APA Corporation outlined a strategy targeting roughly $700 million in lower annual cash costs by 2027 and more than 5% annual oil growth over the next three years. Speaking at the EnerCom conference, CFO Ben Rodgers said the company expects $500 million in structural savings and $175 million in reduced interest expense, while generating $1.2 billion in free cash flow in the first half of the year and using $750 million to repay debt. The Permian Basin and Egypt remain core cash-generating operations, with 2026 Permian production now forecast at 123,000 barrels per day on about $1.3 billion in capital spending, and gas-trading operations expected to generate approximately $950 million in cash flow this year. Growth will be led by the Gran Morgu offshore Suriname project, operated by TotalEnergies as APA's 50/50 partner in Block 58, which is expected to begin production in mid-2028 with a 220,000-barrel-per-day FPSO and a projected breakeven of $30 per barrel. APA also plans exploration wells in Alaska and offshore Uruguay, and intends to fund exploration from cash flow rather than relying solely on acquisitions.
APA CorporationAPA targets $700M cost cuts, debt repayment, and 5% oil growth, boosting financial outlook
TotalEnergies SETotalEnergies operates Suriname project with APA, expected to start production in 2028, enhancing its portfolio
Affiliated Managers Group, Inc.