Apache exits Australia in $US2.1b deal

Apache Corporation's exit from Australia is almost complete, with the sale of its Apache Energy Ltd for $US2.1 billion.

US energy giant Apache Corporation's exit from Australia is almost complete, securing a $US2.1 billion ($A2.73 billion) sale of its local subsidiary.

Analysts say the deal appears to be an opportunistic move by Macquarie Capital Group and its partners, given the recent collapse in oil prices.

US-based Apache said a consortium of private equity funds managed by Macquarie and Brookfield Asset Management agreed to buy Apache Energy Ltd, which owns West Australian domestic gas assets.

The sale ends Apache's involvement in oil exploration and production in Australia, although the company will retain its 49 per cent interest in fertiliser producer Yara Pilbara Holdings.

"Today's announcement represents a notable step in Apache's strategic portfolio repositioning," chief executive John Christmann said.

The deal is expected to close by mid-2015.

Morningstar analyst David Ellis said Macquarie had been expanding into North American gas markets and would most likely hold the assets for a short time before selling them to another party.

"Macquarie has always been opportunistic, so they're taking advantage of the oil price collapse and they obviously believe they can make some money out of this deal," Mr Ellis said.

Apache's exit from Australia had been widely anticipated, with the company selling global assets in recent months as part of a strategy to focus on oil production in North America.

The company expects to receive $US4.85 billion from the sale of all of its Australian assets, including a recent $US2.75 billion deal with Woodside Petroleum.

Global aluminium giant Alcoa also announced it had struck a new energy supply deal which is conditional on the Apache Energy deal.

Morningstar's Mark Taylor said the commitment of $US500 million in gas supply prepayments meant the latest deal relied on the support of Alcoa.

"It's an `if you scratch our back, we'll scratch yours' kind of deal," Mr Taylor said.

He added that it was unlikely Woodside Petroleum would be interested in eventually buying Apache's domestic gas assets, after recently purchasing Apache's stakes in the Wheatstone LNG venture and the Balnaves projects in Western Australia, and the Kitimat Projects in British Columbia, Canada.

"Woodside's probably got enough on their plate at the moment," Mr Taylor said.


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Source: AAP


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