APA Corp buys West Texas oil producing land for $505 mln (updated)

Earthstone Energy

03/08/2022 22:42

(Adds details from company statement, earnings)
    By Shariq Khan and David French
    Aug 3 (Reuters) - U.S. oil producer APA Corp  APA.O  said on
Wednesday it bought West Texas properties for $505 million
during the second quarter, bolstering its position in the
Delaware portion of the Permian shale basin.
    While APA did not name the seller, Reuters earlier reported
the assets belong to privately owned Titus Oil & Gas, according
to three sources familiar with the matter.
    The purchase marks a significant pivot to West Texas for the
former Apache Corp after a failed bet on a remote corner of the
top U.S. shale basin.
    Titus Oil & Gas, backed by private equity firm NGP Energy
Capital Management, is among the private oil and gas companies
investors have put on the market in recent months hoping higher
energy prices would secure bumper valuations.
    APA, Titus and NGP did not immediately respond to requests
for confirmation on the seller.
    Titus and NGP earlier disclosed an agreement to sell New
Mexico oil producing assets to Earthstone Energy Inc  ESTE.N 
for $627 million.  urn:newsml:reuters.com:*:nL4N2YF2D0
    The assets APA Corp purchased abut its existing assets in
the Delaware portion of the Permian basin and should add
production of between 12,000 to 14,000 barrels of oil equivalent
per day through the rest of this year, the company said. 
    When oil prices crashed during lockdowns early in the
coronavirus pandemic, APA briefly suspended U.S. drilling and
reduced activity in Egypt and the North Sea in favor of
developing discoveries off the coast of Suriname.
    Through 2021, APA returned to normal operations in the
Delaware portion of the Permian Basin in Texas, but began
streamlining its Permian assets by selling noncore holdings and
allocated most of its 2022 exploration budget towards Suriname.
    APA on Wednesday also posted adjusted earnings of $2.37,
beating analysts' estimates of $2.33 per share, according to
Refinitiv data.

 (Reporting by Shariq Khan in Bengaluru and David French in New
York; Editing by David Gregorio and Maju Samuel)
 ((Shariq.Khan@thomsonreuters.com; Twitter: @shariqrtrs;))