
|
|||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK
|
|
$
|
(860
|
)
|
|
$
|
34
|
|
|
$
|
(172
|
)
|
|
$
|
138
|
|
|
$
|
(860
|
)
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
(In millions)
|
||||||||||||||||||
REVENUES AND OTHER:
|
|
|
|
|
|
|
|
|
|
||||||||||
Oil and gas production revenues
|
$
|
487
|
|
|
$
|
—
|
|
|
$
|
1,986
|
|
|
$
|
—
|
|
|
$
|
2,473
|
|
Equity in net income (loss) of affiliates
|
(184
|
)
|
|
(20
|
)
|
|
—
|
|
|
204
|
|
|
—
|
|
|||||
Other
|
6
|
|
|
21
|
|
|
(51
|
)
|
|
—
|
|
|
(24
|
)
|
|||||
Gain (loss) on divestiture
|
(2
|
)
|
|
—
|
|
|
18
|
|
|
—
|
|
|
16
|
|
|||||
|
307
|
|
|
1
|
|
|
1,953
|
|
|
204
|
|
|
2,465
|
|
|||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Lease operating expenses
|
144
|
|
|
—
|
|
|
593
|
|
|
—
|
|
|
737
|
|
|||||
Gathering and transportation
|
19
|
|
|
—
|
|
|
85
|
|
|
—
|
|
|
104
|
|
|||||
Taxes other than income
|
43
|
|
|
—
|
|
|
33
|
|
|
—
|
|
|
76
|
|
|||||
Exploration
|
126
|
|
|
—
|
|
|
60
|
|
|
—
|
|
|
186
|
|
|||||
General and administrative
|
163
|
|
|
—
|
|
|
33
|
|
|
—
|
|
|
196
|
|
|||||
Depreciation, depletion, and amortization
|
315
|
|
|
—
|
|
|
1,032
|
|
|
—
|
|
|
1,347
|
|
|||||
Asset retirement obligation accretion
|
9
|
|
|
—
|
|
|
67
|
|
|
—
|
|
|
76
|
|
|||||
Impairments
|
61
|
|
|
—
|
|
|
112
|
|
|
—
|
|
|
173
|
|
|||||
Transaction, reorganization, and separation
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
|||||
Financing costs, net
|
125
|
|
|
17
|
|
|
67
|
|
|
—
|
|
|
209
|
|
|||||
|
1,029
|
|
|
17
|
|
|
2,082
|
|
|
—
|
|
|
3,128
|
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
(722
|
)
|
|
(16
|
)
|
|
(129
|
)
|
|
204
|
|
|
(663
|
)
|
|||||
Provision (benefit) for income taxes
|
(106
|
)
|
|
4
|
|
|
10
|
|
|
—
|
|
|
(92
|
)
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
(616
|
)
|
|
(20
|
)
|
|
(139
|
)
|
|
204
|
|
|
(571
|
)
|
|||||
Net loss from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTEREST
|
(616
|
)
|
|
(20
|
)
|
|
(139
|
)
|
|
204
|
|
|
(571
|
)
|
|||||
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
45
|
|
|
—
|
|
|
45
|
|
|||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK
|
$
|
(616
|
)
|
|
$
|
(20
|
)
|
|
$
|
(184
|
)
|
|
$
|
204
|
|
|
$
|
(616
|
)
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
(In millions)
|
||||||||||||||||||
REVENUES AND OTHER:
|
|
|
|
|
|
|
|
|
|
||||||||||
Oil and gas production revenues
|
$
|
799
|
|
|
$
|
—
|
|
|
$
|
2,851
|
|
|
$
|
—
|
|
|
$
|
3,650
|
|
Equity in net income (loss) of affiliates
|
(1,419
|
)
|
|
(18
|
)
|
|
—
|
|
|
1,437
|
|
|
—
|
|
|||||
Other
|
(45
|
)
|
|
26
|
|
|
22
|
|
|
19
|
|
|
22
|
|
|||||
Gain (loss) on divestiture
|
(29
|
)
|
|
—
|
|
|
238
|
|
|
—
|
|
|
209
|
|
|||||
|
(694
|
)
|
|
8
|
|
|
3,111
|
|
|
1,456
|
|
|
3,881
|
|
|||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
|
||||||||||
Lease operating expenses
|
232
|
|
|
—
|
|
|
716
|
|
|
—
|
|
|
948
|
|
|||||
Gathering and transportation
|
16
|
|
|
—
|
|
|
89
|
|
|
—
|
|
|
105
|
|
|||||
Taxes other than income
|
67
|
|
|
—
|
|
|
61
|
|
|
—
|
|
|
128
|
|
|||||
Exploration
|
261
|
|
|
—
|
|
|
222
|
|
|
—
|
|
|
483
|
|
|||||
General and administrative
|
136
|
|
|
—
|
|
|
40
|
|
|
19
|
|
|
195
|
|
|||||
Depreciation, depletion, and amortization
|
494
|
|
|
—
|
|
|
1,126
|
|
|
—
|
|
|
1,620
|
|
|||||
Asset retirement obligation accretion
|
7
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|
72
|
|
|||||
Impairments
|
1,365
|
|
|
—
|
|
|
1,059
|
|
|
—
|
|
|
2,424
|
|
|||||
Transaction, reorganization, and separation
|
120
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
120
|
|
|||||
Financing costs, net
|
215
|
|
|
21
|
|
|
5
|
|
|
—
|
|
|
241
|
|
|||||
|
2,913
|
|
|
21
|
|
|
3,383
|
|
|
19
|
|
|
6,336
|
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
(3,607
|
)
|
|
(13
|
)
|
|
(272
|
)
|
|
1,437
|
|
|
(2,455
|
)
|
|||||
Provision for income taxes
|
(1,585
|
)
|
|
5
|
|
|
1,110
|
|
|
—
|
|
|
(470
|
)
|
|||||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS INCLUDING NONCONTROLLING INTEREST
|
(2,022
|
)
|
|
(18
|
)
|
|
(1,382
|
)
|
|
1,437
|
|
|
(1,985
|
)
|
|||||
Net loss from discontinued operations, net of tax
|
(172
|
)
|
|
—
|
|
|
54
|
|
|
—
|
|
|
(118
|
)
|
|||||
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTEREST
|
(2,194
|
)
|
|
(18
|
)
|
|
(1,328
|
)
|
|
1,437
|
|
|
(2,103
|
)
|
|||||
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
91
|
|
|
—
|
|
|
91
|
|
|||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK
|
$
|
(2,194
|
)
|
|
$
|
(18
|
)
|
|
$
|
(1,419
|
)
|
|
$
|
1,437
|
|
|
$
|
(2,194
|
)
|
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
CASH PROVIDED BY (USED IN) CONTINUING OPERATING ACTIVITIES
|
|
$
|
54
|
|
|
$
|
(21
|
)
|
|
$
|
1,590
|
|
|
$
|
—
|
|
|
$
|
1,623
|
|
CASH PROVIDED BY DISCONTINUED OPERATIONS
|
|
—
|
|
|
—
|
|
|
159
|
|
|
—
|
|
|
159
|
|
|||||
CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
|
|
54
|
|
|
(21
|
)
|
|
1,749
|
|
|
—
|
|
|
1,782
|
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Additions to oil and gas property
|
|
(1,095
|
)
|
|
—
|
|
|
(1,688
|
)
|
|
—
|
|
|
(2,783
|
)
|
|||||
Leasehold and property acquisitions
|
|
(124
|
)
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
(128
|
)
|
|||||
Additions to gas gathering, transmission, and processing facilities
|
|
(24
|
)
|
|
—
|
|
|
(70
|
)
|
|
—
|
|
|
(94
|
)
|
|||||
Proceeds from sale Kitimat LNG
|
|
—
|
|
|
—
|
|
|
854
|
|
|
—
|
|
|
854
|
|
|||||
Proceeds from sale of other oil and gas properties
|
|
4
|
|
|
—
|
|
|
115
|
|
|
—
|
|
|
119
|
|
|||||
Investment in subsidiaries, net
|
|
82
|
|
|
—
|
|
|
—
|
|
|
(82
|
)
|
|
—
|
|
|||||
Other
|
|
(16
|
)
|
|
—
|
|
|
(51
|
)
|
|
—
|
|
|
(67
|
)
|
|||||
NET CASH USED IN CONTINUING INVESTING ACTIVITIES
|
|
(1,173
|
)
|
|
—
|
|
|
(844
|
)
|
|
(82
|
)
|
|
(2,099
|
)
|
|||||
NET CASH PROVIDED BY DISCONTINUED OPERATIONS
|
|
—
|
|
|
—
|
|
|
4,372
|
|
|
—
|
|
|
4,372
|
|
|||||
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
|
|
(1,173
|
)
|
|
—
|
|
|
3,528
|
|
|
(82
|
)
|
|
2,273
|
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Commercial paper and bank credit facilities, net
|
|
(1,570
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,570
|
)
|
|||||
Intercompany borrowings
|
|
4,562
|
|
|
(10
|
)
|
|
(4,634
|
)
|
|
82
|
|
|
—
|
|
|||||
Distributions to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
(40
|
)
|
|
—
|
|
|
(40
|
)
|
|||||
Dividends paid
|
|
(189
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(189
|
)
|
|||||
Other
|
|
2
|
|
|
31
|
|
|
(18
|
)
|
|
—
|
|
|
15
|
|
|||||
NET CASH PROVIDED BY (USED IN) CONTINUING FINANCING ACTIVITIES
|
|
2,805
|
|
|
21
|
|
|
(4,692
|
)
|
|
82
|
|
|
(1,784
|
)
|
|||||
NET CASH USED IN DISCONTINUED OPERATIONS
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
|
|
2,805
|
|
|
21
|
|
|
(4,692
|
)
|
|
82
|
|
|
(1,784
|
)
|
|||||
NET DECREASE IN CASH AND CASH EQUIVALENTS
|
|
1,686
|
|
|
—
|
|
|
585
|
|
|
—
|
|
|
2,271
|
|
|||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
|
|
267
|
|
|
—
|
|
|
412
|
|
|
—
|
|
|
679
|
|
|||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
1,953
|
|
|
$
|
—
|
|
|
$
|
997
|
|
|
$
|
—
|
|
|
$
|
2,950
|
|
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
||||||||||||||||||
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
152
|
|
|
$
|
—
|
|
|
$
|
1,049
|
|
|
$
|
—
|
|
|
$
|
1,201
|
|
Receivables, net of allowance
|
|
330
|
|
|
—
|
|
|
686
|
|
|
—
|
|
|
1,016
|
|
|||||
Inventories
|
|
32
|
|
|
—
|
|
|
498
|
|
|
—
|
|
|
530
|
|
|||||
Drilling advances
|
|
6
|
|
|
—
|
|
|
196
|
|
|
—
|
|
|
202
|
|
|||||
Deferred tax asset
|
|
(28
|
)
|
|
—
|
|
|
28
|
|
|
—
|
|
|
—
|
|
|||||
Prepaid assets and other
|
|
193
|
|
|
—
|
|
|
150
|
|
|
—
|
|
|
343
|
|
|||||
Intercompany receivable
|
|
5,371
|
|
|
—
|
|
|
—
|
|
|
(5,371
|
)
|
|
—
|
|
|||||
|
|
6,056
|
|
|
—
|
|
|
2,607
|
|
|
(5,371
|
)
|
|
3,292
|
|
|||||
PROPERTY AND EQUIPMENT, NET
|
|
6,304
|
|
|
—
|
|
|
13,839
|
|
|
—
|
|
|
20,143
|
|
|||||
OTHER ASSETS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany receivable
|
|
—
|
|
|
—
|
|
|
11,083
|
|
|
(11,083
|
)
|
|
—
|
|
|||||
Equity in affiliates
|
|
15,908
|
|
|
(1,080
|
)
|
|
699
|
|
|
(15,527
|
)
|
|
—
|
|
|||||
Deferred charges and other
|
|
93
|
|
|
1,000
|
|
|
818
|
|
|
(1,000
|
)
|
|
911
|
|
|||||
|
|
$
|
28,361
|
|
|
$
|
(80
|
)
|
|
$
|
29,046
|
|
|
$
|
(32,981
|
)
|
|
$
|
24,346
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
|
$
|
324
|
|
|
$
|
(2
|
)
|
|
$
|
222
|
|
|
$
|
—
|
|
|
$
|
544
|
|
Other current liabilities
|
|
403
|
|
|
2
|
|
|
621
|
|
|
—
|
|
|
1,026
|
|
|||||
Intercompany payable
|
|
—
|
|
|
—
|
|
|
5,371
|
|
|
(5,371
|
)
|
|
—
|
|
|||||
|
|
727
|
|
|
—
|
|
|
6,214
|
|
|
(5,371
|
)
|
|
1,570
|
|
|||||
LONG-TERM DEBT
|
|
8,431
|
|
|
297
|
|
|
(9
|
)
|
|
—
|
|
|
8,719
|
|
|||||
DEFERRED CREDITS AND OTHER NONCURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany payable
|
|
10,976
|
|
|
—
|
|
|
107
|
|
|
(11,083
|
)
|
|
—
|
|
|||||
Income taxes
|
|
(114
|
)
|
|
5
|
|
|
2,417
|
|
|
—
|
|
|
2,308
|
|
|||||
Asset retirement obligation
|
|
277
|
|
|
—
|
|
|
2,429
|
|
|
—
|
|
|
2,706
|
|
|||||
Other
|
|
922
|
|
|
(1
|
)
|
|
426
|
|
|
(1,000
|
)
|
|
347
|
|
|||||
|
|
12,061
|
|
|
4
|
|
|
5,379
|
|
|
(12,083
|
)
|
|
5,361
|
|
|||||
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
APACHE SHAREHOLDERS’ EQUITY
|
|
7,142
|
|
|
(381
|
)
|
|
15,908
|
|
|
(15,527
|
)
|
|
7,142
|
|
|||||
Noncontrolling interest
|
|
—
|
|
|
—
|
|
|
1,554
|
|
|
—
|
|
|
1,554
|
|
|||||
TOTAL EQUITY
|
|
7,142
|
|
|
(381
|
)
|
|
17,462
|
|
|
(15,527
|
)
|
|
8,696
|
|
|||||
|
|
$
|
28,361
|
|
|
$
|
(80
|
)
|
|
$
|
29,046
|
|
|
$
|
(32,981
|
)
|
|
$
|
24,346
|
|
|
|
Apache
Corporation
|
|
Apache
Finance
Canada
|
|
All Other
Subsidiaries
of Apache
Corporation
|
|
Reclassifications
& Eliminations
|
|
Consolidated
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
ASSETS
|
|
|
||||||||||||||||||
CURRENT ASSETS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
|
$
|
378
|
|
|
$
|
—
|
|
|
$
|
1,089
|
|
|
$
|
—
|
|
|
$
|
1,467
|
|
Receivables, net of allowance
|
|
314
|
|
|
—
|
|
|
939
|
|
|
—
|
|
|
1,253
|
|
|||||
Inventories
|
|
34
|
|
|
—
|
|
|
536
|
|
|
—
|
|
|
570
|
|
|||||
Drilling advances
|
|
16
|
|
|
—
|
|
|
156
|
|
|
—
|
|
|
172
|
|
|||||
Prepaid assets and other
|
|
102
|
|
|
—
|
|
|
188
|
|
|
—
|
|
|
290
|
|
|||||
Intercompany receivable
|
|
5,212
|
|
|
—
|
|
|
—
|
|
|
(5,212
|
)
|
|
—
|
|
|||||
|
|
6,056
|
|
|
—
|
|
|
2,908
|
|
|
(5,212
|
)
|
|
3,752
|
|
|||||
PROPERTY AND EQUIPMENT, NET
|
|
6,546
|
|
|
—
|
|
|
14,292
|
|
|
—
|
|
|
20,838
|
|
|||||
OTHER ASSETS:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany receivable
|
|
—
|
|
|
—
|
|
|
10,744
|
|
|
(10,744
|
)
|
|
—
|
|
|||||
Equity in affiliates
|
|
16,092
|
|
|
(807
|
)
|
|
446
|
|
|
(15,731
|
)
|
|
—
|
|
|||||
Deferred charges and other
|
|
96
|
|
|
1,001
|
|
|
813
|
|
|
(1,000
|
)
|
|
910
|
|
|||||
|
|
$
|
28,790
|
|
|
$
|
194
|
|
|
$
|
29,203
|
|
|
$
|
(32,687
|
)
|
|
$
|
25,500
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
||||||||||
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable
|
|
$
|
409
|
|
|
$
|
—
|
|
|
$
|
209
|
|
|
$
|
—
|
|
|
$
|
618
|
|
Other current liabilities
|
|
539
|
|
|
3
|
|
|
681
|
|
|
—
|
|
|
1,223
|
|
|||||
Intercompany payable
|
|
—
|
|
|
—
|
|
|
5,212
|
|
|
(5,212
|
)
|
|
—
|
|
|||||
|
|
948
|
|
|
3
|
|
|
6,102
|
|
|
(5,212
|
)
|
|
1,841
|
|
|||||
LONG-TERM DEBT
|
|
8,418
|
|
|
298
|
|
|
—
|
|
|
—
|
|
|
8,716
|
|
|||||
DEFERRED CREDITS AND OTHER NONCURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Intercompany payable
|
|
10,744
|
|
|
—
|
|
|
—
|
|
|
(10,744
|
)
|
|
—
|
|
|||||
Income taxes
|
|
(412
|
)
|
|
4
|
|
|
2,937
|
|
|
—
|
|
|
2,529
|
|
|||||
Asset retirement obligation
|
|
271
|
|
|
—
|
|
|
2,291
|
|
|
—
|
|
|
2,562
|
|
|||||
Other
|
|
933
|
|
|
250
|
|
|
179
|
|
|
(1,000
|
)
|
|
362
|
|
|||||
|
|
11,536
|
|
|
254
|
|
|
5,407
|
|
|
(11,744
|
)
|
|
5,453
|
|
|||||
COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
||||||||||
APACHE SHAREHOLDERS’ EQUITY
|
|
7,888
|
|
|
(361
|
)
|
|
16,092
|
|
|
(15,731
|
)
|
|
7,888
|
|
|||||
Noncontrolling interest
|
|
—
|
|
|
—
|
|
|
1,602
|
|
|
—
|
|
|
1,602
|
|
|||||
TOTAL EQUITY
|
|
7,888
|
|
|
(361
|
)
|
|
17,694
|
|
|
(15,731
|
)
|
|
9,490
|
|
|||||
|
|
$
|
28,790
|
|
|
$
|
194
|
|
|
$
|
29,203
|
|
|
$
|
(32,687
|
)
|
|
$
|
25,500
|
|
ITEM 2
.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
Equivalent production decline from second quarter of 2015 levels was only
8 percent
, despite a significant reduction in capital investments in 2015 and the first quarter of 2016 when compared to prior-year levels.
|
•
|
Liquids production for the
second
quarter of
2016
averaged
348 thousand
barrels of oil equivalent per day (Mboe/d), with crude oil representing
82 percent
of total liquids production. Liquids production decreased
6 percent
from the
second
quarter of
2015
.
|
•
|
Onshore equivalent production was down 11 percent for the quarter relative to the 2015 period. This production performance is notable given a significant reduction in North American onshore exploration and development capital spending during 2015 and the first half of 2016.
|
•
|
Second quarter equivalent production from the Permian Basin region, which accounts for more than half of our total onshore North American production, decreased 4 percent from the second quarter of 2015 despite significantly fewer wells placed on production during the second quarter of 2016.
|
•
|
In Egypt, we averaged 4 rigs and placed 14 wells on production during the quarter. Gross equivalent production remained flat compared with the second quarter of 2015, driven by an increase of 4 percent in higher margin oil production, which was offset by a decline in lower margin natural gas production. On a net basis, equivalent production declined
5 percent
from the second quarter of 2015, the impact of cost recovery volumes under our production-sharing contracts.
|
•
|
North Sea average daily production increased 2 percent for the second quarter of 2016 from the second quarter of last year as a result of three new wells brought onto production late in the first quarter of 2016.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||||||||||
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
||||||||||||
|
|
($ in millions)
|
||||||||||||||||||||||||||
Total Oil Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
409
|
|
|
37
|
%
|
|
$
|
627
|
|
|
39
|
%
|
|
$
|
722
|
|
|
37
|
%
|
|
$
|
1,137
|
|
|
39
|
%
|
Canada
|
|
46
|
|
|
4
|
%
|
|
75
|
|
|
4
|
%
|
|
85
|
|
|
5
|
%
|
|
135
|
|
|
5
|
%
|
||||
North America
|
|
455
|
|
|
41
|
%
|
|
702
|
|
|
43
|
%
|
|
807
|
|
|
42
|
%
|
|
1,272
|
|
|
44
|
%
|
||||
Egypt
(1)
|
|
437
|
|
|
39
|
%
|
|
572
|
|
|
36
|
%
|
|
733
|
|
|
38
|
%
|
|
1,018
|
|
|
35
|
%
|
||||
North Sea
|
|
226
|
|
|
20
|
%
|
|
344
|
|
|
21
|
%
|
|
400
|
|
|
20
|
%
|
|
621
|
|
|
21
|
%
|
||||
International
(1)
|
|
663
|
|
|
59
|
%
|
|
916
|
|
|
57
|
%
|
|
1,133
|
|
|
58
|
%
|
|
1,639
|
|
|
56
|
%
|
||||
Total
(1)
|
|
$
|
1,118
|
|
|
100
|
%
|
|
$
|
1,618
|
|
|
100
|
%
|
|
$
|
1,940
|
|
|
100
|
%
|
|
$
|
2,911
|
|
|
100
|
%
|
Total Natural Gas Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
62
|
|
|
30
|
%
|
|
$
|
90
|
|
|
29
|
%
|
|
$
|
124
|
|
|
29
|
%
|
|
$
|
193
|
|
|
31
|
%
|
Canada
|
|
23
|
|
|
11
|
%
|
|
61
|
|
|
19
|
%
|
|
64
|
|
|
15
|
%
|
|
128
|
|
|
21
|
%
|
||||
North America
|
|
85
|
|
|
41
|
%
|
|
151
|
|
|
48
|
%
|
|
188
|
|
|
44
|
%
|
|
321
|
|
|
52
|
%
|
||||
Egypt
(1)
|
|
102
|
|
|
49
|
%
|
|
127
|
|
|
40
|
%
|
|
195
|
|
|
45
|
%
|
|
231
|
|
|
37
|
%
|
||||
North Sea
|
|
22
|
|
|
10
|
%
|
|
37
|
|
|
12
|
%
|
|
49
|
|
|
11
|
%
|
|
71
|
|
|
11
|
%
|
||||
International
(1)
|
|
124
|
|
|
59
|
%
|
|
164
|
|
|
52
|
%
|
|
244
|
|
|
56
|
%
|
|
302
|
|
|
48
|
%
|
||||
Total
(1)
|
|
$
|
209
|
|
|
100
|
%
|
|
$
|
315
|
|
|
100
|
%
|
|
$
|
432
|
|
|
100
|
%
|
|
$
|
623
|
|
|
100
|
%
|
Total Natural Gas Liquids (NGL)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
49
|
|
|
83
|
%
|
|
$
|
50
|
|
|
86
|
%
|
|
$
|
83
|
|
|
82
|
%
|
|
$
|
97
|
|
|
84
|
%
|
Canada
|
|
4
|
|
|
7
|
%
|
|
2
|
|
|
4
|
%
|
|
7
|
|
|
7
|
%
|
|
8
|
|
|
7
|
%
|
||||
North America
|
|
53
|
|
|
90
|
%
|
|
52
|
|
|
90
|
%
|
|
90
|
|
|
89
|
%
|
|
105
|
|
|
91
|
%
|
||||
Egypt
(1)
|
|
3
|
|
|
5
|
%
|
|
4
|
|
|
7
|
%
|
|
6
|
|
|
6
|
%
|
|
7
|
|
|
6
|
%
|
||||
North Sea
|
|
3
|
|
|
5
|
%
|
|
2
|
|
|
3
|
%
|
|
5
|
|
|
5
|
%
|
|
4
|
|
|
3
|
%
|
||||
International
(1)
|
|
6
|
|
|
10
|
%
|
|
6
|
|
|
10
|
%
|
|
11
|
|
|
11
|
%
|
|
11
|
|
|
9
|
%
|
||||
Total
(1)
|
|
$
|
59
|
|
|
100
|
%
|
|
$
|
58
|
|
|
100
|
%
|
|
$
|
101
|
|
|
100
|
%
|
|
$
|
116
|
|
|
100
|
%
|
Total Oil and Gas Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
520
|
|
|
38
|
%
|
|
$
|
767
|
|
|
38
|
%
|
|
$
|
929
|
|
|
38
|
%
|
|
$
|
1,427
|
|
|
39
|
%
|
Canada
|
|
73
|
|
|
5
|
%
|
|
138
|
|
|
7
|
%
|
|
156
|
|
|
6
|
%
|
|
271
|
|
|
8
|
%
|
||||
North America
|
|
593
|
|
|
43
|
%
|
|
905
|
|
|
45
|
%
|
|
1,085
|
|
|
44
|
%
|
|
1,698
|
|
|
47
|
%
|
||||
Egypt
(1)
|
|
542
|
|
|
39
|
%
|
|
703
|
|
|
36
|
%
|
|
934
|
|
|
38
|
%
|
|
1,256
|
|
|
34
|
%
|
||||
North Sea
|
|
251
|
|
|
18
|
%
|
|
383
|
|
|
19
|
%
|
|
454
|
|
|
18
|
%
|
|
696
|
|
|
19
|
%
|
||||
International
(1)
|
|
793
|
|
|
57
|
%
|
|
1,086
|
|
|
55
|
%
|
|
1,388
|
|
|
56
|
%
|
|
1,952
|
|
|
53
|
%
|
||||
Total
(1)
|
|
$
|
1,386
|
|
|
100
|
%
|
|
$
|
1,991
|
|
|
100
|
%
|
|
$
|
2,473
|
|
|
100
|
%
|
|
$
|
3,650
|
|
|
100
|
%
|
Discontinued Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil Revenues
|
|
$
|
—
|
|
|
|
|
$
|
57
|
|
|
|
|
—
|
|
|
|
|
138
|
|
|
|
||||||
Natural Gas Revenues
|
|
—
|
|
|
|
|
53
|
|
|
|
|
—
|
|
|
|
|
140
|
|
|
|
||||||||
NGL Revenues
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
||||||||
Total
|
|
$
|
—
|
|
|
|
|
$
|
110
|
|
|
|
|
—
|
|
|
|
|
278
|
|
|
|
(1)
|
Includes revenues attributable to a noncontrolling interest in Egypt.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||
|
|
2016
|
|
Increase
(Decrease)
|
|
2015
|
|
2016
|
|
Increase
(Decrease)
|
|
2015
|
||||||
Oil Volume – b/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
106,741
|
|
|
(16
|
)%
|
|
127,698
|
|
|
111,300
|
|
|
(12
|
)%
|
|
127,171
|
|
Canada
|
|
12,917
|
|
|
(18
|
)%
|
|
15,791
|
|
|
13,690
|
|
|
(16
|
)%
|
|
16,330
|
|
North America
|
|
119,658
|
|
|
(17
|
)%
|
|
143,489
|
|
|
124,990
|
|
|
(13
|
)%
|
|
143,501
|
|
Egypt
(1)(2)
|
|
106,223
|
|
|
2
|
%
|
|
103,865
|
|
|
102,241
|
|
|
3
|
%
|
|
99,494
|
|
North Sea
|
|
59,124
|
|
|
—
|
|
|
58,873
|
|
|
58,043
|
|
|
(4
|
)%
|
|
60,279
|
|
International
|
|
165,347
|
|
|
2
|
%
|
|
162,738
|
|
|
160,284
|
|
|
—
|
|
|
159,773
|
|
Total
|
|
285,005
|
|
|
(7
|
)%
|
|
306,227
|
|
|
285,274
|
|
|
(6
|
)%
|
|
303,274
|
|
Natural Gas Volume – Mcf/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
408,126
|
|
|
(9
|
)%
|
|
446,788
|
|
|
408,943
|
|
|
(7
|
)%
|
|
441,333
|
|
Canada
|
|
246,830
|
|
|
(13
|
)%
|
|
282,971
|
|
|
256,635
|
|
|
(10
|
)%
|
|
285,251
|
|
North America
|
|
654,956
|
|
|
(10
|
)%
|
|
729,759
|
|
|
665,578
|
|
|
(8
|
)%
|
|
726,584
|
|
Egypt
(1)(2)
|
|
408,013
|
|
|
(15
|
)%
|
|
478,170
|
|
|
402,806
|
|
|
(8
|
)%
|
|
437,611
|
|
North Sea
|
|
60,318
|
|
|
7
|
%
|
|
56,367
|
|
|
65,556
|
|
|
23
|
%
|
|
53,423
|
|
International
|
|
468,331
|
|
|
(12
|
)%
|
|
534,537
|
|
|
468,362
|
|
|
(5
|
)%
|
|
491,034
|
|
Total
|
|
1,123,287
|
|
|
(11
|
)%
|
|
1,264,296
|
|
|
1,133,940
|
|
|
(7
|
)%
|
|
1,217,618
|
|
NGL Volume – b/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
55,632
|
|
|
1
|
%
|
|
54,944
|
|
|
55,666
|
|
|
9
|
%
|
|
51,104
|
|
Canada
|
|
5,092
|
|
|
(13
|
)%
|
|
5,825
|
|
|
5,797
|
|
|
(1
|
)%
|
|
5,839
|
|
North America
|
|
60,724
|
|
|
—
|
|
|
60,769
|
|
|
61,463
|
|
|
8
|
%
|
|
56,943
|
|
Egypt
(1)(2)
|
|
950
|
|
|
(26
|
)%
|
|
1,289
|
|
|
1,119
|
|
|
(7
|
)%
|
|
1,204
|
|
North Sea
|
|
1,563
|
|
|
89
|
%
|
|
826
|
|
|
1,486
|
|
|
74
|
%
|
|
856
|
|
International
|
|
2,513
|
|
|
19
|
%
|
|
2,115
|
|
|
2,605
|
|
|
26
|
%
|
|
2,060
|
|
Total
|
|
63,237
|
|
|
1
|
%
|
|
62,884
|
|
|
64,068
|
|
|
9
|
%
|
|
59,003
|
|
BOE per day
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
230,393
|
|
|
(10
|
)%
|
|
257,107
|
|
|
235,123
|
|
|
(7
|
)%
|
|
251,831
|
|
Canada
|
|
59,148
|
|
|
(14
|
)%
|
|
68,778
|
|
|
62,260
|
|
|
(11
|
)%
|
|
69,711
|
|
North America
|
|
289,541
|
|
|
(11
|
)%
|
|
325,885
|
|
|
297,383
|
|
|
(8
|
)%
|
|
321,542
|
|
Egypt
(2)
|
|
175,175
|
|
|
(5
|
)%
|
|
184,848
|
|
|
170,494
|
|
|
(2
|
)%
|
|
173,634
|
|
North Sea
|
|
70,740
|
|
|
2
|
%
|
|
69,094
|
|
|
70,455
|
|
|
1
|
%
|
|
70,038
|
|
International
|
|
245,915
|
|
|
(3
|
)%
|
|
253,942
|
|
|
240,949
|
|
|
(1
|
)%
|
|
243,672
|
|
Total
|
|
535,456
|
|
|
(8
|
)%
|
|
579,827
|
|
|
538,332
|
|
|
(5
|
)%
|
|
565,214
|
|
Discontinued Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Oil (b/d)
|
|
—
|
|
|
|
|
9,849
|
|
|
—
|
|
|
|
|
15,346
|
|
||
Natural Gas (Mcf/d)
|
|
—
|
|
|
|
|
149,336
|
|
|
—
|
|
|
|
|
189,789
|
|
||
NGL (b/d)
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
||
BOE/d
|
|
—
|
|
|
|
|
34,738
|
|
|
—
|
|
|
|
|
46,978
|
|
(1)
|
Gross oil, natural gas, and NGL production in Egypt for the
second
quarter and
six
-month period of
2016
and
2015
were as follows:
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Oil (b/d)
|
|
212,218
|
|
|
203,319
|
|
|
211,032
|
|
|
200,568
|
|
Natural Gas (Mcf/d)
|
|
814,283
|
|
|
861,181
|
|
|
830,165
|
|
|
861,555
|
|
NGL (b/d)
|
|
1,757
|
|
|
2,549
|
|
|
1,951
|
|
|
2,436
|
|
(2)
|
Includes production volumes per day attributable to a noncontrolling interest in Egypt for the
second
quarter and
six
-months period of
2016
and
2015
of:
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
Oil (b/d)
|
|
35,357
|
|
|
34,580
|
|
|
34,017
|
|
|
33,144
|
|
Natural Gas (Mcf/d)
|
|
136,029
|
|
|
158,848
|
|
|
134,266
|
|
|
145,598
|
|
NGL (b/d)
|
|
317
|
|
|
430
|
|
|
373
|
|
|
402
|
|
(3)
|
The table shows production on a barrel of oil equivalent basis (boe) in which natural gas is converted to an equivalent barrel of oil based on a 6:1 energy equivalent ratio. This ratio is not reflective of the price ratio between the two products.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||
|
|
2016
|
|
Increase
(Decrease) |
|
2015
|
|
2016
|
|
Increase
(Decrease) |
|
2015
|
||||||||||
Average Oil Price - Per barrel
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
41.95
|
|
|
(22
|
)%
|
|
$
|
53.94
|
|
|
$
|
35.61
|
|
|
(28
|
)%
|
|
$
|
49.38
|
|
Canada
|
|
39.39
|
|
|
(25
|
)%
|
|
52.22
|
|
|
34.11
|
|
|
(26
|
)%
|
|
45.81
|
|
||||
North America
|
|
41.45
|
|
|
(23
|
)%
|
|
53.75
|
|
|
35.34
|
|
|
(28
|
)%
|
|
48.97
|
|
||||
Egypt
|
|
45.42
|
|
|
(25
|
)%
|
|
60.83
|
|
|
39.47
|
|
|
(30
|
)%
|
|
56.56
|
|
||||
North Sea
|
|
45.56
|
|
|
(29
|
)%
|
|
64.03
|
|
|
39.64
|
|
|
(30
|
)%
|
|
56.86
|
|
||||
International
|
|
45.47
|
|
|
(26
|
)%
|
|
61.86
|
|
|
39.53
|
|
|
(30
|
)%
|
|
56.67
|
|
||||
Total
|
|
43.14
|
|
|
(26
|
)%
|
|
58.06
|
|
|
37.37
|
|
|
(30
|
)%
|
|
53.03
|
|
||||
Average Natural Gas Price - Per Mcf
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
1.70
|
|
|
(23
|
)%
|
|
$
|
2.21
|
|
|
$
|
1.67
|
|
|
(31
|
)%
|
|
$
|
2.42
|
|
Canada
|
|
1.01
|
|
|
(57
|
)%
|
|
2.34
|
|
|
1.36
|
|
|
(45
|
)%
|
|
2.46
|
|
||||
North America
|
|
1.44
|
|
|
(36
|
)%
|
|
2.26
|
|
|
1.55
|
|
|
(36
|
)%
|
|
2.44
|
|
||||
Egypt
|
|
2.72
|
|
|
(7
|
)%
|
|
2.91
|
|
|
2.65
|
|
|
(9
|
)%
|
|
2.92
|
|
||||
North Sea
|
|
3.95
|
|
|
(46
|
)%
|
|
7.35
|
|
|
4.11
|
|
|
(44
|
)%
|
|
7.37
|
|
||||
International
|
|
2.88
|
|
|
(15
|
)%
|
|
3.38
|
|
|
2.86
|
|
|
(16
|
)%
|
|
3.40
|
|
||||
Total
|
|
2.04
|
|
|
(26
|
)%
|
|
2.74
|
|
|
2.09
|
|
|
(26
|
)%
|
|
2.83
|
|
||||
Average NGL Price - Per barrel
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
9.74
|
|
|
(4
|
)%
|
|
$
|
10.11
|
|
|
$
|
8.17
|
|
|
(22
|
)%
|
|
$
|
10.52
|
|
Canada
|
|
8.54
|
|
|
94
|
%
|
|
4.41
|
|
|
6.88
|
|
|
(11
|
)%
|
|
7.74
|
|
||||
North America
|
|
9.64
|
|
|
1
|
%
|
|
9.56
|
|
|
8.05
|
|
|
(21
|
)%
|
|
10.23
|
|
||||
Egypt
|
|
27.68
|
|
|
(4
|
)%
|
|
28.95
|
|
|
27.24
|
|
|
(15
|
)%
|
|
32.14
|
|
||||
North Sea
|
|
22.25
|
|
|
(28
|
)%
|
|
30.94
|
|
|
20.29
|
|
|
(27
|
)%
|
|
27.75
|
|
||||
International
|
|
24.30
|
|
|
(18
|
)%
|
|
29.73
|
|
|
23.28
|
|
|
(23
|
)%
|
|
30.32
|
|
||||
Total
|
|
10.22
|
|
|
—
|
|
|
10.24
|
|
|
8.67
|
|
|
(21
|
)%
|
|
10.93
|
|
||||
Discontinued Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Oil price ($/Bbl)
|
|
$
|
—
|
|
|
|
|
$
|
63.60
|
|
|
$
|
—
|
|
|
|
|
$
|
49.76
|
|
||
Natural Gas price ($/Mcf)
|
|
—
|
|
|
|
|
3.88
|
|
|
—
|
|
|
|
|
4.07
|
|
||||||
NGL price ($/Bbl)
|
|
—
|
|
|
|
|
—
|
|
|
—
|
|
|
|
|
—
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||||||
|
|
(In millions)
|
|
(Per boe)
|
|
(In millions)
|
|
(Per boe)
|
||||||||||||||||||||||||
Lease operating expense
|
|
$
|
359
|
|
|
$
|
467
|
|
|
$
|
7.38
|
|
|
$
|
8.85
|
|
|
$
|
737
|
|
|
$
|
948
|
|
|
$
|
7.52
|
|
|
$
|
9.26
|
|
Gathering and transportation
|
|
52
|
|
|
49
|
|
|
1.06
|
|
|
0.92
|
|
|
104
|
|
|
105
|
|
|
1.07
|
|
|
1.04
|
|
||||||||
Taxes other than income
|
|
65
|
|
|
55
|
|
|
1.33
|
|
|
1.04
|
|
|
76
|
|
|
128
|
|
|
0.78
|
|
|
1.25
|
|
||||||||
Exploration
|
|
91
|
|
|
225
|
|
|
1.87
|
|
|
4.26
|
|
|
186
|
|
|
483
|
|
|
1.90
|
|
|
4.72
|
|
||||||||
General and administrative
|
|
103
|
|
|
111
|
|
|
2.10
|
|
|
2.10
|
|
|
196
|
|
|
195
|
|
|
2.00
|
|
|
1.90
|
|
||||||||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Oil and gas property and equipment
|
|
629
|
|
|
711
|
|
|
12.92
|
|
|
13.47
|
|
|
1,265
|
|
|
1,454
|
|
|
12.91
|
|
|
14.22
|
|
||||||||
Other assets
|
|
40
|
|
|
83
|
|
|
0.83
|
|
|
1.57
|
|
|
82
|
|
|
166
|
|
|
0.84
|
|
|
1.62
|
|
||||||||
Asset retirement obligation accretion
|
|
38
|
|
|
36
|
|
|
0.78
|
|
|
0.68
|
|
|
76
|
|
|
72
|
|
|
0.77
|
|
|
0.71
|
|
||||||||
Impairments
|
|
173
|
|
|
512
|
|
|
3.56
|
|
|
9.72
|
|
|
173
|
|
|
2,424
|
|
|
1.77
|
|
|
23.70
|
|
||||||||
Transaction, reorganization, and separation
|
|
9
|
|
|
66
|
|
|
0.17
|
|
|
1.25
|
|
|
24
|
|
|
120
|
|
|
0.24
|
|
|
1.17
|
|
||||||||
Financing costs, net
|
|
104
|
|
|
117
|
|
|
2.15
|
|
|
2.23
|
|
|
209
|
|
|
241
|
|
|
2.13
|
|
|
2.35
|
|
||||||||
Total
|
|
$
|
1,663
|
|
|
$
|
2,432
|
|
|
$
|
34.15
|
|
|
$
|
46.09
|
|
|
$
|
3,128
|
|
|
$
|
6,336
|
|
|
$
|
31.93
|
|
|
$
|
61.94
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(In millions)
|
||||||||||||||
Unproved leasehold impairments
|
|
$
|
66
|
|
|
$
|
148
|
|
|
$
|
108
|
|
|
$
|
316
|
|
Dry hole expense
|
|
3
|
|
|
35
|
|
|
31
|
|
|
69
|
|
||||
Geological and geophysical expense
|
|
4
|
|
|
17
|
|
|
9
|
|
|
47
|
|
||||
Exploration overhead and other
|
|
18
|
|
|
25
|
|
|
38
|
|
|
51
|
|
||||
|
|
$
|
91
|
|
|
$
|
225
|
|
|
$
|
186
|
|
|
$
|
483
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(In millions)
|
||||||||||||||
Interest expense
|
|
$
|
116
|
|
|
$
|
123
|
|
|
$
|
232
|
|
|
$
|
251
|
|
Amortization of deferred loan costs
|
|
2
|
|
|
2
|
|
|
3
|
|
|
4
|
|
||||
Capitalized interest
|
|
(12
|
)
|
|
(5
|
)
|
|
(23
|
)
|
|
(9
|
)
|
||||
Interest income
|
|
(2
|
)
|
|
(3
|
)
|
|
(3
|
)
|
|
(5
|
)
|
||||
Financing costs, net
|
|
$
|
104
|
|
|
$
|
117
|
|
|
$
|
209
|
|
|
$
|
241
|
|
|
|
For the Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
|
|
(In millions)
|
||||||
Sources of Cash and Cash Equivalents:
|
|
|
|
|
||||
Net cash provided by continuing operating activities
|
|
$
|
983
|
|
|
$
|
1,623
|
|
Proceeds from asset divestitures
|
|
48
|
|
|
5,666
|
|
||
Other
|
|
28
|
|
|
—
|
|
||
|
|
1,059
|
|
|
7,289
|
|
||
Uses of Cash and Cash Equivalents:
|
|
|
|
|
||||
Capital expenditures
(1)
|
|
$
|
925
|
|
|
$
|
2,877
|
|
Leasehold and property acquisitions
|
|
118
|
|
|
128
|
|
||
Net cash used by Australia discontinued operations
|
|
—
|
|
|
162
|
|
||
Net commercial paper and bank loan repayments
|
|
—
|
|
|
1,570
|
|
||
Dividends paid
|
|
189
|
|
|
189
|
|
||
Distributions to noncontrolling interest
|
|
93
|
|
|
40
|
|
||
Other
|
|
—
|
|
|
52
|
|
||
|
|
1,325
|
|
|
5,018
|
|
||
Increase (decrease) in cash and cash equivalents
|
|
$
|
(266
|
)
|
|
$
|
2,271
|
|
(1)
|
The table presents capital expenditures on a cash basis; therefore, the amounts may differ from those discussed elsewhere in this document, which include accruals.
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
|
|
(In millions)
|
||||||
Cash and cash equivalents
|
|
$
|
1,201
|
|
|
$
|
1,467
|
|
Total debt
|
|
8,720
|
|
|
8,717
|
|
||
Equity
|
|
8,696
|
|
|
9,490
|
|
||
Available committed borrowing capacity
|
|
3,500
|
|
|
3,500
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
3.1
|
–
|
Restated Certificate of Incorporation of Registrant, dated September 19, 2013, as filed with the Secretary of State of Delaware on September 19, 2013 (incorporated by reference to Exhibit 3.2 to Registrant’s Current Report on Form 8-K filed September 20, 2013, SEC File No. 001-4300).
|
3.2
|
–
|
Certificate of Amendment of Restated Certificate of Incorporation of Registrant, dated May 14, 2015, as filed with the Secretary of State of Delaware on May 14, 2015 (incorporated by reference to Exhibit 3.2 to Registrant’s Current Report on Form 8-K filed May 20, 2015, SEC File No. 001-4300).
|
3.3
|
–
|
Bylaws of Registrant, as amended February 3, 2016 (incorporated by reference to Exhibit 3.1 to Registrant’s Current Report on Form 8-K filed February 9, 2016, SEC File No. 001-4300).
|
*10.1
|
–
|
Apache Corporation 2011 Omnibus Equity Compensation Plan, as amended and restated May 12, 2016.
|
10.2
|
–
|
Apache Corporation 2016 Omnibus Compensation Plan, dated February 3, 2016, effective May 12, 2016 (incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed May 16, 2016, SEC File No. 001-4300.)
|
*10.3
|
–
|
Apache Corporation Deferred Delivery Plan, as amended and restated May 12, 2016.
|
*10.4
|
–
|
Apache Corporation Non-Employee Directors’ Restricted Stock Units Program, effective May 12, 2016.
|
*10.5
|
–
|
Apache Corporation Outside Directors’ Deferral Program, effective May 12, 2016.
|
*31.1
|
–
|
Certification (pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act) by Principal Executive Officer.
|
*31.2
|
–
|
Certification (pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act) by Principal Financial Officer.
|
*32.1
|
–
|
Section 1350 Certification (pursuant to Sarbanes-Oxley Section 906) by Principal Executive Officer and Principal Financial Officer.
|
*101.INS
|
–
|
XBRL Instance Document.
|
*101.SCH
|
–
|
XBRL Taxonomy Schema Document.
|
*101.CAL
|
–
|
XBRL Calculation Linkbase Document.
|
*101.DEF
|
–
|
XBRL Definition Linkbase Document.
|
*101.LAB
|
–
|
XBRL Label Linkbase Document.
|
*101.PRE
|
–
|
XBRL Presentation Linkbase Document.
|
*
|
Filed herewith
|
|
|
|
APACHE CORPORATION
|
|
|
|
|
Dated:
|
August 4, 2016
|
|
/s/ STEPHEN J. RINEY
|
|
|
|
Stephen J. Riney
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
Dated:
|
August 4, 2016
|
|
/s/ REBECCA A. HOYT
|
|
|
|
Rebecca A. Hoyt
|
|
|
|
Senior Vice President, Chief Accounting Officer, and Controller
|
|
|
|
(Principal Accounting Officer)
|
(a)
|
"Administrative Agent"
means any designee or agent that may be appointed by the Committee pursuant to subsections 3.1(h) and 3.4 hereof.
|
(b)
|
"Affiliate"
means any entity other than the Company that is affiliated with the Company through stock or equity ownership or otherwise and is designated as an Affiliate for purposes of the Plan by the Committee;
provided
,
however
, that, notwithstanding any other provisions of the
|
(c)
|
“Award”
means any Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, Performance Award, Dividend Equivalent or any other stock-based award granted to a Participant under the Plan.
|
(d)
|
"Board"
means the Board of Directors of the Company.
|
(e)
|
“Change of Control”
shall have the meaning assigned to such term in the Company's Income Continuance Plan as in effect on the Effective Date.
|
(f)
|
"Committee"
means the Management Development and Compensation Committee of the Board or such other Committee of the Board that is empowered hereunder to administer the Plan. The Committee shall be constituted at all times so as to permit the Plan to be administered by "non-employee directors" (as defined in Rule 16b-3 of the Exchange Act) and “outside directors” (as defined in Treasury Regulations Section 1.162‑27 (e)(3)) and to satisfy such additional regulatory or listing requirements as the Board may determine to be applicable or appropriate.
|
(g)
|
“Deferred Delivery Plan”
means the Company’s Deferred Delivery Plan, as it has been or may be amended from time to time, or any successor plan.
|
(h)
|
“Dividend Equivalent”
means a right, granted to an Eligible Person to receive cash, Stock, other Awards or other property equal in value to dividends paid with respect to a specified number of shares of Stock, or other periodic payments.
|
(i)
|
"Eligible Persons"
means those employees of the Company or of any Affiliates, members of the Board, and members of the board of directors of any Affiliates who are designated as Eligible Persons by the Committee. Notwithstanding the foregoing, grants of Incentive Stock Options may not be granted to anyone who is not an employee of the Company or an Affiliate.
|
(j)
|
“
Exchange Act”
means the Securities Exchange Act of 1934, as amended.
|
(k)
|
“Exercise Date”
means the date of exercise determined in accordance with subsection 6.2(g) hereof.
|
(l)
|
"Fair Market Value"
means the per share closing price of the Stock as reported on The New York Stock Exchange, Inc. Composite Transactions Reporting System for a particular date or, if the Stock is not so listed on such date, as reported on NASDAQ or on such other exchange or electronic trading system which, on the date in question, reports the largest number of traded shares of Stock,
provided
,
however
, that if on the date Fair Market Value is to be determined there are no transactions in the Stock, Fair Market Value shall be determined as of the immediately preceding date on which there were transactions in the Stock;
provided
further
,
however
, that if the foregoing provisions are not applicable, the fair market value of a share of the Stock as determined by the Committee by the reasonable application of such reasonable valuation method, consistently applied, as the Committee deems appropriate;
provided
further
,
however
, that, with respect to ISOs, such Fair Market Value shall be determined subject to Section 422(c)(7) of the Internal Revenue Code. For purposes of the foregoing, a valuation prepared in accordance with any of the methods set forth in Treasury Regulation Section 1.409A-1(b)(5)(iv)(B)(2), consistently used, shall be rebuttably presumed to result in a reasonable valuation. This definition is intended to comply with the definition of "fair market value" contained in Treasury Regulation Section 1.409A-1(b)(5)(iv) and should be interpreted consistently therewith.
|
(m)
|
“Incentive Stock Option”
or
“ISO”
means any Option intended to be and designated as an incentive stock option and which satisfies the requirements of Section 422 of the Internal Revenue Code or any successor provision thereto.
|
(n)
|
"Internal Revenue Code" or "Code"
means the Internal Revenue Code of 1986, as it may be amended from time to time, and any successor thereto. Any reference to a section of the Internal Revenue Code or Treasury Regulation shall be treated as a reference to any successor section.
|
(o)
|
“
Involuntary Termination
”
means the termination of employment of the Participant by the Company or its successor for any reason on or after a Change of Control; provided, that the termination does not result from an act of the Participant that (i) constitutes common-law fraud, a felony, or a gross malfeasance of duty, or (ii) is materially detrimental to the best interests of the Company or its successor.
|
(p)
|
“Non-Qualified Stock Option”
or
“NQSO”
means any Option that is not intended to qualify as an “incentive stock option” under Section 422 of the Internal Revenue Code.
|
(q)
|
“
Option”
means an option to purchase a number of shares of Stock granted pursuant to subsection 6.1.
|
(r)
|
“Option Price”
means the price at which shares of Stock subject to an option may be purchased, determined in accordance with subsection 6.2(b) hereof.
|
(s)
|
"Participant"
means an Eligible Person designated by the Committee, from time to time during the term of the Plan to receive one or more Awards under the Plan.
|
(t)
|
“Performance Award”
is a right to either a number of shares of Stock or SARs (“Performance Shares”) determined (in either case) in accordance with subsection 9.1 of this Plan based on the extent to which the applicable Performance Goals are achieved. A Performance Share shall be of no value to a Participant unless and until earned in accordance with subsection 9.2 hereof.
|
(u)
|
“Performance Goals”
are the performance conditions, if any, established pursuant to subsection 9.1 by the Committee in connection with an Award.
|
(v)
|
“Performance Period”
with respect to a Performance Award is a period not less than one calendar year or one fiscal year of the Company, beginning not earlier than the year in which such Performance Award is granted, which may be referred to herein and by the Committee by use of the calendar of fiscal year in which a particular Performance Period commences.
|
(w)
|
“Restricted Stock”
means Stock granted to an Eligible Person under Section 8 hereof, that is subject to certain restrictions and to a risk of forfeiture.
|
(x)
|
“Restricted Stock Unit”
means a right, granted to an Eligible Person under Section 8 hereof, to receive Stock, cash or a combination thereof at the end of a specified vesting period.
|
(y)
|
“Restriction Period”
shall have the meaning assigned to such term in subsection 8.1.
|
(z)
|
"Stock"
means the $0.625 par value common stock of the Company and or any security into which such common stock is converted or exchanged upon merger, consolidation, or any capital restructuring (within the meaning of Section 13) of the Company.
|
(aa)
|
“Stock Appreciation Right”
or
“SAR”
means a right granted to an Eligible Person to receive an amount in cash, Stock, or other property equal to the excess of the Fair Market Value as of the Exercise Date of one share of Stock over the SAR Price times the number of shares of Stock to which the Stock Appreciation Right relates. Stock Appreciation Rights may be granted in tandem with Options or other Awards or may be freestanding.
|
(bb)
|
“SAR Price”
means the price at which the Stock Appreciation Right was granted, which shall be determined in the same manner as the Option Price of an Option in accordance with subsection 6.2 hereof.
|
(cc)
|
“
Voluntary Termination with Cause
”
occurs upon a Participant’s separation from service of his own volition and one or more of the following conditions occurs without the Participant’s consent on or after a Change of Control:
|
(i)
|
There is a material diminution in the Participant’s base compensation, compared to his rate of base compensation on the date of the Change of Control.
|
(ii)
|
There is a material diminution in the Participant’s authority, duties or responsibilities.
|
(iii)
|
There is a material diminution in the authority, duties or responsibilities of the Participant’s supervisor, such as a requirement that the Participant (or his supervisor) report to a corporate officer or employee instead of reporting directly to the board of directors.
|
(iv)
|
There is a material diminution in the budget over which the Participant retains authority.
|
(v)
|
There is a material change in the geographic location at which the Participant must perform his service, including, for example the assignment of the Participant to a regular workplace that is more than 50 miles from his regular workplace on the date of the Change of Control.
|
(a)
|
Grant Awards;
|
(b)
|
Select the Eligible Persons and the time or times at which Awards shall be granted;
|
(c)
|
Determine the type and number of Awards to be granted, the number of shares of Stock to which an Award may relate and the terms, conditions, restrictions, and Performance Goals relating to any Award;
|
(d)
|
Determine whether, to what extent, and under what circumstances an Award may be settled, canceled, forfeited, exchanged, or surrendered;
|
(e)
|
Construe and interpret the Plan and any Award;
|
(f)
|
Prescribe, amend, and rescind rules and procedures relating to the Plan;
|
(g)
|
Determine the terms and provisions of Award agreements;
|
(h)
|
Appoint designees or agents (who need not be members of the Committee or employees of the Company) to assist the Committee with the administration of the Plan;
|
(i)
|
Communicate the material terms of each Award to its recipient within a relatively short period of time after approval; and
|
(j)
|
Make all other determinations deemed necessary or advisable for the administration of the Plan.
|
(a)
|
The Committee may from time to time adopt such rules and regulations for carrying out the purposes of the Plan as it may deem proper and in the best interests of the Company. The Committee may appoint an Administrative Agent, who need not be a member of the Committee or an employee of the Company, to assist the Committee in administration of the Plan and to whom it may delegate such powers as the Committee deems appropriate, except that the Committee shall determine any dispute. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan, or in any Award agreement entered into hereunder, in the manner and to the extent it shall deem expedient, and it shall be the sole and final judge of such inconsistency;
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(b)
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The Committee has delegated authority to the Chief Executive Officer of the Company to grant Awards to employees of the Company who are not the Company's executive officers (as such term is defined for purposes of Section 16 of the Exchange Act) and who are below the level of Regional Vice President or Staff Vice President; provided, that any such Awards may only be granted in accordance with guidelines established by the Committee.
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(a)
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Options
: The maximum aggregate number of shares of Stock that may be subject to Options granted in any calendar year to any one Participant shall be 250,000 shares.
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(b)
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SARs
:
The maximum aggregate number of shares that may be subject to Stock Appreciation Rights granted in any calendar year to any one Participant shall be 250,000 shares. Any shares covered by Options which include tandem SARs granted to one Participant in any calendar year shall reduce this limit on the number of shares subject to SARs that can be granted to such Participant in such calendar year.
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(c)
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Restricted Stock or Restricted Stock Units
: The maximum aggregate number of shares of Stock that may be subject to Awards of Restricted Stock or Restricted Stock Units granted in any calendar year to any one Participant shall be 250,000 shares.
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(d)
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Performance Awards
: The maximum aggregate grant with respect to Performance Awards granted in any calendar year to any one Participant shall be 250,000 shares (or SARs based on the value of such number of shares).
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(a)
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Number of Shares
. Each Stock Option agreement shall state that it covers a specified number of shares of Stock, as determined by the Committee.
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(b)
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Price.
The price at which each share of Stock covered by an Option may be purchased, the Option Price, shall be determined in each case by the Committee and set forth in the Stock Option agreement. The price may vary according to a formula specified in the Stock Option agreement, but in no event shall the Option Price ever be less than the Fair Market Value of the Stock on the date the Option is granted.
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(c)
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No Backdating
. There shall be no backdating of Options, and each Option shall be dated the actual date that the Committee adopts the resolution awarding the grant of such Option.
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(d)
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Limitations on Incentive Stock Options
. No Incentive Stock Option may be granted to an individual if, at the time of the proposed grant, such individual owns (or is attributed to own by virtue of the Internal Revenue Code) Stock possessing more than 10 percent of the total combined voting power of all classes of stock of the Company or any Affiliate unless (i) the exercise price of such Incentive Stock Option is at least 110 percent of the Fair Market Value of a share of Stock at the time such Incentive Stock Option is granted and (ii) such Incentive Stock Option is not exercisable after the expiration of five years from the date such Incentive Stock Option is granted.
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(e)
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Duration of Options
. Each Stock Option agreement shall state the period of time, determined by the Committee, within which the Option may be exercised by the Participant (the "Option
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(f)
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Termination of Options
. During the lifetime of a Participant to whom a Stock Option is granted, the Stock Option may be exercised only by such Participant or, in the case of disability (as determined pursuant to the Company’s Long-Term Disability Plan or any successor plan) by the Participant’s designated legal representative, except to the extent such exercise would cause any Award intended to qualify as an ISO not to so qualify. Once a Participant to whom a Stock Option was granted dies, the Stock Option may be exercised only by the personal representative of the Participant’s estate or, with respect to Stock Options that are not Incentive Stock Options, as otherwise provided in Section 14.2. Unless the Stock Option agreement shall specify a longer or shorter period, at the discretion of the Committee, then the Participant (or representative, or, if applicable pursuant to Section 14.2, designated beneficiary) may exercise the Stock Option for a period of up to three months after such Participant terminates employment or ceases to be a member of the Board.
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(h)
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Tax Withholding
. Each Stock Option agreement shall provide that, upon exercise of the Option, the Participant shall make appropriate arrangements with the Company to provide for not less than the minimum amount of tax withholding required by law, including without limitation Sections 3102 and 3402 or any successor section(s) of the Internal Revenue Code and applicable state and local income and other tax laws, by payment of such taxes in cash (including wire transfer), by check, or as provided in Section 11 hereof.
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(i)
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Repricing Prohibited
. Subject to Sections 4, 6, 12, 13, and 16, outstanding Stock Options granted under this Plan shall not be repriced without approval by the Company’s stockholders. In particular, neither the Board nor the Committee may take any action: (1) to amend the terms of an outstanding Option or SAR to reduce the Option Price or grant price thereof,
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(j)
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Stockholder Privileges
. No Participant shall have any rights as a stockholder with respect to any shares of Stock covered by an Option until the Participant becomes the holder of record of such Stock. Except as provided in Section 4 hereof, no adjustments shall be made for dividends or other distributions or other rights as to which there is a record date preceding the date on which such Participant becomes the holder of record of such Stock.
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(k)
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Section 409A Avoidance
. Once granted, no Stock Option shall be modified, extended, or renewed in any way that would cause the Stock Option to be subject to Internal Revenue Code Section 409A. The Option Period shall not be extended to any date that would cause the Stock Option to become subject to Internal Revenue Code Section 409A. The Option Price shall not be adjusted to reflect any dividends declared and paid on the Stock between the date of grant and the date the Stock Option is exercised.
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(l)
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Vesting Period
. Each Stock Option agreement shall state the vesting period (the period which ends as of a date that the Option is no longer restricted or subject to forfeiture) that applies to the specified number of shares of Stock granted pursuant thereto. In respect of the employees of the Company (including executive officers), such vesting period for the entire Option award shall in no event be less than three years following the grant date, and, subject to Sections 12 and 13 of the Plan, the Committee may not waive such minimum vesting period except in the case of the Participant's death or disability.
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(a)
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The Participant shall not be entitled to delivery of the Stock certificate until the Restriction Period shall have expired.
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(b)
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The Participant may not sell, transfer, pledge, exchange, hypothecate, or otherwise dispose of the Stock during the Restriction Period.
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(c)
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A breach of the terms and conditions established by the Committee with respect to the Restricted Stock shall cause a forfeiture of the Restricted Stock and any dividends withheld thereon.
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(d)
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Dividends and Splits. As a condition to the grant of an Award of Restricted Stock, the Committee may specify whether any cash dividends paid on a share of Restricted Stock be automatically reinvested in additional shares of Restricted Stock or applied to the purchase of additional Awards under this Plan. Unless otherwise determined by the Committee, Stock distributed in connection with a Stock split or Stock dividend, and other property distributed as a dividend, shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Stock with respect to which such Stock or other property has been distributed.
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(a)
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If the Participant voluntarily leaves the employment of the Company or an Affiliates, or if the employment of the Participant is terminated by the Company for cause or otherwise, any Performance Award to such Participant not previously vested shall thereafter be void and forfeited for all purposes.
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(b)
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A Participant shall become vested in all Performance Awards that have met the Performance Goals within the Performance Period on the date the Participant retires from employment with the Company on or after attaining retirement age (which for all purposes of this Plan is determined to be age 65, unless otherwise designated by the Committee at the time the Award is granted), on the date the Participant dies while employed by the Company, or on the date the Participant terminates service with the Company and the Affiliates due to permanent disability (as determined pursuant to the Company’s Long-Term Disability Plan or any successor plan, unless the Performance award is subject to Internal Revenue Code Section 409A, in which case “permanent disability” must also fall within the meaning specified in Internal Revenue Code Section 409A(a)(2)(C) or a more restrictive meaning established by the Committee) while employed by the Company. Such Participant shall not become entitled to any payment which may arise due to the occurrence of a Performance Goal after the Participant dies, terminates service due to permanent disability, or retires. Payment shall occur as soon as administratively convenient following the date the Participant dies, terminates service due to permanent disability, or retires, but in no event shall the payment occur later than March 15 in the calendar year immediately following the calendar year in which the Participant died, so terminates service, or retired. If the Participant dies before receiving payment, the payment shall be made to those entitled pursuant to Section 14.2 of this Plan.
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(a)
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by the delivery to the Company or the Administrative Agent of a number of shares of Stock then owned by the Participant, the aggregate Fair Market Value of which (as of the Exercise Date) is not greater than the amount required to be withheld, provided that such shares have been held by the Participant for a period of at least six months;
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(b)
|
by certification or attestation to the Company or the Administrative Agent of the Participant's ownership (as of the Exercise Date) of a number of shares of Stock, the aggregate Fair Market Value of which (as of the Exercise Date) is not greater than the amount required to be withheld, provided that such shares of Stock have been owned by the Participant for a period of at least six months; or
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(c)
|
by the Company or the Administrative Agent withholding from the shares of Stock otherwise issuable to the Participant upon exercise of the Option, a number of shares of Stock, the aggregate Fair Market Value of which (as of the Exercise Date) is not greater than the amount required to be withheld. Any such elections by Participants to have shares of Stock withheld for this purpose will be subject to the following restrictions:
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(c)
|
Assuming the achievement of a Performance Goal, the entitlement to receive cash and Stock under any outstanding Performance Award grants shall vest automatically, without further action by the Committee or the Board, and shall become payable as follows:
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(i)
|
If such Change of Control occurs subsequent to the achievement of a Performance Goal, any remainder of such payout amount shall vest as of the date of the Participant’s Involuntary Termination or Voluntary Termination with Cause occurring on or after the date of such Change of Control and shall be paid by the Company to the Participant within thirty (30) days of the date of such Involuntary Termination or Voluntary Termination
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(ii)
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If the achievement of a Performance Goal occurs subsequent to the date of a Change of Control, the applicable payout amount shall vest in full for which the Performance Period has not yet ended as of the date of the Participant’s Involuntary Termination or Voluntary Termination with Cause occurring on or after such Change of Control and shall be paid by the Company to the Participant within thirty (30) days after the later of (1) the date of the Participant’s Involuntary Termination or Voluntary Termination with Cause or (2) the date that the Performance Goal is reached. The payment will occur only if the Participant is employed at the time that the Performance Goal is reached or if the Performance Goal is reached after the Participant’s Involuntary Termination or Voluntary Termination with Cause occurring on or after the Change of Control.
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(d)
|
To the extent that any Award is subject to Internal Revenue Code Section 409A, the Award shall contain appropriate provisions to comply with Internal Revenue Code Section 409A, which shall supersede the provisions of subsections (a), (b), and (c).
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ATTEST:
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APACHE CORPORATION
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/s/ Cheri L. Peper
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By:
/s/ Margery M. Harris
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Cheri L. Peper
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Margery M. Harris
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Corporate Secretary
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Executive Vice President,
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Human Resources
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1.01
|
Definitions
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(a)
|
“Account” means the memorandum account maintained for each Participant that is credited with all Participant Deferrals and any contributions by the Company. Each Participant’s Account is divided into subaccounts, as determined by the Committee, and in general each award or deferral will be allocated to its own subaccount.
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(b)
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“Apache” means Apache Corporation or any successor thereto.
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(c)
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“Affiliated Entity” means any legal entity that is treated as a single employer with Apache pursuant to Code §414(b), §414(c), §414(m), or §414(o).
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(d)
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“Beneficiary” means a Participant’s beneficiary, as determined in section 5.04.
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(e)
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“Change of Control” means a change of control as defined in the Income Continuance Plan that is also described in Code §409A(a)(2)(A)(v).
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(f)
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“Code” means the Internal Revenue Code of 1986, as amended. Any reference to a particular section of the Code or the regulations issued thereunder shall be treated as a reference to any successor section.
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(g)
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“Committee” means the Management Development and Compensation Committee of Apache’s Board of Directors. The Committee shall be constituted at all times so as to permit the Plan to be administered by “non-employee directors” (as defined in Rule 16b-3 of the Securities Exchange Act of 1934, as amended).
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(h)
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“Company” means Apache and any Affiliated Entity that, with approval of the Board of Directors of Apache, has adopted the Plan.
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(i)
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“Company Deferrals” means the allocations to a Participant’s Account made pursuant to section 3.02.
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(j)
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“Compensation” means amounts deferrable under this Plan, as determined by the Committee.
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(k)
|
“Election Agreement” means an agreement made by an eligible employee whereby he elects the amount(s) to be withheld from his Compensation pursuant to section 3.01.
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(l)
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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended. Any reference to a particular section of ERISA or the regulations issued thereunder shall be treated as a reference to any successor section.
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(m)
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“Fair Market Value” means the per share closing price of the Stock as reported on The New York Stock Exchange, Inc. Composite Transactions Reporting System for a particular date or, if the Stock is not so listed on such date, as reported on NASDAQ or on such other exchange or electronic trading system which, on the date in question, reports the largest number of traded shares of Stock,
provided
,
however
, that if on the date Fair Market Value is to be determined there are no transactions in the Stock, Fair Market Value shall be determined as of the immediately preceding date on which there were transactions in the Stock;
provided
further
,
however
, that if the foregoing provisions are not applicable, the fair market value of a share of the Stock as determined by the Committee by the reasonable application of such reasonable valuation method, consistently applied, as the Committee deems appropriate. For purposes of the foregoing, a valuation prepared in accordance with any of the methods set forth in Treasury Regulation §1.409A-1(b)(5)(iv)(B)(2), consistently used, shall be rebuttably presumed to result in a reasonable valuation. This definition is intended to comply with the definition of “fair market value” contained in Treasury Regulation §1.409A-1(b)(5)(iv) and should be interpreted consistently therewith.
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(n)
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“Participant” means any eligible employee selected to participate in the Plan.
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(o)
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“Participant Deferrals” means the amounts of a Participant's Compensation that elects to defer and have allocated to his Account pursuant to section 3.01.
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(p)
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“Plan” means the plan set forth in this document, as amended.
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(q)
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“Plan Year” means the calendar year.
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(r)
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“Separation from Service” has the same meaning as the term “separation from service” in Code §409A(a)(2)(A)(i), determined using the default rules in the regulations and other guidance of general applicability issued pursuant to Code §409A, except that a Separation from Service occurs only if both the Company and the Participant expect the Participant’s level of services to permanently drop by more than half. A Participant who has a Separation from Service “Separates from Service.”
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(s)
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“Spouse” means the individual of the opposite sex to whom a Participant is lawfully married according to the laws of the state of the Participant’s domicile.
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(t)
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“Stock” means the $0.625 par value common stock of Apache.
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(u)
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“Stock Units” mean investment units and any related units from dividend amounts. Each Stock Unit is equivalent to one share of Stock.
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(v)
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“Trust” means the trust or trusts, if any, created by the Company to provide funding for the distribution of benefits in accordance with the provisions of the Plan. The assets of any such Trust remain subject to the claims of the Company's general creditors in the event of the Company's insolvency.
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(w)
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“Trust Agreement” means the written instrument pursuant to which each separate Trust is created.
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(x)
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“Trustee” means one or more banks, trust companies, or insurance companies designated by the Company to hold and invest the Trust fund and to pay benefits and expenses as authorized by the Committee in accordance with the terms and provisions of the Trust Agreement.
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1.02
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Headings; Gender and Number
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2.01
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Eligibility and Participation
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2.02
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Election
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2.03
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Failure of Eligibility
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3.01
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Participant Deferrals
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a.
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General
. A Participant may elect to defer a portion of his Compensation by filing the appropriate Election Agreement with the Committee's designee. The Committee has complete discretion to establish procedures for the completion of Election Agreements, including the acceptable forms and formats of the deferral election. The Committee has complete discretion to establish the election periods during which Participants may make Election Agreements, within the bounds described in subsection (b). The Committee may establish different election periods for different types of Compensation, different grants of Compensation, or different groups of Participants.
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b.
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Deadlines for Election Agreements
.
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i.
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Election Period
. In order to make Participant Deferrals, a Participant must submit an Election Agreement during the election period established by the Committee. The election period must precede the Plan Year in which the services giving rise to the Compensation are performed, except in the following situations.
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1.
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Performance-Based Compensation
. If the Compensation is “performance-based compensation based on services performed over a period of at least 12 months” (within the meaning of Code §409A(a)(4)(B)(iii)), the election period must end at least six months before the end of the performance period.
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2.
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New Participant
. The election period for a new Participant must end no later than 30 days after he became eligible to participate in the Plan; the new Participant’s initial Election Agreement may only apply to Compensation for which he has not yet performed any services. However, a Participant who has a lapse in eligibility to participate in the Plan can only use this special 30-day election when he again becomes eligible to accrue benefits (other than investment earnings), (1) on the date of his new eligibility if he has received a complete payout of his benefits from his prior episode of participation, or (2) if his lapse in eligibility was at least 24 months in duration.
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3.
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Unvested Deferrals
. The election period for any Compensation that is subject to the condition that the Participant continue to provide services for Apache and Affiliated Entities for at least 12 months, such as many grants of restricted stock units, must end within 30 days of the date the Compensation is awarded, provided that (1) the award does not vest for 12 months following the end of the election period, (2) no event other than the Participant’s death or disability (within the meaning of Code §409A(2)(C)), or a Change of Control can cause vesting within the 12 months following the end of the election period, and (3) if the Participant’s death or disability, or the Change of Control occurs before the first anniversary of the end of the election period, the Election Agreement shall be cancelled.
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ii.
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Duration of and Cancellation of Election Agreements
. The Committee has full discretion to determine which Compensation is subject to each Election Agreement. The Election Agreement becomes irrevocable by the Participant at the end of the election period. The Committee shall determine, at the time the Election Agreement is made, the circumstances in which the Election Agreement shall be cancelled, such as upon the Participant’s disability (within the meaning of Code §409A(a)(2)(A)(ii)) or upon a Change of Control. An Election Agreement is not affected by a hardship withdrawal from the Non-Qualified Retirement/Savings Plan of Apache Corporation. However, if the Participant takes a hardship withdrawal from the Apache Corporation 401(k) Savings Plan, all outstanding Election Agreements that apply to Compensation that would have been paid to the Participant within six months after the hardship withdrawal (if the Election Agreements had not been in effect) shall be cancelled and no further Participant Deferrals made pursuant to such Election Agreements.
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3.02
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Company Deferrals
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4.01
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Investments
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4.02
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Voting
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5.01
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Vesting
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a.
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General
. Each award of Compensation to a Participant shall vest in accordance with the terms of the award, which are determined by the Committee. Upon the death or disability of a Participant, the award shall specify whether no vesting occurs, whether the next tranche or some other portion of the award vests, or whether the entire award vests.
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b.
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Termination for Cause
. If the employment of the Participant is terminated for cause as determined by the Company, the Participant’s entire Account balance, whether vested or not, shall be forfeited immediately. For this purpose, “cause” shall mean a gross violation, as determined by the Company, of the Company’s established policies and procedures.
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c.
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Earnings
. Stock Units attributable to dividend amounts credited to a Participant's Account shall vest as the Stock Units on which the dividend amounts are calculated vest.
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d.
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Change of Control
. If a change of control, within the meaning of Apache’s Income Continuance Plan or any successor plan, of Apache occurs, all unvested Stock Units credited to Participants' Accounts shall become automatically vested, without further action by the Committee or Apache’s board of directors.
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5.02
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Payouts of Company Deferrals
.
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a.
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Timing of Payout
. The Committee may specify the timing of the distribution of any grant of Company Deferrals, or the Committee may allow a Participant to make a payout election for his Company Deferrals. If the Participant is given the opportunity to make a payout election, the deadline for the election is 30 days after the grant of a Company Deferral unless the Committee specifies an earlier deadline.
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b.
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Payout Alternatives
. A Participant shall receive a lump sum distribution of the subaccount(s) containing Company Deferrals six months after he Separates from Service, unless the Committee permits him to elect five installments and he so elects, in which case the first installment will be paid six months after his Separation from Service, or as soon as convenient after that date, and subsequent installments will be paid on the anniversary of the first installment, or as near to that date as is administratively convenient.
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c.
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Death or Change of Control
. If there is a Change of Control or the Participant dies before receiving all installments, the remaining vested benefits shall be paid as specified in section 5.04 or 5.05, rather than as provided for in this section.
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d.
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Disability
. Each award of Compensation will specify whether the Participant’s disability (which shall fall within the meaning of the term in Code §409A(a)(2)(A)(ii)) will trigger a payout and when such payout(s) shall occur.
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e.
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Small Accounts
. See section 5.03(d) for payouts of small accounts.
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5.03
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Payouts of Participant Deferrals
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a.
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Election
. Each subaccount containing Participant Deferrals shall be paid in a lump sum six months after the Participant’s Separation from Service unless the Committee, in its sole discretion, allows a Participant to elect, and the Participant does elect, to have the Participant Deferrals under an Election Agreement paid to him in one of the following manners. Any payout election that the Participant is permitted make with respect to deferrals pursuant to an Election Agreement must be made by the end of the election period for that Election Agreement. The Committee has the discretion to reduce the possible payout alternatives from the three identified below. Paragraph (iv) contains special rules that apply when Stock Units vest after the Participant’s Separation from Service.
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i.
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In-Service Withdrawal, Single Payment
. The subaccount for Participant Deferrals from an Election Agreement will be paid in a lump sum five years after the Stock Units vest, or as near to that date as is administratively convenient. For example, if the Stock Units under a particular Election Agreement vest over four years, the Participant will receive four annual lump sums. If the Participant Separates from Service before receiving all lump sums with respect to an Election Agreement, (A), if a lump sum is scheduled to be paid during the six months after the Separation from Service, it will be paid as scheduled, and (B) if any lump sum is scheduled to be paid more than six months after the Separation from Service, it will instead be paid 6 months after his Separation from Service, or as soon thereafter as is administratively convenient.
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ii.
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In-Service Withdrawal, Limited Installments
. This payout alternative is available only if all Stock Units relating to an Election Agreement either are vested at the time of the Election Agreement or are scheduled to vest on a single date; thus, for example, this alternative is not available for a restricted stock unit award where vesting is scheduled to occur over four years. The benefits will be paid in five annual installments, with the first installment paid five years after the Stock Units vest (or, if vested when granted, five years after the date of the grant), or as near to that date as is administratively convenient. Subsequent installments are paid on the anniversary of the first installment or as near to that date as is administratively convenient. The amount of each installment is equal to the number of remaining Stock Units associated the Election Agreement, divided by the number of remaining installments, rounded down to the nearest whole Stock Unit, except that the last installment is equal to the number of remaining vested Stock Units, with any fractional share paid in cash. If the Participant Separates from Service before receiving all installments with respect to an Election Agreement, (A), any installment payment scheduled to be paid during the six months after the Separation from Service will be paid as scheduled, and (B) any remaining installment(s) will instead be paid in a lump sum 6 months after his Separation from Service, or as soon thereafter as is administratively convenient.
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iii.
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No In-Service Withdrawal
. The subaccount for the Participant Deferrals from each Election Agreement will be paid out in a single payment or in five annual installments. The single payment or the first installment payment will be paid six months after the Participant’s Separation from Service or as soon thereafter as is administratively convenient; subsequent installments will be paid on each anniversary of the first installment, or as near thereto as administratively convenient. Each installment will be equal to the balance in the subaccount measured as short a period of time before the installment is paid as is administratively convenient, divided by the number of remaining annual installments, rounded down to the nearest whole Stock Unit, except that the last installment shall be equal to the number of remaining Stock Units, with any fractional share paid in cash.
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iv.
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Vesting After Separation from Service
. An award of nonqualified deferred compensation may provide that some or all of the award may vest after the Participant Separates from Service. Typically, this occurs when a Participant retires under certain conditions specified in the award. Regardless of what payout elections were made under paragraphs, (i), (ii), or (iii), payment of that portion of an award that vests after the Participant’s Separation from Service will be made on the later of (A) the date that portion of the award vests or (B) six months after the Participant’s Separation from Service, or as soon thereafter as is administratively convenient.
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b.
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Existing Elections
. If a Participant made an Election Agreement before 2009 for an award that vested over more than one year and the Participant elected to defer such amounts for five years after vesting occurred with each amount paid in five installments, the payments scheduled to be made on or after January 1, 2009 will, in spite of the Participant’s previous election, be paid a lump sum on the fifth anniversary of date of the date such Stock Units vested, or, if later, in January of 2009. If the Participant Separates from Service before receiving all lump sums with respect to an Election Agreement, (i) if a lump sum is scheduled to be paid during the six months after the Separation from Service, it will be paid as scheduled, and (ii) if any lump sum is scheduled to be paid more than six months after the Separation from Service, it will instead be paid in January 2009 or if later six months after his Separation from Service, or as soon thereafter as is administratively convenient
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c.
|
Death, Disability, or Change of Control
. If there is a Change of Control or the Participant dies or becomes disabled before receiving all vested Stock Units, the remaining vested Stock Units, as well as any additional Stock Units that vest because of the death, disability, Change of Control, shall be paid as specified in section 5.02(d), 5.04, or 5.05, rather than as originally scheduled.
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d.
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Small Accounts
. If the Fair Market Value of a Participant’s Account six months after he Separates from Service is less than $100,000, (i) he shall receive a lump sum payment of the vested Account balance six months after the Separation from Service or as soon thereafter as is administratively convenient, and (ii) he shall receive a lump sum payment of any additional amounts that vest after the Separation from Service
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5.04
|
Distributions After Participant’s Death
|
a.
|
Immediate Payment
. When a Participant dies, his remaining vested Account balance shall be paid to each beneficiary in one lump sum four months after the Participant’s death, which should give each beneficiary adequate time to decide whether to disclaim. However, no payment may be made before the Committee’s designee has been furnished with proof of death and such other information as it may reasonably require, including information needed for tax reporting purposes. Such distribution shall be paid in whole shares of Stock, with any fractional shares paid in cash.
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b.
|
Designating Beneficiaries
. Each Participant shall designate one or more persons, trusts, or other entities as his Beneficiary to receive any amounts distributable hereunder after the Participant’s death, by furnishing the Committee with a beneficiary designation form. In the absence of an effective Beneficiary designation as to part or all of a Participant's interest in the Plan, such amount will be distributed to the Participant's surviving Spouse, if any, otherwise to the Participant's estate. Unless the Participant’s beneficiary designation form specifies otherwise, if a Beneficiary dies after the Participant but before being paid by the Plan, the Plan shall pay the Beneficiary’s estate.
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c.
|
Changing Beneficiaries
. A beneficiary designation may be changed by the Participant at any time and without the consent of any previously designated Beneficiary. However, if the Participant is married, his Spouse shall be his Beneficiary unless such Spouse has consented to the designation of a different Beneficiary. To be effective, the Spouse's consent must be in writing, witnessed by a notary public, and filed with the Committee's designee. If a Participant has designated his Spouse as a Beneficiary or as a contingent Beneficiary, and the Participant and that Spouse subsequently divorce, then the former Spouse will be treated as having pre-deceased the Participant for purposes of interpreting a beneficiary designation form completed prior to the divorce; this sentence shall apply only if the Committee’s designee is informed of the divorce before payment to the former Spouse is authorized.
|
d.
|
Disclaimers
. Any individual or legal entity who is a Beneficiary may disclaim all or any portion of his interest in the Plan, provided that the disclaimer satisfies the requirements of applicable state law and Code §2518(b). The legal guardian of a minor or legally incompetent person may disclaim for such person. The personal representative (or the individual or legal entity acting in the capacity of the personal representative according to applicable state law) may disclaim on behalf of a Beneficiary who has died. The amount disclaimed shall be distributed as if the disclaimant had predeceased the Participant.
|
5.05
|
Change of Control
|
a.
|
Former Employees
.
|
i.
|
Separated More than Six Months
. Each Participant who is not a “specified employee” (defined below) and each Participant who Separated from Service more than six months before the date of a Change of Control, including those who are already receiving installment payments, will be paid a single payment of his entire remaining vested Account balance on the date of the Change of Control or as soon thereafter as is administratively practicable.
|
ii.
|
Recent Separations
. Each Participant who is a specified employee and who Separated from Service less than six months before the Change of Control occurred will be paid a single payment of his entire Account balance six months after his Separation from Service, or as soon thereafter as is administratively practicable.
|
iii.
|
Specified Employee
. The term “specified employee” has the same meaning as the term “specified employee” in Code §409A(a)(2)(B)(i), and is determined using the default rules in the regulations and other guidance of general applicability issued pursuant to Code §409A.
|
b.
|
Current Employees
. Each Participant who is an employee on the date of a Change of Control will be paid a lump sum of his entire vested Account balance, including any amounts that vest upon the Change of Control, on the date of the Change of Control or as soon thereafter as is administratively practicable.
|
5.06
|
Rehires
. If a Participant Separated from Service and then becomes eligible to again accrue benefits, the payment of his benefits from his first episode of participation will not be affected by his subsequent participation. He will be treated as a new Participant for making payout elections for benefits accruing during his second episode of participation, except as otherwise provided in section 3.01.
|
5.07
|
Form of Distribution
. Subject to section 5.08, each payment shall be made in whole shares of Stock, with each Stock Unit being converted into one share of Stock. Any fractional Stock Units will be converted into cash based on the Fair Market Value of a share of Stock on the day preceding the day the payment is processed. Upon a change of control as defined in the Income Continuance Plan or its successor, the payment for each Stock Unit shall be one share of Stock unless the material characteristics of the Stock were affected by the Change of Control, in which case the payment for each Stock Unit shall be in the form of cash equal to the fair market value, determined as of the date of the Change of Control, of the property an Apache shareholder receives upon the change of control in exchange for one of his Shares.
|
5.08
|
Withholding
|
5.09
|
Divorce
|
a.
|
General
. If a Participant has divorced his Spouse, all or a portion of his Account may be allocated to his former Spouse. The Participant may be a former or current employee of the Company.
|
b.
|
Contents of Order
. The allocation will occur as soon as practicable after the Plan receives a judgment, decree, or order (collectively, an “order”) that (i) is made pursuant to a state domestic relations law or community property law, (ii) relates to the marital property rights of the former Spouse, (iii) unambiguously specifies the amount or percentage of the Participant’s Account that is to be allocated to the former Spouse, or unambiguously specifies the manner in which the amount or percentage is to be calculated, (iv) does not allocate any benefits that have already been allocated to a different former Spouse, (v) contains the name and last known mailing address of the Participant and eh former Spouse, (vi) the name of the Plan, (vii) does not contain any provision that violates subsections (c), (d), or (e), and (viii) contains the former Spouse’s Social Security number (or other similar taxpayer identification number) unless such number has been provided by the former Spouse to the Plan in a manner acceptable to the Committee.
|
c.
|
Payout Provisions
. The vested portion of the amount allocated to the former Spouse will be paid to the former Spouse in a single payment as soon as administratively practicable after (i) the Plan has determined that the order meets the requirements of subsection (b), (ii) the Plan has communicated its interpretation of the order to the Participant and former Spouse, and given them a reasonable amount of time (such as 30 days) to object to the Plan’s interpretation, (and if there is a timely objection, the parties must submit a revised order or withdraw their objections), and (iii) the parties agree to the Plan’s interpretation of the order.
|
d.
|
Not Fully Vested
. If the former Spouse is allocated any unvested amounts, the Plan will establish a separate account for the former Spouse. Unvested amounts are forfeited at the same time as the Participant’s unvested amounts are forfeited. If an amount allocated to the former Spouse subsequently become vested, the newly-vested amount will be paid to the former Spouse in a single payment as soon as administratively practicable following the additional vesting. If the former Spouse dies before award is fully vested, the unvested amounts shall be returned to the Participant’s Account.
|
e.
|
Source of Funds
. The order may specify which subaccounts the former Spouse’s benefits shall be taken from; if the order is silent on this matter, the amount awarded to the former Spouse shall be taken from the Participant’s subaccounts in the order determined by the Committee and shall be taken on a pro rata basis from the vested portion of the Account and the unvested portion.
|
5.10
|
Timing of Payments
|
5.11
|
Administrative Delays in Payments
|
5.12
|
Noncompliance with Code §409A
|
6.01
|
Committee to Administer and Interpret Plan
|
6.02
|
Organization of Committee
|
6.03
|
Agent for Process
|
6.04
|
Determination of Committee Final
|
7.01
|
Trust Agreement
|
7.02
|
Expenses of Trust
|
8.01
|
Amendment
|
8.02
|
Successors and Assigns; Termination of Plan
|
9.01
|
Number of Shares
|
9.02
|
Other Shares of Stock
|
9.03
|
Adjustments for Stock Split, Stock Dividend, Etc.
|
9.04
|
Dividend Payable in Stock of Another Corporation, Etc.
|
9.05
|
Other Changes in Stock
|
9.06
|
Rights to Subscribe
|
9.07
|
General Adjustment Rules
|
9.08
|
Determination by the Committee, Etc.
|
11.01
|
Funding of Benefits -- No Fiduciary Relationship
|
11.02
|
Right to Terminate Employment
|
11.03
|
Inalienability of Benefits
|
11.04
|
Claims Procedure
|
a.
|
General
. Each claim for benefits shall be processed in accordance with the procedures that may be established by the Committee. The procedures shall comply with the guidelines specified in this section. The Committee may delegate its duties under this section.
|
b.
|
Representatives
. A claimant may appoint a representative to act on his behalf. The Plan shall only recognize a representative if the Plan has received a written authorization signed by the claimant and on a form prescribed by the Committee, with the following exceptions. The Plan shall recognize a claimant’s legal representative, once the Plan is provided with documentation of such representation. If the claimant is a minor child, the Plan shall recognize the claimant’s parent or guardian as the claimant’s representative. Once an authorized representative is appointed, the Plan shall direct all information and notification regarding the claim to the authorized representative and the claimant shall be copied on all notifications regarding decisions, unless the claimant provides specific written direction otherwise.
|
c.
|
Extension of Deadlines
. The claimant may agree to an extension of any deadline that is mentioned in this section that applies to the Plan. The Committee or the relevant decision-maker may agree to an extension of any deadline that is mentioned in this section that applies to the claimant.
|
d.
|
Fees
. The Plan may not charge any fees to a claimant for utilizing the claims process described in this section.
|
e.
|
Filing a Claim
. A claim is made when the claimant files a claim in accordance with the procedures specified by the Committee. Any communication regarding benefits that is not made in accordance with the Plan’s procedures will not be treated as a claim.
|
f.
|
Initial Claims Decision
. The Plan shall decide a claim within a reasonable time up to 90 days after receiving the claim. The Plan shall have a 90-day extension, but only if the Plan is unable to decide within 90 days for reasons beyond its control, the Plan notifies the claimant of the special circumstances requiring
|
g.
|
Notification of Initial Decision
. The Plan shall provide the claimant with written notification of the Plan’s full or partial denial of a claim, reduction of a previously approved benefit, or termination of a benefit. The notification shall include a statement of the reason(s) for the decision; references to the plan provision(s) on which the decision was based; a description of any additional material or information necessary to perfect the claim and why such information is needed; a description of the procedures and deadlines for appeal; a description of the right to obtain information about the appeal procedures; and a statement of the claimant’s right to sue.
|
h.
|
Appeal
. The claimant may appeal any adverse or partially adverse decision. To appeal, the claimant must follow the procedures specified by the Committee. The appeal must be filed within 60 days of the date the claimant received notice of the initial decision. If the appeal is not timely and properly filed, the initial decision shall be the final decision of the Plan. The claimant may submit documents, written comments, and other information in support of the appeal. The claimant shall be given reasonable access at no charge to, and copies of, all documents, records, and other relevant information.
|
i.
|
Appellate Decision
. The Plan shall decide the appeal of a claim within a reasonable time of no more than 60 days from the date the Plan receives the claimant’s appeal. The 60-day deadline shall be extended by an additional 60 days, but only if the Committee determines that special circumstances require an extension, the Plan notifies the claimant of the special circumstances requiring the need for the extension by the 60th day after receiving the appeal, and the Plan notifies the claimant of the date by which the Plan expects to make a decision. If an appeal is missing any information from the claimant that is needed to decide the appeal, the Plan shall notify the claimant of the missing information and grant the claimant a reasonable period to provide the missing information. If the missing information is not timely provided, the Plan shall deny the claim. If the missing information is timely provided, the 60-day deadline (or 120-day deadline with the extension) for the Plan to make its decision shall be increased by the length of time between the date the Plan requested the missing information and the date the Plan received it.
|
j.
|
Notification of Decision
. The Plan shall provide the claimant with written notification of the Plan’s appellate decision (positive or adverse). The notification of any adverse or partially adverse decision shall include a statement of the reason(s) for the decision; reference to the plan provision(s) on which the decision was based; a description of the procedures and deadlines for a second appeal, if any; a description of the right to obtain information about the second-appeal procedures; a statement of the claimant’s right to sue; and a statement that the claimant is entitled to receive, free of charge and upon request, reasonable access to and copies of all documents, records, and other information relevant to the claim.
|
k.
|
Limitations on Bringing Actions in Court
. Once an appellate decision that is adverse or partially adverse to the claimant has been made, the claimant may file suit in court only if he does so by the earlier of the following dates: (i) the one-year anniversary of the date of an appellate decision made on or before a Change of Control or the three-year anniversary of the date of an appellate decision made after a Change of Control, or (ii) the date on which the statute of limitations for such claim expires.
|
11.05
|
Disposition of Unclaimed Distributions
|
11.06
|
Distributions due Infants or Incompetents
|
11.07
|
Addresses
|
a.
|
If to the Company, to Apache Corporation at its principal place of business at 2000 Post Oak Boulevard, Suite 100, Houston, Texas 77056-4400 (Attention: Corporate Secretary) or at such other address as may have been furnished in writing by the Company to a Participant; or
|
b.
|
If to a Participant, at the address the Participant has furnished to the Company in writing.
|
c.
|
If to a Beneficiary or former Spouse, at the address the Participant has furnished to the Company in writing, or at the address the Beneficiary or former Spouse subsequently provided in writing.
|
11.08
|
Statutory References
|
11.09
|
Governing Law
|
ATTEST:
|
|
|
APACHE CORPORATION
|
|
|
|
|
|
|
/s/ Cheri L. Peper
|
|
|
By:
/s/ Margery M. Harris
|
|
|
|
|
|
|
Cheri L. Peper
|
|
|
Margery M. Harris
|
|
Corporate Secretary
|
|
|
Executive Vice President, Human Resources
|
|
Share Plan:
|
2016 Omnibus Compensation Plan (the “2016 Plan”), the terms of which are incorporated herein by reference.
|
Administration:
|
This Program is administered by the Management Development and Compensation Committee of the Company’s Board of Directors.
|
Eligible Participants:
|
Members of the Company’s Board of Directors, as of the applicable grant date, who are neither officers nor employees of the Company.
|
Objective:
|
The program is designed to be administered in conjunction with the provisions of the current Non-Employee Directors’ Compensation Plan as a means to recognize the non-employee directors for services rendered through the awarding of equity compensation.
|
Grant Dates:
|
The last day of each calendar quarter.
|
Directors*:
|
RSUs the number of which is calculated by dividing $50,000 by the Fair Market Value (as defined in the 2016 Plan) of a share of Apache Common Stock on the grant date. If applicable, the grant shall be prorated for a non-employee director’s service during the calendar quarter. If the calculated number of RSUs includes a fraction, the number shall be rounded down to the nearest whole number.
|
Chairman*:
|
RSUs the number of which is calculated by dividing $25,000 by the Fair Market Value (as defined in the 2016 Plan) of a share of Apache Common Stock on the grant date. If applicable, the grant shall be prorated for the non-employee, non-executive chairman’s service during the calendar quarter. If the calculated number of RSUs includes a fraction, the number shall be rounded down to the nearest whole number.
|
Program Term:
|
Until termination of the 2016 Plan
|
Vesting:
|
100% as of grant date, with 100% automatic, mandatory deferral as described below.
|
Automatic Deferral
|
Upon vesting, the RSUs will be deferred into the Outside Directors’ Deferral Program and the RSUs and the associated dividend amounts (converted to shares of the Company’s common stock) will be distributed in a lump sum at the times specified in the Outside Directors’ Deferral Program.
|
1.01
|
Definitions
|
(a)
|
“Account” means the memorandum account maintained for each Participant that is credited with all Deferrals.
|
(b)
|
“Apache” means Apache Corporation or any successor thereto.
|
(c)
|
“Beneficiary” means a Participant’s beneficiary, as determined in section 5.03.
|
(d)
|
“Change of Control” means a change of control as defined in the Income Continuance Plan that is also described in Code §409A(a)(2)(A)(v).
|
(e)
|
“Code” means the Internal Revenue Code of 1986, as amended. Any reference to a particular section of the Code or the regulations issued thereunder shall be treated as a reference to any successor section.
|
(f)
|
“Committee” means the Management Development and Compensation Committee of Apache’s Board of Directors. The Committee shall be constituted at all times so as to permit the Apache Corporation 2011 Omnibus Equity Compensation Plan and the Apache Corporation 2016 Omnibus Compensation Plan to be administered by “non-employee directors” (as defined in Rule 16b-3 of the Securities Exchange Act of 1934, as amended).
|
(g)
|
“Deferrals” means any contributions to this Program.
|
(h)
|
“Fair Market Value” means the per share closing price of the Stock as reported on The New York Stock Exchange, Inc. Composite Transactions Reporting System for a particular date or, if the Stock is not so listed on such date, as reported on NASDAQ or on such other exchange or electronic trading system which, on the date in question, reports the largest number of traded shares of Stock,
provided
,
however
, that if on the date Fair Market Value is to be determined there are no transactions in the Stock, Fair Market Value shall be determined as of the immediately preceding date on which there were transactions in the Stock;
provided
further
,
however
, that if the foregoing provisions are not applicable, the fair market value of a share of the Stock as determined by the Committee by the reasonable application of such reasonable valuation method, consistently applied, as the Committee deems appropriate. For purposes of the foregoing, a valuation prepared in accordance with any of the methods set forth in Treasury Regulation §1.409A-1(b)(5)(iv)(B)(2), consistently used, shall be rebuttably presumed to result in a reasonable
|
(i)
|
“NED RSU Program” means the Non-Employee Directors’ Restricted Stock Units Program as established under the Apache Corporation 2011 Omnibus Equity Compensation Plan and the Apache Corporation 2016 Omnibus Compensation Plan.
|
(j)
|
“Outside Director” means any non-employee member of Apache’s board of directors.
|
(k)
|
“Participant” means any Outside Director as well as any former Outside Director who has accrued benefits in the Program that have not been fully paid out.
|
(l)
|
“Program” means the program set forth in this document, as amended from time to time.
|
(m)
|
“Separation from Service” has the same meaning as the term “separation from service” in Code §409A(a)(2)(A)(i), determined using the default rules in the regulations and other guidance of general applicability issued pursuant to Code §409A, including the special rules for directors in Treasury Regulation §1.409A-1(h)(5). A Participant who has a Separation from Service “Separates from Service.”
|
(n)
|
“Specified Employee” has the same meaning as the term “specified employee” in Code §409A(a)(2)(B)(i), and is determined using the default rules in the regulations and other guidance of general applicability issued pursuant to Code §409A.
|
(o)
|
“Spouse” means the individual to whom a Participant is lawfully married according to the laws of the state of the Participant’s domicile.
|
(p)
|
“Stock” means the $0.625 par value common stock of Apache.
|
(q)
|
“Stock Units” mean investment units and any related units from dividend amounts. Each Stock Unit is equivalent in value to one share of Stock.
|
1.02
|
Headings; Gender and Number
|
2.01
|
Eligibility and Participation
|
2.02
|
Enrollment
|
2.03
|
Failure of Eligibility
|
4.01
|
Investments
|
4.02
|
Voting
|
5.01
|
Vesting
|
5.02
|
Payouts
|
a.
|
General
. The Committee shall specify, on or before any award of Restricted Stock Units, the timing of the payout of any such Restricted Stock Units that are contributed to this Program when they vest; such payout provisions would apply in lieu of any payout provision otherwise specified in this section
.
|
b.
|
Payout Upon Separation from Service
. The Stock Units in the Program will be converted to Stock and paid to the Participant on the business day after the Participant Separates from Service, or as soon thereafter as is administratively convenient. See section 5.03 if the Participant dies before receiving all Program benefits; see section 5.04 if there is a Change of Control; see section 5.08 if the Participant is divorced and payments are made to his or her former Spouse. See the terms of the grant agreement for any special payment provisions that apply to a Participant who becomes disabled within the meaning of Code §409A(a)(2)(A)(ii).
|
c.
|
Payouts of Dividend Amounts
. The Stock Units acquired with dividend amounts shall be paid out at the same time as the Stock Units they relate to are paid out.
|
d.
|
Delayed Payment for Specified Employees
. In the rare event that a Participant is a Specified Employee when he or she Separates from Service, any benefit payments triggered by his or her Separation from Service will be delayed until six months after his or her Separation from Service.
|
5.03
|
Distributions After Participant’s Death
|
a.
|
Immediate Payment
. When a Participant dies, his or her remaining vested Account balance shall be paid to each Beneficiary in one lump sum four months after the Participant’s death, which should give each beneficiary adequate time to decide whether to disclaim as set forth in section 5.03(d). However, no payment may be made before the Committee’s designee has been furnished with proof of death and such other information as it may reasonably require, including information needed for tax reporting purposes. Such distribution shall be paid in whole shares of Stock, with any fractional shares paid in cash.
|
b.
|
Designating Beneficiaries
. Each Participant shall designate one or more persons, trusts, or other entities as his or her Beneficiary to receive any amounts distributable hereunder after the Participant’s death, by furnishing the Committee with a beneficiary designation form. In the absence of an effective Beneficiary designation as to part or all of a Participant's interest in the Program, such amount will be distributed to the Participant's surviving Spouse, if any, otherwise to the Participant's estate. Unless the Participant’s beneficiary designation form specifies otherwise, if a Beneficiary dies after the Participant but before being paid by the Program, the Program shall pay the Beneficiary’s estate.
|
c.
|
Changing Beneficiaries
. A Beneficiary designation may be changed by the Participant at any time and without the consent of any previously designated Beneficiary. However, if the Participant is married, his or her Spouse shall be his or her Beneficiary unless such Spouse has consented to the designation of a different Beneficiary. To be effective, the Spouse's consent must be in writing, witnessed by a notary public, and filed with the Committee's designee. If a Participant has designated his or her Spouse as a Beneficiary or as a contingent Beneficiary, and the Participant and that Spouse subsequently divorce, then the former Spouse will be treated as having pre-deceased the Participant for purposes of interpreting a beneficiary designation form completed prior to the divorce; this sentence shall apply only if the Committee’s designee is informed of the divorce before payment to the former Spouse is authorized.
|
d.
|
Disclaimers
. Any individual or legal entity who is a Beneficiary may disclaim all or any portion of his or her interest in the Program, provided that the disclaimer satisfies the requirements of applicable state law and Code §2518(b). The legal guardian of a minor or legally incompetent person may disclaim for such person. The personal representative (or the individual or legal entity acting in the capacity of the personal representative according to applicable state law) may disclaim on behalf of a Beneficiary who has died. The amount disclaimed shall be distributed as if the disclaimant had predeceased the Participant.
|
5.04
|
Change of Control
. Each Participant on the date of a Change of Control will be paid a lump sum of his or her or her entire Account balance on the date of the Change of Control or as soon thereafter as is administratively practicable.
|
5.05
|
Reappointments
. If a Participant Separated from Service and then becomes eligible to again accrue benefits, the payment of his or her benefits from his or her first episode of participation will not be affected by his or her subsequent participation. He or she will be treated as a new Participant for receiving grants under Article III.
|
5.06
|
Form of Distribution
. Except as otherwise provided in this section, each payment shall be made in whole shares of Stock, with each Stock Unit being converted into one share of Stock. Any fractional Stock Units will be converted into cash based on the Fair Market Value of a share of Stock on the day preceding the day the payment is processed. Upon a change of control as defined in the Income Continuance Plan or its successor, the payment for each Stock Unit shall be one share of Stock unless the material characteristics of the Stock were affected by the change of control, in which case the payment for each Stock Unit shall be in the form of cash equal to the fair market value, determined as of the date of the change of control, of the property an Apache shareholder receives upon the change of control in exchange for one of his or her Shares.
|
5.07
|
Withholding
|
5.08
|
Divorce
|
a.
|
General
. If a Participant has divorced his or her Spouse, all or a portion of his or her Account may be allocated to his or her former Spouse.
|
b.
|
Contents of Order
. The allocation will occur as soon as practicable after the Program receives a judgment, decree, or order (collectively, an “order”) that (i) is made pursuant to a state domestic relations law or community property law, (ii) relates to the marital property rights of the former Spouse, (iii) unambiguously specifies the amount or percentage of the Participant’s Account that is to be allocated to the former Spouse, or unambiguously specifies the manner in which the amount or percentage is to be calculated, (iv) does not allocate any benefits that have already been allocated to a different former Spouse, (v) contains the name and last known mailing address of the Participant and eh former Spouse, (vi) the name of the Program, (vii) does not contain any provision that violates subsections (c), (d), or (e), and (viii) contains the former Spouse’s Social Security number (or other similar taxpayer identification number) unless such number has been provided by the former Spouse to the Program in a manner acceptable to the Committee.
|
c.
|
Payout Provisions
. The amount allocated to the former Spouse will be paid to the former Spouse in a single payment as soon as administratively practicable after (i) the Program has determined that the order meets the requirements of subsection (b), (ii) the Program has communicated its interpretation of the order to the Participant and former Spouse, and given them a reasonable amount of time (such as 30 days) to object to the Program’s interpretation, (and if there is a timely objection, the parties must submit a revised order or withdraw their objections), and (iii) the parties agree to the Program’s interpretation of the order.
|
d.
|
Source of Funds
. The order may specify which subaccounts the former Spouse’s benefits shall be taken from; if the order is silent on this matter, the amount awarded to the former Spouse shall be taken pro rata from each subaccount.
|
5.09
|
Timing of Payments
|
5.10
|
Administrative Delays in Payments
|
5.11
|
Noncompliance with Code §409A
|
6.01
|
Committee to Administer and Interpret Program
|
6.02
|
Organization of Committee
|
6.03
|
Agent for Process
|
6.04
|
Determination of Committee Final
|
7.01
|
Amendment
|
7.02
|
Successors and Assigns; Termination of Program
|
8.01
|
Funding of Benefits -- No Fiduciary Relationship
|
8.02
|
Inalienability of Benefits
|
8.03
|
Claims Procedure
|
a.
|
General
. The Committee shall develop a reasonable claims procedure.
|
b.
|
Limitations on Bringing Actions in Court
. Once a final decision that is adverse or partially adverse to the claimant has been made, the claimant may file suit in court only if he or she does so by the earlier of the following dates: (i) the one-year anniversary of the date of the final decision made on or before a Change of Control or the three-year anniversary of the date of a final decision made after a Change of Control, or (ii) the date on which the statute of limitations for such claim expires.
|
8.04
|
Disposition of Unclaimed Distributions
|
8.05
|
Distributions due Infants or Incompetents
|
8.06
|
Addresses
|
a.
|
If to Apache, to Apache Corporation at its principal place of business at 2000 Post Oak Boulevard, Suite 100, Houston, Texas 77056-4400 (Attention: Corporate Secretary) or at such other address as may be furnished in writing by Apache to a Participant; or
|
b.
|
If to a Participant, at the address the Participant has furnished to Apache in writing.
|
c.
|
If to a Beneficiary or former Spouse, at the address the Participant has furnished to Apache in writing, or at the address the Beneficiary or former Spouse subsequently provided in writing.
|
8.07
|
Statutory References
|
8.08
|
Governing Law
|
ATTEST:
|
|
|
APACHE CORPORATION
|
|
|
|
|
|
|
/s/ Cheri L. Peper
|
|
|
By:
/s/ Margery M. Harris
|
|
|
|
|
|
|
Cheri L. Peper
|
|
|
Margery M. Harris
|
|
Corporate Secretary
|
|
|
Executive Vice President,
|
|
|
|
|
Human Resources
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Apache Corporation;
|
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
|
3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
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The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
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The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ John J. Christmann IV
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John J. Christmann IV
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Chief Executive Officer and President
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(principal executive officer)
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1.
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I have reviewed this quarterly report on Form 10-Q of Apache Corporation;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Stephen J. Riney
|
|
Stephen J. Riney
|
|
Executive Vice President and Chief Financial Officer
|
|
(principal financial officer)
|
|
/s/ John J. Christmann IV
|
|
||
By:
|
|
John J. Christmann IV
|
|
Title:
|
|
Chief Executive Officer and President
|
|
|
|
(principal executive officer)
|
|
/s/ Stephen J. Riney
|
|
||
By:
|
|
Stephen J. Riney
|
|
Title:
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(principal financial officer)
|
|