Apache 4Q14 Earnings Call Notes

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Each week I read dozens of transcripts from earnings calls and presentations as part of my investment process. Below are some of the most important quotes about the economy and industry trends from the transcripts that I read this week. Full notes can be found here.

New CEO

“Steve announced last month that he would be retiring from Apache following more than two decades of leadership. During his tenure he helped grow the Company to one of the largest and most successful independents in the world.”

Cannot predict length of oil price correction

“We cannot predict nor control the length or depth of this oil price correction, or the timing and extent of the rebound. We have therefore acted quickly and decisively regarding the things we can control. Our activity levels and cost structure”

>10% well cost reduction

“our competitors are talking about just seeing 10% well cost reductions that’s going to have to be more than that. We’re seeing more than that.'”

Not planning to rework the portfolio at these prices

“Right now in this price environment a lot changes a $100 price environment to $50, so right now as I stated in the prepared comments, we are not proceeding with anything on the spinoff of Egypt or North Sea. We are looking at possibly still monetizing or the non-LNG assets of Australia, but at this point in this price environment I think you’re seeing strength of our international assets complement our North American portfolio.”

It wont be hard to ramp back up

“o we are going be pretty prudent, in terms of what we do we will continue to look at what is the best organization for North America in terms of where things are going and do not worry about being over ramp up, I mean its easy to ramp up after you’ve been there before, I mean we’ve got great capabilities in the Permian and our other regions and it will not be hard to ramp up.”

There will be some opportunities for acquisition if things stay this way

” mean I think the point is we would be opportunistic. I mean we see a potentially if things stay where they are there’s a lot of folks that are significantly out spending. There is a lot of clocks on acreage. We’re seeing things pop-up right now and for drilling a well we can earn pretty big acreage blocks. I think there’s just a lot of opportunity that could surface and we would expect to surface.”