Gas Apache announces big oil find in neglected Texas field

Oil and gas exploration Apache Corporation, yesterday announced it had found more 3 billion barrels of oil and also 75 trillion cubic feet of gas in Texas.

Though initial estimates tended to be on the high side, according to commentators, if the Alpine High discovery in west Texas was anywhere close to the figures, then rivals needed to be at least mildly concerned according to commentators.

They added, that was also because the slides about Alpine High, in CEO John Christmann's presentation yesterday did not quite reflect the full potential of the find.

They add what was interesting about Apache's slide, though, was the number $10, the difference between the two oil-price scenarios laid out, $50 and $60 a barrel.

According to  Christmann Apache had 700 locations it could drill in that area that were "very economic at $50." If the price were to increase to $60, though, according to Apache, the number of viable locations would increase between 2,450 and 3,200.

Meanwhile, Apache's shares vaulted 14 per cent to $58.99 in early trading after the company said it had assembled contiguous parcels of over 300,000 acres for $1,300 an acre in Alpine High, most of which was in Reeves County, Texas.

Experts say Apache would be able to exploit the area with improved technologies and efficiencies, which comprised an overlooked part of the Permian Basin, the top US oilfield with multiple layers of oil-bearing rock.

The company has raised its 2016 budget to $2 billion from 1.8 billion, in a bid to develop the field, which made it one of a dozen or so leading shale producers to raise spending even as weaker peers fell into bankruptcy.

Apache further said there was significant potential in the in the shallower Pennsylvanian, Bone Springs and Wolfcamp formations.