Apache Corporation discovered over 2 billion barrel of oil deposits in West Texas. The discovery is going to generate a revenue from $8 million up to $80 million to Apache Corporation. The production is going to start in a few years, after the necessary equipment is ready.
- Apache Corporation made its most important discovery on the U.S territory
- Apache Corporation is an oil and gas exploration company that has operations in Canada, U.S, Egypt, United Kingdom.
- The discovery in the West Texas could be worth up to $80 million
- It is going to take some time before the production starts due to the poor infrastructure.
The discovery was announced after 2 years of drilling in the area.
Due to the poor infrastructure and the remote location the field requires big investment before it could make money out of it.
The Apache Corporation started buying the mineral rights in that area and realized the real potential of that place. Because it was considered to be a poor field the price paid by Apache Corporation was extremely low. This will not be the case with the other companies that decide to buy land there, the price will now rise significantly.
Although the Apache Corporation has to invest a lot in this project the profit potential is significant. The oil deposits could generate up to 30% profit with the costs of the drilling included.
The amount of oil deposits and natural gas found in West Texas land makes this the company’s biggest discovery on the U.S territory, also one of the most remarkable ones worldwide.
Chief executive of Apache Corporations says that they acted exactly the opposite of the other companies, they bought land in the low-competitive section instead the others who bought in the ultra-competitive section. This is how the managed to gain more money, investing a lot less than the competition.
They already drilled 19 wells and found 2000-3000 other drilling location that can provide a natural mix of gas in oil that is worth up to $20 million per well.
It is unclear how much of the barrels can be recovered, because the statistic show that only 6-12 % is getting out of the ground, at least at the first attempt. Even so, the Apache Corporation estimated a minimum of 13 % recovery.
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