Apache Finalizes Australian Gas Contract

Apache Corporation reports that the Harriet Joint Venture has finalized a contract to supply more than 600 billion cubic feet of natural gas over 25 years to the Burrup Fertilisers plant to be built in Western Australia.

The new plant, which will have a capacity of 2,200 tons of liquid ammonia per day, will use 73 million cubic feet (MMcf) of gas per day supplied by the Harriet Joint Venture beginning in July 2005. Apache is the operator of the oil and gas joint venture and holds a 68.5 percent working interest. Partners are Kufpec with 19.3 percent and Tap Oil with 12.2 percent working interest.

The contract will more than double the joint venture's daily gas production, now approximately 60 MMcf per day.

"This contract will permit Apache and its partners to continue our active exploration program in the Carnarvon Basin with confidence that we will have markets for additional discoveries and we will be able to book the reserves," said John Crum, executive vice president for Eurasia and new ventures.

"This is also an important project in the Western Australia government's program to develop industrial facilities on the Burrup Peninsula to take advantage of the province's rich natural resources.

"The new contract also enhances the value of Apache's strategic processing and transportation hub at Varanus Island," Crum said.

Construction of the Burrup plant, which is owned by the Oswal Group of India, is scheduled to begin during the first quarter of 2003.

In the third quarter, Apache's net production in Australia was 123 MMcf of gas and 30,000 barrels of oil per day.