Apache CEO Shares Insight On Permian’s Alpine High

HOUSTON—When Apache Corp. (NYSE: APA) stepped into the Delaware Basin’s Alpine High area in 2015, the company’s perceptions did not come off as a ringing endorsement: complex geology with uneconomic dry gas, infrastructure assets with minimal value and a lack of endorsement from the industry.

But today’s reality, as outlined by Apache CEO John Christmann, has put those perceptions to rest.

“What we’ve proven today is we’ve got 6,000-ft column and multiple targets, high BTU gas and improving oil production as well and there is a lot of wet gas,” Christmann told a crowd gathered for RBN Energy’s PermiCon. “We now have decades of high-return inventory that we are excited about.”

Plus, Apache’s equity ownership in Altus Midstream, a joint venture (JV) partnership with midstream investor Kayne Anderson Acquisition Corp. (NASDAQ: KAAC), is valued at about $2.5 billion based on a share price of $10. The asset mix includes gathering and processing and potential JV long-haul pipelines, according to Apache.

Compared to activity around Alpine High in 2016, Christmann said today the “industry is right along our doorstep,” having acquired acreage since the discovery was first announced outside Apache’s more than 340,000-acre territory in the play.