energy 2008 analystanalyst reviewreview

The following discussions contain certain “forward‐looking statements” as defined by the Private Securities Litigation Reform Act of 1995 including, without limitation, estimates, expectations, plans and goals regarding Apache’s production, reserves, financings, acquisitions, exploration and exploitation prospects, energy prices, operating costs, and results of operations. Such forward‐looking statements involve estimates, assumptions and uncertainties. No assurance can be given that Apache’s expectations or goals will be realized, and actual results may differ materially from those expressed in the forward‐looking statements. For reconciliations of non‐GAAP financial measures, see our web site www.apachecorp.com.

ENERGYENERGY

2008 Analyst Review2008 Analyst Review

Tim WallRegional VP Australia


ENERGYENERGYAustralia Region SummaryAustralia Region Summary

Acreage 7.3 MM AcresSeismic 10,000 km 2D

29,000 km2 3D

ProductionGross: 360 mmcfpd, 24 Mbopd

Net: 205 mmcfpd, 12 Mbopd

2008 Net Capital - 1.0 B$

Operated Producing AssetsVaranus Island

John Brookes FieldVarious Harriett Fields

Stag PlatformLegendre Platform

Major ProjectsVan Gogh FPSOPyrenees FPSOReindeer Field

Devil’s Creek Gas PlantHalyard Field

ENERGYENERGYWell Positioned Acreage InventoryWell Positioned Acreage Inventory

Gippsland Basin - Vic/P 59

Browse Basin – AC/P 37, 42,43Dampier & Barrow Basins1.15 MM acres Gross

1.90 MM acres Gross1.5 MM acres Gross

2.75 MM acres Gross

Exmouth Basin

ENERGYENERGYOperating PhilosophyOperating Philosophy

Project Execution - Deliver Current Projects at Cost and on Schedule

High Impact Exploration - Continue with an Aggressive, High-Reserve-Potential

Exploration ProgramProject Development

- Maintain a Significant Project InventoryBuild Domestic Gas Market Position

- Continue Contracting into Strong Domestic Western Australia Gas Market

Project Execution - Deliver Current Projects at Cost and on Schedule

High Impact Exploration - Continue with an Aggressive, High-Reserve-Potential

Exploration ProgramProject Development

- Maintain a Significant Project InventoryBuild Domestic Gas Market Position

- Continue Contracting into Strong Domestic Western Australia Gas Market

ENERGYENERGYWA Gas Market UpdateWA Gas Market Update

Western Australia’s Gas Demand - Concentrated in mining, power-generation and

alumina sectorsStrong Growth Forecast for the Mining and Power Sectors

- Power-generation capacity requirements increasing from 2011

- New mining projects and expansions scheduled for 2010-11 onward

Significant Un-Contracted Demand - Forecast to be 7-8 Tcf through 2030

Strong Gas Prices- Prices have risen substantially over the past

12-18 months

Western Australia’s Gas Demand - Concentrated in mining, power-generation and

alumina sectorsStrong Growth Forecast for the Mining and Power Sectors

- Power-generation capacity requirements increasing from 2011

- New mining projects and expansions scheduled for 2010-11 onward

Significant Un-Contracted Demand - Forecast to be 7-8 Tcf through 2030

Strong Gas Prices- Prices have risen substantially over the past

12-18 months

ENERGYENERGYProduction Growth by ProjectProduction Growth by Project

0

5

10

15

20

25

30

35

40

45

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

MM

boe

Base Van Gogh/Coniston Pyrenees Reindeer Halyard Julimar E Spar Area

0

5

10

15

20

25

30

35

40

45

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

MM

boe

Base Van Gogh/Coniston Pyrenees Reindeer Halyard Julimar E Spar Area

ENERGYENERGYInvesting for the FutureInvesting for the Future

319 341 307 331 313434

1,055

531

187249

1761330

500

1,000

1,500

2003 2004 2005 2006 2007 2008(E)

$MM

LLICapital

Lease Level Income vs CapexLease Level Income vs Capex

Note: Lease level income = revenue - operating expense – transportation expense - severance taxes

ENERGYENERGYVaranus UpdateVaranus Update

June 3, 2008- Explosion at Varanus Island Facility NW Australia shut down production

from the facility (320 mmcfpd, 8,000 bopd)- Both sales-gas export lines and facilities were damaged

August 6, 2008- John Brookes facility and 16” sales-gas export line re-instated- 2/3 of pre-incident production back online (220 mmcfpd, 2,300 bopd)

October 15, 2008- Harriett Alpha line re-instated to tanks. Increasing oil production by

1,400 bopd.November, 2008

- Harriet Facilities Train 3 back online- Plant back at full pre-incident rates. (320 mmcfpd, 8,000 bopd)

January, 2009- Full plant re-instated.

June 3, 2008- Explosion at Varanus Island Facility NW Australia shut down production

from the facility (320 mmcfpd, 8,000 bopd)- Both sales-gas export lines and facilities were damaged

August 6, 2008- John Brookes facility and 16” sales-gas export line re-instated- 2/3 of pre-incident production back online (220 mmcfpd, 2,300 bopd)

October 15, 2008- Harriett Alpha line re-instated to tanks. Increasing oil production by

1,400 bopd.November, 2008

- Harriet Facilities Train 3 back online- Plant back at full pre-incident rates. (320 mmcfpd, 8,000 bopd)

January, 2009- Full plant re-instated.

ENERGYENERGYCurrent Development ProjectsCurrent Development Projects

Pyrenees Development

Reindeer

Devil Creek Development

Varanus Hub

Julimar / Brunello

Halyard

Macedon Development

Van Gogh Development

Coniston

ENERGYENERGYDevelopment Project TimetableDevelopment Project Timetable

ENERGYENERGY

First Oil Target = Q2 2009Overall Progress = 85%Apache = 52.5% Inpex = 47.5%P50 Reserves = 59 MMbblsPeak Rate = 63,000 bopdCapital Cost = $546 MMRate of Return = 56%

First Oil Target = Q2 2009Overall Progress = 85%Apache = 52.5% Inpex = 47.5%P50 Reserves = 59 MMbblsPeak Rate = 63,000 bopdCapital Cost = $546 MMRate of Return = 56%

Van Gogh Development ProjectVan Gogh Development Project

ENERGYENERGYVan Gogh Development ProjectVan Gogh Development Project

FPSO under construction (progress: 85%) Keppel Shipyard, Singapore

FPSO under construction (progress: 85%) Keppel Shipyard, Singapore

ENERGYENERGYVan Gogh Development ProjectVan Gogh Development Project

Subsea Installation Commenced – Oct’08Subsea Installation Commenced – Oct’08

Installation Vessel Toisa Proteus

ENERGYENERGY

-130

5-1

275

-1285-1280

-1255

-1260

-1250

CONISTON-1

Derwent-1 050208

Derwent-1H 050208

Windermere-1H

Grasmere-1H 240608

CRUMMOCK-1 (P)

NOVARA-1

GOC

GOC

GOC

GO

C

GOC

GOC

GOC

GOC

GO

C

GOCGOC

GOC

GOC

OWC

OWC

OW

C

OWCO

WC

OW

C

OWC

OWC

OWC

OWC

OWC

OWC

OWC

OWC

OWC

0 500 1000 1500 2000m

Coniston Project (add‐on to Van Gogh)Coniston Project (add‐on to Van Gogh)Top Barrow

Depth Structure Map

Coniston / Novara

New Depth Mapping on new 3D depth seismic

Coniston / Novara

New Depth Mapping on new 3D depth seismic

GOC

OWC Windermere

DerwentGrasmere

Coniston-1

Novara-1

Crummock

ENERGYENERGY

Board Sanction Target: Q2 2009Appraisal Program Will Need to be PerformedOil and Reservoir Quality Similar to Van Gogh

Subsea Tie-Back to Van Gogh Facility

First Oil 2012

Board Sanction Target: Q2 2009Appraisal Program Will Need to be PerformedOil and Reservoir Quality Similar to Van Gogh

Subsea Tie-Back to Van Gogh Facility

First Oil 2012

Coniston Project (add‐on to Van Gogh)Coniston Project (add‐on to Van Gogh)

ENERGYENERGY

First Gas Target = Q3 2010Overall Progress = 15% Apache = 55.0% Santos 45.0%P50 Reserves = 452 BCFCapital Cost = $744 MMRate of Return = 26.71%3rd Major Gas Hub inWestern Australia

First Gas Target = Q3 2010Overall Progress = 15% Apache = 55.0% Santos 45.0%P50 Reserves = 452 BCFCapital Cost = $744 MMRate of Return = 26.71%3rd Major Gas Hub inWestern Australia

Reindeer/Devil Creek Development ProjectReindeer/Devil Creek Development Project

ENERGYENERGYReindeer/Devil Creek Development ProjectReindeer/Devil Creek Development Project

Reindeer Platform (Model)Reindeer Platform (Model)

Devil Creek Plant – Establishment of Accommodation Village

Devil Creek Plant – Establishment of Accommodation Village

ENERGYENERGYHalyard Development ProjectHalyard Development Project

RESERVOIR31.1 m gross sand27.8 m net pay (89.4% NTG)Avg. porosity 15.7%Avg. perm 1,500 md (DST)Avg. Sw 30.2%

GASCGR 14.5 CO2 3.25%

RESERVOIR31.1 m gross sand27.8 m net pay (89.4% NTG)Avg. porosity 15.7%Avg. perm 1,500 md (DST)Avg. Sw 30.2%

GASCGR 14.5 CO2 3.25%

GROSS PAY( )30.0 0.0

GAMMA RAY(API)0.0 250.0

NET PAY FLAG( )0.0 30.0

SW(V/V)1.0 0.0

CALIPER-BIT SIZE(INCH)-20.0 20.0

SWT -CPX(V/V)1.0 0.0

PHIT(V/V)0.5 0.0

PHIE(V/V)0.5 0.0

PHIE*SXO( )0.5 0.0

PHIE*SW( )0.5 0.0

CLAY(V/V)0.0 1.0

SANDSTONE(V/V)0.0 1.0

LIMESTONE(V/V)0.0 1.0

DOLOMITE(V/V)0.0 1.0

PHIE(V/V)1.0 0.0

PHIE*SXO( )1.0 0.0

PHIE*SW( )1.0 0.0

Bound Water Vol(V/V)0.0 1.0

DEPTHRTM1:200

TVDSSMAHD

2590

2600

2610

2620

2630

2560

2570

2580

2590

2600

2610

Halyard Sandstone(Formerly Lobe B2)

2597.4 m MDRT-2572.2 m TVDAHD

Gas-on-Rock2628.5 m MDRT

-2603.3 m TVDAHD

GROSS PAY( )30.0 0.0

GAMMA RAY(API)0.0 250.0

NET PAY FLAG( )0.0 30.0

SW(V/V)1.0 0.0

CALIPER-BIT SIZE(INCH)-20.0 20.0

SWT -CPX(V/V)1.0 0.0

PHIT(V/V)0.5 0.0

PHIE(V/V)0.5 0.0

PHIE*SXO( )0.5 0.0

PHIE*SW( )0.5 0.0

CLAY(V/V)0.0 1.0

SANDSTONE(V/V)0.0 1.0

LIMESTONE(V/V)0.0 1.0

DOLOMITE(V/V)0.0 1.0

PHIE(V/V)1.0 0.0

PHIE*SXO( )1.0 0.0

PHIE*SW( )1.0 0.0

Bound Water Vol(V/V)0.0 1.0

DEPTHRTM1:200

TVDSSMAHD

2590

2600

2610

2620

2630

2560

2570

2580

2590

2600

2610

Halyard Sandstone(Formerly Lobe B2)

2597.4 m MDRT-2572.2 m TVDAHD

Gas-on-Rock2628.5 m MDRT

-2603.3 m TVDAHD

Net Pay Map

Well tested 68 MMcfpd

Condensate Gas Ratio 14.5 STB/MMCF

Recoverable Reserves

- 121 Bcf + 1.74 MMbbls

Well tested 68 MMcfpd

Condensate Gas Ratio 14.5 STB/MMCF

Recoverable Reserves

- 121 Bcf + 1.74 MMbblsRegional Muderong Seal

300

200 200150150

150

300

IVF

400

100

OnlapTruncationTop lapDownlap

Base MuderongBase Muderong

SparSpar HalyardHalyard

Regional Muderong Seal

300

200 200150150

150

300

IVF

400

100

OnlapTruncationTop lapDownlap

Base MuderongBase Muderong

SparSpar HalyardHalyard

ENERGYENERGYHalyard Development ProjectHalyard Development Project

P50 Reserves = 122 BCF

Board Sanction Target: Q4 2008

First Gas Q1 2010

Subsea Well already Completed

Tie-in to existing infrastructure

Capital Cost = $110 MM

Rate of Return = 56.9%

P50 Reserves = 122 BCF


First Gas Q1 2010

Subsea Well already Completed

Tie-in to existing infrastructure

Capital Cost = $110 MM

Rate of Return = 56.9%

Max Rate = 68 MMSCFDMax Rate = 68 MMSCFDExcellent Perm: 1500 MDExcellent Perm: 1500 MDCGR = 14.5 STB/MMCF CGR = 14.5 STB/MMCF CO2 = 3.2%CO2 = 3.2%

East Spar Manifold@KP0 14" ES Pipeline

EHU tie-back30km

8" Flowline16km

To Var Is@KP65

Halyard Gas Field

PLET& SDU

John Brookes WHP

ENERGYENERGYJulimar/ Brunello Development ProjectJulimar/ Brunello Development Project


Pre-FEED design work complete for development options

- LNG: sub-sea tie-back to a riser platform

- Full domestic gas production: via Devil Creek


Pre-FEED design work complete for development options

- LNG: sub-sea tie-back to a riser platform

- Full domestic gas production: via Devil Creek

First Gas 2012 – 13200 – 400 MMcfpd

First Gas 2012 – 13200 – 400 MMcfpd

LNG Dom GasLNG

ENERGYENERGYJulimar –Brunello Development ProjectJulimar –Brunello Development Project

Gas well

2009 Brunello Location2009 Julimar Location

Dry well

Brokenwood

Balnaves

CurrentReserve Estimate

2 - 4 TCF

ENERGYENERGYJulimar Appraisal: Brokenwood‐1 (P) / ST1Julimar Appraisal: Brokenwood‐1 (P) / ST1

B9 Sand B9 Gas B8 Sand B8 Gas

OHST

B9B9

B8B8

G40G40

Brokenwood-1/B9Brokenwood-1/B9 Brokenwood-1/B8Brokenwood-1/B8GrothGroth

ApacheApacheOperatorOperator65%65%Apache %Apache %

~3104 to ~3104 to 3152 m3152 m

Depth to Depth to ObjectiveObjective

~140m~140mWater Water DepthDepth

Crestal well on the B9 followed by sidetrack Crestal well on the B9 followed by sidetrack downdipdowndip on B8 and B9on B8 and B9

Play Play Concept :Concept :

Exploration Exploration / Appraisal/ Appraisal

Well typeWell typeWAWA--356356--PPPermitPermit

296 Bcf296 BcfHigh confidence in the B8/B9 High confidence in the B8/B9

amplitude and inferences from the amplitude and inferences from the regional water gradientregional water gradient

Best Best EstimateEstimate

ENERGYENERGYJulimar Appraisal: Balnaves‐1 (P)Julimar Appraisal: Balnaves‐1 (P)

B20 Sand B20 Gas B10 Sand B10 Gas

1 km

B10B10

B20B20


3229 m3229 mDepth to Depth to ObjectiveObjective

139m139mWater Water DepthDepth

Crestal well on the B20 followed by sidetrack Crestal well on the B20 followed by sidetrack downdipdowndip on the B10 and the B20on the B10 and the B20

Play Play Concept :Concept :

Exploration Exploration / Appraisal/ Appraisal

Well typeWell typeWAWA--356356--PPPermitPermit

281 Bcf281 BcfHigh confidence in the B10 High confidence in the B10

amplitude and inferences from amplitude and inferences from the regional water gradientthe regional water gradient

Best Best EstimateEstimate

ENERGYENERGY

First Oil Target = Q1 2010

Overall Progress = 40%

Apache = 29.0% BHP Billiton (Operator) 71%

P50 Reserves = 143 MMbbls

Peak Rate = 90,000 bopd

Capital Cost = $1.86 B

ROR = 20.2%

First Oil Target = Q1 2010

Overall Progress = 40%

Apache = 29.0% BHP Billiton (Operator) 71%

P50 Reserves = 143 MMbbls

Peak Rate = 90,000 bopd

Capital Cost = $1.86 B

ROR = 20.2%

Pyrenees Development ProjectPyrenees Development Project

ENERGYENERGYPyrenees Development ProjectPyrenees Development Project

FPSO in Dry Dock - Dalian China (Modec)FPSO in Dry Dock - Dalian China (Modec)


ENERGYENERGY

ExplorationExploration

October 2008October 2008

ENERGYENERGY“Top Ten” Apache Discoveries“Top Ten” Apache Discoveries

AustraliaEgyptCanada

3,000

590

440

200143

10075 75 75 59

0

100

200

300

400

500

600

700

3,000

Ootla Julimar Qasr JohnBrookes

Pyrenees Ladyfern AsalaArea

NevisCBM

Reindeer Van Gogh

Res

erve

s (G

ross

MM

boe)

ENERGYENERGYSeismic Acquisition: Key to ExplorationSeismic Acquisition: Key to Exploration

2008/2009 Acquisition Campaign

11,672 km² 3D 53.33 MM$ US

ACP 37Canis 3D/Ursa 3DCanis 3D/Ursa 3D

West Anchor/Grimalkin 3DWest Anchor/Grimalkin 3D

ENERGYENERGYAustralian Prospect InventoryAustralian Prospect Inventory

ExmouthExmouth

BrowseBrowse

GippslandGippsland

BarrowBarrow

DampierDampier

N=28Upside Gross Reserves: 2107 MMboeUpside Gross Reserves: 2107 MMboe

0 50 100 150 200 250

Fangtooth-1Arlo-1

Palmerston-1Dory-1

Rosella-2Elver-1

Galileo South-1Beefsteak-1

Scafell East-1Madfish-1Hermit-1

Brokenwood-1Argonauta-1Saffron-N-1Balnaves-1Derwent-1 Echinoid-1Maitland -4

Julimar Central-1Monarca-1

Julimar North-1Scafell-2

Parnassus-1Gustavo-1

Julimar-SW-1Hurricane-3

Boom-1Beam-1

MMboe

ENERGYENERGYGippsland Basin Exploration ProgramGippsland Basin Exploration Program

1

2

3

ENERGYENERGY

DORY

VIC/P59: Dory ProspectVIC/P59: Dory Prospect

585814814830301111TruncatedTruncated

4141110110161622UntruncatedUntruncated

MeanMeanP50P50 P10P10P90P90ReservesReserves

Key Risks Depth ClosureKey Risks Depth ClosureDHIDHI

Pc (oil) 29%Pc (oil) 29%Pg 48%Pg 48%


2760 m TVDAHD2760 m TVDAHD

Depth to ObjectiveDepth to Objective

600m600mWater DepthWater Depth

4-way dip closure in depth only4-way dip closure in depth onlyPlay Concept :Play Concept :

ExplorationExplorationWell typeWell typeVIC/P-59VIC/P-59PermitPermitDORY-1(P)

Selene

Volador

Latrobe

BLACKBACK-1

1000m

035 TOL

ENERGYENERGYVIC/P59: Elver Prospect VIC/P59: Elver Prospect

51.351.3126.3126.329.129.110.610.6TruncatedTruncated

39.539.5103.5103.518.818.83.43.4UntruncatedUntruncated

MeanMeanP50P50 P10P10P90P90ReservesReserves

Key Risks Depth ClosureKey Risks Depth ClosureDHIDHI

Pc (oil) 21%Pc (oil) 21%Pg 33%Pg 33%


3150 m TVDAHD3150 m TVDAHD

Depth to ObjectiveDepth to Objective

700m700mWater DepthWater Depth

4-way dip closure in depth only4-way dip closure in depth onlyPlay Concept :Play Concept :

ExplorationExplorationWell typeWell typeVic/P59Vic/P59PermitPermitELVER-1(P)

Selene

Volador

Latrobe

1000m

IGB

GB

066 VLD

ENERGYENERGYVIC/P59: Madfish 3 Zone Oil CaseVIC/P59: Madfish 3 Zone Oil Case

41.797.526.510.5Truncated

33.684.019.04.3Untruncated

MeanP50 P10P90Reserves

Key Risks Closure and lateral seal

DHI

Pc (oil) 29%Pg 47%

ApacheOperator65%Apache %

2830 m TVDAHD

Depth to Objective

390 mWater Depth

Faulted 3-way dip closurePlay Concept :

ExplorationWell typeVIC/P-59Permit

MADFISH-1(P)

072 SEL

MADFISH-1(P)Latrobe

Selene

IGB

GB

Volador

1000m

ENERGYENERGYBarrow WA‐13‐L Locator MapBarrow WA‐13‐L Locator Map

HALYARD-1

ROSELLA-1

ROSELLA-2

BEAM-1

BOOM-1

ENERGYENERGYWA‐13‐L BeamWA‐13‐L Beam

681106336Probabilistic Reserves

PmeanP50 P10P90BCFE

Source Migration/preservationKey Risks

Pc51%Pg


2700 mDepth to Objective

95mWater Depth

Structual/Stratigraphic Barrow Shelf Edge SandsPlay Concept :

ExplorationWell typeWA-13-LPermit

ENERGYENERGYWA‐13‐L: Boom‐1 ProspectWA‐13‐L: Boom‐1 Prospect

113199100 50Probabilistic Reserves

PmeanP50 P10P90BCFE

Source Migration/preservationKey Risks

Pc51%Pg


2700 mDepth to Objective

95mWater Depth

Structural/Stratigraphic Barrow Shelf Edge SandsPlay Concept :

ExplorationWell typeWA-13-LPermit

ENERGYENERGYBrowse Basin: AC/P‐37 Location MapBrowse Basin: AC/P‐37 Location Map

CRUX

PUFFIN

Arlo

ENERGYENERGY

ApacheApacheOperatorOperator100100%%Apache %Apache %

-- 27902790 mm

-- 3620 m3620 m

ObjectiveObjective

PTDPTD

200200 mmWater Water DepthDepth

Puffin Formation 4Puffin Formation 4--way dip closure. way dip closure. 2 zone roll2 zone roll--up.up.

Summary :Summary :

ExplorationExplorationWell typeWell typeACP 37ACP 37PermitPermit

25%25%PcPc44%44%PgPgChanceChance

Hydrocarbon migrationHydrocarbon migrationKey RiskKey Risk

70.570.5183.3183.334.634.66.56.5Reserves Reserves MMBOMMBO

Mean Mean (P(P2929))P50P50 P10P10P90P90

27.8 27.8 MMBOMMBO (P52)(P52)Best Est.Best Est.

(K5(K5--6)6)

Best Est.

P90

P10

Puffin K5-6 Sand

--1.5

--2.52.5--

1.5--

1.2 km

AC/P‐37: Arlo‐1 ProspectAC/P‐37: Arlo‐1 Prospect

Puffin K8-9 Sand

Arlo

ENERGYENERGYAchieving Sustained GrowthAchieving Sustained Growth

0

5

10

15

20

25

30

35

40

2007 2008* 2009 2010 2011 2012 2013

MM

boe

Gas ComponentOil Component

0

5

10

15

20

25

30

35

40

2007 2008* 2009 2010 2011 2012 2013

MM

boe

Gas ComponentOil Component

Production ‐ Annual Net MMboe

Future Growth PotentialFuture Growth Potential

Increased Capital InvestmentIncreased Capital Investment

Production to increase by 124% (2007 to 2013)

Production to increase by 124% (2007 to 2013)*

* Includes impact of Varanus Island pipeline incident* Includes impact of Varanus Island pipeline incident

*

Note: Includes planned and proposed development projects plus 1 high chance of success exploration project


ENERGYENERGY

2008 Analyst Review2008 Analyst Review



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