Apache said the assets had estimated proved reserves at the end of last year of 133 million barrels of oil and natural gas liquids and 636 billion cubic feet of natural gas. It said on average the fields produced 50,000 barrels of liquid hydrocarbons and 254 million cubic feet of natural gas per day in the first quarter.
Fieldwood said it and Apache would jointly participate in deep exploration opportunities on the acquired assets targeting what it called a "robust inventory of high potential prospects," including subsalt horizons around known producing fields.
Apache chairman and CEO G. Steven Farris said in a statement that the transaction is an important step toward rebalancing its portfolio. "At the end of this process, we expect Apache to have the right mix of assets to generate strong returns, drive more predictable production growth and create shareholder value," he said.
Farris said Apache has had "a great run" on the Gulf of Mexico shelf over the last 30 years but its investment priorities have evolved. "Since 2010 we have increased our focus in North America on capturing and developing a deep inventory of onshore assets, where we have been generating exceptional production growth at attractive rates of return," he said. "The shallower horizons in the shelf have matured to the point that dependable production growth is more difficult to achieve than from our onshore liquids plays."Farris said the company remains excited about the potential associated with the emerging plays under salt domes, which is why it kept 50% of the deep rights on 406 blocks held by production and 50% of all rights in 146 primary term blocks. Matt McCarroll, president and CEO of Fieldwood, called Apache the "preeminent operator on the Gulf of Mexico shelf" and said Apache's team will help lead its efforts toward continued successful development of asset base as well as pursuing an active exploration program on the inventory of identified high-impact prospects. Riverstone co-founders Pierre Lapeyre and David Leuschen said the Gulf of Mexico has been a core area of focus of the firm's since its early funds and called the Apache acquisition a "rare and exciting new opportunity."