Bullish options flow was detected in APA stock on September 25, 2020.
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On September 23, 2020, Archer has secured a four-year contract extension with Apache for the provision of platform drilling operations and maintenance services on Beryl Alpha and Bravo, Forties Alpha, Bravo, Charlie and Delta in the UK North Sea. The Extension will commence January 2021 in direct continuation of the current contract. Based on current and expected future activity, including additional services through our Engineering, Rentals and Oil tools divisions, the Extension has an estimated value of up to $100M. Dag Skindlo, CEO of Archer comments: We are very pleased to secure this contract extension which underlines Apaches confidence in Archers capabilities in providing platform drilling and maintenance services on their assets. The extension strengthens our long-term business relationship with Apache, which dates back to 2004, and our position as a major provider of platform-based drilling and intervention solutions in the UK.
On September 16, 2020, the board of directors of Apache Corporation (Nasdaq: APA) has declared a regular cash dividend on the company’s common shares.
The dividend on common shares is payable Nov. 23, 2020, to stockholders of record on Oct. 22, 2020, at a rate of 2.5 cents per share on the corporation’s common stock.
On September 14, 2020, a $92M put sale in Apache was tied to a 10M share delta hedge. A trader on the BOX floor sold 190k Oct 23rd 11.5 puts for $1.16, against a delta hedge of 10,405,000 shares at $11.61. The block size is 4x the total put open interest in the name, and appears set to expire just before earnings are expected late next month.
On September 14, 2020, Apache Corporation (APA) and Total S.A. (TOT) provided an update to the technical evaluation of the Kwaskwasi-1 discovery well offshore Suriname.
As previously announced, Kwaskwasi-1 discovered hydrocarbons in multiple stacked targets in the upper Cretaceous-aged Campanian and Santonian intervals. The well encountered 278 meters of net oil and volatile oil/gas condensate pay. The shallower Campanian interval contains 63 meters of net oil pay and 86 meters of net volatile oil/gas condensate pay. The Santonian interval contains 129 meters of net pay. Fluid samples from the Campanian validated the presence of oil with API gravities between 34 and 43 degrees.
Since the discovery announcement on July 29, 2020, the Noble Sam Croft drillship has gathered reservoir and other technical data in the Santonian. The company was able to successfully retrieve rotary sidewall cores but was unable to collect representative fluid samples from the reservoir due to conditions caused by cementing operations, which were required to mitigate increased pressure below the base of the Santonian formation. Hydrocarbon shows were observed in the Santonian reservoirs, and the results of the formation evaluation indicate the presence of oil. The Noble Sam Croft has commenced operations at the Keskesi East-1 exploration well approximately 14 kilometers southeast of Sapakara West-1. The Keskesi well will test upper Cretaceous targets in the Campanian and Santonian. Apache holds a 50% working interest in Block 58 and will continue to be the operator through the completion of the Keskesi well. Total S.A. holds the remaining 50% working interest.
On September 11, 2020, Capital One upgraded Apache to Overweight from Equalweight with a $16 price target citing the recent pullback in shares and Suriname block potential.
On August 26, 2020, Evercore ISI analyst Stephen Richardson upgraded Apache to Outperform from In Line with a $21 price target. The stock is down as much as the average energy equity year-to-date despite the company’s recent “world scale discoveries” in Suriname, noted Richardson, who thinks the Apache can maintain and lengthen its valuation gap over peers as the company works toward development in Suriname over the next 12 to 24 months. The analyst, who expects Apache to pursue a multi-rig blend of appraisal and exploratory work that will make for more frequent updates on asset quality and resource potential, notes that first oil in Suriname is still two to three years away.