Apache Corporation reported today an 84 percent drop in third-quarter earnings as falling natural gas prices took a toll on its revenue and the value of its assets.
The oil and natural gas exploration and production company reported profits slumped to $161 million, or 41 cents per diluted share, for the three-month period ending Sept. 30. Apache earned $983 million during the same period last year, or $2.50 per share.
The results included an after-tax write-down of $539 million on the value of Canadian natural gas properties.
Revenue for the Houston-based company fell 3.4 percent to $4.2 billion.
Total third-quarter production rose 2.4 percent to 771,000 barrels of oil equivalent per day compared to the say period a year earlier. But falling natural gas prices offset the production growth. The average price Apache received for North American natural gas dropped 27 percent to $3.51 per thousand cubic feet.
CEO G. Steven Farris emphasized the company’s effort to move more of its production from natural gas to higher-valued crude oil. Apache received an average $102.62 per oil barrel during the third quarter, compared to $101.71 a year earlier.
He noted Apache has expanded activity in areas rich in oil and other liquids in the Permian Basin in West Texas and Anadarko Basin on the Oklahoma-Texas Panhandle border. Production in those regions hit record levels during the quarter, growing 30 percent compared to a year earlier, Farris said in a written statement.
“Today, we are running 56 rigs in these regions with plans to expand throughout next year,” he said. “All are drilling oil and liquids-rich targets and more than half are drilling horizontal wells.”