Slide 1: Investor Update September 2022
Investor Update September 2022
Slide 2: Notice to Investors
Notice to Investors Certain statements in this presentation contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 including, without limitation, expectations, beliefs, plans, and objectives regardin
Slide 3: APA Highlights
APA Highlights • ~$3 billion of Free Cash Flow(1,2) (FCF) in 2022; committed to return 60% (~$1.8 billion) of FCF to shareholders through share repurchases & dividends • Strong leverage to U.S. / Int’l natural gas & LNG markets o Natural gas production contributed 38% and 17% of U.S. and North Sea p
Slide 4: APA at a Glance: Diversified and Balanced
APA at a Glance: Diversified and Balanced 2Q’22 Reported Production 2Q’22 Commodity Mix North Sea 11% Global Portfolio Gas Oil U.S. 37% 47% Egypt 52% 37% NGL 16% UK North Sea 2Q’22 Cash Flow(1) 2Q’22 Upstream Capital United States Egypt North Sea Suriname 10% 20% Suriname U.S. Egypt U.S. North Sea 4
Slide 5: 2Q 2022 Operating Cash Margins
2Q 2022 Operating Cash Margins Egypt North Sea United States $120 $111 / Boe $100 $80 $74 $76 / Boe Per Boe - $11 $60 vs. 1Q $63 / Boe $66 $48 $40 Per Boe $37 / Boe Per Boe + $10 + $10 vs. 1Q vs. 1Q $20 $15 / Boe $10 / Boe $0 Operating Cash Margin(1) Avg Realization Cash Operating Cost (1) Operating
Slide 6: United States
United States U.S. Acreage • Well connections expected to nearly double in 2H’22 o Anticipate 30 wells to be brought online in 2H’22 vs 16 wells in 1H’22 NEW OKLAHOMA MEXICO NEW MEXICO • Southern Midland Basin: operating 2 rigs drilling predominantly TEXAS longer laterals (2-3 miles) • Delaware Basi
Slide 7: Egypt
Egypt Apache Egypt Acreage: ~5 million acres • Country’s largest oil producer & onshore acreage holder • Reached 15-rig activity level in August • On track to meet 3Q’22 well connection expectations Modernized Concession Other Concessions • Anticipate meeting 40% upstream flaring reduction goal by Y
Slide 8: 2022 Egypt Outlook Commentary
2022 Egypt Outlook Commentary Egypt Well Connection Expectations (Current vs Feb’22 Guidance) 35 • Temporary operational delays & rig ramp inefficiencies 30 o Supply chain, equipment & infrastructure related delays 26 o Longer than expected time to staff & reactivate cold-stacked rigs 25 24 o Extend
Slide 9: North Sea
North Sea • Focused on sustaining production & cash flow generation capacity o Forties: mature waterflood, focused on mitigating declines/managing costs o Beryl: exploration focused, high-volume subsea tiebacks • Completed Beryl maintenance turnaround activity in mid-August • Garten-3 (100% WI) brou
Slide 10: Suriname
Suriname Block 58 (APA 50% WI) • Five exploration discoveries since Jan. 2020 • Maersk Valiant drilling second appraisal well at the Sapakara South field (TTE operated) • Noble Gerry De Souza to drill the Awari exploration prospect (TTE operated) Block 53 (APA 45% WI) • Announced first exploration d
Slide 11: Committed to Return ≥ 60% of Free Cash Flow to Shareholders in 2022
Committed to Return ≥ 60% of Free Cash Flow to Shareholders in 2022 2022 Shareholder Return ($MM)(2) $1,400 • Returned 43% of Free Cash Flow(1) to shareholders in 1H’22 $1,200 ~$1,160 o Repurchased 14.2 MM shares at an average price of $38.78 o Paid a quarterly dividend of $0.125/shr ($0.50/shr annu
Slide 12: APA Corporation's 2022 Sustainability Report
APA Corporation’s 2022 Sustainability Report “ We are charting a steady course and positioning ourselves as a partner to the world by providing affordable, reliable and abundant sources of energy. ” John Christmann, CEO and President To view the report online, please visit the APA Corporation websit
Slide 13: Appendix
Appendix 13
Slide 14: Compensation-linked ESG Goals
Compensation-linked ESG Goals Short-term Goals Long-term Goal • Egypt: 40% reduction of upstream flaring in Established long-term incentive Egypt by year-end compensation-linked emissions • People: Develop and implement a future of reduction goal: work strategy inclusive of working model, workplace
Slide 15: APA Committed to Return ≥ 60% of Free Cash Flow to Shareholders in 2022
APA Committed to Return ≥ 60% of Free Cash Flow to Shareholders in 2022 4Q 1Q 2Q YTD Since Inception 2021 2022 2022 6/30/2022 (Oct’21) Shares Repurchased (MM) 31.2 7.2 7.0 14.2 45.4 In July, APA repurchased Average Stock Price $27.13 $36.07 $41.59 $38.78 $30.78 an additional 6.9 million shares at an
Slide 16: APA Debt Profile Improvement
APA Debt Profile Improvement As of June 30, 2022 Significant Balance Sheet De-Leveraging Actions YE 2021 June 2022 • $213 million (April ‘22 notes) called at par in January Notes & • De-consolidated ~$1.4 billion of ALTM debt and preferred in February $6,344MM $5,032MM Debentures(1) • Completed $1.1
Slide 17: Guidance (Published August 3rd 2022)
Guidance (Published August 3rd 2022) 3Q 2022 FY 2022 Commentary Production (Mboe/d) US FY '22 updated to reflect Texas DB acquisition, deferral of Austin Chalk activity, Permian completion timing delays and divestiture United States……………………………………………………………………………………………………. 208 – 212 208 – 210 Egypt FY
Slide 18: Suriname PSC and APA / Total Energies Joint Venture
Suriname PSC and APA / Total Energies Joint Venture Summary Terms and Production Sharing Contract Mechanics Suriname Gov’t Profit Oil Split by 20% R-Factor Joint APA 40% Total 40% Venture Staatsolie 20% Gross APA 40% Contractors Total 40% Revenue 93.75% Staatsolie 20% 1. Opex APA & Total in Proporti
Slide 19: Summary of Terms Suriname PSC APA / Total JV
Summary of Terms Suriname PSC APA / Total JV • Cost oil recovery ceiling of 80% after royalty payment • Parties have the right to alternate proposals of exploration wells up to 8 wells per year • Unrecovered cost oil balances carried forward until fully recovered on a project-by-project basis • Eith
Slide 20: Glossary of Referenced Terms
Glossary of Referenced Terms • Upstream Capital Investment: Includes exploration, development, gathering, processing, and transmission capital, capitalized overhead, and settled asset retirement obligations. Excludes capitalized interest, non-cash asset retirement additions and revisions, Egypt nonc
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations 21
Slide 22: Non-GAAP Reconciliation
Non – GAAP Reconciliation Cash Flow Before Changes in Operating Assets & Liabilities and Free Cash Flow Reconciliation of Net Cash Provided by Operating Activities to Cash Flows from Operations before Changes in Operating Assets and Liabilities and Free Cash Flow Cash flows from operations before ch
Slide 23: Non-GAAP Reconciliation
Non – GAAP Reconciliation Segment Cash Flows Reconciliation of Net Cash Provided by Operating Activities to Cash Flows from Continuing Operations before Changes in Operating Assets and Liabilities Cash flows from operations before changes in operating assets and liabilities is a non-GAAP financial m
Slide 24: Non-GAAP Reconciliation
Non – GAAP Reconciliation Net Debt Reconciliation of Debt to Net Debt Net debt, or outstanding debt obligations less cash and cash equivalents, is a non-GAAP financial measure. Management uses net debt as a measure of the Company's outstanding debt obligations that would not be readily satisfied by
Slide 25: Non-GAAP Reconciliation
Non – GAAP Reconciliation Upstream Capital Investment Reconciliation of Costs Incurred to Upstream Capital Investment Management believes the presentation of upstream capital investments is useful for investors to assess APA's expenditures related to our upstream capital activity. We define capital