U.S. energy firm,
) announced that it has struck oil in the Canning Basin, off the
shore of Western Australia. The discovery, at the Phoenix South-1
well, marks the company's first find in the region and is believed
to be a significant one.
Preliminary estimates indicate about 300 million barrels of oil in
the area, based on six light oil samples collected from the region.
Moreover, the company stated that the oil and reservoir quality are
indicative of a commercial discovery, which could mean a new oil
province in Australia.
Apache is the operator and 40% owner of the WA-435-P permit where
the discovery well is located. The other partners are Carnarvon
Petroleum, Finder Exploration and JX Nippon, which have 20% stake
each. The company also holds stake in the permit WA-437-P. Further,
Apache intends to acquire stake as well as ownership of two other
nearby permits, WA-436-P and WA-438-P, and has exercised its option
for the same. The additional acquisitions would bring Apache's
total acreage in the region to over 5 million acres.
Apache, encouraged by the Phoenix South-1 results, believes that
the region comprises a large number of undrilled prospective
locations that could hold significant oil accumulations. The
company added that more drilling and evaluation activities have
been planned for the next year.
Notably, this Houston, TX based company has been planning to sell
its international operations following pressure from the activist
hedge fund Jana Partners LLC, which recently disclosed a $1 billion
stake in the U.S. energy company. This new find should enhance the
value of its properties, fetching more money from potential buyers.
Currently, Apache caries a Zacks Rank #3 (Hold). Meanwhile, one can
consider better-ranked players from the oil and gas exploration and
production industry like Cheniere Energy, Inc. (
), Clayton Williams Energy, Inc. (
) and Sanchez Energy Corporation (
). All these stocks sport a Zacks Rank #1 (Strong Buy).
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