There was no announcement of a green light for the Kitimat LNG project in today’s conference call by Apache Corp. with market anaylsts and journalists.
Apache CEO G. Steven Farris told the call that negotiations with overseas (likely Asian) buyers are at an advanced stage.
“Frankly we’re somewhat past the polite introductions and that kind of stuff with respect to buyers,” he said. “We’re now in the throes of actual negotiations.”
While Apache has yet to commit to building the $5-billion plant at Bish Cove, south of Kitimat, construction work has continued all winter at the site.
Market analysts still expect Apache and its partners in KMLNG, Encana and EOG, to give the go ahead sometime in the first quarter of 2012.
In a news release issued before the call, Farris, said “Apache’s balanced portfolio and returns focus fueled an outstanding year in 2011, setting records for production, earnings, revenues, proved reserves and cash flow.”
The release went on to say:
In the fourth quarter, earnings totaled $1.2 billion or $2.98 per diluted share, up from $670 million or $1.77 per share in the prior-year period. Production totaled 759,000 boe per day, up 4 percent from the year-earlier quarter, and cash from operations before changes in operating assets and liabilities* totaled $2.7 billion, up from $2 billion in the year-earlier period. Apache reported fourth-quarter adjusted earnings* of $1.2 billion or $2.94 per share.
Apache’s oil and natural gas liquids production was 50 percent of total volume in 2011 but contributed nearly 80 percent of revenues because of the wide gap between global crude oil and North American natural gas prices. Apache’s results also benefited from the price differentials between oil prices in basins linked to the West Texas Intermediate benchmark and higher prices for oil produced in the Gulf of Mexico, Egypt, Australia and the North Sea that represents approximately 76 percent of its crude production.
Apache ended 2011 with proved reserves of 3 billion boe, up 1 percent from 2010. Apache’s 2011 production was 273 million boe (MMboe). The company added 422 MMboe, or 155 percent of production, through extensions, discoveries and acquisitions. Divestitures and revisions totaled 113 MMboe. Apache spent $9.1 billion on exploration, development and acquisitions capital, excluding asset retirement obligations and capitalized interest.*
During 2011, with the continued downward pressure on North American natural gas prices, Apache transitioned its North American drilling program to oily and liquids-rich targets in the Permian and Anadarko basins, the Gulf of Mexico and Canada.