Apache Corporation and its subsidiaries announced an agreement to sell all of its operations in Argentina to YPF Sociedad Anonima for cash payment of $800 million plus the assumption of $52 million of bank debt as of June 30, 2013.
YPF paid a $50 million deposit on the transaction, which is expected to be completed in the next 30 days. The transaction is subject to customary post-closing adjustments.
"Over the past year, Apache has taken decisive steps to focus its portfolio on repeatable and profitable long-term growth in areas where the company has industry-leading positions, such as its deep inventory of liquids-rich drilling opportunities onshore North America and international assets generating large free cash flows. This transaction is consistent with that strategy," said G. Steven Farris, chairman and chief executive officer.
The transaction complements Apache's realization of more than $7 billion of cash proceeds from asset sales in the last two quarters. Apache is deploying these proceeds to invest for profitable growth, enhance financial flexibility, reduce debt and buy back Apache common shares under a share repurchase program authorized by the board in 2013.
"Apache's employees in Argentina have done an outstanding job finding and developing new reserves and creating commercial opportunities in the region since we entered the country in 2001, and we are grateful for their many contributions," Farris said.
At year-end 2013, Apache had estimated reserves in the country of approximately 540 billion cubic feet of natural gas equivalent. During 2013, Apache's production from Argentina averaged 256 million cubic feet of gas equivalent per day.
