☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
41-0747868
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
Title of each class
|
|
Trading Symbol(s)
|
|
Name of each exchange on which registered
|
Common Stock, $0.625 par value
|
|
APA
|
|
New York Stock Exchange
|
Common Stock, $0.625 par value
|
|
APA
|
|
Chicago Stock Exchange
|
Common Stock, $0.625 par value
|
|
APA
|
|
NASDAQ Global Select Market
|
7.75% Notes Due 2029
|
|
APA/29
|
|
New York Stock Exchange
|
Large accelerated filer
|
|
☒
|
Accelerated filer
|
|
☐
|
Non-accelerated filer
|
|
☐
|
Smaller reporting company
|
|
☐
|
|
|
|
Emerging growth company
|
|
☐
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Number of shares of registrant’s common stock outstanding as of October 30, 2019
|
376,036,287
|
|
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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.
|
|
||
5.
|
|
||
6.
|
|
•
|
the market prices of oil, natural gas, natural gas liquids (NGLs), and other products or services;
|
•
|
commodity hedging arrangements;
|
•
|
the supply and demand for oil, natural gas, NGLs, and other products or services;
|
•
|
production and reserve levels;
|
•
|
drilling risks;
|
•
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economic and competitive conditions;
|
•
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the availability of capital resources;
|
•
|
capital expenditure and other contractual obligations;
|
•
|
currency exchange rates;
|
•
|
weather conditions;
|
•
|
inflation rates;
|
•
|
the availability of goods and services;
|
•
|
legislative, regulatory, or policy changes;
|
•
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terrorism or cyber attacks;
|
•
|
occurrence of property acquisitions or divestitures;
|
•
|
the integration of acquisitions;
|
•
|
the securities or capital markets and related risks such as general credit, liquidity, market, and interest-rate risks; and
|
•
|
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 third-quarter 2019 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 September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions, except per common share data)
|
||||||||||||||
REVENUES AND OTHER:
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas production revenues
|
|
|
|
|
|
|
|
|
||||||||
Oil revenues
|
|
$
|
1,207
|
|
|
$
|
1,555
|
|
|
$
|
3,914
|
|
|
$
|
4,524
|
|
Natural gas revenues
|
|
136
|
|
|
241
|
|
|
490
|
|
|
675
|
|
||||
Natural gas liquids revenues
|
|
95
|
|
|
180
|
|
|
286
|
|
|
446
|
|
||||
|
|
1,438
|
|
|
1,976
|
|
|
4,690
|
|
|
5,645
|
|
||||
Derivative instrument losses, net
|
|
(2
|
)
|
|
(23
|
)
|
|
(40
|
)
|
|
(46
|
)
|
||||
Gain on divestitures
|
|
—
|
|
|
1
|
|
|
20
|
|
|
10
|
|
||||
Other
|
|
41
|
|
|
29
|
|
|
45
|
|
|
50
|
|
||||
|
|
1,477
|
|
|
1,983
|
|
|
4,715
|
|
|
5,659
|
|
||||
OPERATING EXPENSES:
|
|
|
|
|
|
|
|
|
||||||||
Lease operating expenses
|
|
350
|
|
|
382
|
|
|
1,104
|
|
|
1,087
|
|
||||
Gathering, processing, and transmission
|
|
66
|
|
|
92
|
|
|
230
|
|
|
260
|
|
||||
Taxes other than income
|
|
44
|
|
|
58
|
|
|
141
|
|
|
162
|
|
||||
Exploration
|
|
56
|
|
|
99
|
|
|
220
|
|
|
251
|
|
||||
General and administrative
|
|
98
|
|
|
99
|
|
|
323
|
|
|
330
|
|
||||
Transaction, reorganization, and separation
|
|
7
|
|
|
8
|
|
|
17
|
|
|
20
|
|
||||
Depreciation, depletion, and amortization
|
|
711
|
|
|
610
|
|
|
1,959
|
|
|
1,771
|
|
||||
Asset retirement obligation accretion
|
|
27
|
|
|
27
|
|
|
80
|
|
|
81
|
|
||||
Impairments
|
|
9
|
|
|
10
|
|
|
249
|
|
|
10
|
|
||||
Financing costs, net
|
|
95
|
|
|
192
|
|
|
365
|
|
|
385
|
|
||||
|
|
1,463
|
|
|
1,577
|
|
|
4,688
|
|
|
4,357
|
|
||||
NET INCOME BEFORE INCOME TAXES
|
|
14
|
|
|
406
|
|
|
27
|
|
|
1,302
|
|
||||
Current income tax provision
|
|
141
|
|
|
262
|
|
|
514
|
|
|
709
|
|
||||
Deferred income tax benefit
|
|
(10
|
)
|
|
(17
|
)
|
|
(52
|
)
|
|
(43
|
)
|
||||
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTERESTS
|
|
(117
|
)
|
|
161
|
|
|
(435
|
)
|
|
636
|
|
||||
Net income attributable to noncontrolling interest - Egypt
|
|
38
|
|
|
80
|
|
|
125
|
|
|
215
|
|
||||
Net loss attributable to noncontrolling interest - Altus
|
|
(3
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
||||
Net income attributable to Altus Preferred Unit limited partners
|
|
18
|
|
|
—
|
|
|
22
|
|
|
—
|
|
||||
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK
|
|
$
|
(170
|
)
|
|
$
|
81
|
|
|
$
|
(577
|
)
|
|
$
|
421
|
|
|
|
|
|
|
|
|
|
|
||||||||
NET INCOME (LOSS) PER COMMON SHARE:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.45
|
)
|
|
$
|
0.21
|
|
|
$
|
(1.53
|
)
|
|
$
|
1.10
|
|
Diluted
|
|
$
|
(0.45
|
)
|
|
$
|
0.21
|
|
|
$
|
(1.53
|
)
|
|
$
|
1.09
|
|
WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
377
|
|
|
383
|
|
|
377
|
|
|
383
|
|
||||
Diluted
|
|
377
|
|
|
385
|
|
|
377
|
|
|
385
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
NET INCOME (LOSS) INCLUDING NONCONTROLLING INTERESTS
|
|
$
|
(117
|
)
|
|
$
|
161
|
|
|
$
|
(435
|
)
|
|
$
|
636
|
|
OTHER COMPREHENSIVE LOSS, NET OF TAX:
|
|
|
|
|
|
|
|
|
||||||||
Share of equity method interests other comprehensive loss
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
COMPREHENSIVE INCOME (LOSS) INCLUDING NONCONTROLLING INTERESTS
|
|
(118
|
)
|
|
161
|
|
|
(436
|
)
|
|
636
|
|
||||
Comprehensive income attributable to noncontrolling interest - Egypt
|
|
38
|
|
|
80
|
|
|
125
|
|
|
215
|
|
||||
Comprehensive loss attributable to noncontrolling interest - Altus
|
|
(3
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
||||
Comprehensive income attributable to Altus Preferred Unit limited partners
|
|
18
|
|
|
—
|
|
|
22
|
|
|
—
|
|
||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK
|
|
$
|
(171
|
)
|
|
$
|
81
|
|
|
$
|
(578
|
)
|
|
$
|
421
|
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(In millions)
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
||||
Net income (loss) including noncontrolling interest
|
|
$
|
(435
|
)
|
|
$
|
636
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
||||
Unrealized derivative instrument losses (gains), net
|
|
52
|
|
|
(88
|
)
|
||
Gain on divestitures
|
|
(20
|
)
|
|
(10
|
)
|
||
Exploratory dry hole expense and unproved leasehold impairments
|
|
107
|
|
|
133
|
|
||
Depreciation, depletion, and amortization
|
|
1,959
|
|
|
1,771
|
|
||
Asset retirement obligation accretion
|
|
80
|
|
|
81
|
|
||
Impairments
|
|
249
|
|
|
10
|
|
||
Deferred income tax benefit
|
|
(52
|
)
|
|
(43
|
)
|
||
Loss on extinguishment of debt
|
|
75
|
|
|
94
|
|
||
Other
|
|
35
|
|
|
96
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Receivables
|
|
124
|
|
|
(113
|
)
|
||
Inventories
|
|
(16
|
)
|
|
(7
|
)
|
||
Drilling advances
|
|
(2
|
)
|
|
(22
|
)
|
||
Deferred charges and other
|
|
(1
|
)
|
|
91
|
|
||
Accounts payable
|
|
(82
|
)
|
|
110
|
|
||
Accrued expenses
|
|
(1
|
)
|
|
(3
|
)
|
||
Deferred credits and noncurrent liabilities
|
|
17
|
|
|
(2
|
)
|
||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
2,089
|
|
|
2,734
|
|
||
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
||||
Additions to oil and gas property
|
|
(2,015
|
)
|
|
(2,338
|
)
|
||
Leasehold and property acquisitions
|
|
(39
|
)
|
|
(86
|
)
|
||
Additions to Altus gathering, processing, and transmission facilities
|
|
(294
|
)
|
|
(412
|
)
|
||
Altus equity method interests
|
|
(1,008
|
)
|
|
—
|
|
||
Proceeds from sale of oil and gas properties
|
|
590
|
|
|
51
|
|
||
Other, net
|
|
(17
|
)
|
|
(55
|
)
|
||
NET CASH USED IN INVESTING ACTIVITIES
|
|
(2,783
|
)
|
|
(2,840
|
)
|
||
|
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
||||
Proceeds from Altus credit facility
|
|
235
|
|
|
—
|
|
||
Fixed-rate debt borrowings
|
|
989
|
|
|
992
|
|
||
Payments on fixed-rate debt
|
|
(1,150
|
)
|
|
(1,370
|
)
|
||
Distributions to noncontrolling interest - Egypt
|
|
(235
|
)
|
|
(256
|
)
|
||
Redeemable noncontrolling interest - Altus Preferred Unit limited partners
|
|
611
|
|
|
—
|
|
||
Dividends paid
|
|
(282
|
)
|
|
(287
|
)
|
||
Other
|
|
(25
|
)
|
|
(48
|
)
|
||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
|
|
143
|
|
|
(969
|
)
|
||
|
|
|
|
|
||||
NET DECREASE IN CASH AND CASH EQUIVALENTS
|
|
(551
|
)
|
|
(1,075
|
)
|
||
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
|
|
714
|
|
|
1,668
|
|
||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
163
|
|
|
$
|
593
|
|
|
|
|
|
|
||||
SUPPLEMENTARY CASH FLOW DATA:
|
|
|
|
|
||||
Interest paid, net of capitalized interest
|
|
$
|
318
|
|
|
$
|
344
|
|
Income taxes paid, net of refunds
|
|
473
|
|
|
649
|
|
In millions except share and per-share amounts
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
ASSETS
|
|
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
|
||||
Cash and cash equivalents ($3 and $450 related to Altus VIE)
|
|
$
|
163
|
|
|
$
|
714
|
|
Receivables (net of allowance of $86 and $92)
|
|
1,070
|
|
|
1,194
|
|
||
Other current assets (Note 5) ($35 and $7 related to Altus VIE)
|
|
738
|
|
|
779
|
|
||
|
|
1,971
|
|
|
2,687
|
|
||
PROPERTY AND EQUIPMENT:
|
|
|
|
|
||||
Oil and gas, on the basis of successful efforts accounting:
|
|
|
|
|
||||
Proved properties
|
|
40,114
|
|
|
42,345
|
|
||
Unproved properties and properties under development
|
|
1,256
|
|
|
1,435
|
|
||
Gathering, processing, and transmission facilities ($1,457 and $1,251 related to Altus VIE)
|
|
2,061
|
|
|
1,856
|
|
||
Other ($38 and nil related to Altus VIE)
|
|
1,177
|
|
|
1,120
|
|
||
|
|
44,608
|
|
|
46,756
|
|
||
Less: Accumulated depreciation, depletion, and amortization ($52 and $24 related to Altus VIE)
|
|
(26,953
|
)
|
|
(28,335
|
)
|
||
|
|
17,655
|
|
|
18,421
|
|
||
OTHER ASSETS:
|
|
|
|
|
||||
Equity method interests ($1,095 and $91 related to Altus VIE)
|
|
1,095
|
|
|
121
|
|
||
Deferred charges and other ($73 and $71 related to Altus VIE)
|
|
684
|
|
|
353
|
|
||
|
|
$
|
21,405
|
|
|
$
|
21,582
|
|
LIABILITIES, NONCONTROLLING INTEREST, AND EQUITY
|
|
|
|
|
||||
CURRENT LIABILITIES:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
661
|
|
|
$
|
709
|
|
Current debt ($18 and nil related to Altus VIE)
|
|
19
|
|
|
151
|
|
||
Other current liabilities (Note 7) ($38 and $85 related to Altus VIE)
|
|
1,241
|
|
|
1,341
|
|
||
|
|
1,921
|
|
|
2,201
|
|
||
LONG-TERM DEBT (Note 10) ($235 and nil related to Altus VIE)
|
|
8,393
|
|
|
8,093
|
|
||
DEFERRED CREDITS AND OTHER NONCURRENT LIABILITIES:
|
|
|
|
|
||||
Income taxes
|
|
340
|
|
|
391
|
|
||
Asset retirement obligation ($34 and $29 related to Altus VIE)
|
|
1,853
|
|
|
1,866
|
|
||
Other ($98 and nil related to Altus VIE)
|
|
491
|
|
|
219
|
|
||
|
|
2,684
|
|
|
2,476
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 11)
|
|
|
|
|
||||
|
|
|
|
|
||||
REDEEMABLE NONCONTROLLING INTEREST - ALTUS PREFERRED UNIT LIMITED PARTNERS (Note 12)
|
|
539
|
|
|
—
|
|
||
|
|
|
|
|
||||
EQUITY:
|
|
|
|
|
||||
Common stock, $0.625 par, 860,000,000 shares authorized, 416,986,332 and 415,692,116 shares issued, respectively
|
|
261
|
|
|
260
|
|
||
Paid-in capital
|
|
11,852
|
|
|
12,106
|
|
||
Accumulated deficit
|
|
(2,625
|
)
|
|
(2,048
|
)
|
||
Treasury stock, at cost, 40,964,193 and 40,995,894 shares, respectively
|
|
(3,190
|
)
|
|
(3,192
|
)
|
||
Accumulated other comprehensive income
|
|
3
|
|
|
4
|
|
||
APACHE SHAREHOLDERS’ EQUITY
|
|
6,301
|
|
|
7,130
|
|
||
Noncontrolling interest - Egypt
|
|
1,165
|
|
|
1,275
|
|
||
Noncontrolling interest - Altus
|
|
402
|
|
|
407
|
|
||
TOTAL EQUITY
|
|
7,868
|
|
|
8,812
|
|
||
|
|
$
|
21,405
|
|
|
$
|
21,582
|
|
|
|
Redeemable Noncontrolling Interest — Altus Preferred Unit Limited Partners
|
|
|
Common
Stock
|
|
Paid-In
Capital
|
|
Accumulated Deficit
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
APACHE
SHAREHOLDERS’
EQUITY
|
|
Noncontrolling
Interests
|
|
TOTAL
EQUITY
|
||||||||||||||||||
|
|
|
|
|
(In millions)
|
||||||||||||||||||||||||||||||||
For the Quarter Ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
BALANCE AT JUNE 30, 2018
|
|
$
|
—
|
|
|
|
$
|
260
|
|
|
$
|
12,011
|
|
|
$
|
(1,748
|
)
|
|
$
|
(2,887
|
)
|
|
$
|
4
|
|
|
$
|
7,640
|
|
|
$
|
1,355
|
|
|
$
|
8,995
|
|
Net income attributable to common stock
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|
—
|
|
|
—
|
|
|
81
|
|
|
—
|
|
|
81
|
|
|||||||||
Net income attributable to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
80
|
|
|
80
|
|
|||||||||
Distributions to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(101
|
)
|
|
(101
|
)
|
|||||||||
Common dividends ($0.25 per share)
|
|
—
|
|
|
|
—
|
|
|
(96
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(96
|
)
|
|
—
|
|
|
(96
|
)
|
|||||||||
Other
|
|
—
|
|
|
|
—
|
|
|
30
|
|
|
—
|
|
|
(43
|
)
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
(13
|
)
|
|||||||||
BALANCE AT SEPTEMBER 30, 2018
|
|
$
|
—
|
|
|
|
$
|
260
|
|
|
$
|
11,945
|
|
|
$
|
(1,667
|
)
|
|
$
|
(2,930
|
)
|
|
$
|
4
|
|
|
$
|
7,612
|
|
|
$
|
1,334
|
|
|
$
|
8,946
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
For the Quarter Ended September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
BALANCE AT JUNE 30, 2019
|
|
$
|
521
|
|
|
|
$
|
261
|
|
|
$
|
11,931
|
|
|
$
|
(2,455
|
)
|
|
$
|
(3,190
|
)
|
|
$
|
4
|
|
|
$
|
6,551
|
|
|
$
|
1,603
|
|
|
$
|
8,154
|
|
Net loss attributable to common stock
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
—
|
|
|
(170
|
)
|
|
—
|
|
|
(170
|
)
|
|||||||||
Net income attributable to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38
|
|
|
38
|
|
|||||||||
Net loss attributable to noncontrolling interest - Altus
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||||||||
Net income attributable to Altus Preferred Unit limited partners
|
|
18
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Distributions to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(71
|
)
|
|
(71
|
)
|
|||||||||
Common dividends ($0.25 per share)
|
|
—
|
|
|
|
—
|
|
|
(94
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(94
|
)
|
|
—
|
|
|
(94
|
)
|
|||||||||
Other
|
|
—
|
|
|
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
14
|
|
|
—
|
|
|
14
|
|
|||||||||
BALANCE AT SEPTEMBER 30, 2019
|
|
$
|
539
|
|
|
|
$
|
261
|
|
|
$
|
11,852
|
|
|
$
|
(2,625
|
)
|
|
$
|
(3,190
|
)
|
|
$
|
3
|
|
|
$
|
6,301
|
|
|
$
|
1,567
|
|
|
$
|
7,868
|
|
|
|
Redeemable Noncontrolling Interest — Altus Preferred Unit Limited Partners
|
|
|
Common
Stock
|
|
Paid-In
Capital
|
|
Accumulated Deficit
|
|
Treasury
Stock
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
APACHE
SHAREHOLDERS’
EQUITY
|
|
Noncontrolling
Interests
|
|
TOTAL
EQUITY
|
||||||||||||||||||
|
|
|
|
|
(In millions)
|
||||||||||||||||||||||||||||||||
For the Nine Months Ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
BALANCE AT DECEMBER 31, 2017
|
|
$
|
—
|
|
|
|
$
|
259
|
|
|
$
|
12,128
|
|
|
$
|
(2,088
|
)
|
|
$
|
(2,887
|
)
|
|
$
|
4
|
|
|
$
|
7,416
|
|
|
$
|
1,375
|
|
|
$
|
8,791
|
|
Net income attributable to common stock
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
421
|
|
|
—
|
|
|
—
|
|
|
421
|
|
|
—
|
|
|
421
|
|
|||||||||
Net income attributable to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
215
|
|
|
215
|
|
|||||||||
Distributions to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(256
|
)
|
|
(256
|
)
|
|||||||||
Common dividends ($0.75 per share)
|
|
—
|
|
|
|
—
|
|
|
(287
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(287
|
)
|
|
—
|
|
|
(287
|
)
|
|||||||||
Other
|
|
—
|
|
|
|
1
|
|
|
104
|
|
|
—
|
|
|
(43
|
)
|
|
—
|
|
|
62
|
|
|
—
|
|
|
62
|
|
|||||||||
BALANCE AT SEPTEMBER 30, 2018
|
|
$
|
—
|
|
|
|
$
|
260
|
|
|
$
|
11,945
|
|
|
$
|
(1,667
|
)
|
|
$
|
(2,930
|
)
|
|
$
|
4
|
|
|
$
|
7,612
|
|
|
$
|
1,334
|
|
|
$
|
8,946
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
For the Nine Months Ended September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
BALANCE AT DECEMBER 31, 2018
|
|
$
|
—
|
|
|
|
$
|
260
|
|
|
$
|
12,106
|
|
|
$
|
(2,048
|
)
|
|
$
|
(3,192
|
)
|
|
$
|
4
|
|
|
$
|
7,130
|
|
|
$
|
1,682
|
|
|
$
|
8,812
|
|
Net loss attributable to common stock
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
(577
|
)
|
|
—
|
|
|
—
|
|
|
(577
|
)
|
|
—
|
|
|
(577
|
)
|
|||||||||
Net income attributable to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
125
|
|
|
125
|
|
|||||||||
Net loss attributable to noncontrolling interest - Altus
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|||||||||
Issuance of Altus Preferred Units
|
|
517
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Net income attributable to Altus Preferred Unit limited partners
|
|
22
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Distributions to noncontrolling interest - Egypt
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(235
|
)
|
|
(235
|
)
|
|||||||||
Common dividends ($0.75 per share)
|
|
—
|
|
|
|
—
|
|
|
(282
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(282
|
)
|
|
—
|
|
|
(282
|
)
|
|||||||||
Other
|
|
—
|
|
|
|
1
|
|
|
28
|
|
|
—
|
|
|
2
|
|
|
(1
|
)
|
|
30
|
|
|
—
|
|
|
30
|
|
|||||||||
BALANCE AT SEPTEMBER 30, 2019
|
|
$
|
539
|
|
|
|
$
|
261
|
|
|
$
|
11,852
|
|
|
$
|
(2,625
|
)
|
|
$
|
(3,190
|
)
|
|
$
|
3
|
|
|
$
|
6,301
|
|
|
$
|
1,567
|
|
|
$
|
7,868
|
|
1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Oil and Gas Property:
|
|
|
|
|
|
|
|
|
||||||||
Proved
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
86
|
|
|
$
|
—
|
|
Unproved
|
|
12
|
|
|
49
|
|
|
223
|
|
|
86
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Revenues from customers
|
|
$
|
1,361
|
|
|
$
|
1,902
|
|
|
$
|
4,414
|
|
|
$
|
5,437
|
|
Revenues from non-customers
|
|
107
|
|
|
198
|
|
|
347
|
|
|
534
|
|
|
|
Operating Leases
|
|
Finance Leases
|
||
Weighted average remaining lease term
|
|
3.3 years
|
|
|
9.7 years
|
|
Weighted average discount rate
|
|
4.4
|
%
|
|
4.3
|
%
|
Net Minimum Commitments
|
|
Operating Leases(1)
|
|
Finance Leases(2)
|
||||
|
|
(In millions)
|
||||||
2019
|
|
$
|
48
|
|
|
$
|
9
|
|
2020
|
|
124
|
|
|
13
|
|
||
2021
|
|
50
|
|
|
3
|
|
||
2022
|
|
41
|
|
|
3
|
|
||
2023
|
|
24
|
|
|
3
|
|
||
Thereafter
|
|
40
|
|
|
40
|
|
||
Total future minimum lease payments
|
|
327
|
|
|
71
|
|
||
Less: imputed interest
|
|
(26
|
)
|
|
(14
|
)
|
||
Total lease liabilities
|
|
301
|
|
|
57
|
|
||
Current portion
|
|
(149
|
)
|
|
(19
|
)
|
||
Non-current portion
|
|
$
|
152
|
|
|
$
|
38
|
|
(1)
|
Amounts included for drilling rig and related operational equipment obligations represent future payments associated with oil and gas operations inclusive of amounts billable to partners and other working interest owners. Such payments may be capitalized as a component of oil and gas properties and subsequently depreciated, impaired, or written off as exploration expense.
|
(2)
|
Amounts represent the Company’s finance lease obligation related to physical power generators being leased on a one-year term with the right to purchase and a separate lease for the Company’s Midland, Texas regional office building.
|
2.
|
ACQUISITIONS AND DIVESTITURES
|
Production Period
|
|
Settlement Index
|
|
Mbbls
|
|
Weighted Average Price Differential
|
|
October—December 2019
|
|
Midland-WTI/Cushing-WTI
|
|
1,380
|
|
|
$(3.72)
|
Production Period
|
|
Settlement Index
|
|
MMBtu
(in 000’s)
|
|
Weighted Average Price Differential
|
|
October—December 2019
|
|
NYMEX Henry Hub/Waha
|
|
3,680
|
|
|
$(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)
|
||||||||||||||||||||||
September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
6
|
|
||||||
Foreign Currency Derivative Instruments
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||||
Preferred Units Embedded Derivative
|
|
—
|
|
|
—
|
|
|
98
|
|
|
98
|
|
|
—
|
|
|
98
|
|
||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
$
|
—
|
|
|
$
|
69
|
|
|
$
|
—
|
|
|
$
|
69
|
|
|
$
|
(14
|
)
|
|
$
|
55
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commodity Derivative Instruments
|
|
—
|
|
|
25
|
|
|
—
|
|
|
25
|
|
|
(14
|
)
|
|
11
|
|
(1)
|
The derivative fair values are based on analysis of each contract on a gross basis, excluding the impact of netting agreements with counterparties.
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
|
(In millions)
|
||||||
Current Assets: Other current assets
|
|
$
|
2
|
|
|
$
|
55
|
|
Total Assets
|
|
$
|
2
|
|
|
$
|
55
|
|
|
|
|
|
|
||||
Current Liabilities: Other current liabilities
|
|
$
|
7
|
|
|
$
|
11
|
|
Deferred Credits and Other Noncurrent Liabilities: Other
|
|
98
|
|
|
—
|
|
||
Total Liabilities
|
|
$
|
105
|
|
|
$
|
11
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
|
|
(In millions)
|
||||||||||||||
Realized gain (loss):
|
|
|
|
|
|
|
|
|
||||||||
Derivative settlements, realized gain (loss)
|
|
$
|
(16
|
)
|
|
$
|
7
|
|
|
$
|
12
|
|
|
$
|
(110
|
)
|
Amortization of put premium, realized loss
|
|
—
|
|
|
(14
|
)
|
|
—
|
|
|
(24
|
)
|
||||
Unrealized gain (loss)
|
|
14
|
|
|
(16
|
)
|
|
(52
|
)
|
|
88
|
|
||||
Derivative instrument losses, net
|
|
$
|
(2
|
)
|
|
$
|
(23
|
)
|
|
$
|
(40
|
)
|
|
$
|
(46
|
)
|
5.
|
OTHER CURRENT ASSETS
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
|
(In millions)
|
||||||
Inventories
|
|
$
|
475
|
|
|
$
|
401
|
|
Drilling advances
|
|
161
|
|
|
218
|
|
||
Assets held for sale
|
|
18
|
|
|
—
|
|
||
Prepaid assets and other
|
|
84
|
|
|
160
|
|
||
Total other current assets
|
|
$
|
738
|
|
|
$
|
779
|
|
6.
|
EQUITY METHOD INTERESTS
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||
|
|
Interest
|
|
Amount
|
|
Interest
|
|
Amount
|
||||||
|
|
($ in millions)
|
||||||||||||
Gulf Coast Express Pipeline LLC
|
|
16.0
|
%
|
|
$
|
275
|
|
|
15.0
|
%
|
|
$
|
91
|
|
EPIC Crude Holdings, LP
|
|
15.0
|
%
|
|
128
|
|
|
—
|
|
|
—
|
|
||
Permian Highway Pipeline LLC
|
|
26.7
|
%
|
|
224
|
|
|
—
|
|
|
—
|
|
||
Shin Oak Pipeline (Breviloba, LLC)
|
|
33.0
|
%
|
|
468
|
|
|
—
|
|
|
—
|
|
||
|
|
|
|
$
|
1,095
|
|
|
|
|
$
|
91
|
|
|
|
Gulf Coast Express Pipeline LLC
|
|
EPIC Crude Holdings, LP
|
|
Permian Highway Pipeline LLC
|
|
Breviloba, LLC
|
|
Total
|
||||||||||
|
|
(In millions)
|
||||||||||||||||||
Balance at December 31, 2018
|
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
91
|
|
Acquisitions
|
|
15
|
|
|
52
|
|
|
161
|
|
|
442
|
|
|
670
|
|
|||||
Capital contributions
|
|
169
|
|
|
83
|
|
|
63
|
|
|
23
|
|
|
338
|
|
|||||
Distributions
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Equity income (loss), net
|
|
3
|
|
|
(5
|
)
|
|
—
|
|
|
3
|
|
|
1
|
|
|||||
Accumulated other comprehensive loss
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Balance at September 30, 2019
|
|
$
|
275
|
|
|
$
|
128
|
|
|
$
|
224
|
|
|
$
|
468
|
|
|
$
|
1,095
|
|
7.
|
OTHER CURRENT LIABILITIES
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
|
(In millions)
|
||||||
Accrued operating expenses
|
|
$
|
187
|
|
|
$
|
65
|
|
Accrued exploration and development
|
|
355
|
|
|
667
|
|
||
Accrued gathering, processing, and transmission - Altus
|
|
25
|
|
|
81
|
|
||
Accrued compensation and benefits
|
|
171
|
|
|
177
|
|
||
Accrued interest
|
|
114
|
|
|
137
|
|
||
Accrued income taxes
|
|
80
|
|
|
58
|
|
||
Current asset retirement obligation
|
|
66
|
|
|
66
|
|
||
Current operating lease liability
|
|
149
|
|
|
—
|
|
||
Other
|
|
94
|
|
|
90
|
|
||
Total other current liabilities
|
|
$
|
1,241
|
|
|
$
|
1,341
|
|
8.
|
ASSET RETIREMENT OBLIGATION
|
|
|
(In millions)
|
||
Asset retirement obligation at December 31, 2018
|
|
$
|
1,932
|
|
Liabilities incurred
|
|
11
|
|
|
Liabilities settled
|
|
(49
|
)
|
|
Liabilities divested
|
|
(55
|
)
|
|
Accretion expense
|
|
80
|
|
|
Asset retirement obligation at September 30, 2019
|
|
1,919
|
|
|
Less current portion
|
|
(66
|
)
|
|
Asset retirement obligation, long-term
|
|
$
|
1,853
|
|
9.
|
INCOME TAXES
|
10.
|
DEBT AND FINANCING COSTS
|
(1)
|
The fair value of the Company’s notes and debentures was $8.2 billion and $7.8 billion as of September 30, 2019 and December 31, 2018, respectively. Apache uses a market approach to determine the fair value of its notes and debentures using estimates provided by an independent investment financial data services firm (a Level 2 fair value measurement).
|
(2)
|
The carrying amount of borrowings by Altus Midstream LP on its credit facility approximate fair value because the interest rates are variable and reflective of market rates.
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Interest expense
|
|
$
|
107
|
|
|
$
|
113
|
|
|
$
|
323
|
|
|
$
|
335
|
|
Amortization of deferred loan costs
|
|
2
|
|
|
2
|
|
|
5
|
|
|
8
|
|
||||
Capitalized interest
|
|
(9
|
)
|
|
(11
|
)
|
|
(26
|
)
|
|
(36
|
)
|
||||
Loss on extinguishment of debt
|
|
—
|
|
|
94
|
|
|
75
|
|
|
94
|
|
||||
Interest income
|
|
(5
|
)
|
|
(6
|
)
|
|
(12
|
)
|
|
(16
|
)
|
||||
Financing costs, net
|
|
$
|
95
|
|
|
$
|
192
|
|
|
$
|
365
|
|
|
$
|
385
|
|
11.
|
COMMITMENTS AND CONTINGENCIES
|
12.
|
REDEEMABLE NONCONTROLLING INTEREST - ALTUS
|
•
|
The Preferred Units bear quarterly distributions at a rate of 7 percent per annum, increasing after the fifth anniversary of Closing and upon the occurrence of specified events. Altus Midstream LP may pay distributions in-kind for the first six quarters after the Preferred Units are issued.
|
•
|
The Preferred Units are redeemable at Altus Midstream LP’s option at any time in cash at a redemption price (the Redemption Price) equal to the greater of an 11.5 percent internal rate of return (increasing after the fifth anniversary of Closing to 13.75 percent) and a 1.3x multiple of invested capital. The Preferred Units will be redeemable at the holder’s option upon a change of control or liquidation of Altus Midstream LP and certain other events, including certain asset dispositions.
|
•
|
The Preferred Units will be exchangeable for shares of ALTM’s Class A common stock at the holder’s election after the seventh anniversary of Closing or upon the occurrence of specified events. Each Preferred Unit will be exchangeable for a number of shares of ALTM’s Class A common stock equal to the Redemption Price divided by the volume-weighted average trading price of ALTM’s Class A common stock on the NASDAQ Capital Market for the 20 trading days immediately preceding the second trading day prior to the applicable exchange date, less a 6 percent discount.
|
•
|
Each outstanding Preferred Unit has a liquidation preference equal to the Redemption Price payable before any amounts are paid in respect of Altus Midstream LP’s common units and any other units that rank junior to the Preferred Units with respect to distributions or distributions upon liquidation.
|
•
|
Preferred Units holders have rights to approve certain partnership business, financial, and governance-related matters.
|
•
|
Altus Midstream LP is restricted from declaring or making cash distributions on its common units until all required distributions on the Preferred Units have been paid. In addition, before the fifth anniversary of Closing, aggregate cash distributions on, and redemptions of, Altus Midstream LP’s common units are limited to $650 million of cash from ordinary course operations if permitted under its credit facility. Cash distributions on, and redemptions of, Altus Midstream LP’s common units also are subject to satisfaction of leverage ratio requirements specified in its partnership agreement.
|
|
|
June 12, 2019
|
||
|
|
(In millions)
|
||
Redeemable noncontrolling interest - Altus Preferred Unit Limited Partners
|
|
$
|
517
|
|
Preferred Units embedded derivative
|
|
94
|
|
|
|
|
$
|
611
|
|
|
|
Units Outstanding
|
|
Financial Position(2)
|
|||
|
|
(In millions, except unit data)
|
|||||
Redeemable noncontrolling interest - Altus Preferred Unit Limited Partners: beginning of period
|
|
—
|
|
|
$
|
—
|
|
Issuance of Preferred Units, net
|
|
625,000
|
|
|
517
|
|
|
Distribution of in-kind additional Preferred Units(1)
|
|
2,188
|
|
|
—
|
|
|
Allocation of Altus Midstream LP net income
|
|
N/A
|
|
|
21
|
|
|
Accreted value adjustment
|
|
N/A
|
|
|
1
|
|
|
Redeemable noncontrolling interest - Altus Preferred Unit Limited Partners: end of period
|
|
627,188
|
|
|
539
|
|
|
Preferred Units embedded derivative
|
|
|
|
98
|
|
||
|
|
|
|
$
|
637
|
|
(1)
|
Subsequent to the balance sheet date, Altus Midstream LP provided notice to the Preferred Unit holders of record at September 30, 2019 of the amount of the distribution on the Preferred Units for the quarter ended September 30, 2019. The holders also were notified that Altus Midstream LP elected to pay the entire amount of the approximate $11 million distribution in-kind in additional Preferred Units (PIK Units) on November 14, 2019. In total, 10,975.8 PIK Units will be issued in satisfaction of the required distribution.
|
(2)
|
As at September 30, 2019, the aggregate Redemption Price was $646 million, based on an internal rate of return of 11.5 percent.
|
13.
|
CAPITAL STOCK
|
|
|
For the Quarter Ended September 30,
|
||||||||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||||||||
|
|
Loss
|
|
Shares
|
|
Per Share
|
|
Income
|
|
Shares
|
|
Per Share
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) attributable to common stock
|
|
$
|
(170
|
)
|
|
377
|
|
|
$
|
(0.45
|
)
|
|
$
|
81
|
|
|
383
|
|
|
$
|
0.21
|
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stock options and other
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
—
|
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) attributable to common stock
|
|
$
|
(170
|
)
|
|
377
|
|
|
$
|
(0.45
|
)
|
|
$
|
81
|
|
|
385
|
|
|
$
|
0.21
|
|
|
|
For the Nine Months Ended September 30,
|
||||||||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||||||||
|
|
Loss
|
|
Shares
|
|
Per Share
|
|
Income
|
|
Shares
|
|
Per Share
|
||||||||||
|
|
(In millions, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) attributable to common stock
|
|
$
|
(577
|
)
|
|
377
|
|
|
$
|
(1.53
|
)
|
|
$
|
421
|
|
|
383
|
|
|
$
|
1.10
|
|
Effect of Dilutive Securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Stock options and other
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
(0.01
|
)
|
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) attributable to common stock
|
|
$
|
(577
|
)
|
|
377
|
|
|
$
|
(1.53
|
)
|
|
$
|
421
|
|
|
385
|
|
|
$
|
1.09
|
|
14.
|
BUSINESS SEGMENT INFORMATION
|
|
|
Egypt(1)
|
|
North Sea
|
|
U.S.
|
|
Altus
|
|
Intersegment Eliminations & Other
|
|
Total(2)
|
||||||||||||
|
|
Upstream
|
|
Midstream
|
|
|
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Quarter Ended September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
472
|
|
|
$
|
231
|
|
|
$
|
504
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,207
|
|
Natural gas revenues
|
|
72
|
|
|
14
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
136
|
|
||||||
Natural gas liquids revenues
|
|
2
|
|
|
5
|
|
|
88
|
|
|
—
|
|
|
—
|
|
|
95
|
|
||||||
Oil and gas production revenues
|
|
546
|
|
|
250
|
|
|
642
|
|
|
—
|
|
|
—
|
|
|
1,438
|
|
||||||
Midstream service affiliate revenues
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34
|
|
|
(34
|
)
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Lease operating expenses
|
|
115
|
|
|
76
|
|
|
159
|
|
|
—
|
|
|
—
|
|
|
350
|
|
||||||
Gathering, processing, and transmission
|
|
9
|
|
|
9
|
|
|
69
|
|
|
13
|
|
|
(34
|
)
|
|
66
|
|
||||||
Taxes other than income
|
|
—
|
|
|
—
|
|
|
40
|
|
|
4
|
|
|
—
|
|
|
44
|
|
||||||
Exploration
|
|
27
|
|
|
—
|
|
|
25
|
|
|
—
|
|
|
4
|
|
|
56
|
|
||||||
Depreciation, depletion, and amortization
|
|
177
|
|
|
71
|
|
|
452
|
|
|
11
|
|
|
—
|
|
|
711
|
|
||||||
Asset retirement obligation accretion
|
|
—
|
|
|
19
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
27
|
|
||||||
Impairments
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
9
|
|
||||||
|
|
328
|
|
|
175
|
|
|
753
|
|
|
37
|
|
|
(30
|
)
|
|
1,263
|
|
||||||
Operating Income (Loss)(3)
|
|
$
|
218
|
|
|
$
|
75
|
|
|
$
|
(111
|
)
|
|
$
|
(3
|
)
|
|
$
|
(4
|
)
|
|
175
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Derivative instrument losses, net
|
|
|
|
|
|
|
|
|
|
|
|
(2
|
)
|
|||||||||||
Other(4)
|
|
|
|
|
|
|
|
|
|
|
|
41
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(98
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(7
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(95
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
14
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Egypt(1)
|
|
North Sea
|
|
U.S.
|
|
Altus
|
|
Intersegment Eliminations & Other
|
|
Total(2)
|
||||||||||||
|
|
Upstream
|
|
Midstream
|
|
|
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Nine Months Ended September 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
1,509
|
|
|
$
|
868
|
|
|
$
|
1,537
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,914
|
|
Natural gas revenues
|
|
223
|
|
|
64
|
|
|
203
|
|
|
—
|
|
|
—
|
|
|
490
|
|
||||||
Natural gas liquids revenues
|
|
9
|
|
|
16
|
|
|
261
|
|
|
—
|
|
|
—
|
|
|
286
|
|
||||||
Oil and gas production revenues
|
|
1,741
|
|
|
948
|
|
|
2,001
|
|
|
—
|
|
|
—
|
|
|
4,690
|
|
||||||
Midstream service affiliate revenues
|
|
—
|
|
|
—
|
|
|
—
|
|
|
92
|
|
|
(92
|
)
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Lease operating expenses
|
|
365
|
|
|
240
|
|
|
501
|
|
|
—
|
|
|
(2
|
)
|
|
1,104
|
|
||||||
Gathering, processing, and transmission
|
|
31
|
|
|
32
|
|
|
214
|
|
|
43
|
|
|
(90
|
)
|
|
230
|
|
||||||
Taxes other than income
|
|
—
|
|
|
—
|
|
|
131
|
|
|
10
|
|
|
—
|
|
|
141
|
|
||||||
Exploration
|
|
89
|
|
|
2
|
|
|
117
|
|
|
—
|
|
|
12
|
|
|
220
|
|
||||||
Depreciation, depletion, and amortization
|
|
538
|
|
|
269
|
|
|
1,125
|
|
|
27
|
|
|
—
|
|
|
1,959
|
|
||||||
Asset retirement obligation accretion
|
|
—
|
|
|
56
|
|
|
23
|
|
|
1
|
|
|
—
|
|
|
80
|
|
||||||
Impairments
|
|
—
|
|
|
—
|
|
|
240
|
|
|
9
|
|
|
—
|
|
|
249
|
|
||||||
|
|
1,023
|
|
|
599
|
|
|
2,351
|
|
|
90
|
|
|
(80
|
)
|
|
3,983
|
|
||||||
Operating Income (Loss)(3)
|
|
$
|
718
|
|
|
$
|
349
|
|
|
$
|
(350
|
)
|
|
$
|
2
|
|
|
$
|
(12
|
)
|
|
707
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on divestitures
|
|
|
|
|
|
|
|
|
|
|
|
20
|
|
|||||||||||
Derivative instrument losses, net
|
|
|
|
|
|
|
|
|
|
|
|
(40
|
)
|
|||||||||||
Other(4)
|
|
|
|
|
|
|
|
|
|
|
|
45
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(323
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(17
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(365
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
27
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total Assets(5)
|
|
$
|
3,851
|
|
|
$
|
2,529
|
|
|
$
|
12,288
|
|
|
$
|
2,649
|
|
|
$
|
88
|
|
|
$
|
21,405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
For the Quarter Ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
669
|
|
|
$
|
303
|
|
|
$
|
583
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,555
|
|
Natural gas revenues
|
|
86
|
|
|
30
|
|
|
125
|
|
|
—
|
|
|
—
|
|
|
241
|
|
||||||
Natural gas liquids revenues
|
|
4
|
|
|
5
|
|
|
171
|
|
|
—
|
|
|
—
|
|
|
180
|
|
||||||
Oil and gas production revenues
|
|
759
|
|
|
338
|
|
|
879
|
|
|
—
|
|
|
—
|
|
|
1,976
|
|
||||||
Midstream service affiliate revenues
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25
|
|
|
(25
|
)
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Lease operating expenses
|
|
112
|
|
|
92
|
|
|
178
|
|
|
—
|
|
|
—
|
|
|
382
|
|
||||||
Gathering, processing, and transmission
|
|
12
|
|
|
12
|
|
|
76
|
|
|
17
|
|
|
(25
|
)
|
|
92
|
|
||||||
Taxes other than income
|
|
—
|
|
|
—
|
|
|
57
|
|
|
1
|
|
|
—
|
|
|
58
|
|
||||||
Exploration
|
|
10
|
|
|
2
|
|
|
86
|
|
|
—
|
|
|
1
|
|
|
99
|
|
||||||
Depreciation, depletion, and amortization
|
|
187
|
|
|
89
|
|
|
329
|
|
|
5
|
|
|
—
|
|
|
610
|
|
||||||
Asset retirement obligation accretion
|
|
—
|
|
|
19
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
27
|
|
||||||
Impairments
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
|
|
321
|
|
|
224
|
|
|
734
|
|
|
23
|
|
|
(24
|
)
|
|
1,278
|
|
||||||
Operating Income (Loss)(3)
|
|
$
|
438
|
|
|
$
|
114
|
|
|
$
|
145
|
|
|
$
|
2
|
|
|
$
|
(1
|
)
|
|
698
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on divestitures
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
|||||||||||
Derivative instrument losses, net
|
|
|
|
|
|
|
|
|
|
|
|
(23
|
)
|
|||||||||||
Other(4)
|
|
|
|
|
|
|
|
|
|
|
|
29
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(99
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(8
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(192
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
406
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Egypt(1)
|
|
North Sea
|
|
U.S.
|
|
Altus
|
|
Intersegment Eliminations & Other
|
|
Total(2)
|
||||||||||||
|
|
Upstream
|
|
Midstream
|
|
|
||||||||||||||||||
|
|
(In millions)
|
||||||||||||||||||||||
For the Nine Months Ended September 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Oil revenues
|
|
$
|
1,887
|
|
|
$
|
894
|
|
|
$
|
1,743
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,524
|
|
Natural gas revenues
|
|
263
|
|
|
81
|
|
|
331
|
|
|
—
|
|
|
—
|
|
|
675
|
|
||||||
Natural gas liquids revenues
|
|
11
|
|
|
14
|
|
|
421
|
|
|
—
|
|
|
—
|
|
|
446
|
|
||||||
Oil and gas production revenues
|
|
2,161
|
|
|
989
|
|
|
2,495
|
|
|
—
|
|
|
—
|
|
|
5,645
|
|
||||||
Midstream service affiliate revenues
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|
(50
|
)
|
|
—
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Lease operating expenses
|
|
316
|
|
|
264
|
|
|
507
|
|
|
—
|
|
|
—
|
|
|
1,087
|
|
||||||
Gathering, processing, and transmission
|
|
35
|
|
|
32
|
|
|
204
|
|
|
39
|
|
|
(50
|
)
|
|
260
|
|
||||||
Taxes other than income
|
|
—
|
|
|
—
|
|
|
156
|
|
|
6
|
|
|
—
|
|
|
162
|
|
||||||
Exploration
|
|
70
|
|
|
19
|
|
|
159
|
|
|
—
|
|
|
3
|
|
|
251
|
|
||||||
Depreciation, depletion, and amortization
|
|
564
|
|
|
281
|
|
|
913
|
|
|
13
|
|
|
—
|
|
|
1,771
|
|
||||||
Asset retirement obligation accretion
|
|
—
|
|
|
56
|
|
|
24
|
|
|
1
|
|
|
—
|
|
|
81
|
|
||||||
Impairments
|
|
—
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
|
|
985
|
|
|
662
|
|
|
1,963
|
|
|
59
|
|
|
(47
|
)
|
|
3,622
|
|
||||||
Operating Income (Loss)(3)
|
|
$
|
1,176
|
|
|
$
|
327
|
|
|
$
|
532
|
|
|
$
|
(9
|
)
|
|
$
|
(3
|
)
|
|
2,023
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on divestitures
|
|
|
|
|
|
|
|
|
|
|
|
10
|
|
|||||||||||
Derivative instrument losses, net
|
|
|
|
|
|
|
|
|
|
|
|
(46
|
)
|
|||||||||||
Other(4)
|
|
|
|
|
|
|
|
|
|
|
|
50
|
|
|||||||||||
General and administrative
|
|
|
|
|
|
|
|
|
|
|
|
(330
|
)
|
|||||||||||
Transaction, reorganization, and separation
|
|
|
|
|
|
|
|
|
|
|
|
(20
|
)
|
|||||||||||
Financing costs, net
|
|
|
|
|
|
|
|
|
|
|
|
(385
|
)
|
|||||||||||
Income Before Income Taxes
|
|
|
|
|
|
|
|
|
|
|
|
$
|
1,302
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total Assets(5)
|
|
$
|
4,404
|
|
|
$
|
3,033
|
|
|
$
|
13,335
|
|
|
$
|
1,054
|
|
|
$
|
44
|
|
|
$
|
21,870
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes revenue from non-customers for the third quarters and nine-month periods of 2019 and 2018 of:
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Oil
|
|
$
|
98
|
|
|
$
|
181
|
|
|
$
|
316
|
|
|
$
|
485
|
|
Natural gas
|
|
9
|
|
|
16
|
|
|
30
|
|
|
47
|
|
||||
Natural gas liquids
|
|
—
|
|
|
1
|
|
|
1
|
|
|
2
|
|
(2)
|
Includes a noncontrolling interest in Egypt for the 2019 and 2018 periods, and Altus for the 2019 period.
|
(3)
|
The operating income (loss) of Altus Midstream, U.S., and Egypt includes leasehold and other asset impairments totaling $9 million, $10 million, and $2 million, respectively, for the third quarter of 2019. The operating income of Altus Midstream, U.S., and Egypt includes leasehold and other asset impairments totaling $9 million, $308 million, and $6 million, respectively, for the first nine months of 2019. The operating income (loss) of U.S. and North Sea includes leasehold and unproved impairments totaling $39 million and $10 million, respectively, for the third quarter of 2018. The operating income of U.S. and North Sea includes leasehold and unproved impairments totaling $76 million and $10 million, respectively, for the first nine months of 2018.
|
(4)
|
Included in Other are sales proceeds related to U.S. third-party purchased oil and gas volumes which are determined to be revenue from customers. Proceeds for these volumes totaled $30 million and $124 million for the third quarters of 2019 and 2018, respectively, and $71 million and $326 million for the first nine months of 2019 and 2018, respectively.
|
(5)
|
Intercompany balances are excluded from total assets.
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
Third quarter equivalent production from the Permian region, which accounts for 96 percent of Apache’s total U.S. production, increased 14 percent from the third quarter of 2018, which was driven by continued production ramp-up at Alpine High and strong performance in the Midland Basin. The Company averaged five rigs at Alpine High during the quarter and is currently running only two rigs, deferring several fourth quarter completions into 2020.
|
•
|
The Egypt region’s gross equivalent production decreased 11 percent and net production decreased 15 percent from the third quarter of 2018 primarily a result of natural decline and fewer wells brought on-line during the period. The region continues to build and enhance its robust drilling inventory, supplemented with recent seismic acquisitions and new play concept evaluations, on both new and existing acreage.
|
•
|
The North Sea region averaged 3 rigs and drilled 2 gross wells during the third quarter of 2019. The region’s daily production increased six percent from the third quarter 2018, primarily the result of production from the Garten field, which came on-line in November 2018.
|
•
|
The North Sea region’s Storr exploration discovery and its second well at Garten are expected to come on-line in the fourth quarter. The first well at the Company’s Storr development is a high-rate gas condensate well and will be tied back to existing infrastructure connecting to the Beryl Alpha platform. The Garten #2 well encountered approximately 1,200 feet of net pay and compares favorably to the Garten #1 well, which came on-line in November 2018 with initial 30-day production rates of 13 thousand barrels of oil per day (Mb/d) and 17 million cubic feet of natural gas per day (MMcf/d) from 700 feet of net pay. Apache holds a 100 percent working interest in the Garten complex.
|
•
|
The Company continues to progress its exploration efforts in Suriname and is currently drilling its first well, the Maka Central #1, on the 100 percent-owned Block 58. The well is expected to reach total depth in November. Additionally, the Company has committed to drill a second and third well on Block 58, which in conjunction with optional future well commitments, enables the retention of the entirety of the Block with no relinquishment requirements through June 2026.
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||
|
|
$
Value
|
|
% Contribution
|
|
$
Value
|
|
% Contribution
|
|
$
Value
|
|
%
Contribution
|
|
$
Value
|
|
%
Contribution
|
||||||||||||
|
|
($ in millions)
|
||||||||||||||||||||||||||
Oil Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
504
|
|
|
42
|
%
|
|
$
|
583
|
|
|
37
|
%
|
|
$
|
1,537
|
|
|
39
|
%
|
|
$
|
1,743
|
|
|
39
|
%
|
Egypt (1)
|
|
472
|
|
|
39
|
%
|
|
669
|
|
|
43
|
%
|
|
1,509
|
|
|
39
|
%
|
|
1,887
|
|
|
41
|
%
|
||||
North Sea
|
|
231
|
|
|
19
|
%
|
|
303
|
|
|
20
|
%
|
|
868
|
|
|
22
|
%
|
|
894
|
|
|
20
|
%
|
||||
Total (1)
|
|
$
|
1,207
|
|
|
100
|
%
|
|
$
|
1,555
|
|
|
100
|
%
|
|
$
|
3,914
|
|
|
100
|
%
|
|
$
|
4,524
|
|
|
100
|
%
|
Natural Gas Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
50
|
|
|
37
|
%
|
|
$
|
125
|
|
|
52
|
%
|
|
$
|
203
|
|
|
41
|
%
|
|
$
|
331
|
|
|
49
|
%
|
Egypt (1)
|
|
72
|
|
|
53
|
%
|
|
86
|
|
|
36
|
%
|
|
223
|
|
|
46
|
%
|
|
263
|
|
|
39
|
%
|
||||
North Sea
|
|
14
|
|
|
10
|
%
|
|
30
|
|
|
12
|
%
|
|
64
|
|
|
13
|
%
|
|
81
|
|
|
12
|
%
|
||||
Total (1)
|
|
$
|
136
|
|
|
100
|
%
|
|
$
|
241
|
|
|
100
|
%
|
|
$
|
490
|
|
|
100
|
%
|
|
$
|
675
|
|
|
100
|
%
|
Natural Gas Liquids (NGL) Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
88
|
|
|
93
|
%
|
|
$
|
171
|
|
|
95
|
%
|
|
$
|
261
|
|
|
91
|
%
|
|
$
|
421
|
|
|
94
|
%
|
Egypt (1)
|
|
2
|
|
|
2
|
%
|
|
4
|
|
|
2
|
%
|
|
9
|
|
|
3
|
%
|
|
11
|
|
|
3
|
%
|
||||
North Sea
|
|
5
|
|
|
5
|
%
|
|
5
|
|
|
3
|
%
|
|
16
|
|
|
6
|
%
|
|
14
|
|
|
3
|
%
|
||||
Total (1)
|
|
$
|
95
|
|
|
100
|
%
|
|
$
|
180
|
|
|
100
|
%
|
|
$
|
286
|
|
|
100
|
%
|
|
$
|
446
|
|
|
100
|
%
|
Oil and Gas Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
|
$
|
642
|
|
|
45
|
%
|
|
$
|
879
|
|
|
44
|
%
|
|
$
|
2,001
|
|
|
43
|
%
|
|
$
|
2,495
|
|
|
44
|
%
|
Egypt (1)
|
|
546
|
|
|
38
|
%
|
|
759
|
|
|
39
|
%
|
|
1,741
|
|
|
37
|
%
|
|
2,161
|
|
|
38
|
%
|
||||
North Sea
|
|
250
|
|
|
17
|
%
|
|
338
|
|
|
17
|
%
|
|
948
|
|
|
20
|
%
|
|
989
|
|
|
18
|
%
|
||||
Total (1)
|
|
$
|
1,438
|
|
|
100
|
%
|
|
$
|
1,976
|
|
|
100
|
%
|
|
$
|
4,690
|
|
|
100
|
%
|
|
$
|
5,645
|
|
|
100
|
%
|
(1)
|
Includes revenues attributable to a noncontrolling interest in Egypt.
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||||
|
|
2019
|
|
Increase
(Decrease)
|
|
2018
|
|
2019
|
|
Increase
(Decrease)
|
|
2018
|
||||||
Oil Volume – b/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
100,045
|
|
|
(3
|
)%
|
|
103,538
|
|
|
103,912
|
|
|
1
|
%
|
|
102,830
|
|
Egypt(1)(2)
|
|
84,114
|
|
|
(13
|
)%
|
|
97,129
|
|
|
86,470
|
|
|
(10
|
)%
|
|
96,201
|
|
North Sea
|
|
44,281
|
|
|
4
|
%
|
|
42,769
|
|
|
49,584
|
|
|
10
|
%
|
|
45,076
|
|
Total
|
|
228,440
|
|
|
(6
|
)%
|
|
243,436
|
|
|
239,966
|
|
|
(2
|
)%
|
|
244,107
|
|
Natural Gas Volume – Mcf/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
563,162
|
|
|
(14
|
)%
|
|
651,782
|
|
|
633,239
|
|
|
12
|
%
|
|
563,299
|
|
Egypt(1)(2)
|
|
275,569
|
|
|
(17
|
)%
|
|
331,681
|
|
|
289,397
|
|
|
(15
|
)%
|
|
338,813
|
|
North Sea
|
|
47,875
|
|
|
15
|
%
|
|
41,455
|
|
|
51,596
|
|
|
23
|
%
|
|
41,932
|
|
Total
|
|
886,606
|
|
|
(13
|
)%
|
|
1,024,918
|
|
|
974,232
|
|
|
3
|
%
|
|
944,044
|
|
NGL Volume – b/d
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
72,005
|
|
|
20
|
%
|
|
60,239
|
|
|
64,329
|
|
|
13
|
%
|
|
56,886
|
|
Egypt(1)(2)
|
|
891
|
|
|
18
|
%
|
|
753
|
|
|
979
|
|
|
4
|
%
|
|
939
|
|
North Sea
|
|
1,540
|
|
|
53
|
%
|
|
1,008
|
|
|
1,678
|
|
|
54
|
%
|
|
1,092
|
|
Total
|
|
74,436
|
|
|
20
|
%
|
|
62,000
|
|
|
66,986
|
|
|
14
|
%
|
|
58,917
|
|
BOE per day(3)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
United States
|
|
265,910
|
|
|
(2
|
)%
|
|
272,406
|
|
|
273,781
|
|
|
8
|
%
|
|
253,599
|
|
Egypt(1)(2)
|
|
130,934
|
|
|
(15
|
)%
|
|
153,163
|
|
|
135,681
|
|
|
(12
|
)%
|
|
153,609
|
|
North Sea(4)
|
|
53,800
|
|
|
6
|
%
|
|
50,686
|
|
|
59,861
|
|
|
13
|
%
|
|
53,157
|
|
Total
|
|
450,644
|
|
|
(5
|
)%
|
|
476,255
|
|
|
469,323
|
|
|
2
|
%
|
|
460,365
|
|
(1)
|
Gross oil, natural gas, and NGL production in Egypt for the third quarter and nine-month period of 2019 and 2018 were as follows:
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Oil (b/d)
|
|
187,589
|
|
|
208,889
|
|
|
196,643
|
|
|
205,822
|
|
Natural Gas (Mcf/d)
|
|
673,065
|
|
|
766,128
|
|
|
719,083
|
|
|
775,405
|
|
NGL (b/d)
|
|
1,529
|
|
|
1,161
|
|
|
1,810
|
|
|
1,450
|
|
(2)
|
Includes production volumes per day attributable to a noncontrolling interest in Egypt for the third quarter and nine-month period of 2019 and 2018 of:
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Oil (b/d)
|
|
28,052
|
|
|
32,385
|
|
|
28,839
|
|
|
32,077
|
|
Natural Gas (Mcf/d)
|
|
92,212
|
|
|
110,777
|
|
|
96,706
|
|
|
113,164
|
|
NGL (b/d)
|
|
297
|
|
|
251
|
|
|
326
|
|
|
313
|
|
(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 third quarter of 2019 and 2018 were 49,349 boe/d and 51,765 boe/d, respectively, and 58,843 boe/d and 53,985 boe/d for the first nine months of 2019 and 2018, respectively. Sales volumes may vary from production volumes as a result of the timing of liftings in the Beryl field.
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||||||||
|
|
2019
|
|
Increase
(Decrease) |
|
2018
|
|
2019
|
|
Increase
(Decrease) |
|
2018
|
||||||||||
Average Oil Price - Per barrel
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
54.70
|
|
|
(11
|
)%
|
|
$
|
61.20
|
|
|
$
|
54.16
|
|
|
(13
|
)%
|
|
$
|
62.08
|
|
Egypt
|
|
61.10
|
|
|
(18
|
)%
|
|
74.92
|
|
|
63.96
|
|
|
(11
|
)%
|
|
71.85
|
|
||||
North Sea
|
|
63.12
|
|
|
(16
|
)%
|
|
75.01
|
|
|
65.45
|
|
|
(8
|
)%
|
|
71.32
|
|
||||
Total
|
|
58.60
|
|
|
(15
|
)%
|
|
69.12
|
|
|
60.00
|
|
|
(11
|
)%
|
|
67.65
|
|
||||
Average Natural Gas Price - Per Mcf
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
0.97
|
|
|
(54
|
)%
|
|
$
|
2.09
|
|
|
$
|
1.17
|
|
|
(46
|
)%
|
|
$
|
2.15
|
|
Egypt
|
|
2.81
|
|
|
(1
|
)%
|
|
2.85
|
|
|
2.82
|
|
|
(1
|
)%
|
|
2.85
|
|
||||
North Sea
|
|
3.20
|
|
|
(59
|
)%
|
|
7.78
|
|
|
4.56
|
|
|
(36
|
)%
|
|
7.07
|
|
||||
Total
|
|
1.66
|
|
|
(35
|
)%
|
|
2.56
|
|
|
1.84
|
|
|
(30
|
)%
|
|
2.62
|
|
||||
Average NGL Price - Per barrel
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
United States
|
|
$
|
13.26
|
|
|
(57
|
)%
|
|
$
|
30.84
|
|
|
$
|
14.93
|
|
|
(45
|
)%
|
|
$
|
27.15
|
|
Egypt
|
|
27.76
|
|
|
(40
|
)%
|
|
45.92
|
|
|
33.17
|
|
|
(18
|
)%
|
|
40.67
|
|
||||
North Sea
|
|
26.63
|
|
|
(51
|
)%
|
|
54.73
|
|
|
33.98
|
|
|
(28
|
)%
|
|
47.16
|
|
||||
Total
|
|
13.71
|
|
|
(56
|
)%
|
|
31.42
|
|
|
15.68
|
|
|
(43
|
)%
|
|
27.74
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Lease operating expenses
|
|
$
|
350
|
|
|
$
|
382
|
|
|
$
|
1,104
|
|
|
$
|
1,087
|
|
Gathering, processing, and transmission
|
|
66
|
|
|
92
|
|
|
230
|
|
|
260
|
|
||||
Taxes other than income
|
|
44
|
|
|
58
|
|
|
141
|
|
|
162
|
|
||||
Exploration
|
|
56
|
|
|
99
|
|
|
220
|
|
|
251
|
|
||||
General and administrative
|
|
98
|
|
|
99
|
|
|
323
|
|
|
330
|
|
||||
Transaction, reorganization, and separation
|
|
7
|
|
|
8
|
|
|
17
|
|
|
20
|
|
||||
Depreciation, depletion, and amortization:
|
|
|
|
|
|
|
|
|
||||||||
Oil and gas property and equipment
|
|
667
|
|
|
575
|
|
|
1,836
|
|
|
1,666
|
|
||||
GPT assets
|
|
28
|
|
|
21
|
|
|
76
|
|
|
62
|
|
||||
Other assets
|
|
16
|
|
|
14
|
|
|
47
|
|
|
43
|
|
||||
Asset retirement obligation accretion
|
|
27
|
|
|
27
|
|
|
80
|
|
|
81
|
|
||||
Impairments
|
|
9
|
|
|
10
|
|
|
249
|
|
|
10
|
|
||||
Financing costs, net
|
|
95
|
|
|
192
|
|
|
365
|
|
|
385
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Third-party processing and transmission costs
|
|
$
|
53
|
|
|
$
|
75
|
|
|
$
|
187
|
|
|
$
|
221
|
|
Midstream service affiliate costs
|
|
34
|
|
|
25
|
|
|
90
|
|
|
50
|
|
||||
Upstream processing and transmission costs
|
|
87
|
|
|
100
|
|
|
277
|
|
|
271
|
|
||||
Midstream operating expenses
|
|
13
|
|
|
17
|
|
|
43
|
|
|
39
|
|
||||
Intersegment eliminations
|
|
(34
|
)
|
|
(25
|
)
|
|
(90
|
)
|
|
(50
|
)
|
||||
Total GPT costs
|
|
$
|
66
|
|
|
$
|
92
|
|
|
$
|
230
|
|
|
$
|
260
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Unproved leasehold impairments
|
|
$
|
12
|
|
|
$
|
39
|
|
|
$
|
74
|
|
|
$
|
76
|
|
Dry hole expense
|
|
5
|
|
|
21
|
|
|
33
|
|
|
57
|
|
||||
Geological and geophysical expense
|
|
18
|
|
|
6
|
|
|
56
|
|
|
41
|
|
||||
Exploration overhead and other
|
|
21
|
|
|
33
|
|
|
57
|
|
|
77
|
|
||||
|
|
$
|
56
|
|
|
$
|
99
|
|
|
$
|
220
|
|
|
$
|
251
|
|
|
|
For the Quarter Ended September 30,
|
|
For the Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(In millions)
|
||||||||||||||
Interest expense
|
|
$
|
107
|
|
|
$
|
113
|
|
|
$
|
323
|
|
|
$
|
335
|
|
Amortization of debt issuance costs
|
|
2
|
|
|
2
|
|
|
5
|
|
|
8
|
|
||||
Capitalized interest
|
|
(9
|
)
|
|
(11
|
)
|
|
(26
|
)
|
|
(36
|
)
|
||||
Loss on extinguishment of debt
|
|
—
|
|
|
94
|
|
|
75
|
|
|
94
|
|
||||
Interest income
|
|
(5
|
)
|
|
(6
|
)
|
|
(12
|
)
|
|
(16
|
)
|
||||
Financing costs, net
|
|
$
|
95
|
|
|
$
|
192
|
|
|
$
|
365
|
|
|
$
|
385
|
|
|
|
For the Nine Months Ended September 30,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(In millions)
|
||||||
Sources of Cash and Cash Equivalents:
|
|
|
|
|
||||
Net cash provided by operating activities
|
|
$
|
2,089
|
|
|
$
|
2,734
|
|
Proceeds from sale of oil and gas properties
|
|
590
|
|
|
51
|
|
||
Fixed-rate debt borrowings
|
|
989
|
|
|
992
|
|
||
Proceeds from Altus credit facility
|
|
235
|
|
|
—
|
|
||
Redeemable noncontrolling interest - Altus Preferred Unit limited partners
|
|
611
|
|
|
—
|
|
||
|
|
4,514
|
|
|
3,777
|
|
||
Uses of Cash and Cash Equivalents:
|
|
|
|
|
||||
Additions to oil and gas property(1)
|
|
$
|
2,015
|
|
|
$
|
2,338
|
|
Leasehold and property acquisitions
|
|
39
|
|
|
86
|
|
||
Additions to Altus gathering, processing, and transmission facilities(1)
|
|
294
|
|
|
412
|
|
||
Altus equity method interests
|
|
1,008
|
|
|
—
|
|
||
Payments on fixed-rate debt
|
|
1,150
|
|
|
1,370
|
|
||
Dividends paid
|
|
282
|
|
|
287
|
|
||
Distributions to noncontrolling interest - Egypt
|
|
235
|
|
|
256
|
|
||
Other
|
|
42
|
|
|
103
|
|
||
|
|
5,065
|
|
|
4,852
|
|
||
Decrease in cash and cash equivalents
|
|
$
|
(551
|
)
|
|
$
|
(1,075
|
)
|
(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.
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
|
(In millions)
|
||||||
Cash and cash equivalents
|
|
$
|
163
|
|
|
$
|
714
|
|
Total debt
|
|
8,412
|
|
|
8,244
|
|
||
Equity
|
|
7,868
|
|
|
8,812
|
|
||
Available committed borrowing capacity
|
|
3,996
|
|
|
3,857
|
|
||
Available committed borrowing capacity - Altus
|
|
415
|
|
|
450
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
ITEM 1A.
|
RISK FACTORS
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS
|
3.1
|
–
|
|
3.2
|
–
|
|
*3.3
|
–
|
|
4.1
|
–
|
|
4.2
|
–
|
|
*31.1
|
–
|
|
*31.2
|
–
|
|
*32.1
|
–
|
|
*101
|
–
|
The following financial statements from the Registrant's Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, formatted in Inline XBRL: (i) Statement of Consolidated Operations, (ii) Statement of Consolidated Comprehensive Income (Loss), (iii) Statement of Consolidated Cash Flows, (iv) Consolidated Balance Sheets, (v) Statement of Consolidated Changes in Equity and Noncontrolling Interest and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags.
|
*101.SCH
|
–
|
Inline XBRL Taxonomy Schema Document.
|
*101.CAL
|
–
|
Inline XBRL Calculation Linkbase Document.
|
*101.DEF
|
–
|
Inline XBRL Definition Linkbase Document.
|
*101.LAB
|
–
|
Inline XBRL Label Linkbase Document.
|
*101.PRE
|
–
|
Inline XBRL Presentation Linkbase Document.
|
*104
|
–
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
|
*
|
Filed herewith
|
|
|
|
APACHE CORPORATION
|
|
|
|
|
Dated:
|
October 31, 2019
|
|
/s/ STEPHEN J. RINEY
|
|
|
|
Stephen J. Riney
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
|
|
Dated:
|
October 31, 2019
|
|
/s/ REBECCA A. HOYT
|
|
|
|
Rebecca A. Hoyt
|
|
|
|
Senior Vice President, Chief Accounting Officer, and Controller
|
|
|
|
(Principal Accounting 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/ 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)
|
|