On Thursday, Apache Corp announced it would begin to use more of its capital and estimated the spending for 2016 to be on the higher end of its originally predicted range. Originally, the spending budget was calculated to be between $1.4 billion and $1.8 billion. The Houston oil and gas production company made the decision to spend more based on the “modest signs of improvement” in oil prices.
Benchmark prices in the U.S. have surged almost 58 percent since February’s 12-year low of $26. This has encouraged oil production companies to work the rigs again. Apache just added a rig in Texas’ Midland Basin and accelerated “strategic testing initiatives” while presiding over two rigs in the North Sea.
As early as May, Apache mentioned a “better investment environment” that indicated the company would probably increase spending. Apache’s oil and gas output reached an average of 535,456 barrels of oil equivalent (BOE) a day during the second quarter which is down from its average of 579,827 BOE posted a year ago during the same quarter.
The total revenue for Apache dipped almost 39 percent and saw a 32 percent fall in total expenses and costs. The net loss totaled to $244 million or 65 cents per share as of the quarter that ended on June 30. Last year during this same period, the company posted a net loss of $860 million or $2.28 per share.
The adjusted loss was calculated to be 26 cents per share under an accounting system Apache just began to use. Under the previous accounting system, Apache was making just 5 cents per share.
The revenue for Apache came in at $1.38 billion which was just above analysts’ original predictions of $1.37 billion.
Article written by HEI contributor Briana Steptoe.