The investment community is torn on Apache Corp.’s new find in West Texas.
Plenty are unconvinced that Alpine High, as the Houston company is calling it, will produce as advertised.
Apache has announced finds before that petered out, said Andy McConn, a senior analyst at the energy research firm Wood Mackenzie. It pushed fields in the Texas panhandle and in South Texas’ Eagle Ford. “Both those plays really fell out of favor,” McConn said. “I’m a bit skeptical, just because of that history.”
More wells need to be drilled to prove the field, agreed Hassan Eltorie, an analyst at energy research firm IHS Markit. Pipelines need to be built. “We’ll get a lot better vision six months to a year from now,” Eltorie said.
But some insist Apache has found something other exploration and production companies couldn’t.
“I think Apache has done some of the best homework of any E&P I’ve followed in some time,” John Herrlin, head of oil and gas research for the investment bank Societe Generale, told me recently.
“Next year, once the pipeline is in place,” Herrlin said, “Wall Street will have a different appreciation.”
Apache stock rose in early trading on Tuesday to $64.71, but has since fallen with the price of oil, to $62.93.