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Apache Inks Agreement to Divest North Sea Pipeline Assets
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Leading independent energy player, Apache Corporation (APA - Free Report) recently signed an agreement to divest its stake in a North Sea pipeline system.Buyer for the transaction is U.K. pension funds managed by London-based Ancala Partners. The deal is estimated to be worth multi-million pounds but no specific figures have been revealed. The deal is expected to complete during the first half of 2017.
Apache will be offloading both its 30.28% share in the Scottish Area Gas Evacuation system and a 60.56% stake in the Beryl pipeline to Ancala Midstream Acquisitions. The Scottish Area Gas Evacuation pipeline transports output from nine North Sea fields around 200 miles for processing at a terminal at St. Fergus North of Aberdeen.
Crude prices, which reached $110 per barrel in mid-2014, fell to a 12-year low of $26.21 in February. The commodity is now trading below $50 per barrel owing to a supply glut amid slowing demand. Hence, energy companies that are facing tough cash flow positions have been taking austere cost-control measures to protect their already squeezed profits.
The latest asset sale announcement by Apache is a step in the same direction. We believe that the divestments will boost the company’s financials and lower its cost profile via reduction in the headcount and sale of non-core assets. Moreover, Apache intends to use the raised proceeds to fund the development of assets in the Alpine High oil fields in the Delaware Basin.
Founded in 1954, Houston, TX-based Apache is one of the world's leading independent energy companies engaged in the exploration, development and production of natural gas, crude oil and natural gas liquids.
Currently, Apache carries a Zacks Rank #3 (Hold), which implies that the stock will perform in line with the broader U.S. equity market over the next one to three months.
Some better-ranked players in the broader energy sector include Braskem S.A. (BAK - Free Report) , Ultra Petroleum Corp. and McDermott International Inc. . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the last four quarters, Braskem posted an average positive earnings surprise of 105.5%.
Ultra Petroleum, on the other hand, posted an average positive earnings surprise of 65.91% in the last four quarters.
In the last four quarters, McDermott posted an average positive earnings surprise of 250.00%.
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Apache Inks Agreement to Divest North Sea Pipeline Assets
Leading independent energy player, Apache Corporation (APA - Free Report) recently signed an agreement to divest its stake in a North Sea pipeline system.Buyer for the transaction is U.K. pension funds managed by London-based Ancala Partners. The deal is estimated to be worth multi-million pounds but no specific figures have been revealed. The deal is expected to complete during the first half of 2017.
Apache will be offloading both its 30.28% share in the Scottish Area Gas Evacuation system and a 60.56% stake in the Beryl pipeline to Ancala Midstream Acquisitions. The Scottish Area Gas Evacuation pipeline transports output from nine North Sea fields around 200 miles for processing at a terminal at St. Fergus North of Aberdeen.
Crude prices, which reached $110 per barrel in mid-2014, fell to a 12-year low of $26.21 in February. The commodity is now trading below $50 per barrel owing to a supply glut amid slowing demand. Hence, energy companies that are facing tough cash flow positions have been taking austere cost-control measures to protect their already squeezed profits.
The latest asset sale announcement by Apache is a step in the same direction. We believe that the divestments will boost the company’s financials and lower its cost profile via reduction in the headcount and sale of non-core assets. Moreover, Apache intends to use the raised proceeds to fund the development of assets in the Alpine High oil fields in the Delaware Basin.
Founded in 1954, Houston, TX-based Apache is one of the world's leading independent energy companies engaged in the exploration, development and production of natural gas, crude oil and natural gas liquids.
Currently, Apache carries a Zacks Rank #3 (Hold), which implies that the stock will perform in line with the broader U.S. equity market over the next one to three months.
APACHE CORP Price
APACHE CORP Price | APACHE CORP Quote
Stocks to Consider
Some better-ranked players in the broader energy sector include Braskem S.A. (BAK - Free Report) , Ultra Petroleum Corp. and McDermott International Inc. . All these stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the last four quarters, Braskem posted an average positive earnings surprise of 105.5%.
Ultra Petroleum, on the other hand, posted an average positive earnings surprise of 65.91% in the last four quarters.
In the last four quarters, McDermott posted an average positive earnings surprise of 250.00%.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>