Apache Corporation’s profits surged 75 percent in the fourth quarter, benefiting from higher oil prices and boosted fossil fuel production, the company reported Thursday.
The Houston-based oil and natural gas exploration and production company posted $1.2 billion in earnings, or $2.98 per diluted share, in the final three months of 2011. That increased from $670 million, or $1.77 per share, during the same period of 2010.
Fourth-quarter revenue climbed 25 percent to $4.3 billion.
The company’s full-year earnings jumped 50 percent in 2011 to $4.5 billion, $11.47 per share. Full-year revenue climbed 40 percent to $16.9 billion.
Apache noted that it produced 748,000 barrels of oil equivalent per day in 2011, up 14 percent from 2010. The price for domestic benchmark West Texas Intermediate crude oil averaged $94.87 per barrel in 2011, compared to $79.40 in 2010, according to the U.S. Energy Information Administration.
The company further benefited from a portfolio tied to higher-priced fossil fuels, CEO G. Steven Farris noted in a written statement. Most of Apache’s crude oil production in 2011 was linked to the higher Brent crude, which averaged about $111.26 per barrel last year, $16.39 higher than the average WTI price.
And half of the fossil fuels Apache produced were crude and natural gas liquids, which boasted much higher returns than dry natural gas in 2011, making up 80 percent of Apache’s revenue, the company noted.
Low prices for dry natural gas led the company to alter its drilling program in 2011, focusing more on geographies with high crude oil and natural gas liquids content, including the Gulf of Mexico and the Permian basin in West Texas.
The company grossed 1,100 new wells in 2011, Farris said. He plans to expand the drilling program, adding as many as 1,430 new wells in 2012.
“More than half of the wells planned in 2012 will be drilled in the Permian and Anadarko Basins to exploit stacked oil and liquids-rich pay opportunities in these prolific basins,” Farris said. “We anticipate production will increase in the range of 7 to 13 percent in 2012.”
