Second Quarter 2014 EARNINGS RELEASE OPERATIONS SUPPLEMENT & Pro Forma Production Reconciliation

Transcription

1 Second Quarter 2014 EARNINGS RELEASE OPERATIONS SUPPLEMENT & Pro Forma Production Reconciliation

2 TABLE OF CONTENTS Overview... 2 NORTH AMERICA... 7 Permian... 7 Central Gulf Coast Canada Gulf of Mexico INTERNATIONAL Australia Egypt North Sea... 24

3 NOTICE TO INVESTORS This earnings release operations supplement contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended and, whenever possible, are identified by use of the words such as anticipates, intends, plans, seeks, believes, estimates, expects and similar references to future periods. Any matters that are not historical facts are forward-looking and, accordingly, involve estimates, assumptions, risks and uncertainties, including, without limitation, our assumptions and estimates about the market prices of oil, natural gas, NGLs and other products or services, our commodity hedging arrangements, the supply and demand for oil, natural gas, NGLs and other products or services, production and reserve levels, drilling risks, the number of wells drilled, economic and competitive conditions, the availability of capital resources, capital expenditure and other contractual obligations, and our ability to complete, test and produce the wells identified in this supplement. Because such statements involve risks and uncertainties, Apache s actual results and performance may differ materially from the results expressed or implied by the forwardlooking statements contained in this supplement. Other important factors that could cause actual results to differ materially from expected results are described in Risk Factors in our most recently filed Annual Report on Form 10-K, recent Quarterly Reports on Form 10-Q and amendments thereto, available on our Web site and in our other public filings and press releases. There is no assurance that Apache's expectations will be realized, and readers are cautioned not to place undue reliance on forward looking statements, which speak only as of the date hereof. Unless otherwise required by law, we assume no duty to update these statements as of any future date. Cautionary Note to Investors: The United States Securities and Exchange Commission ("SEC") permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SEC's definitions for such terms. Apache may use certain terms in this earnings release operations supplement, such as resources, potential resources, resource potential, reserves potential, and other similar terms that the SEC guidelines strictly prohibit Apache from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality and other factors, and are therefore not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in Apache s Annual Report on Form 10-K for the fiscal year ended December 31, 2013, available from Apache at or by writing Apache at: 2000 Post Oak Blvd., Suite 100, Houston, Texas (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling SEC-0330 or from the SEC's website at Certain information may be provided in this supplement that includes financial measurements that are not required by, or presented in accordance with, generally accepted accounting principles (GAAP), including these measures: adjusted earnings, pre-tax margin, and cash from operations. These non-gaap measures should not be considered as alternatives to GAAP measures, such as net income or cash from operating activities, and may be calculated differently from, and therefore may not be comparable to, similarly titled measures used at other companies. Reconciliation to the most directly comparable GAAP financial measure has been provided on our website at None of the information contained in this document has been audited by any independent auditor. This supplemental document is prepared as a convenience for securities analysts and investors and may be useful as a reference tool. Apache intends to continue to publish this supplement in conjunction with our quarterly earnings release, but may elect to modify the format or discontinue publication at any time, without notice to securities analysts or investors. 1

4 Overview North American onshore liquids production grew 18 percent year-overyear and 3 percent sequentially on a pro forma basis led by strong results in our Permian region. Total North American onshore liquids volumes reached a record 201,400 Bbls/d. Total worldwide production during the quarter averaged 636 thousand barrels of oil equivalent per day (Mboe/d). Liquids production comprised 59 percent of the total, up from 58 percent in the previous quarter. Pro forma second-quarter production averaged 550 Mboe/d compared to a second-quarter 2013 average of 529 Mboe/d. Apache averaged 116 rigs worldwide during the second quarter, 82 of which were focused onshore in North America. The company completed 440 gross wells during the quarter, 360 of which were onshore in North America. NORTH AMERICAN ONSHORE KEY STATS Q2 Production: 351,302 Boe/d Q2 Wells: 360 gross, 262 net Q2 Rigs: Avg 82 rigs GLOBAL KEY STATS Q2 Production: 635,814 Boe/d Q2 Wells: 440 gross, 330 net Q2 Rigs: Avg 116 rigs APACHE WORLDWIDE OPERATIONS Note: Pro forma production rates and growth percentages in this report are adjusted to exclude volumes from divestitures, noncontrolling interest and tax barrels in Egypt. The number of wells reported as drilled and/or completed throughout this report could be subject to reclassification that may cause adjustments to reported amounts in future periods. The number of wells reported is subject to SEC standards and therefore, along with other SEC guidelines, includes completed wells only. 2

5 UPDATED PRO FORMA 2013 PRODUCTION BRIDGE 532 Mboe/d As Reported GOM Shelf Argentina Egypt Tax Barrels Noncontrolling Interest Canada Sales Initial 2013 Pro Forma South Texas Sale Updated 2013 Pro Forma Note: At Apache s February 2014 Investor Day, we provided a reconciliation from 2013 reported production volumes of 761 Mboe/d to pro forma production volumes of 537 Mboe/d which were adjusted to exclude volumes from GOM Shelf, Argentina and Canada divestitures and noncontrolling interest and tax barrels in Egypt. We have since disclosed additional divestitures in South Texas and are therefore providing an updated 2013 pro forma production volume of 532 Mboe/d for the comparability of results production guidance is based off of pro forma production volumes. 3

6 PRO FORMA SECOND-QUARTER PRODUCTION BRIDGE 550 Mboe/d As Reported Egypt Tax Barrels Noncontrolling Interest Canada Sales South Texas Sale 2Q 2014 Pro Forma PRO FORMA SECOND-QUARTER PRODUCTION BY REGION 550 Mboe/d 583 Mboe/d North Sea 13% Australia 9% Central PRO FORMA SECOND-QUARTER PRODUCTION BY PRODUCT 550 Mboe/d International Liquids North American Liquids 16% 22% Egypt 14% 38% Gulf of Mexico 2% N.A. Onshore 62% 14% Canada 13% 5% 28% Permian International Gas 26% Gulf Coast North American Gas North American Onshore International & Offshore Liquids Natural Gas 4

7 PRO FORMA NORTH AMERICAN ONSHORE PRODUCTION: 2Q 2013 VS 2Q 2014 Liquids Production (Mbbls/d) Total Production (Mboe/d) % % 15% Liquids NGLs % 141 Oil Q Q Q Q % Liquids 54% 59% PRO FORMA WORLDWIDE PRODUCTION (Mboe/d) PF 2Q 2013 Updated PF 2013 PF 1Q 2014 PF 2Q

8 REPORTED SECOND-QUARTER PRODUCTION BY REGION 636 Mboe/d North Sea 11% Australia 8% 14% Central Egypt 24% N.A. Onshore 55% Gulf of Mexico 2% Canada 12% 5% Gulf Coast 24% Permian REPORTED SECOND-QUARTER PRODUCTION BY PRODUCT 636 Mboe/d SECOND-QUARTER REVENUE BY PRODUCT $3.7 Billion International Liquids 26% North American Liquids International Liquids $1.7 Bn North American Liquids $1.5 Bn 33% 45% 39% 17% International Gas 24% 6% 10% North American Gas North American Onshore International & Offshore Liquids Natural Gas 6 International Gas $0.2 Bn North American Gas $0.3 Bn Note: Reported volumes are consistent with production included for purposes of GAAP financial reporting and therefore include noncontrolling interest and tax barrels in Egypt.

9 NORTH AMERICA Permian Second-quarter 2014 production in the Permian averaged a record 155,244 barrels of oil equivalent per day (Boe/d) (77 percent liquids), up 4 percent over the previous quarter, and up 26 percent over the second quarter of PERMIAN KEY STATS Q2 Production: 155,244 Boe/d Q2 Wells: 207 gross, 152 net Q2 Rigs: Avg 37 rigs The Barnhart (Irion County, Wolfcamp), Pecos Bend (Loving County, Bones Springs), and Cedar Lake (Eddy County, Yeso) areas lead the region s production growth, while Deadwood and Barnhart in the Midland Basin remained the top two areas in terms of production contribution. The Permian region averaged 37 operated drilling rigs, with horizontal rigs increasing to 24 and vertical rigs decreasing to 13. The region drilled (TD d) 164 gross operated wells during the quarter including 74 horizontal and 90 vertical.* APACHE PERMIAN REGION ACREAGE AND KEY PLAYS * This is different from the 207 wells reported in the Key Stats due to differences in classification. 7

10 Permian (Continued) PERMIAN WELL HIGHLIGHTS PLAY/TARGET WELL NAME COUNTY, ST TVD LATERAL IP (Peak 24-Hour) IP (30-Day) Wolfcamp Shale SRH 1335 HU Reagan, TX 7,700 5,800 1,184 Boe/d N/A SRH 1336 HM Reagan, TX 8,000 5, Boe/d N/A Cline Shale Augusta Barrow #1418H Ector, TX 9,900 4,460 1,268 Boe/d 518 Boe/d Penn George D Hogg #8H Winkler, TX 8,696 5,577 1,158 Boe/d 1,162 Boe/d Robin 8 #103H Reeves, TX 10,583 4,567 1,192 Boe/d 912 Boe/d Bone Springs Waha #802 HL Reeves, TX 10,612 4, Boe/d N/A Chaparral 89 #103H Loving, TX 10,897 4,449 1,473 Boe/d 1,321 Boe/d Spraberry Augusta Barrow #2309 Ector, TX 11,410 VERTICAL 583 Boe/d 374 Boe/d Yeso Tony Federal #56 Eddy, NM 6,500 VERTICAL 789 Boe/d 348 Boe/d Wolfcamp King 59-1 Crane, TX 8,045 VERTICAL 354 Boe/d N/A 8

11 Permian (Continued) WOLFCAMP SHALE During the second quarter, Apache drilled 37 wells in the Wolfcamp Shale in Irion, Reagan, and Upton County. Irion County: The Barnhart area of Irion County remained extremely active ending the second quarter with seven rigs. The activity focused on drilling 12 Upper and 7 Middle Wolfcamp wells, four of which were drilled to two-mile lateral lengths and the remaining 15 wells were drilled to 1.5-mile lateral lengths. Reagan County (Southern Midland Basin): During the quarter, four wells were drilled at Scottish Rite Hospital (SRH) with two drilling rigs. Two recently completed wells, the SRH 1335HU and 1336HM, produced 24-hour initial production (IP) rates of 1,184 Boe/d and 812 Boe/d, respectively. MIDLAND VERTICAL The southern end of the Deadwood core continued to provide excellent Wolfwood results due to a combination of Strawn and Wolfcamp potential. The Midland vertical program in the Permian continues to provide strong rates of return with select wells exhibiting 30-day average production rates in excess of 300 Boe/d. CLINE SHALE We continued our active program in the Deadwood field in Glasscock County (Midland Basin) drilling nine Lower Cline horizontal wells in the second quarter. Apache is also testing new areas including eastern Ector County at the Augusta Barrow field (Central Basin Platform) with very strong initial results. The Augusta Barrow #1418H recently generated a peak 24-hour IP of 1,268 Boe/d. 9

12 Permian (Continued) CENTRAL BASIN PLATFORM (CBP) Horizontal activity during the second quarter was focused in Andrews County on the Super Bar area where five horizontal wells were drilled targeting the upper Wichita Albany formation. Additional activity centered on the North Monahans horizontal development in Winkler County. Apache is also testing Grayburg potential in Crane County drilling five horizontal wells during the quarter. NORTHWEST SHELF - YESO Apache ran two rigs in the Yeso play during the second quarter and spud a total of 20 wells, four of which were horizontal and the other 16 vertical. 16 wells were brought onto production adding 1,578 Bo/d and 3,351 Mcf/d to the field (2,137 Boe/d). The 10 horizontal wells completed last year in the Cedar Lake area are still among the best Yeso wells producing approximately 3,700 Bo/d due to lift upgrades installed during the second quarter. DELAWARE BASIN Three rigs continued to drill in Pecos Bend and Waha during the second quarter. In Pecos Bend, seven wells were spud: two in the 2 nd Bone Springs, four in the 3 rd Bone Springs and one in the Wolfcamp formations. Waha 10

13 Central Second-quarter 2014 production in the Central Region was 89,883 Boe/d. Production growth was lower than expected because fewer wells were brought online than had been planned. Liquids now constitute 51 percent of production (oil is 24 percent), up from 49 percent in the second quarter of For the quarter, the Central Region averaged 33 drilling rigs and drilled 98 gross wells versus a planned 108 gross wells. CENTRAL KEY STATS Q2 Production: 89,883 Boe/d Q2 Wells: 98 gross, 66 net Q2 Rigs: Avg 33 rigs APACHE CENTRAL REGION ACREAGE AND KEY PLAYS 11

14 Central (Continued) CANYON LIME/CANYON WASH Evaluation of the extensive acreage position is underway as Apache has already drilled two horizontal wells exhibiting promising performance. Apache s first horizontal well in the Canyon Lime formation was drilled in the first quarter. The Bivins East 41-1H, was drilled to a vertical depth of roughly 9,500 feet with a one mile lateral and successfully tested the play. A follow-up Canyon Lime well, the Bivins East 94-1H, was drilled south of the Bivins East 41-1H in the second quarter and produced an average 30-day rate of 1,718 Boe/d. The Bivins-LIT 110 1H was also drilled and reached total depth of 15,275 feet. Completion of the well is underway. TONKAWA For the quarter, Apache drilled 11 Tonkawa wells and completed 17 wells with an average 30-day rate of 250 Bo/d and 500 Mcf/d. Apache continues to lead the industry in low-cost horizontal Tonkawa wells with typical completed well costs between $3.9 and $4.5 million. CENTRAL WELL HIGHLIGHTS PLAY/TARGET WELL NAME COUNTY, ST TVD Lateral IP (30-Day) Granite Wash Moore, R. #2-1H Wheeler, TX 13,300 4, Boe/d Tonkawa Currier 3-18H Roger Mills, OK 8,937 4, Boe/d Canyon Lime Bivins East 94 #1H Potter, TX 9,099 4,472 1,718 Boe/d Des Moines Deal #1H Beckham, OK 12,940 4, Boe/d Cleveland Fiskin H Roger Mills, OK 10,083 4,450 1,571 Boe/d 12

15 Gulf Coast Second-quarter 2014 reported production averaged 29,483 Boe/d, down 2 percent from the first quarter of 2014 due to planned downtime at Belle Isle facility and a small asset sale of approximately 3,000 Boe/d on average for the quarter in South Texas. When adjusting for asset divestitures, production was flat sequentially. For the quarter, Apache operated five rigs in the East Texas Eagle Ford and two rigs in South Louisiana for a total of seven operated drilling rigs while completing a total of 24 gross (19 net) wells. GULF COAST KEY STATS Q2 Production: 29,483 Boe/d Q2 Wells: 24 gross, 19 net Q2 Rigs: Avg 7 rigs APACHE GULF COAST REGION ACREAGE AND KEY PLAYS 13

16 Gulf Coast (Continued) EAST TEXAS EAGLE FORD During the quarter, Apache continued its drilling program in its emerging East Texas Eagle Ford play in Brazos and Burleson Counties. Apache is utilizing pads for greater efficiency and began drilling a total of 26 wells during the quarter. One well was completed and brought online during the quarter, with the rest expected to come on in the second half of the year. The timing of the production impact from wells drilled during the second quarter will not be evident until all wells are completed and come online. Early tests on third quarter completed wells such as the Reveille 10H and Reveille 14H had 24-hour initial production rates of 906 Boe/d and 1,220 Boe/d, respectively. Apache s commitment to the East Texas Eagle Ford area continues to increase with the rig count during the quarter approaching a total of eight rigs. GULF COAST WELL HIGHLIGHTS PLAY/TARGET WELL NAME TMD Lateral Length 24-Hour Peak Rate Eagle Ford Reveille #8H 17,775 7, Boe/d 14

17 Canada Second-quarter 2014 production in Canada, which includes Kitimat upstream production, was 76,692 Boe/d. Total production was down 13 percent from the first-quarter 2014 due to the closing of the previously announced sale of Ojay, Noel and Wapiti areas in Alberta and British Columbia on April 30, 2014 and third-party downtime of approximately 3,000 Boe/d. The production associated with the downtime is now online. CANADA KEY STATS* Q2 Production: 76,692 Boe/d Q2 Wells: 31 gross, 26 net Q2 Rigs: Avg 5 rigs These divestitures were primarily dry gas-producing properties comprising 622,600 gross acres (328,400 net acres). In the Wapiti area, Apache retained 100 percent of its working interest in horizons below the Cretaceous including rights to the liquids-rich Montney and other deeper horizons. During 2013, production from the fields divested averaged 101 MMcf/d of natural gas and 1,500 Bbls/d of liquid hydrocarbons. During the quarter, the region averaged one rig (excluding Kitimat), down from eight in the previous quarter due to the planned spring break-up season. Apache anticipates increasing the rig count to an average of seven rigs in the third quarter. APACHE CANADA REGION ACREAGE AND KEY ASSETS *Includes Kitimat Upstream. 15

18 Canada (Continued) CANADA WELL HIGHLIGHTS PLAY/TARGET WELL NAME TVD Lateral Length 30-Day IP (% Gas) Kaybob - Bluesky 00/ W5/00 7,054 4, Boe/d (73%) House Mountain - Beaverhill 00/ W5/00 7,161 4, Boe/d (7%) West 5 - Cardium Kaybob Duvernay 00/ W5/00 6,819 4, Boe/d (13%)* 00/ W5/00 6,826 3, Boe/d (12%)* Previously Unreported Wells Drilled in First-Quarter / W5 10,840 3,927 1,963 Boe/d (44%)* 00/ W5 11,125 4, Boe/d (54%)** Wapiti Montney 00/ W6 10,134 4, Boe/d (67%) * Less than 30-day rate. Well 00/ W5 does not have a representative 30-day IP rate at this time due to facility constraints. ** Only 60% of the lateral well bore was treated during the hydraulic fracture completion process due to service company performance issues. 16

19 Canada (Continued) KITIMAT UPSTREAM (50 PERCENT APA) During the second quarter, Kitimat Upstream gross production in the Horn River and Liard Basins averaged 140 MMcf/d (55 MMcf/d net to Apache s interest), down 5 percent from first-quarter 2014 due mainly to natural field declines. During the quarter, two vertical tenure wells reached total depth, retaining 40,861 gross acres (18,480 net acres). Operations concluded on the 2013/2014 winter 3D seismic programs in early second quarter with 515-squaremiles acquired. At 54 north, Kitimat is one of North America s closest ports to Asian markets. Liard Kitimat-Tokyo 3,988 nm, 10 days Qatar-Tokyo 6,500 nm, 16 days KM 17

20 Gulf of Mexico Second-quarter 2014 production in the Gulf of Mexico averaged 11,908 Boe/d, up 11 percent from first-quarter 2014 with natural declines being offset by a full quarter of production at Bushwood. Apache averaged one rig during the quarter and drilled the Bimini prospect but did not encounter commercial quantities of hydrocarbons. GULF OF MEXICO Q2 Production: 11,908 Boe/d Q2 Wells: 3 gross, 1 net Q2 Rigs: Avg 1 rig On May 8, 2014, Apache announced the sale of the Lucius and Heidelberg development projects to Freeport- McMoRan Copper & Gold. The deal closed on June 30, APACHE GULF OF MEXICO REGION ACREAGE POSITION Bushwood 18

21 INTERNATIONAL Australia Second-quarter 2014 production averaged 49,633 Boe/d, down 6 percent from first quarter New production from the BHP Billiton Petroleum-operated Moondyne project was offset by natural field declines at the Pyrenees Venture FPSO. During the quarter, the region operated two semi-submersible drilling rigs and drilled the first tri-lateral development well at Coniston and a delineation well in the greater Julimar area. AUSTRALIA KEY STATS Q2 Production: 49,633 Boe/d Q2 Wells: 2 gross, 1 net Q2 Rigs: Avg 2 rigs APACHE AUSTRALIA REGION ACREAGE AND KEY PROJECTS 19

22 Australia (Continued) BALNAVES (65 PERCENT APA) The Armada Claire FPSO left the Singapore shipyard and arrived in the field. Final hook-up and commissioning activities are now underway in preparation for first oil production. CONISTON DEVELOPMENT AND NINGALOO VISION UPGRADE PROJECT (52.5 PERCENT APA) Development drilling on the Coniston development continued during the second quarter with the completion of its first tri-lateral well development. Apache has now successfully drilled seven of the 17 well laterals. Maintenance and upgrade works continued during the quarter on the Ningaloo Vision FPSO in the shipyard drydock. Removal and replacement of the subsea flowlines to increase capacity for Coniston took place. Offshore installation of the last flowline replacement is now underway and will complete the offshore Coniston facilities development work. JULIMAR (65 PERCENT APA) / WHEATSTONE LNG (13 PERCENT APA) Wheatstone LNG: Nearly 38 percent complete. Platform fabrication continued with all topside deck blocks and steel gravity substructure blocks erected. Chevron completed installation of the 44-inch main trunkline from shore to platform location. The pipelay was completed with excellent safety performance and productivity. At the LNG Plant site, the first LNG tank foundation was completed. A key downstream milestone was achieved with the material offloading facility (MOF) completed and ready to receive the first module. Julimar: Nearly 60 percent complete and on track to meet the year-end 2016 forecast for first LNG sales from Wheatstone. Apache completed drilling operations on intermediate hole sections for five development wells. All five subsea trees were successfully installed ready for final drilling and completion in Mobilization activities commenced for installation of the two Julimar 18-inch pipelines. MOONDYNE (28.57 PERCENT APA) Moondyne subsea installation work to connect its two production and one water injection to the Pyrenees Venture FPSO was completed and first oil was achieved in the second quarter. NORTHERN CARNARVON BASIN Apache entered an agreement with Karoon Gas Australia to farm in to WA-482-P in the Northern Carnarvon Basin. The permit offers exploration opportunities for large potential targets in a proven petroleum system. 20

23 Egypt Second-quarter gross liquids production was 199,767 Bo/d and gross gas production was 908 MMcf/d, for a total of 351,059 Boe/d. Apache averaged 26 rigs in the second quarter and drilled a total of 67 gross (59 net) wells. Apache continued its active exploration program and appraisal drilling campaign in Egypt. Khalda remains on pace to drill 37 exploration wells for the year with 14 reaching total depth and eight classified as discoveries with logged pay in the quarter. EGYPT KEY STATS* Q2 Gross Production: 351,059 Boe/d Liquids: 199,767 Bo/d Gas: 907,752 Mcf/d Q2 Wells: 67 gross, 59 net Q2 Rigs: Avg 26 rigs Notable tests in the second quarter included the Ras Kanayes-10X well located in the Ras Kanayes B Concession. The well tested the Safa and AEB5/6 resevoirs and encountered pay in the AEB-4, Masajid, Zahra, Upper Safa and Lower Safa formations. The post-frac drill stem test in the Upper Safa tested 872 Bo/d and 7 MMcf/d on a 32/64- inch choke. The Pinot-3HX, a horizontal exploration well, is pursuing Bahariya oil reserves in the large Pinot-Nour structure. During the second quarter, the well was drilled vertically 6,900 feet and then horizontally 3,300 feet through a 40- foot window in the Upper Bahariya formation. The time to drill required only 20 days and costs came in under AFE. A multiple-staged fracture stimulation program is scheduled to be completed in the third quarter. As part of the ongoing horizontal drilling program, during the quarter the region spud another Upper Bahariya horizontal well, the Cyngus 23H. The Cyngus field was discovered in 2007 but deemed to be uneconomic as the vertical well performance was poor. A large area of potential reserves remains and this well represents a trial to improve economics of the play utilizing horizontal drilling and multi-stage hydraulic fracturing technology. Development drilling success during the second quarter included the North Razak #12 and WKAL-I7ST1 wells drilled in the Alamein and Faghur Basins, respectively. The North Razak #12 well encountered unswept Alamein reservoir and after acid stimulation initially flowed 3,500 Bo/d, while the WKAL-I7ST1 initially tested at 3,550 Bo/d and 11.5 MMcf/d furthering development of the Jurassic and Safa projects. Following the significant field discovery at Herunefer-1X during the first quarter in the Khalda Offset (East) Concession, Apache was granted a new development lease covering 4,450 acres in this area. *Includes noncontrolling interest. 21

24 Egypt (Continued) EGYPT WELL HIGHLIGHTS PLAY/TARGET WELL NAME IP (30-Day) Safa WKAL I7 1,817 Boe/d Upper Safa Scorpion 1X 7,747 Boe/d PLZC Hydra 1 Siwa 3R2 5,897 Boe/d 920 Bo/d AEB 3C WKAL A6 3,240 Bo/d AEB 3D Buchis W3 2,970 Bo/d ALM DOL NRZK 12 1,150 Bo/d ARG MRZK Bo/d APACHE EGYPT REGION ACREAGE AND KEY BASINS 22

25 Egypt (Continued) Liquids (Bbls/d) EGYPT PRODUCTION DETAIL 2Q Q 2014 Gas (Mcf/d) Boe/d Liquids (Bbls/d) Gas (Mcf/d) Boe/d Gross Production 199, , , , , ,841 Net Production With Tax: Apache Share 59, , ,606 59, , ,275 Noncontrolling Interest 29, ,665 50,247 29, ,799 49,944 Total Net Production With Tax 89, , ,853 88, , ,219 % of Gross 44.8% 40.5% 43.0% 44.3% 41.0% 42.9% Total Tax Barrels 24,183 95,115 40,036 22,630 89,805 37,598 Net Production Without Tax: Apache Share 43, ,791 73,871 44, ,890 76,188 Noncontrolling Interest 21,771 91,044 36,946 21,657 94,662 37,434 Total Net Production Without Tax 65, , ,817 65, , ,621 % of Gross 32.7% 30.1% 31.6% 33.0% 31.2% 32.2% 23

26 North Sea Second-quarter 2014 production in the North Sea was 72,118 Boe/d, up 7 percent from the first quarter due to a combination of production efficiency and drilling success. During the second quarter, the region operated an average of five drilling rigs and drilled eight wells. NORTH SEA KEY STATS Q2 Production: 72,118 Boe/d Q2 Wells: 8 gross, 7 net Q2 Rigs: Avg 5 rigs From the Beryl Bravo Platform, the BDR development well drilled into the East Flank, which intersected 268 feet of vertical depth net pay and achieved a 30-day IP of 4,500 Boe/d. From the Forties Alpha Platform, Maule M6 development well was drilled to target an unswept oil accumulation based on the 2013 Forties 4D seismic and found 21 feet true vertical depth net oil pay. The well came online in June with a 30-day IP of 5,105 Bo/d. From the Forties Echo Platform, the Rowan Gorilla-7 successfully drilled the T268 horizontal completion hole and encountered 230 feet net pay along the wellbore with a 30-day IP of 2,367 Bo/d. NORTH SEA WELL HIGHLIGHTS PLAY/TARGET WELL NAME IP (30-Day) Beryl B76 4,500 Boe/d Forties T268 2,367 Bo/d Forties T267 1,661 Bo/d Maule M6 5,105 Bo/d APACHE NORTH SEA REGION ACREAGE AND KEY PROJECTS 24