Apache's 2019 shale spend: $1.7B

By Luke Geiver | February 12, 2019

Apache Corp. will spend three-fourths of its 2019 capital budget in the U.S. The plan for the exploration and production company in 2019 is to spend $2.4 billion and produce up to 440,000 barrels of oil equivalent from all operations combined. The spend will be a decrease from 2018 when Apache spent $3.4 billion. In the U.S. upstream space, the company will spend $1.7 billion while international upstream sectors will get $660 million.

In the next year, Apache expects to grow overall production across its U.S. operations by up to 16 percent. In the Permian, Apache will grow oil production from Q4 2018 to the same period in 2019 by roughly 5 percent.

“We believe Apache offers a very competitive investment proposition both within the E&P sector and relative to other sectors in the market. In a flat oil price environment, we believe we can deliver a combination of sustainable production and operating cash flow growth, strong returns, a stable dividend that currently yields more than 3 percent, and return at least 50 percent of any free cash flow to our shareholders,” said John Christmann, CEO and president.

Christmann also said the company will continue to operate on a returns-focused development plan for its oil, natural gas and natural gas liquids assets.

Apache estimated oil prices at an average price of $53/b this year, with natural gas averaging $2.80. The company said it is currently receiving a significant premium on its oil sold in comparison to the price of West Texas Intermediate crude. If the company generates free cash flow this year, planned capital activity will not be increased until at least 50 percent of the free cash flow has been returned to shareholders through share repurchases, debt reduction or dividends, the company said.