OREANDA-NEWS. November 14, 2013. Apache Corporation (NYSE, Nasdaq: APA) announced third-quarter 2013 earnings of USD 300 million or USD 0.75 per diluted common share and adjusted earnings, which exclude certain items that impact the comparability of results, of USD932 million or USD2.32 per share.

For the same period in the prior year, Apache reported earnings of USD 161 million or USD 0.41 per diluted common share and adjusted earnings of USD 861 million or USD 2.16 per share. Net cash provided by operating activities came to approximately USD 2 billion, with cash from operations before changes in operating assets and liabilities totaling USD 2.7 billion, up from USD 2.4 billion in the year-ago period.

"The strength of our financial performance this quarter is a testament to the effectiveness of our strategy to rebalance our portfolio and drive returns by achieving the right mix of predictable production growth from our North American onshore assets combined with the substantial free cash flow generation from our international operations," said G. Steven Farris, chairman and chief executive officer at Apache. "Apache's focused drilling program in North America is yielding significant production growth. Our Permian and Central regions are the main drivers of this higher production, adding nearly 13,000 barrels per day of oil and natural gas liquids from the second quarter. These two regions represented 35 percent of the company's total worldwide liquids production, up from 27 percent a year ago, contributing 149,000 barrels per day during the third quarter. Going forward, our international regions will be the primary source of excess cash flow to fund our next growth cycle.

"We also made significant progress rebalancing our portfolio to provide more predictable and consistent growth. During the quarter we closed on transactions in the Gulf of Mexico Shelf and Canada, and announced a significant partnership with Sinopec in Egypt, which we expect to close by the end of this year," Farris said. "As previously announced, sale proceeds are being used to reduce our debt and buyback shares. We've already repurchased nearly 8 million shares of Apache common stock, and we're on track to pay down USD 2 billion in debt by yearend."

Production and operating highlights

Highlights from the third quarter and more recent drilling include:

Total worldwide net daily production of oil, natural gas, and natural gas liquids (NGLs) averaged 784,000 barrels of oil equivalent (boe) per day, with liquids production comprising 54 percent of the total.

The Permian Region achieved record production of 132,000 boe per day, up 7 percent from the preceding period and up 18 percent from a year ago. In the region's Barnhart area, six rigs were active throughout the quarter drilling 20 Middle and Upper Wolfcamp Shale laterals. Apache holds 345,000 net acres prospective for Wolfcamp Shale development with 971 identified locations. During October, the region achieved a milestone with half of its operated rigs drilling horizontal wells.

Apache's Central Region increased production to 95,000 boe per day, up 4 percent from the preceding quarter and 31 percent from the third quarter of 2012. Liquids production increased to 49,000 barrels per day, up 94 percent from the same period in the prior year, and now comprises 52 percent of the region's production. Drilling is concentrated in the stacked pays of the Anadarko Basin targeting formations such as the Granite Wash and Tonkawa, where Apache has identified thousands of locations on its prolific acreage position.

In its international regions, Apache commenced production from the Macedon development in Western Australia. This includes four offshore production wells, transmission lines and an onshore processing plant. Apache holds a 28.57 percent working interest in Macedon, with gross sales ramped up to 212 million cubic feet (MMcf) per day. In the North Sea, a second development well commenced production from the Tonto field, testing at an initial 24-hour rate of 8,300 barrels of oil per day. Apache holds a 100 percent working interest in Tonto.

Apache's third-quarter 2013 operations supplement includes drilling, production and other updates for each of its regions, and can be accessed at www.apachecorp.com/financialdata.