Houston oil and gas producer Apache Corp. returned to profitability last quarter and, perhaps more importantly, delivered first gas to market and improved oil production results at its new West Texas discovery, Alpine High.
First quarter revenues jumped by almost $800 million or three-quarters to $1.9 billion over the same period last year, Apache reported on Thursday. Expenses fell by $125 million or 9 percent to $1.3 billion. And income leaped to $200 million in the quarter, a jump of almost $600 million after a $400 million loss in the first quarter of 2016.
At the same time, the company reported new results for its much-discussed West Texas discovery, Alpine High. It finished construction of the first section of a 30-inch gas pipeline, allowing the company to send gas to market for the first time in the field. The trunk line allows Apache to begin bringing on new wells and producing oil and natural gas liquids in earnest.
Apache also reported new test well results, including some of the field’s best oil production rates so far, an important marker after earlier results disappointed analysts.
The Chinook 101AH, with a horizontal well length of just 4,500 feet, is producing more than 600 barrels of oil per day, the company reported, about three times better than previously released rates in the Woodford formation at Alpine High, and the highest flow to date there.
And the Blackhawk 5H, with another 4,500-foot lateral, is producing more than 700 barrels of oil per day, 200 better than the company’s next best result in the Barnett formation.
“At Alpine High, testing and delineation have continued with strong results that reinforce our confidence in this world-class resource play,” said chief executive John Christmann.
“We are maintaining a razor-sharp focus on costs and well optimization and actively managing our portfolio,” he added.