Apache reveals new Alpine High results, disappoints analysts

Shares of Apache Corp. fell in early trading on Tuesday after releasing well results from its new West Texas discovery, Alpine High, which some analysts viewed as disappointing.

The Houston-based company announced in September the new oil field, which stretches largely across the bottom of Reeves County, near Balmorhea State Park. Apache estimated Alpine High contained at least 15 billion barrels of oil and gas, one of the largest discoveries in recent years. Analysts, however, were skeptical: Several other companies had tried drilling in the region and found little oil.

On Tuesday, Apache chief executive John Christmann revealed new Alpine High details at the annual Credit Suisse Energy Summit in Vail, Colo. The company has confirmed oil and gas in five geologic formations, each with multiple targets. They’ve drilled new well locations that stretch south and west into Pecos County. And the reservoirs are “over-pressured,” the Christmann said, meaning they will more easily produce oil and gas.

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But analysts pointed out that initial production in the new wells was not as strong as in earlier wells.

“Overall, we would not be surprised to see shares come under some pressure following the news,” said analysts at the Minneapolis investment bank Piper Jaffray.

Still, they acknowledged, results may well improve as Apache fine-tunes drilling and completions.

Shares of Apache fell $1.75 or 3 percent to $55.43 by mid-morning.