Apache reveals WA gas exit
Apache reveals WA gas exit

Apache has admitted it is considering selling its WA gas business, not just a 13 per cent stake in the Wheatstone LNG development near Onslow, to appease dissident shareholders who want the $US39 billion company to focused on onshore hydrocarbons in the US.

Apache boss Steven Farris made the comments in the US overnight when handing down the company's second-quarter profit of $US505 million.

The profit was down from $US1 billion the previous year, reflecting the asset sales program Apache has undertaken since then.

Mr Farris, a regular visitor to Apache's WA operations, trumpeted the record-breaking performance of the company's Permian region business in Texas in the latest quarterly result, illustrating his new focus.

And he dispelled any doubts about his about-face on Apache's two LNG investments, in the Chevron-led Wheatstone and Kitimat (Canada) projects, by declaring a firm exit route.

Mr Farris also signalled the likely end of Apache's ownership of one of WA's biggest and most important domestic gas production businesses.

"Consistent with the company's ongoing repositioning for profitable and repeatable North American onshore growth, Apache intends to completely exit the Wheatstone and Kitimat LNG projects," Mr Farris said.

"In addition, Apache is evaluating its international assets and exploring multiple opportunities, including the potential separation of some or all of these assets through the capital markets."

It was only three years ago that Apache trumpeted its move into Wheatstone as the company's first LNG development, and its biggest project-specific capital investment.

As recently as April in front of Australia's oil and gas elite, Apache executives were talking up their involvement in Wheatstone, based on feeding Apache's Julimar-Brunello field into the Chevron-run venture.

There is widespread industry talk that Apache's WA management was caught by surprise by the shift in head office strategy.

But the pressure from activist investors has forced a sudden change in international strategy, and contributed to Mr Farris last week shifting Apache Australia's Perth-based managing director Faron Thibodeaux to the US to run the more important Permian business.

Apache is yet to provide a timetable on its Wheatstone and broader WA exit.

The West Australian

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