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Apache to Buy BP Fields

The company will pay $1.3 billion for the properties.
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Oil and gas producer


(APA) - Get APA Corporation Report

said it will pay $1.3 billion to acquire


(BP) - Get BP p.l.c. Report

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remaining producing properties on the outer continental shelf of the Gulf of Mexico.

The company said Wednesday that it will take over 18 producing fields with estimated proved reserves of 27 million barrels of liquid hydrocarbons and 185 billion cubic feet of natural gas.

"This transaction is a good fit for the long-term strategies of both BP and Apache," said Raymond Plank, Apache's founder and chairman. "Though we are much smaller than BP, we share its desire to focus capital and talented professionals on assets that will provide the maximum return for shareholders."

Once the transaction closes, assets on the outer continental shelf will account for 21% of Apache's production and 15% of its worldwide reserves.

The BP deal is the latest of three acquisitions that are expected to add 14,700 barrels of liquids and 142 million cubic feet of natural gas to Apache's 2006 average worldwide daily production.

Apache also said its board authorized the repurchase of up to 15 million common shares, worth about $1 billion at the company's recent stock price. Shares of Apache were lately up $2.50, or 3.6%, to $72.63.