Sinopec to give Apache Corporation $3.1 billion for Egypt business
As the first step in this partnership, Apache will receive $3.1 billion in cash, subject to customary closing adjustments, in exchange for Sinopec gaining a 33 percent minority participation in Apache's Egypt oil and gas business. Apache will continue to operate its Egypt upstream oil and gas business.
"We are pleased to launch a global partnership with Sinopec, and to welcome them into our business in Egypt. Their technical expertise complements our 20 years of experience operating in Egypt and creates an alliance that will continue to explore and deliver the tremendous hydrocarbon resources in the Western Desert," said G. Steven Farris, chairman and chief executive officer of Apache.
Given the sustained growth of its operations in Egypt, Apache has conducted an extended evaluation of a strategic partnership to ensure its ability to continue to deliver growth opportunities there while enhancing Apache's portfolio balance. The new partnership results from several months of joint efforts between Apache and Sinopec.
The Egypt partnership is subject to customary governmental approvals and is expected to close during the fourth quarter, with an effective date of January 1, 2013.
Net production from Apache's Egypt operations averaged 100,000 barrels of oil and 354 million cubic feet (MMcf) of natural gas per day in 2012. Gross production during the period averaged 213,000 barrels of oil and 900 MMcf of gas per day. Apache's exploration and production operations, which are located in remote, unpopulated areas, remain unaffected by political events in the region. ■