Apache agreed to sell its Australian subsidiary Apache Energy Ltd. to a consortium of private equity funds managed by Macquarie Capital Group Ltd. and Brookfield Asset Management Inc. for cash payment of $2.1 billion. With the sale, the company will fully exit its exploration and production business in Australia.
The assets being acquired by the Brookfield and Macquarie include:
Carnarvon Petroleum – a partner (20%) in offshore lease WA-437-P with Apache (40%), JX Nippon (20%) and Finder Exploration (20%) – said on 9 April that the sale does not impact the drilling of the Roc-1 well, which is scheduled to be drilled in 4Q 2015. The Roc area has a best estimate prospective resource of 42 MMbo.
The sell is part of Apache’s goal to focus more on its North American onshore business, a plan that was put into place last August when the company announced its exit from two Chevron-helmed LNG projects, Kitimat in Canada and Wheatstone off Australia.
“Over the last five years, we have transitioned Apache's primary growth engine to North America onshore through the announcement or completion of approximately $17 billion of asset purchases and $17 billion of asset sales,” said John J. Christmann, IV, chief executive officer and president, of the asset sale. “Following the sale of our Australian assets, approximately 70% of Apache's production will come from North America onshore. Our robust North American position is complemented by our North Sea and Egyptian regions, which have an extensive inventory of prospects and assets that generate free cash flow.”
GlobalData analyst Jonathan Lacouture told OE last August that the decision to exit the LNG projects came at the right time for the company before development ramped up on both. The focus on onshore, he said, was due to the company and its investors wanting to focus on low-risk money, “and US liquids is where that is at,” Lacouture told OE at the time.
Apache Energy and its subsidiaries averaged production of approximately 49,000 boe/d in March.
The sale is expected to close mid-2015 and is subject to necessary government and regulatory approvals. The effective date of the sale is 1 October 2014.
Earlier this month, Apache completed the sale of its Wheatstone LNG project and related oil and natural gas properties to Woodside Petroleum for $2.8 billion.
Image: Wheatstone LNG/Chevron
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