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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Emerging growth company
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¨
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Number of shares of registrant’s common stock outstanding as of July 31, 2018
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382,485,953
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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, natural gas liquids (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 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, regulatory, or policy changes;
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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 integration of acquisitions;
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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
2018
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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2018
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2017
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2018
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2017
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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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1,576
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$
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1,050
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$
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2,969
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$
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2,222
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Natural gas revenues
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212
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233
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434
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488
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Natural gas liquids revenues
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148
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63
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|
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266
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148
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||||
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1,936
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1,346
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3,669
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2,858
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||||
Gain (loss) on divestitures
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2
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(21
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)
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9
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320
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||||
Other
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(9
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)
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59
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(2
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)
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84
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||||
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1,929
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1,384
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3,676
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3,262
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OPERATING EXPENSES:
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Lease operating expenses
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356
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372
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705
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708
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Gathering, transmission, and processing
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82
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48
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168
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105
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Taxes other than income
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49
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29
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104
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71
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Exploration
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76
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108
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152
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200
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General and administrative
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117
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106
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231
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209
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Transaction, reorganization, and separation
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12
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4
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12
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(6
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)
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Depreciation, depletion, and amortization:
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Oil and gas property and equipment
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573
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536
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1,091
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1,074
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Other assets
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35
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36
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70
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74
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Asset retirement obligation accretion
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27
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37
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54
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73
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Impairments
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—
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—
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—
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8
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Financing costs, net
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94
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99
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193
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199
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1,421
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1,375
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2,780
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2,715
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NET INCOME BEFORE INCOME TAXES
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508
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9
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896
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547
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Current income tax provision
|
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249
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126
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447
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314
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Deferred income tax benefit
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(10
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)
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(730
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)
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(26
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)
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(647
|
)
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NET INCOME INCLUDING NONCONTROLLING INTEREST
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269
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613
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475
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880
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Net income attributable to noncontrolling interest
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74
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41
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135
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95
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NET INCOME ATTRIBUTABLE TO COMMON STOCK
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$
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195
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$
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572
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$
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340
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$
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785
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NET INCOME PER COMMON SHARE:
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Basic
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$
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0.51
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$
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1.50
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$
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0.89
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$
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2.06
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Diluted
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$
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0.51
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$
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1.50
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$
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0.88
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$
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2.05
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WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
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Basic
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382
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381
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382
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380
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Diluted
|
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385
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383
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384
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383
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DIVIDENDS DECLARED PER COMMON SHARE
|
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$
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0.25
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$
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0.25
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$
|
0.50
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$
|
0.50
|
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For the Six Months Ended June 30,
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||||||
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2018
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|
2017
|
||||
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(In millions)
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||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
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|
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Net income including noncontrolling interest
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$
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475
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$
|
880
|
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Adjustments to reconcile net income to net cash provided by operating activities:
|
|
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Unrealized derivative instrument gain, net
|
|
(104
|
)
|
|
(41
|
)
|
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Gain on divestitures
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(9
|
)
|
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(320
|
)
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Exploratory dry hole expense and unproved leasehold impairments
|
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73
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152
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Depreciation, depletion, and amortization
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1,161
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1,148
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Asset retirement obligation accretion
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54
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73
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Impairments
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—
|
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8
|
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Deferred income tax benefit
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(26
|
)
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(647
|
)
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Other
|
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107
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|
|
80
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Changes in operating assets and liabilities:
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Receivables
|
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(101
|
)
|
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62
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Inventories
|
|
(9
|
)
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20
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Drilling advances
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30
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(20
|
)
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Deferred charges and other
|
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69
|
|
|
(90
|
)
|
||
Accounts payable
|
|
46
|
|
|
(37
|
)
|
||
Accrued expenses
|
|
(45
|
)
|
|
(86
|
)
|
||
Deferred credits and noncurrent liabilities
|
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7
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|
|
24
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NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
1,728
|
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1,206
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||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Additions to oil and gas property
|
|
(1,572
|
)
|
|
(883
|
)
|
||
Leasehold and property acquisitions
|
|
(38
|
)
|
|
(67
|
)
|
||
Additions to gas gathering, transmission, and processing facilities
|
|
(284
|
)
|
|
(274
|
)
|
||
Proceeds from sale of Midale and House Mountain
|
|
—
|
|
|
228
|
|
||
Proceeds from sale of oil and gas properties
|
|
13
|
|
|
483
|
|
||
Other, net
|
|
(33
|
)
|
|
(16
|
)
|
||
NET CASH USED IN INVESTING ACTIVITIES
|
|
(1,914
|
)
|
|
(529
|
)
|
||
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Payments on fixed-rate debt
|
|
(150
|
)
|
|
(70
|
)
|
||
Distributions to noncontrolling interest
|
|
(155
|
)
|
|
(170
|
)
|
||
Dividends paid
|
|
(191
|
)
|
|
(190
|
)
|
||
Other
|
|
(14
|
)
|
|
43
|
|
||
NET CASH USED IN FINANCING ACTIVITIES
|
|
(510
|
)
|
|
(387
|
)
|
||
|
|
|
|
|
||||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
|
(696
|
)
|
|
290
|
|
||
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
|
|
1,668
|
|
|
1,377
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
972
|
|
|
$
|
1,667
|
|
|
|
|
|
|
||||
SUPPLEMENTARY CASH FLOW DATA:
|
|
|
|
|
||||
Interest paid, net of capitalized interest
|
|
$
|
200
|
|
|
$
|
202
|
|
Income taxes paid, net of refunds
|
|
374
|
|
|
163
|
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
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(In millions)
|
||||||
ASSETS
|
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
972
|
|
|
$
|
1,668
|
|
Receivables, net of allowance
|
|
1,446
|
|
|
1,345
|
|
||
Inventories
|
|
361
|
|
|
368
|
|
||
Drilling advances
|
|
177
|
|
|
207
|
|
||
Prepaid assets and other
|
|
183
|
|
|
137
|
|
||
|
|
3,139
|
|
|
3,725
|
|
||
PROPERTY AND EQUIPMENT:
|
|
|
|
|
||||
Oil and gas, on the basis of successful efforts accounting:
|
|
|
|
|
||||
Proved properties
|
|
40,644
|
|
|
39,197
|
|
||
Unproved properties and properties under development
|
|
1,807
|
|
|
1,783
|
|
||
Gathering, transmission and processing facilities
|
|
1,619
|
|
|
1,376
|
|
||
Other
|
|
1,062
|
|
|
1,046
|
|
||
|
|
45,132
|
|
|
43,402
|
|
||
Less: Accumulated depreciation, depletion, and amortization
|
|
(26,796
|
)
|
|
(25,643
|
)
|
||
|
|
18,336
|
|
|
17,759
|
|
||
OTHER ASSETS:
|
|
|
|
|
||||
Deferred charges and other
|
|
435
|
|
|
438
|
|
||
|
|
$
|
21,910
|
|
|
$
|
21,922
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
682
|
|
|
$
|
641
|
|
Current debt
|
|
400
|
|
|
550
|
|
||
Other current liabilities (Note 5)
|
|
1,230
|
|
|
1,373
|
|
||
|
|
2,312
|
|
|
2,564
|
|
||
LONG-TERM DEBT
|
|
7,937
|
|
|
7,934
|
|
||
DEFERRED CREDITS AND OTHER NONCURRENT LIABILITIES:
|
|
|
|
|
||||
Income taxes
|
|
518
|
|
|
545
|
|
||
Asset retirement obligation
|
|
1,845
|
|
|
1,792
|
|
||
Other
|
|
303
|
|
|
296
|
|
||
|
|
2,666
|
|
|
2,633
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 9)
|
|
|
|
|
||||
EQUITY:
|
|
|
|
|
||||
Common stock, $0.625 par, 860,000,000 shares authorized, 415,627,712 and 414,125,879 shares issued, respectively
|
|
260
|
|
|
259
|
|
||
Paid-in capital
|
|
12,011
|
|
|
12,128
|
|
||
Accumulated deficit
|
|
(1,748
|
)
|
|
(2,088
|
)
|
||
Treasury stock, at cost, 33,168,561 and 33,171,015 shares, respectively
|
|
(2,887
|
)
|
|
(2,887
|
)
|
||
Accumulated other comprehensive income
|
|
4
|
|
|
4
|
|
||
APACHE SHAREHOLDERS’ EQUITY
|
|
7,640
|
|
|
7,416
|
|
||
Noncontrolling interest
|
|
1,355
|
|
|
1,375
|
|
||
TOTAL EQUITY
|
|
8,995
|
|
|
8,791
|
|
||
|
|
$
|
21,910
|
|
|
$
|
21,922
|
|
|
|
Common
Stock
|
|
Paid-In
Capital
|
|
Accumulated Deficit
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
APACHE
SHAREHOLDERS’
EQUITY
|
|
Noncontrolling
Interest
|
|
TOTAL
EQUITY
|
||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||||||||||
BALANCE AT DECEMBER 31, 2016
|
|
$
|
258
|
|
|
$
|
12,364
|
|
|
$
|
(3,385
|
)
|
|
$
|
(2,887
|
)
|
|
$
|
(112
|
)
|
|
$
|
6,238
|
|
|
$
|
1,441
|
|
|
$
|
7,679
|
|
Net income
|
|
—
|
|
|
—
|
|
|
785
|
|
|
—
|
|
|
—
|
|
|
785
|
|
|
95
|
|
|
880
|
|
||||||||
Distributions to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
(170
|
)
|
||||||||
Common dividends ($0.50 per share)
|
|
—
|
|
|
(190
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(190
|
)
|
|
—
|
|
|
(190
|
)
|
||||||||
Other
|
|
1
|
|
|
72
|
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
66
|
|
|
—
|
|
|
66
|
|
||||||||
BALANCE AT JUNE 30, 2017
|
|
$
|
259
|
|
|
$
|
12,246
|
|
|
$
|
(2,607
|
)
|
|
$
|
(2,887
|
)
|
|
$
|
(112
|
)
|
|
$
|
6,899
|
|
|
$
|
1,366
|
|
|
$
|
8,265
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
BALANCE AT DECEMBER 31, 2017
|
|
$
|
259
|
|
|
$
|
12,128
|
|
|
$
|
(2,088
|
)
|
|
$
|
(2,887
|
)
|
|
$
|
4
|
|
|
$
|
7,416
|
|
|
$
|
1,375
|
|
|
$
|
8,791
|
|
Net income
|
|
—
|
|
|
—
|
|
|
340
|
|
|
—
|
|
|
—
|
|
|
340
|
|
|
135
|
|
|
475
|
|
||||||||
Distributions to noncontrolling interest
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(155
|
)
|
|
(155
|
)
|
||||||||
Common dividends ($0.50 per share)
|
|
—
|
|
|
(191
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(191
|
)
|
|
—
|
|
|
(191
|
)
|
||||||||
Other
|
|
1
|
|
|
74
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
75
|
|
|
—
|
|
|
75
|
|
||||||||
BALANCE AT JUNE 30, 2018
|
|
$
|
260
|
|
|
$
|
12,011
|
|
|
$
|
(1,748
|
)
|
|
$
|
(2,887
|
)
|
|
$
|
4
|
|
|
$
|
7,640
|
|
|
$
|
1,355
|
|
|
$
|
8,995
|
|
1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
(In millions)
|
||||||||||||||
Oil and Gas Property:
|
|
|
|
|
|
|
|
|
||||||||
Proved
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Unproved
|
|
21
|
|
|
39
|
|
|
37
|
|
|
54
|
|
2.
|
ACQUISITIONS AND DIVESTITURES
|
|
|
|
|
Put Options
(1)
|
|||
Production Period
|
|
Settlement Index
|
|
Mbbls
|
|
Weighted Average Strike Price
|
|
July—December 2018
|
|
Dated Brent
|
|
7,360
|
|
|
$56.00
|
July—December 2018
|
|
NYMEX WTI
|
|
5,520
|
|
|
$53.00
|
(1)
|
The remaining unamortized premium paid as of
June 30, 2018
, was
$25 million
.
|
|
|
|
|
Collars
|
|
Call Options
(2)
|
||||||||
Production Period
|
|
Settlement Index
|
|
Mbbls
|
|
Weighted Average Floor Price
|
|
Weighted Average Ceiling Price
|
|
Mbbls
|
|
Strike Price
|
||
July—December 2018
|
|
NYMEX WTI
|
|
3,404
|
|
|
$45.00
|
|
$57.00
|
|
3,404
|
|
|
$60.03
|
(2)
|
The remaining unamortized premium paid as of
June 30, 2018
, was
$5 million
.
|
Production Period
|
|
Settlement Index
|
|
Mbbls
|
|
Weighted Average Price Differential
|
|
October—December 2018
|
|
Midland-WTI/Cushing-WTI
|
|
1,380
|
|
|
$(9.23)
|
January—September 2019
|
|
Midland-WTI/Cushing-WTI
|
|
4,095
|
|
|
$(9.23)
|
October—December 2019
|
|
Midland-WTI/Cushing-WTI
|
|
1,380
|
|
|
$(3.72)
|
|
|
|
|
Fixed-Price Swaps
|
|||
Production Period
|
|
Settlement Index
|
|
MMBtu
(in 000’s)
|
|
Weighted Average Fixed Price
|
|
July—December 2018
|
|
NYMEX Henry Hub
|
|
33,580
|
|
|
$2.96
|
Production Period
|
|
Settlement Index
|
|
MMBtu
(in 000’s)
|
|
Weighted Average Price Differential
|
|
July—December 2018
|
|
NYMEX Henry Hub/Waha
|
|
33,120
|
|
|
$(0.53)
|
October—December 2018
|
|
NYMEX Henry Hub/Waha
|
|
1,380
|
|
|
$(0.51)
|
January—March 2019
|
|
NYMEX Henry Hub/Waha
|
|
1,350
|
|
|
$(0.54)
|
January—June 2019
|
|
NYMEX Henry Hub/Waha
|
|
32,580
|
|
|
$(0.53)
|
January—December 2019
|
|
NYMEX Henry Hub/Waha
|
|
14,600
|
|
|
$(0.45)
|
|
|
Fair Value Measurements Using
|
|
|
|
|
|
|
||||||||||||||||
|
|
Quoted Price in Active Markets (Level 1)
|
|
Significant Other Inputs (Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
Total Fair Value
|
|
Netting
(1)
|
|
Carrying Amount
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
$
|
—
|
|
|
$
|
124
|
|
|
$
|
—
|
|
|
$
|
124
|
|
|
$
|
(46
|
)
|
|
$
|
78
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
—
|
|
|
50
|
|
|
—
|
|
|
50
|
|
|
(46
|
)
|
|
4
|
|
||||||
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
$
|
—
|
|
|
$
|
67
|
|
|
$
|
—
|
|
|
$
|
67
|
|
|
$
|
(43
|
)
|
|
$
|
24
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
—
|
|
|
107
|
|
|
—
|
|
|
107
|
|
|
(43
|
)
|
|
64
|
|
(1)
|
The derivative fair values are based on analysis of each contract on a gross basis, excluding the impact of netting agreements with counterparties.
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
|
(In millions)
|
||||||
Current Assets: Prepaid assets and other
|
|
$
|
74
|
|
|
$
|
8
|
|
Other Assets: Deferred charges and other
|
|
4
|
|
|
16
|
|
||
Total Assets
|
|
$
|
78
|
|
|
$
|
24
|
|
|
|
|
|
|
||||
Current Liabilities: Other current liabilities
|
|
$
|
2
|
|
|
$
|
64
|
|
Noncurrent Liabilities: Other
|
|
2
|
|
|
—
|
|
||
Total Liabilities
|
|
$
|
4
|
|
|
$
|
64
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||
|
|
(In millions)
|
||||||||||||||
Realized loss:
|
|
|
|
|
|
|
|
|
||||||||
Derivative settlements
|
|
$
|
(75
|
)
|
|
$
|
—
|
|
|
$
|
(117
|
)
|
|
$
|
—
|
|
Amortization of call and put premium
|
|
(5
|
)
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
||||
Unrealized gain
|
|
55
|
|
|
41
|
|
|
104
|
|
|
41
|
|
||||
Derivative instrument gain (losses), net
|
|
$
|
(25
|
)
|
|
$
|
41
|
|
|
$
|
(23
|
)
|
|
$
|
41
|
|
5.
|
OTHER CURRENT LIABILITIES
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
|
(In millions)
|
||||||
Accrued operating expenses
|
|
$
|
76
|
|
|
$
|
72
|
|
Accrued exploration and development
|
|
603
|
|
|
680
|
|
||
Accrued gathering, transmission, and processing
|
|
70
|
|
|
122
|
|
||
Accrued compensation and benefits
|
|
90
|
|
|
115
|
|
||
Accrued interest
|
|
141
|
|
|
145
|
|
||
Accrued income taxes
|
|
110
|
|
|
55
|
|
||
Current asset retirement obligation
|
|
38
|
|
|
43
|
|
||
Other
|
|
102
|
|
|
141
|
|
||
Total other current liabilities
|
|
$
|
1,230
|
|
|
$
|
1,373
|
|
6.
|
ASSET RETIREMENT OBLIGATION
|
|
|
(In millions)
|
||
Asset retirement obligation at December 31, 2017
|
|
$
|
1,835
|
|
Liabilities incurred
|
|
18
|
|
|
Liabilities settled
|
|
(24
|
)
|
|
Accretion expense
|
|
54
|
|
|
Asset retirement obligation at June 30, 2018
|
|
1,883
|
|
|
Less current portion
|
|
(38
|
)
|
|
Asset retirement obligation, long-term
|
|
$
|
1,845
|
|
7.
|
INCOME TAXES
|
8.
|
DEBT AND FINANCING COSTS
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||||||||||
|
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
|
|
(In millions)
|
||||||||||||||
Commercial paper and committed bank facilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Notes and debentures
|
|
8,337
|
|
|
8,507
|
|
|
8,484
|
|
|
9,244
|
|
||||
Total Debt
|
|
$
|
8,337
|
|
|
$
|
8,507
|
|
|
$
|
8,484
|
|
|
$
|
9,244
|
|
|
|
June 30, 2018
|
|
December 31, 2017
|
||||
|
|
(In millions)
|
||||||
Debt before unamortized discount and deferred loan costs
|
|
$
|
8,430
|
|
|
$
|
8,580
|
|
Unamortized discount
|
|
(46
|
)
|
|
(47
|
)
|
||
Deferred loan costs
|
|
(47
|
)
|
|
(49
|
)
|
||
Total debt
|
|
8,337
|
|
|
8,484
|
|
||
Current maturities
|
|
(400
|
)
|
|
(550
|
)
|
||
Long-term debt
|
|
$
|
7,937
|
|
|
$
|
7,934
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
(In millions)
|
||||||||||||||
Interest expense
|
|
$
|
110
|
|
|
$
|
115
|
|
|
$
|
222
|
|
|
$
|
231
|
|
Amortization of deferred loan costs
|
|
1
|
|
|
2
|
|
|
6
|
|
|
4
|
|
||||
Capitalized interest
|
|
(13
|
)
|
|
(13
|
)
|
|
(25
|
)
|
|
(27
|
)
|
||||
Loss on extinguishment of debt
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Interest income
|
|
(4
|
)
|
|
(5
|
)
|
|
(10
|
)
|
|
(10
|
)
|
||||
Financing costs, net
|
|
$
|
94
|
|
|
$
|
99
|
|
|
$
|
193
|
|
|
$
|
199
|
|
9.
|
COMMITMENTS AND CONTINGENCIES
|
10.
|
CAPITAL STOCK
|
|
|
For the Quarter Ended June 30,
|
||||||||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||||||||
|
|
Income
|
|
Shares
|
|
Per Share
|
|
Income
|
|
Shares
|
|
Per Share
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income attributable to common stock
|
|
$
|
195
|
|
|
382
|
|
|
$
|
0.51
|
|
|
$
|
572
|
|
|
381
|
|
|
$
|
1.50
|
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stock options and other
|
|
$
|
—
|
|
|
3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
—
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income attributable to common stock
|
|
$
|
195
|
|
|
385
|
|
|
$
|
0.51
|
|
|
$
|
572
|
|
|
383
|
|
|
$
|
1.50
|
|
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||||||||
|
|
Income
|
|
Shares
|
|
Per Share
|
|
Income
|
|
Shares
|
|
Per Share
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income attributable to common stock
|
|
$
|
340
|
|
|
382
|
|
|
$
|
0.89
|
|
|
$
|
785
|
|
|
380
|
|
|
$
|
2.06
|
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stock options and other
|
|
$
|
—
|
|
|
2
|
|
|
$
|
(0.01
|
)
|
|
$
|
—
|
|
|
3
|
|
|
$
|
(0.01
|
)
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income attributable to common stock
|
|
$
|
340
|
|
|
384
|
|
|
$
|
0.88
|
|
|
$
|
785
|
|
|
383
|
|
|
$
|
2.05
|
|
11.
|
BUSINESS SEGMENT INFORMATION
|
|
|
United
States
|
|
Canada
(1)
|
|
Egypt
(2,3)
|
|
North Sea
|
|
Other
International
|
|
Total
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Quarter Ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
607
|
|
|
$
|
—
|
|
|
$
|
649
|
|
|
$
|
320
|
|
|
$
|
—
|
|
|
$
|
1,576
|
|
Natural gas revenues
|
|
96
|
|
|
—
|
|
|
89
|
|
|
27
|
|
|
—
|
|
|
212
|
|
||||||
Natural gas liquids revenues
|
|
139
|
|
|
—
|
|
|
4
|
|
|
5
|
|
|
—
|
|
|
148
|
|
||||||
Total Oil and Gas Production Revenues
|
|
$
|
842
|
|
|
$
|
—
|
|
|
$
|
742
|
|
|
$
|
352
|
|
|
$
|
—
|
|
|
$
|
1,936
|
|
Operating Income (Loss)
(4)
|
|
$
|
192
|
|
|
$
|
—
|
|
|
$
|
401
|
|
|
$
|
146
|
|
|
$
|
(1
|
)
|
|
$
|
738
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
2
|
|
|||||||||||
Other
(5)
|
|
|
|
|
|
|
|
|
|
|
|
(9
|
)
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(117
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(12
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(94
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
508
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
For the Six Months Ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
1,160
|
|
|
$
|
—
|
|
|
$
|
1,218
|
|
|
$
|
591
|
|
|
$
|
—
|
|
|
$
|
2,969
|
|
Natural gas revenues
|
|
206
|
|
|
—
|
|
|
177
|
|
|
51
|
|
|
—
|
|
|
434
|
|
||||||
Natural gas liquids revenues
|
|
250
|
|
|
—
|
|
|
7
|
|
|
9
|
|
|
—
|
|
|
266
|
|
||||||
Total Oil and Gas Production Revenues
|
|
$
|
1,616
|
|
|
$
|
—
|
|
|
$
|
1,402
|
|
|
$
|
651
|
|
|
$
|
—
|
|
|
$
|
3,669
|
|
Operating Income (Loss)
(4)
|
|
$
|
376
|
|
|
$
|
—
|
|
|
$
|
737
|
|
|
$
|
214
|
|
|
$
|
(2
|
)
|
|
$
|
1,325
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
9
|
|
|||||||||||
Other
(5)
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(231
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(12
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(193
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
896
|
|
||||||||||
Total Assets
|
|
$
|
14,250
|
|
|
$
|
—
|
|
|
$
|
4,471
|
|
|
$
|
3,148
|
|
|
$
|
41
|
|
|
$
|
21,910
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United
States
|
|
Canada
(1)
|
|
Egypt
(2,3)
|
|
North Sea
|
|
Other
International
|
|
Total
|
||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Quarter Ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
355
|
|
|
$
|
47
|
|
|
$
|
423
|
|
|
$
|
225
|
|
|
$
|
—
|
|
|
$
|
1,050
|
|
Natural gas revenues
|
|
84
|
|
|
40
|
|
|
95
|
|
|
14
|
|
|
—
|
|
|
233
|
|
||||||
Natural gas liquids revenues
|
|
52
|
|
|
6
|
|
|
3
|
|
|
2
|
|
|
—
|
|
|
63
|
|
||||||
Total Oil and Gas Production Revenues
|
|
$
|
491
|
|
|
$
|
93
|
|
|
$
|
521
|
|
|
$
|
241
|
|
|
$
|
—
|
|
|
$
|
1,346
|
|
Operating Income (Loss)
(6)
|
|
$
|
(17
|
)
|
|
$
|
(18
|
)
|
|
$
|
213
|
|
|
$
|
4
|
|
|
$
|
(2
|
)
|
|
$
|
180
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Loss on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
(21
|
)
|
|||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
59
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(106
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(4
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(99
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
9
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
For the Six Months Ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
752
|
|
|
$
|
96
|
|
|
$
|
909
|
|
|
$
|
465
|
|
|
$
|
—
|
|
|
$
|
2,222
|
|
Natural gas revenues
|
|
169
|
|
|
85
|
|
|
197
|
|
|
37
|
|
|
—
|
|
|
488
|
|
||||||
Natural gas liquids revenues
|
|
122
|
|
|
14
|
|
|
6
|
|
|
6
|
|
|
—
|
|
|
148
|
|
||||||
Total Oil and Gas Production Revenues
|
|
$
|
1,043
|
|
|
$
|
195
|
|
|
$
|
1,112
|
|
|
$
|
508
|
|
|
$
|
—
|
|
|
$
|
2,858
|
|
Operating Income (Loss)
(6)
|
|
$
|
43
|
|
|
$
|
(31
|
)
|
|
$
|
514
|
|
|
$
|
42
|
|
|
$
|
(23
|
)
|
|
$
|
545
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on divestitures, net
|
|
|
|
|
|
|
|
|
|
|
|
320
|
|
|||||||||||
Other
|
|
|
|
|
|
|
|
|
|
|
|
84
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(209
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
6
|
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(199
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
547
|
|
||||||||||
Total Assets
|
|
$
|
12,530
|
|
|
$
|
1,476
|
|
|
$
|
4,778
|
|
|
$
|
3,772
|
|
|
$
|
46
|
|
|
$
|
22,602
|
|
(1)
|
Apache exited its Canadian operations in the third quarter of 2017.
|
(2)
|
Includes a noncontrolling interest in Egypt.
|
(3)
|
Includes revenue from non-customer of
$165 million
,
$15 million
, and
$1 million
for oil, natural gas, and natural gas liquids, respectively, for the
second
quarter of
2018
, and
$304 million
,
$30 million
, and
$2 million
, for oil, natural gas, and natural gas liquids, respectively, for the first
six
months of
2018
.
|
(4)
|
Operating income (loss) consists of oil and gas production revenues less lease operating expenses, gathering, transmission, and processing costs, taxes other than income, exploration costs, depreciation, depletion, and amortization, asset retirement obligation accretion, and impairments. The operating income of U.S. includes leasehold impairments totaling
$21 million
for the
second
quarter of
2018
. The operating income of U.S. includes leasehold impairments totaling
$37 million
for the first
six
months of
2018
.
|
(5)
|
Included in Other are sales proceeds related to U.S. third-party purchased oil and gas totaling
$98 million
and
$202 million
for the
second
quarter and first
six
months of
2018
, respectively, which are determined to be revenue from customers.
|
(6)
|
The operating income (loss) of U.S. and Canada includes leasehold impairments totaling
$38 million
and
$1 million
, respectively, for the second quarter of 2017. The operating income (loss) of U.S., Canada and North Sea includes leasehold and other asset impairments totaling
$52 million
,
$2 million
, and
$8 million
, respectively, for the first
six
months of
2017
.
|
•
|
U.S. onshore equivalent production
increased
33 percent
from the
second
quarter of
2017
, a reflection of the success of the Midland Basin drilling program and the commencement and continued production ramp-up of the Company’s Alpine High development.
|
•
|
Second
-quarter equivalent production from the Permian region, which accounts for
79 percent
of Apache’s total U.S. production,
increased
39 percent
from the
second
quarter of
2017
, driven by the Alpine High discovery and strong performance in the Midland Basin. Crude oil production in the region
increased
25 percent
between the comparative quarters.
|
•
|
Drilling and infrastructure development activities continue at Alpine High; specifically:
|
◦
|
First production from the Alpine High play was achieved in early May 2017. Net production for the
second
quarter of
2018
averaged approximately 32.1 Mboe/d.
|
◦
|
Development continues to ramp-up steadily as the Company drills more development wells in the overall mix of its drilling program at Alpine High. Apache is now conducting key spacing and pattern tests in addition to its ongoing retention drilling program.
|
◦
|
During the
second
quarter of 2018, Apache invested $123 million in Alpine High infrastructure, with development ongoing. Inception-to-date investment in Alpine High infrastructure as of quarter-end was $949 million.
|
◦
|
The Company is in the process of evaluating opportunities for monetizing its Alpine High midstream assets, including options for minority interests in transportation projects from the Permian Basin to the Gulf Coast.
|
•
|
The Egypt region averaged 13 rigs and drilled 35 gross wells during the
second
quarter of
2018
. Net equivalent production
decreased
5 percent
from the
second
quarter
2017
despite
an increase
of
2 percent
in gross production, a result of the impact of higher Brent oil prices on cost recovery volumes as a function of the Company’s production sharing contracts.
|
•
|
In Egypt, Apache completed the acquisition of 650,000 additional gross acres in the East Bahariya area. The contract provides a 6-year term for exploration on the concession, which is located close to existing production. Apache plans to commence exploration drilling in the third quarter of 2018.
|
•
|
The North Sea region average daily production remained relatively flat compared with the
second
quarter of
2017
primarily as a result of production from new wells offsetting natural decline.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||||||
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
||||||||||||
|
|
($ in millions)
|
||||||||||||||||||||||||||
Total Oil Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
607
|
|
|
39
|
%
|
|
$
|
355
|
|
|
34
|
%
|
|
$
|
1,160
|
|
|
39
|
%
|
|
$
|
752
|
|
|
34
|
%
|
Canada
|
|
—
|
|
|
—
|
|
|
47
|
|
|
4
|
%
|
|
—
|
|
|
—
|
|
|
96
|
|
|
4
|
%
|
||||
North America
|
|
607
|
|
|
39
|
%
|
|
402
|
|
|
38
|
%
|
|
1,160
|
|
|
39
|
%
|
|
848
|
|
|
38
|
%
|
||||
Egypt
(1)
|
|
649
|
|
|
41
|
%
|
|
423
|
|
|
40
|
%
|
|
1,218
|
|
|
41
|
%
|
|
909
|
|
|
41
|
%
|
||||
North Sea
|
|
320
|
|
|
20
|
%
|
|
225
|
|
|
22
|
%
|
|
591
|
|
|
20
|
%
|
|
465
|
|
|
21
|
%
|
||||
International
(1)
|
|
969
|
|
|
61
|
%
|
|
648
|
|
|
62
|
%
|
|
1,809
|
|
|
61
|
%
|
|
1,374
|
|
|
62
|
%
|
||||
Total
(1)
|
|
$
|
1,576
|
|
|
100
|
%
|
|
$
|
1,050
|
|
|
100
|
%
|
|
$
|
2,969
|
|
|
100
|
%
|
|
$
|
2,222
|
|
|
100
|
%
|
Total Natural Gas Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
96
|
|
|
45
|
%
|
|
$
|
84
|
|
|
36
|
%
|
|
$
|
206
|
|
|
47
|
%
|
|
$
|
169
|
|
|
35
|
%
|
Canada
|
|
—
|
|
|
—
|
|
|
40
|
|
|
17
|
%
|
|
—
|
|
|
—
|
|
|
85
|
|
|
17
|
%
|
||||
North America
|
|
96
|
|
|
45
|
%
|
|
124
|
|
|
53
|
%
|
|
206
|
|
|
47
|
%
|
|
254
|
|
|
52
|
%
|
||||
Egypt
(1)
|
|
89
|
|
|
42
|
%
|
|
95
|
|
|
41
|
%
|
|
177
|
|
|
41
|
%
|
|
197
|
|
|
40
|
%
|
||||
North Sea
|
|
27
|
|
|
13
|
%
|
|
14
|
|
|
6
|
%
|
|
51
|
|
|
12
|
%
|
|
37
|
|
|
8
|
%
|
||||
International
(1)
|
|
116
|
|
|
55
|
%
|
|
109
|
|
|
47
|
%
|
|
228
|
|
|
53
|
%
|
|
234
|
|
|
48
|
%
|
||||
Total
(1)
|
|
$
|
212
|
|
|
100
|
%
|
|
$
|
233
|
|
|
100
|
%
|
|
$
|
434
|
|
|
100
|
%
|
|
$
|
488
|
|
|
100
|
%
|
Total Natural Gas Liquids (NGL) Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
139
|
|
|
94
|
%
|
|
$
|
52
|
|
|
83
|
%
|
|
$
|
250
|
|
|
94
|
%
|
|
$
|
122
|
|
|
82
|
%
|
Canada
|
|
—
|
|
|
—
|
|
|
6
|
|
|
9
|
%
|
|
—
|
|
|
—
|
|
|
14
|
|
|
10
|
%
|
||||
North America
|
|
139
|
|
|
94
|
%
|
|
58
|
|
|
92
|
%
|
|
250
|
|
|
94
|
%
|
|
136
|
|
|
92
|
%
|
||||
Egypt
(1)
|
|
4
|
|
|
3
|
%
|
|
3
|
|
|
5
|
%
|
|
7
|
|
|
3
|
%
|
|
6
|
|
|
4
|
%
|
||||
North Sea
|
|
5
|
|
|
3
|
%
|
|
2
|
|
|
3
|
%
|
|
9
|
|
|
3
|
%
|
|
6
|
|
|
4
|
%
|
||||
International
(1)
|
|
9
|
|
|
6
|
%
|
|
5
|
|
|
8
|
%
|
|
16
|
|
|
6
|
%
|
|
12
|
|
|
8
|
%
|
||||
Total
(1)
|
|
$
|
148
|
|
|
100
|
%
|
|
$
|
63
|
|
|
100
|
%
|
|
$
|
266
|
|
|
100
|
%
|
|
$
|
148
|
|
|
100
|
%
|
Total Oil and Gas Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
842
|
|
|
43
|
%
|
|
$
|
491
|
|
|
36
|
%
|
|
$
|
1,616
|
|
|
44
|
%
|
|
$
|
1,043
|
|
|
36
|
%
|
Canada
|
|
—
|
|
|
—
|
|
|
93
|
|
|
7
|
%
|
|
—
|
|
|
—
|
|
|
195
|
|
|
7
|
%
|
||||
North America
|
|
842
|
|
|
43
|
%
|
|
584
|
|
|
43
|
%
|
|
1,616
|
|
|
44
|
%
|
|
1,238
|
|
|
43
|
%
|
||||
Egypt
(1)
|
|
742
|
|
|
39
|
%
|
|
521
|
|
|
39
|
%
|
|
1,402
|
|
|
38
|
%
|
|
1,112
|
|
|
39
|
%
|
||||
North Sea
|
|
352
|
|
|
18
|
%
|
|
241
|
|
|
18
|
%
|
|
651
|
|
|
18
|
%
|
|
508
|
|
|
18
|
%
|
||||
International
(1)
|
|
1,094
|
|
|
57
|
%
|
|
762
|
|
|
57
|
%
|
|
2,053
|
|
|
56
|
%
|
|
1,620
|
|
|
57
|
%
|
||||
Total
(1)
|
|
$
|
1,936
|
|
|
100
|
%
|
|
$
|
1,346
|
|
|
100
|
%
|
|
$
|
3,669
|
|
|
100
|
%
|
|
$
|
2,858
|
|
|
100
|
%
|
(1)
|
Includes revenues attributable to a noncontrolling interest in Egypt.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||
|
|
2018
|
|
Increase
(Decrease)
|
|
2017
|
|
2018
|
|
Increase
(Decrease)
|
|
2017
|
||||||
Oil Volume – b/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
105,163
|
|
|
22
|
%
|
|
86,071
|
|
|
102,470
|
|
|
16
|
%
|
|
88,386
|
|
Canada
|
|
—
|
|
|
NM
|
|
11,638
|
|
|
—
|
|
|
NM
|
|
11,647
|
|
||
North America
|
|
105,163
|
|
|
8
|
%
|
|
97,709
|
|
|
102,470
|
|
|
2
|
%
|
|
100,033
|
|
Egypt
(1)(2)
|
|
96,185
|
|
|
(1
|
)%
|
|
96,961
|
|
|
95,730
|
|
|
(4
|
)%
|
|
99,327
|
|
North Sea
|
|
46,150
|
|
|
(4
|
)%
|
|
48,091
|
|
|
46,249
|
|
|
(5
|
)%
|
|
48,933
|
|
International
|
|
142,335
|
|
|
(2
|
)%
|
|
145,052
|
|
|
141,979
|
|
|
(4
|
)%
|
|
148,260
|
|
Total
|
|
247,498
|
|
|
2
|
%
|
|
242,761
|
|
|
244,449
|
|
|
(2
|
)%
|
|
248,293
|
|
Natural Gas Volume – Mcf/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
547,777
|
|
|
50
|
%
|
|
364,052
|
|
|
518,324
|
|
|
42
|
%
|
|
365,481
|
|
Canada
|
|
—
|
|
|
NM
|
|
205,408
|
|
|
—
|
|
|
NM
|
|
210,484
|
|
||
North America
|
|
547,777
|
|
|
(4
|
)%
|
|
569,460
|
|
|
518,324
|
|
|
(10
|
)%
|
|
575,965
|
|
Egypt
(1)(2)
|
|
340,991
|
|
|
(11
|
)%
|
|
383,296
|
|
|
342,438
|
|
|
(13
|
)%
|
|
395,179
|
|
North Sea
|
|
43,297
|
|
|
26
|
%
|
|
34,348
|
|
|
42,174
|
|
|
8
|
%
|
|
39,111
|
|
International
|
|
384,288
|
|
|
(8
|
)%
|
|
417,644
|
|
|
384,612
|
|
|
(11
|
)%
|
|
434,290
|
|
Total
|
|
932,065
|
|
|
(6
|
)%
|
|
987,104
|
|
|
902,936
|
|
|
(11
|
)%
|
|
1,010,255
|
|
NGL Volume – b/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
59,036
|
|
|
26
|
%
|
|
47,029
|
|
|
55,182
|
|
|
16
|
%
|
|
47,511
|
|
Canada
|
|
—
|
|
|
NM
|
|
4,365
|
|
|
—
|
|
|
NM
|
|
4,592
|
|
||
North America
|
|
59,036
|
|
|
15
|
%
|
|
51,394
|
|
|
55,182
|
|
|
6
|
%
|
|
52,103
|
|
Egypt
(1)(2)
|
|
1,127
|
|
|
28
|
%
|
|
880
|
|
|
1,033
|
|
|
13
|
%
|
|
917
|
|
North Sea
|
|
1,104
|
|
|
49
|
%
|
|
741
|
|
|
1,135
|
|
|
19
|
%
|
|
955
|
|
International
|
|
2,231
|
|
|
38
|
%
|
|
1,621
|
|
|
2,168
|
|
|
16
|
%
|
|
1,872
|
|
Total
|
|
61,267
|
|
|
16
|
%
|
|
53,015
|
|
|
57,350
|
|
|
6
|
%
|
|
53,975
|
|
BOE per day
(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
255,495
|
|
|
32
|
%
|
|
193,775
|
|
|
244,039
|
|
|
24
|
%
|
|
196,811
|
|
Canada
|
|
—
|
|
|
NM
|
|
50,238
|
|
|
—
|
|
|
NM
|
|
51,319
|
|
||
North America
|
|
255,495
|
|
|
5
|
%
|
|
244,013
|
|
|
244,039
|
|
|
(2
|
)%
|
|
248,130
|
|
Egypt
(2)
|
|
154,144
|
|
|
(5
|
)%
|
|
161,724
|
|
|
153,836
|
|
|
(7
|
)%
|
|
166,107
|
|
North Sea
(4)
|
|
54,470
|
|
|
—
|
|
|
54,556
|
|
|
54,413
|
|
|
(4
|
)%
|
|
56,407
|
|
International
|
|
208,614
|
|
|
(4
|
)%
|
|
216,280
|
|
|
208,249
|
|
|
(6
|
)%
|
|
222,514
|
|
Total
|
|
464,109
|
|
|
1
|
%
|
|
460,293
|
|
|
452,288
|
|
|
(4
|
)%
|
|
470,644
|
|
(1)
|
Gross oil, natural gas, and NGL production in Egypt for the
second
quarter and
six
-month period of
2018
and
2017
were as follows:
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Oil (b/d)
|
|
206,296
|
|
|
195,293
|
|
|
204,264
|
|
|
194,559
|
|
Natural Gas (Mcf/d)
|
|
801,727
|
|
|
825,947
|
|
|
780,121
|
|
|
811,608
|
|
NGL (b/d)
|
|
1,719
|
|
|
1,545
|
|
|
1,598
|
|
|
1,509
|
|
(2)
|
Includes production volumes per day attributable to a noncontrolling interest in Egypt for the
second
quarter and
six
-month period of
2018
and
2017
of:
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Oil (b/d)
|
|
32,066
|
|
|
32,562
|
|
|
31,921
|
|
|
33,232
|
|
Natural Gas (Mcf/d)
|
|
113,846
|
|
|
128,696
|
|
|
114,377
|
|
|
132,197
|
|
NGL (b/d)
|
|
376
|
|
|
293
|
|
|
344
|
|
|
306
|
|
(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.
|
(4)
|
Average sales volumes from the North Sea for the
second
quarter of
2018
and
2017
were
56,516
boe/d and
57,905
boe/d, respectively, and
55,113
boe/d and
58,347
boe/d for the first
six
months of
2018
and
2017
, respectively. Sales volumes may vary from production volumes as a result of the timing of liftings in the Beryl field.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||
|
|
2018
|
|
Increase
(Decrease) |
|
2017
|
|
2018
|
|
Increase
(Decrease) |
|
2017
|
||||||||||
Average Oil Price - Per barrel
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
63.27
|
|
|
40
|
%
|
|
$
|
45.18
|
|
|
$
|
62.54
|
|
|
33
|
%
|
|
$
|
46.99
|
|
Canada
|
|
—
|
|
|
NM
|
|
44.52
|
|
|
—
|
|
|
NM
|
|
45.70
|
|
||||||
North America
|
|
63.27
|
|
|
40
|
%
|
|
45.10
|
|
|
62.54
|
|
|
34
|
%
|
|
46.84
|
|
||||
Egypt
|
|
74.14
|
|
|
55
|
%
|
|
47.98
|
|
|
70.26
|
|
|
39
|
%
|
|
50.57
|
|
||||
North Sea
|
|
73.05
|
|
|
52
|
%
|
|
48.21
|
|
|
69.58
|
|
|
38
|
%
|
|
50.51
|
|
||||
International
|
|
73.78
|
|
|
54
|
%
|
|
48.06
|
|
|
70.04
|
|
|
39
|
%
|
|
50.55
|
|
||||
Total
|
|
69.35
|
|
|
48
|
%
|
|
46.89
|
|
|
66.90
|
|
|
36
|
%
|
|
49.06
|
|
||||
Average Natural Gas Price - Per Mcf
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
1.94
|
|
|
(23
|
)%
|
|
$
|
2.53
|
|
|
$
|
2.20
|
|
|
(14
|
)%
|
|
$
|
2.55
|
|
Canada
|
|
—
|
|
|
NM
|
|
2.14
|
|
|
—
|
|
|
NM
|
|
2.24
|
|
||||||
North America
|
|
1.94
|
|
|
(19
|
)%
|
|
2.39
|
|
|
2.20
|
|
|
(10
|
)%
|
|
2.44
|
|
||||
Egypt
|
|
2.85
|
|
|
4
|
%
|
|
2.73
|
|
|
2.85
|
|
|
4
|
%
|
|
2.75
|
|
||||
North Sea
|
|
6.82
|
|
|
50
|
%
|
|
4.54
|
|
|
6.71
|
|
|
27
|
%
|
|
5.27
|
|
||||
International
|
|
3.29
|
|
|
14
|
%
|
|
2.88
|
|
|
3.27
|
|
|
10
|
%
|
|
2.98
|
|
||||
Total
|
|
2.50
|
|
|
(4
|
)%
|
|
2.60
|
|
|
2.65
|
|
|
(1
|
)%
|
|
2.67
|
|
||||
Average NGL Price - Per barrel
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
26.03
|
|
|
112
|
%
|
|
$
|
12.26
|
|
|
$
|
25.10
|
|
|
77
|
%
|
|
$
|
14.21
|
|
Canada
|
|
—
|
|
|
NM
|
|
15.99
|
|
|
—
|
|
|
NM
|
|
16.53
|
|
||||||
North America
|
|
26.03
|
|
|
107
|
%
|
|
12.58
|
|
|
25.10
|
|
|
74
|
%
|
|
14.42
|
|
||||
Egypt
|
|
40.80
|
|
|
31
|
%
|
|
31.11
|
|
|
38.72
|
|
|
8
|
%
|
|
35.74
|
|
||||
North Sea
|
|
44.71
|
|
|
95
|
%
|
|
22.92
|
|
|
43.75
|
|
|
33
|
%
|
|
32.85
|
|
||||
International
|
|
42.73
|
|
|
56
|
%
|
|
27.37
|
|
|
41.35
|
|
|
21
|
%
|
|
34.26
|
|
||||
Total
|
|
26.64
|
|
|
104
|
%
|
|
13.03
|
|
|
25.72
|
|
|
70
|
%
|
|
15.10
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||||||||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||||||||||
|
|
(In millions)
|
|
(Per boe)
|
|
(In millions)
|
|
(Per boe)
|
||||||||||||||||||||||||
Lease operating expenses
(1)
|
|
$
|
356
|
|
|
$
|
372
|
|
|
$
|
8.39
|
|
|
$
|
8.81
|
|
|
$
|
705
|
|
|
$
|
708
|
|
|
$
|
8.60
|
|
|
$
|
8.27
|
|
Gathering, transmission, and processing
(1)
|
|
82
|
|
|
48
|
|
|
1.95
|
|
|
1.19
|
|
|
168
|
|
|
105
|
|
|
2.04
|
|
|
1.24
|
|
||||||||
Taxes other than income
|
|
49
|
|
|
29
|
|
|
1.16
|
|
|
0.68
|
|
|
104
|
|
|
71
|
|
|
1.27
|
|
|
0.83
|
|
||||||||
Exploration
|
|
76
|
|
|
108
|
|
|
1.81
|
|
|
2.58
|
|
|
152
|
|
|
200
|
|
|
1.86
|
|
|
2.35
|
|
||||||||
General and administrative
|
|
117
|
|
|
106
|
|
|
2.76
|
|
|
2.53
|
|
|
231
|
|
|
209
|
|
|
2.82
|
|
|
2.45
|
|
||||||||
Transaction, reorganization, and separation
|
|
12
|
|
|
4
|
|
|
0.27
|
|
|
0.08
|
|
|
12
|
|
|
(6
|
)
|
|
0.14
|
|
|
(0.07
|
)
|
||||||||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Oil and gas property and equipment
(1)
|
|
573
|
|
|
536
|
|
|
13.50
|
|
|
12.72
|
|
|
1,091
|
|
|
1,074
|
|
|
13.31
|
|
|
12.56
|
|
||||||||
Other assets
|
|
35
|
|
|
36
|
|
|
0.82
|
|
|
0.86
|
|
|
70
|
|
|
74
|
|
|
0.85
|
|
|
0.87
|
|
||||||||
Asset retirement obligation accretion
|
|
27
|
|
|
37
|
|
|
0.64
|
|
|
0.87
|
|
|
54
|
|
|
73
|
|
|
0.66
|
|
|
0.85
|
|
||||||||
Impairments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
0.09
|
|
||||||||
Financing costs, net
|
|
94
|
|
|
99
|
|
|
2.24
|
|
|
2.37
|
|
|
193
|
|
|
199
|
|
|
2.36
|
|
|
2.34
|
|
(1)
|
For expenses impacted by the timing of liftings in the North Sea, per-boe calculations are based on sales volumes rather than production volumes.
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
(In millions)
|
||||||||||||||
Unproved leasehold impairments
|
|
$
|
21
|
|
|
$
|
39
|
|
|
$
|
37
|
|
|
$
|
54
|
|
Dry hole expense
|
|
16
|
|
|
46
|
|
|
36
|
|
|
98
|
|
||||
Geological and geophysical expense
|
|
17
|
|
|
6
|
|
|
35
|
|
|
12
|
|
||||
Exploration overhead and other
|
|
22
|
|
|
17
|
|
|
44
|
|
|
36
|
|
||||
|
|
$
|
76
|
|
|
$
|
108
|
|
|
$
|
152
|
|
|
$
|
200
|
|
|
|
For the Quarter Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
|
|
(In millions)
|
||||||||||||||
Interest expense
|
|
$
|
110
|
|
|
$
|
115
|
|
|
$
|
222
|
|
|
$
|
231
|
|
Amortization of deferred loan costs
|
|
1
|
|
|
2
|
|
|
6
|
|
|
4
|
|
||||
Capitalized interest
|
|
(13
|
)
|
|
(13
|
)
|
|
(25
|
)
|
|
(27
|
)
|
||||
Loss on extinguishment of debt
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||
Interest income
|
|
(4
|
)
|
|
(5
|
)
|
|
(10
|
)
|
|
(10
|
)
|
||||
Financing costs, net
|
|
$
|
94
|
|
|
$
|
99
|
|
|
$
|
193
|
|
|
$
|
199
|
|
|
|
For the Six Months Ended June 30,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In millions)
|
||||||
Sources of Cash and Cash Equivalents:
|
|
|
|
|
||||
Net cash provided by operating activities
|
|
$
|
1,728
|
|
|
$
|
1,206
|
|
Proceeds from sale of oil and gas properties
|
|
13
|
|
|
711
|
|
||
Other
|
|
—
|
|
|
27
|
|
||
|
|
1,741
|
|
|
1,944
|
|
||
Uses of Cash and Cash Equivalents:
|
|
|
|
|
||||
Capital expenditures
(1)
|
|
$
|
1,856
|
|
|
$
|
1,157
|
|
Leasehold and property acquisitions
|
|
38
|
|
|
67
|
|
||
Payments on fixed-rate debt
|
|
150
|
|
|
70
|
|
||
Dividends paid
|
|
191
|
|
|
190
|
|
||
Distributions to noncontrolling interest
|
|
155
|
|
|
170
|
|
||
Other
|
|
47
|
|
|
—
|
|
||
|
|
2,437
|
|
|
1,654
|
|
||
Increase (decrease) in cash and cash equivalents
|
|
$
|
(696
|
)
|
|
$
|
290
|
|
(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, 2018
|
|
December 31, 2017
|
||||
|
|
(In millions)
|
||||||
Cash and cash equivalents
|
|
$
|
972
|
|
|
$
|
1,668
|
|
Total debt
|
|
8,337
|
|
|
8,484
|
|
||
Equity
|
|
8,995
|
|
|
8,791
|
|
||
Available committed borrowing capacity
|
|
3,830
|
|
|
3,500
|
|
3.1
|
–
|
|
3.2
|
–
|
|
3.3
|
–
|
|
*†10.1
|
–
|
|
*31.1
|
–
|
|
*31.2
|
–
|
|
*32.1
|
–
|
|
*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.
|
† Management contracts or compensatory plans or arrangements required to be filed herewith pursuant to Item 15 hereof.
|
|
|
|
APACHE CORPORATION
|
|
|
|
|
Dated:
|
August 2, 2018
|
|
/s/ STEPHEN J. RINEY
|
|
|
|
Stephen J. Riney
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
Dated:
|
August 2, 2018
|
|
/s/ REBECCA A. HOYT
|
|
|
|
Rebecca A. Hoyt
|
|
|
|
Senior Vice President, Chief Accounting Officer, and Controller
|
|
|
|
(Principal Accounting Officer)
|
•
|
In the event that the performance goals related to the conditional grant of RSUs are achieved at the conclusion of each respective performance period, then Employee shall receive continued vesting of performance awards, conditioned upon Employee’s compliance with his obligations under this Agreement. Vesting of performance awards shall be in accordance with the table below. Results of the program will be calculated at the end of the performance period and, if a payout is warranted, awards will be paid in cash according to the performance program’s vesting and payment schedule. In the event that the performance goals related to such grants are achieved at the conclusion of each respective performance period, then within 30 days following the applicable vesting dates set forth below, provided that Employee is then in compliance with the provisions of this Agreement, Apache will pay Employee a cash amount equal to the fair market value of a share of common stock of Apache (determined at the close of the applicable date of vesting) multiplied by the number of units indicated below. Because FICA taxation will occur when the performance goal is met, and Employee will not be receiving payment at that time, Employee’s share of FICA taxes will be paid by reducing the cash amount payable to Employee.
|
Condition Precedent
|
Vesting Date
|
Number of Units
|
2016 Performance Goal Achieved
|
1/1/19
|
50% of (i) multiple of Target Amount achieved times (ii) 29,924*
|
2016 Performance Goal Achieved
|
1/1/20
|
50% of (i) multiple of Target Amount achieved times (ii) 29,924*
|
2017 Performance Goal Achieved
|
1/1/20
|
50% of (i) multiple of Target Amount achieved times (ii) 17,292**
|
2017 Performance Goal Achieved
|
1/1/21
|
50% of (i) multiple of Target Amount achieved times (ii) 17,292**
|
•
|
the employment of Employee by Apache, including the termination of Employee’s employment;
|
•
|
employment discrimination in violation of the Age Discrimination in Employment Act;
|
•
|
employment discrimination in violation of Title VII of the Civil Rights Act of 1964;
|
•
|
any violations of federal, state or local statutes, ordinances, regulations, rules, decisions or laws;
|
•
|
retaliation under the whistleblower provisions of Section 806 of the Sarbanes Oxley Act of 2002 or any other anti-retaliation law;
|
•
|
failure to act in good faith and deal fairly;
|
•
|
injuries, illness or disabilities of Employee;
|
•
|
exposure of Employee to toxic or hazardous materials;
|
•
|
stress, anxiety or mental anguish;
|
•
|
discrimination on the basis of sex, race, religion, national origin or another basis;
|
•
|
sexual harassment;
|
•
|
defamation based on statements of Apache or others;
|
•
|
breach of an express or implied employment contract;
|
•
|
compensation or reimbursement of Employee;
|
•
|
unfair employment practices; and
|
•
|
any act or omission by or on behalf of Apache.
|
•
|
those for reinstatement;
|
•
|
those for actual, consequential, punitive, or special damages;
|
•
|
those for attorney’s fees, costs, experts’ fees and other expenses of investigating, litigating or settling Claims; and
|
•
|
those against Apache and/or Apache’s present, former and future subsidiaries, affiliates, employees, officers, directors, agents, contractors, benefit plans, shareholders, advisors, insurance carriers, and legal representatives (together with Apache the “Released Parties”).
|
STATE OF TEXAS
|
§
|
|
|
|
§
|
|
|
COUNTY OF HARRIS
|
§
|
STATE OF TEXAS
|
§
|
|
|
|
§
|
|
|
COUNTY OF HARRIS
|
§
|
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.
|
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/ John J. Christmann IV
|
|
John J. Christmann IV
|
|
Chief Executive Officer and President
|
|
(principal executive officer)
|
|
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.
|
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)
|
|