Apache Corp. (NYSE: APA) said a recent rally in oil prices coupled with lower production costs had created a “better investment environment,” signaling that it may ramp up spending.
The company, which also reported a smaller-than-expected quarterly loss, raised its full year production forecast by 5,000 barrels of oil equivalent per day (boe/d), while maintaining its 2016 capital spending of $1.4 billion-$1.8 billion.
“As we become more confident in the sustainability of higher oil prices and the resulting increase in cash flow relative to our $35-per-barrel plan, we will increase our capital investment program accordingly,” Chief Executive John Christmann said May 5.
Total revenue fell more than 35 percent to $1.05 billion, missing analysts’ estimate of $1.10 billion.
Apache, which now expects 2016 production of between 438,000 boe/d and 458,000 boe/d, said the majority of additional investment would likely go to the Permian Basin.
Excluding one-time items, the company posted a loss of 40 cents per share, smaller than the average analyst estimate of 89 cents per share, according to Thomson Reuters I/B/E/S.
The company's shares were up 1.2 percent at $51.36 in premarket trading May 5. They have fallen more than 25 percent in the past 12 months.
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