Forties field acquisition

SUMMARY

The Forties field was discovered in the early 1970s by BP and contains an estimated 4.2 to 5.0 billion barrels of original oil in place. Production peaked at over 500,000 barrels per day (Bpd), but by the time Apache purchased the field from BP in 2003, production had declined to 40,000 to 45,000 Bpd.

Since 2003, Apache’s engineers and geoscientists have aggressively “beaten the curve” by adding reserves, production and value to the Forties field. Apache originally purchased 144 MMBoe of proved reserves at a cost of $667 million. Through December 2011, Apache has produced over 170 MMBoe and still has 150 MMBoe of proved reserves on the books. Despite investing an additional $3.6 billion into the field, Forties has generated cash flow of $6.3 billion to return over 400 percent of our original 2003 investment.

Capturing value was achieved by performing a wide variety of projects. Early on, Apache raised production by drilling a number of highly productive wells off of the Echo platform. Drilling costs had historically been high from that platform due to outdated drilling equipment that had been installed on the platform. Apache removed the equipment, drilled several new wells with a modern jack-up, and added significant production at a competitive cost to the field within the first 18 months.

Apache has sustained a successful drilling program in all areas of the field the past several years by utilizing 4-D seismic technology that identifies areas of the field that have not been adequately drained. In 2011, Apache drilled three wells that each had initial production rates of 12,567 Bpd, 11,876 Bpd and 8,781 Bpd – the highest-rate new wells drilled in over a decade. 

Apache’s engineers have also successfully reduced costs. One highlight was the ring main project which is a system that allows electricity to be generated using natural gas from the field instead of purchased fuel oil.  This project decreased fuel oil costs and had the added benefit of greatly reducing greenhouse gas emissions due to the lower amounts of carbon dioxide produced from natural gas fired generation.

Apache’s engineers and scientists will continue to capture value at Forties for decades to come. The prize is significant: each additional one-percent recovery of the five billion barrel original oil in place is the equivalent of a 45 to 50 million barrel discovery.