Apache records third-quarter adjusted net loss of $59 million

Apache Energy posted a net loss attributable to common stock of $4 million for third-quarter 2020, compared to net loss of $170 million for third-quarter 2019. When adjusted for certain items that impact comparability, Apache reported a third-quarter loss of $59 million, compared to adjusted loss of $108 million for third-quarter 2019.Net cash provided by operating activities in third-quarter 2020 was $304 million, down from $635 million for the same quarter in 2019.

Production for the quarter was 445,000 boe/d, and adjusted production, which excludes Egypt non-controlling interest and tax barrels, was 394,000 boe/d, unchanged from the second quarter. 

Third-quarter upstream capital investment totaled $141 million, nearly all of which was attributable to international operations. Apache is currently focusing its capital investment and rig activity in higher-margin international assets. Specifically, the company operated a five-rig program in Egypt, one floating rig and one platform crew in the North Sea, and one drillship offshore Suriname in the third quarter. 

The company’s organizational redesign, launched in the fall of 2019, is delivering cost efficiencies in excess of original expectations, it said. The associated estimated annual run-rate cost savings is now $400 million, up 33% from the previous estimate of $300 million. Given the favorable service cost environment, Apache recently commissioned two fracture stimulation crews to begin completing its inventory of drilled but uncompleted (DUC) wells in the Permian basin. The activity will have a nominal impact on fourth-quarter capital, and the company has reduced its full-year 2020 upstream capital guidance to $1 billion.  

The company expects a 2021 upstream capital budget of $1 billion or less, which is based on a WTI oil price of $40/bbl, and a Henry Hub natural gas price of $2.75/MMbtu.