425

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 20, 2010

APACHE CORPORATION

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction
of incorporation) 1-4300
(Commission
File Number) 41-0747868
(I.R.S. Employer
Identification No.)

2000 Post Oak Boulevard
Suite 100
Houston, Texas 77056-4400
(Address of principal executive offices, including zip code)

(713) 296-6000
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

þ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

     The information in Items 2.02 and 7.01, including Exhibits 99.1 and 99.2 incorporated therein by reference, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of Section 18, and shall not be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as set forth by specific reference in such filing.

Item 1.01. Entry into a Material Definitive Agreement

     On July 20, 2010, Apache Corporation (“Apache”) announced the signing of three definitive purchase and sale agreements (the “BP Purchase Agreements”) to acquire properties in the Permian Basin, the Western Canada Sedimentary Basin and the Western Desert of Egypt (the “BP Properties”) from subsidiaries of BP plc (collectively, “BP”) for aggregate consideration of approximately $7.0 billion (the “BP Acquisition”).

     Of the $7.0 billion purchase price, $3.1 billion is applicable to the Permian Basin properties, $3.25 billion is applicable to the Canadian properties and $650 million is applicable to the Egyptian properties. The effective date of the BP Acquisition is July 1, 2010. Apache Corporation has agreed to guarantee the performance of the obligations of its subsidiaries under the BP Purchase Agreements.

     The BP Acquisition is subject to a number of closing conditions, including clearance under the competition laws of the United States and Canada, the foreign investment law of Canada and approval of the Government of Egypt. Because of the relatively short time period contemplated between signing the BP Purchase Agreements and the expected closing of the BP Acquisition, several significant matters commonly resolved prior to closing such an acquisition have been reserved for after closing. For example, title review with respect to most of the BP Properties will not be completed until after closing. In addition, we will not have sufficient time before closing to conduct a full assessment of any environmental and legal liabilities with respect to the BP Properties. Also, some of the BP Properties are subject to preferential purchase rights held by third parties, and those rights may be exercised before or after we close the BP Acquisition. Most of the preferential purchase rights have exercise periods of 30 days after delivery of notice of acquisition. Accordingly, the BP Acquisition is subject to certain post-closing requirements relating to, among other things, resolution of title, environmental and legal issues and any exercise by third parties of preferential purchase rights with respect to certain of the BP Properties. Prompt notice of the proposed sale of the BP Properties will be provided to appropriate governmental agencies and to parties holding preferential rights to purchase such properties. The transactions comprising the BP Acquisition are not mutually conditioned, and we may close any of these transactions without closing the others.

     Each BP Purchase Agreement may be terminated prior to closing pursuant to termination provisions that are typical of a transaction of this type. If a BP Purchase Agreement is terminated other than as a result of our material breach or our failure or refusal to close, BP is required to return the applicable portion of the Deposit plus interest. BP plc has agreed to provide a limited guarantee with respect to the BP Purchase Agreements, principally as to return of the Deposit. If a BP Purchase Agreement is terminated as a result of our material breach or our failure or refusal to close, BP is required to return the applicable portion of the Deposit plus interest, less an amount equal to five percent of the purchase price plus interest in such agreement (which we refer to as the “Reverse Breakup Fee”). Each BP Purchase Agreement provides that BP’s retention of the Reverse Breakup Fee is the sole and exclusive remedy of BP in the event of a termination of such agreement.

     On July 30, 2010, we expect to make a deposit of $5.0 billion toward the purchase price of the BP Properties (which we refer to as the “Deposit”), to be returned to us or applied to the purchase price, as the case may be. Of the $5.0 billion Deposit, $1.5 billion is applicable to the Permian Basin properties, $3.25 billion is applicable to the Canadian properties and $250 million is applicable to the Egyptian properties. In Canada, the Deposit will be implemented in the form of a loan from Apache to the BP subsidiary that is the seller of the Canadian properties which will be guaranteed by BP plc. From the date of the Deposit until receipt of regulatory approvals, BP will retain complete operational control of the BP Properties, subject to customary covenants regarding the conduct of business in the ordinary course, maintenance of the properties and similar matters. The Deposit is not required to be segregated from the operations of BP, but may be made available for use by BP in its operations. Should the applicable regulatory approval not be obtained, the affected transaction will not close and the applicable portion of the Deposit will be returned. Should preferential purchase rights with respect to any portion of the BP Properties, the purchase price payable to the affected BP subsidiary will be reduced accordingly. We estimate that only an immaterial portion of the BP Properties are subject to preferential purchase rights in favor of third parties.

     If regulatory approval is obtained, and to the extent preferential purchase rights are not exercised, with respect to any portion of the BP Acquisition, we will pay the balance of the allocated consideration and close the respective transaction as promptly as practicable after receipt of the various regulatory approvals and contractual consents applicable to the individual components of the BP Acquisition. Upon receipt of regulatory approvals in Canada, the instrument representing the loan will convert into ownership of the equity interests of the BP subsidiary holding the Canadian properties.

     Apache anticipates that required regulatory approvals and resolution of any preferential purchase rights, and any transfer of operational control of the BP Properties, will occur in the third and fourth quarters of 2010.

     The foregoing summary of the BP Purchase Agreements and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the BP Purchase Agreements, which will be provided supplementally pursuant to an amendment to this Current Report on Form 8-K.

     The BP Purchase Agreements will be provided supplementally pursuant to an amendment to this Current Report on Form 8-K to provide investors and security holders with information regarding their terms. They are not intended to provide any other factual information about Apache. The representations, warranties and covenants contained in the BP Purchase Agreements were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements, and may be subject to

limitations agreed upon by the contracting parties, including being qualified by confidential disclosures exchanged between the parties in connection with the execution of the BP Purchase Agreements. The representations and warranties may have been made for the purposes of allocating contractual risk between the parties to the agreements instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the BP Purchase Agreements and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of Apache or BP or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the BP Purchase Agreements, which subsequent information may or may not be fully reflected in Apache’s public disclosures.

Item 2.02. Results of Operations and Financial Condition.

     On July 20, 2010, Apache issued a press release announcing financial and operating results for the fiscal quarter ended June 30, 2010 and that it had rescheduled its second-quarter earnings call. The full text of the press release announcing second-quarter earnings is furnished herewith as Exhibit 99.1 and incorporated herein by reference.

Item 7.01. Regulation FD Disclosure

     On July 20, 2010, Apache issued a press release announcing the BP Acquisition. A copy of the press release is furnished herewith as Exhibit 99.2 and incorporated herein by reference.

Forward-Looking Statements

     Statements in this document and the exhibits furnished herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The opinions, forecasts, projections, future plans or other statements other than statements of historical fact are forward-looking statements. These forward-looking statements include statements regarding expectations as to completion of the BP Acquisition. Apache can give no assurance that such expectations will prove to have been correct. Actual results could differ materially as a result of a variety of risks and uncertainties, including: the timing to consummate the proposed BP Acquisition; the risk that a condition to closing of the BP Purchase Agreements may not be satisfied; the risk that a regulatory approval that may be required for the BP Purchase Agreements is not obtained or is obtained subject to conditions that are not anticipated; negative effects from the pendency of the BP Acquisition; Apache’s ability to achieve the synergies and value creation contemplated by the BP Acquisition; Apache’s ability to promptly and effectively integrate the acquired assets; and the diversion of management time on BP Acquisition-related issues. Other factors regarding Apache and other risks related to it and its business and operations are discussed in Apache’s most recent Form 10-K as well as Apache’s other filings with the United States Securities and Exchange Commission (“SEC”) available at the SEC’s website at www.sec.gov. Actual results may differ materially from those expected, estimated or projected. Forward-looking statements speak only as of the date they are made, and other than as

required by law, Apache undertakes no obligation to publicly update or revise any of them in light of new information, future events or otherwise.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits.

99.1	Press release of Apache Corporation announcing financial and operating results for the quarter ended June 30, 2010, dated July 20, 2010.
99.2	Press release of Apache Corporation announcing the BP Acquisition, dated July 20, 2010.

S I G N A T U R E

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	APACHE CORPORATION
Dated: July 20, 2010	By:	/s/ Roger B. Plank
		Roger B. Plank, President
		(Principal Financial Officer)

EXHIBIT INDEX

Exhibit
Number		Description
	99.1	Press release of Apache Corporation announcing financial and operating results for the quarter ended June 30, 2010, dated July 20, 2010.
	99.2	Press release of Apache Corporation announcing the BP Acquisition, dated July 20, 2010.

EX-99.1

CONTACTS:
(Media):	Bill Mintz	(713) 296-7276
	Bob Dye	(713) 296-6662
(Investors):	Tom Chambers	(713) 296-6685
	Rob Rayphole	(713) 296-6160
(Web site):	www.apachecorp.com

APACHE’S PRODUCTION RISES 10 PERCENT TO RECORD 646,866 BOE PER DAY
FUELING SECOND-QUARTER EARNINGS OF $860 MILLION OR $2.53 PER SHARE

     Houston, July 20, 2010 — Apache Corporation (NYSE, Nasdaq: APA) today reported that higher oil output from international operations fueled record production in the second quarter as net income climbed to $860 million or $2.53 per diluted common share, nearly double the net income of $443 million or $1.31 per share in the prior-year period.

     Production totaled 646,866 barrels of oil equivalent (boe) per day, up 10 percent from the prior-year period. Liquid hydrocarbon production climbed to 348,272 barrels per day, up 19 percent from the prior-year period and 16 percent from the first quarter of 2010. Natural gas production increased to 1.79 billion cubic feet per day, a 1-percent increase from the year-earlier period and up 5 percent from the first quarter.

     Apache’s increased oil production was the result of a nearly sixfold increase in output in Australia, including a full quarter of production from the Van Gogh and Pyrenees oil developments, and higher output from the Faghur Basin in Egypt’s Western Desert. Natural gas production was higher in Australia, Gulf Coast, Egypt and the Anadarko Basin of western Oklahoma.

     Cash from operations before changes in operating assets and liabilities* totaled $1.8 billion in the second quarter, up 46 percent from $1.3 billion in the year-earlier period. At the end of the quarter, Apache’s cash balance was $1.8 billion.

     Apache’s second-quarter adjusted earnings*, which exclude certain items that impact the comparability of operating results, totaled $829 million or $2.44 per diluted share, up from $474 million or $1.41 per share in the prior-year period.

     “Apache’s second-quarter results illustrate the benefit of our focus on long-term growth,” said G. Steven Farris, chairman and chief executive officer. “We are realizing the benefit of significant discoveries and the investments Apache made to bring them on production. Apache’s financial results also benefitted from our balanced commodity mix at a time when oil prices remain strong relative to North American natural gas prices.”

     Apache’s international operations accounted for 56 percent of worldwide production. Liquids sales were 54 percent of worldwide production and 78 percent of revenue. Apache realized an average of $74.89 per barrel of oil, essentially unchanged from the first quarter, and $4.01 per thousand cubic feet (Mcf) of natural gas, down from $4.60 per Mcf in the first quarter.

     Apache’s second-quarter results include production from June 9 on Gulf Shelf assets acquired on that date from Devon Energy Corp. for $1.05 billion. The acquisition brought year-end 2009 estimated proved and probable reserves of 83 million boe across approximately 150 blocks.

     Apache also expects to close its previously announced merger with Mariner Energy upon approval of regulators and Mariner’s shareholders. Mariner is an independent producer with operations in the Gulf of Mexico, the Gulf Coast and the Permian Basin with year-end 2009 estimated proved reserves of 181 million boe (47 percent liquid hydrocarbons) as well as unbooked resource potential of 2 billion boe. Approval is projected for the third quarter.

     Apache Corporation is an oil and gas exploration and production company with operations in the United States, Canada, Egypt, the United Kingdom North Sea, Australia and Argentina. From time to time, Apache posts announcements, updates and investor information, in addition to copies of all press releases, on its Web site, www.apachecorp.com.

     *Adjusted earnings and cash from operations before changes in operating assets and liabilities are non-GAAP measures. Please see reconciliations below. For supplemental and non-GAAP information, please go to www.apachecorp.com/financialinfo.

Additional Information

     This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. Apache has filed with the Securities and Exchange Commission (“SEC”) a registration statement on Form S-4 containing a preliminary proxy statement of Mariner Energy that also constitutes a preliminary prospectus of Apache. A definitive proxy statement/prospectus will be mailed to stockholders of Mariner. Apache and Mariner also plan to file other documents with the SEC regarding the proposed transaction. INVESTORS AND SECURITY HOLDERS OF MARINER ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain the documents (when available) free of charge at the SEC’s web site, www.sec.gov. Copies of the documents filed with the SEC by Apache will be available free of charge on Apache’s website at www.apachecorp.com under the tab “Investors” or by contacting Apache’s Investor Relations Department at 713-296-6000. Copies of the documents filed with the SEC by Mariner will be available free of charge on Mariner’s website at www.mariner-energy.com under the tab “Investor Information” or by contacting Mariner’s Investor Relations Department at 713-954-5558. You may also read and copy any reports, statements and other information filed with the SEC at the SEC public reference room at 100 F Street N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at (800) 732-0330 or visit the SEC’s website for further information on its public reference room.

     Apache, Mariner, their respective directors and executive officers and other persons may be deemed, under SEC rules, to be participants in the solicitation of proxies from stockholders of Mariner in connection with the proposed transaction. Information regarding Apache’s directors and officers can be found in its proxy statement filed with the SEC on March 31, 2010, and information regarding Mariner’s directors and officers can be found in its proxy statement filed with the SEC on April 1, 2010. Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interests in the transaction, by security holdings or otherwise, will be contained in the definitive proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available.

Forward-Looking Statements

     Statements in this document include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The opinions, forecasts, projections, future plans or other statements other than statements of historical fact, are forward-looking statements. We can give no assurance that such expectations will prove to have been correct. Actual results could differ materially as a result of a variety of risks and uncertainties, including: the timing to consummate the proposed transaction; the risk that a condition to closing of the proposed transaction may not be satisfied; the risk that a regulatory approval that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; negative effects from the pendency of the merger; our ability to achieve the synergies and value creation contemplated by the proposed transaction; our ability to promptly and effectively integrate the merged businesses; and the diversion of management time on transaction-related issues. Other factors that could materially affect actual results are discussed in Apache’s and Mariner’s most recent Forms 10-K as well as each company’s other filings with the SEC available at the SEC’s website at www.sec.gov. Actual results may differ materially from those expected, estimated or projected. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update or revise any of them in light of new information, future events or otherwise.

APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands, except per share data)

	For the Quarter				For the Six Months
	Ended June 30,				Ended June 30,
	2010		2009		2010			2009
REVENUES AND OTHER:
Oil and gas production revenues	$	2,968,765	$	2,074,344	$	5,662,390		$	3,677,958
Other		3,145		19,034		(17,229	)		49,245
		2,971,910		2,093,378		5,645,161			3,727,203
COSTS AND EXPENSES:
Depreciation, depletion and amortization
Recurring		729,751		573,359		1,368,249			1,153,976
Additional		—		—		—			2,818,161
Asset retirement obligation accretion		24,760		26,483		48,762			53,221
Lease operating expenses		445,949		405,273		886,195			802,762
Gathering and transportation		43,038		33,479		83,403			66,818
Taxes other than income		186,833		115,941		363,771			203,280
General and administrative		91,829		90,905		178,979			175,951
Financing costs, net		55,757		61,155		115,024			119,742
		1,577,917		1,306,595		3,044,383			5,393,911
INCOME (LOSS) BEFORE INCOME TAXES		1,393,993		786,783		2,600,778			(1,666,708	)
Current income tax provision		339,151		218,247		682,125			220,741
Deferred income tax provision (benefit)		194,619		123,816		353,449			(575,229	)
NET INCOME (LOSS)		860,223		444,720		1,565,204			(1,312,220	)
Preferred stock dividends		—		1,420		—			2,840
INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCK	$	860,223	$	443,300	$	1,565,204		$	(1,315,060	)
NET INCOME (LOSS) PER COMMON SHARE:
Basic	$	2.55	$	1.32	$	4.64		$	(3.92	)
Diluted	$	2.53	$	1.31	$	4.61		$	(3.92	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		337,618		335,637		337,273			335,372
DILUTED SHARES OUTSTANDING		339,377		337,365		339,282			335,372

APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands)

	For the Quarter				For the Six Months
	Ended June 30,				Ended June 30,
	2010		2009		2010		2009
COSTS INCURRED: (1)
North America exploration and development	$	782,103	$	381,782	$	1,310,492	$	887,098
International exploration and development		475,016		506,229		956,787		993,011
Oil and gas property acquisitions		1,028,724		183,195		1,033,394		243,220
	$	2,285,843	$	1,071,206	$	3,300,673	$	2,123,329

(1) Includes noncash asset retirement costs and capitalized interest as follows:

Capitalized interest	$	15,747	$	14,972	$	31,676	$	30,981
Asset retirement costs	$	292,373	$	34,098	$	314,607	$	93,703

	June 30,		December 31,
	2010		2009
BALANCE SHEET DATA:
Cash and Cash Equivalents	$	1,805,347	$	2,048,117
Other Current Assets		2,701,593		2,537,732
Property and Equipment, net		25,123,455		22,900,615
Goodwill		189,252		189,252
Other Assets		612,760		510,027
Total Assets	$	30,432,407	$	28,185,743
Short-Term Debt	$	116,205	$	117,326
Other Current Liabilities		2,086,630		2,275,232
Long-Term Debt		4,896,127		4,950,390
Deferred Credits and Other Noncurrent Liabilities		5,657,685		5,064,174
Shareholders’ Equity		17,675,760		15,778,621
Total Liabilities and Shareholders’ Equity	$	30,432,407	$	28,185,743
Common shares outstanding at end of period		337,799		336,437

APACHE CORPORATION
FINANCIAL INFORMATION

	For the Quarter				For the Six Months
	Ended June 30,				Ended June 30,
	2010		2009		2010		2009
PRODUCTION DATA:
OIL VOLUME — Barrels per day
Gulf Coast		50,788		52,054		50,649		50,441
Central		2,929		2,212		2,652		2,242
Permian		35,812		34,264		35,843		34,959
United States		89,529		88,530		89,144		87,642
Canada		14,561		15,833		14,447		16,090
North America		104,090		104,363		103,591		103,732
Egypt		98,495		95,359		94,642		89,475
Australia		60,680		10,478		43,978		9,164
North Sea		58,141		59,688		57,995		60,089
Argentina		9,874		11,948		9,897		12,192
International		227,190		177,473		206,512		170,920
Total		331,280		281,836		310,103		274,652
NATURAL GAS VOLUME — Mcf per day
Gulf Coast		382,550		364,961		381,636		338,792
Central		206,386		202,594		198,478		206,697
Permian		85,950		95,279		93,247		92,405
United States		674,886		662,834		673,361		637,894
Canada		339,611		373,796		326,646		365,551
North America		1,014,497		1,036,630		1,000,007		1,003,445
Egypt		388,367		376,737		375,249		347,443
Australia		203,147		161,069		205,209		151,607
North Sea		2,516		2,645		2,540		2,663
Argentina		183,028		192,542		168,953		192,250
International		777,058		732,993		751,951		693,963
Total		1,791,555		1,769,623		1,751,958		1,697,408
NGL VOLUME — Barrels per day
Gulf Coast		4,903		3,935		4,901		3,614
Central		500		201		496		279
Permian		6,475		1,347		3,977		1,305
United States		11,878		5,483		9,374		5,198
Canada		1,996		2,052		1,866		2,082
North America		13,874		7,535		11,240		7,280
Argentina		3,118		3,091		3,204		3,114
Total		16,992		10,626		14,444		10,394
BOE per day
Gulf Coast		119,450		116,816		119,156		110,520
Central		37,827		36,178		36,228		36,971
Permian		56,612		51,491		55,362		51,665
United States		213,889		204,485		210,746		199,156
Canada		73,159		80,185		70,753		79,097
North America		287,048		284,670		281,499		278,253
Egypt		163,223		158,148		157,184		147,382
Australia		94,538		37,323		78,179		34,431
North Sea		58,560		60,129		58,418		60,533
Argentina		43,497		47,130		41,260		47,348
International		359,818		302,730		335,041		289,694
Total		646,866		587,400		616,540		567,947

APACHE CORPORATION
FINANCIAL INFORMATION

	For the Quarter				For the Six Months
	Ended June 30,				Ended June 30,
	2010		2009		2010		2009
PRICING DATA:
AVERAGE OIL PRICE PER BARREL
Gulf Coast	$	76.95	$	57.40	$	76.94	$	49.05
Central		74.20		56.07		74.66		45.94
Permian		73.95		52.23		74.50		43.36
United States (1)		74.20		57.00		74.26		49.95
Canada		70.87		55.17		73.10		46.49
North America (1)		73.73		56.72		74.10		49.41
Egypt		76.08		60.30		76.27		51.90
Australia		74.42		63.01		74.58		49.74
North Sea		78.78		58.77		76.58		51.51
Argentina		55.41		46.17		56.60		46.73
International		75.43		58.99		75.05		51.28
Total (1)		74.89		58.15		74.74		50.57
AVERAGE NATURAL GAS PRICE PER MCF
Gulf Coast	$	4.45	$	3.76	$	5.07	$	4.29
Central		4.23		2.96		4.95		3.38
Permian		4.76		4.08		6.03		3.94
United States (1)		5.11		3.88		5.58		4.21
Canada (1)		4.51		3.86		4.88		4.26
North America (1)		4.91		3.88		5.35		4.23
Egypt		3.51		3.85		3.54		3.73
Australia		2.22		1.82		2.22		1.71
North Sea		17.15		12.24		17.73		9.82
Argentina		1.88		1.89		2.01		1.94
International		2.83		2.92		2.88		2.82
Total (1)		4.01		3.48		4.29		3.65
AVERAGE NGL PRICE PER BARREL
Gulf Coast	$	44.27	$	27.13	$	49.25	$	26.33
Central		38.87		27.28		44.40		23.21
Permian		37.73		28.04		38.96		25.30
United States		40.48		27.36		44.63		25.90
Canada		35.76		24.23		37.97		22.40
North America		39.80		26.50		43.52		24.90
Argentina		25.68		15.91		30.23		16.51
Total		37.21		23.42		40.58		22.39

⁽¹⁾ Prices reflect the impact of financial derivative hedging activities.

APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands, except per share data)

NON-GAAP FINANCIAL MEASURES:

Reconciliation of income attributable to common stock to adjusted earnings:

The press release discusses Apache’s adjusted earnings. Adjusted earnings exclude certain items that management believes affect the comparability of operating results and are meaningful for the following reasons:

     Ÿ Management uses adjusted earnings to evaluate the company’s operational trends and performance relative to other oil and gas producing companies.

     Ÿ Management believes this presentation may be useful to investors who follow the practice of some industry analysts who adjust reported company earnings for items that may obscure underlying fundamentals and trends.

     Ÿ The reconciling items below are the types of items management believes are frequently excluded by analysts when evaluating the operating trends and comparability of the company’s results.

	For the Quarter					For the Six Months
	Ended June 30,					Ended June 30,
	2010			2009		2010			2009
Income (Loss) Attributable to Common Stock (GAAP)	$	860,223		$	443,300	$	1,565,204		$	(1,315,060	)
Adjustments:
Foreign currency fluctuation impact on deferred tax expense		(31,511	)		31,164		(24,927	)		26,350
Additional depletion, net of tax		—			—		—			1,981,398
Adjusted Earnings (Non-GAAP)	$	828,712		$	474,464	$	1,540,277		$	692,688
Adjusted Earnings Per Share (Non-GAAP)
Basic	$	2.45		$	1.41	$	4.57		$	2.07
Diluted	$	2.44		$	1.41	$	4.54		$	2.05
Average Number of Common Shares
Basic		337,618			335,637		337,273			335,372
Diluted		339,377			337,365		339,282			337,198

Reconciliation of net cash provided by operating activities to cash from operations before changes in operating assets and liabilities:

The press release discusses Apache’s cash from operations before changes in operating assets and liabilities. It is presented because management believes the information is useful for investors because it is used internally and widely accepted by those following the oil and gas industry as a financial indicator of a company’s ability to generate cash to internally fund exploration and development activities, fund dividend programs, and service debt. It is also used by research analysts to value and compare oil and gas exploration and production companies, and is frequently included in published research when providing investment recommendations. Cash from operations before changes in operating assets and liabilities, therefore, is an additional measure of liquidity, but is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing, or financing activities.

The following table reconciles net cash provided by operating activities to cash from operations before changes in operating assets and liabilities.

	For the Quarter					For the Six Months
	Ended June 30,					Ended June 30,
	2010			2009		2010		2009
Net cash provided by operating activities	$	1,932,012		$	823,513	$	3,085,441	$	1,366,729
Changes in operating assets and liabilities		(97,289	)		436,071		317,162		875,914
Cash from operations before changes in operating assets and liabilities	$	1,834,723		$	1,259,584	$	3,402,603	$	2,242,643

EX-99.2

Exhibit 99.2

CONTACTS:
(Media):	Bill Mintz	(713) 296-7276
	Bob Dye	(713) 296-6662
(Investors):	Tom Chambers	(713) 296-6685
	Rob Rayphole	(713) 296-6160
(Web site):	www.apachecorp.com

APACHE TO ACQUIRE BP ASSETS IN PERMIAN BASIN, CANADA AND EGYPT FOR $7 BILLION

• Legacy assets complement existing operations in all three areas

• Adds proved reserves of 385 million barrels of oil equivalent and approximately 83,000 boe per day of production

• Substantial development opportunities and additional resource potential

     Houston, July 20, 2010 — Apache Corporation (NYSE, Nasdaq: APA) today announced it has agreed to acquire all of BP’s oil and gas operations, acreage and infrastructure in the Permian Basin of West Texas and New Mexico and Egypt’s Western Desert. Apache also will acquire substantially all of BP’s upstream natural gas business in western Alberta and British Columbia. Apache will pay $7 billion for the assets, which include estimated proved reserves of 385 million barrels of oil equivalent (boe).

     Net production from the properties in the first half of 2010 was 28,000 barrels of liquid hydrocarbons and 331 million cubic feet of gas (MMcf) per day, or a total of approximately 83,000 boe per day. By comparison, in the just-completed second quarter of 2010 Apache produced 646,866 boe per day. The transaction also adds 2.4 million net acres to Apache’s global portfolio.

     “This is a rare opportunity to acquire legacy positions from a major oil company, with oil and gas production, acreage, infrastructure, seismic data, field studies, exploration prospects and other essential aspects of our business,” said G. Steven Farris, Apache’s chairman and chief executive officer. “We seldom have an opportunity like this in one of our core areas let alone three. This is a step change that will add muscle, enabling Apache to add value for decades to come through our demonstrated exploitation capabilities and exploration drilling.”

     The effective date of the transaction is July 1, 2010. Closing is subject to certain preferential rights as well as normal regulatory approvals and conditions in the United States, Canada, Egypt and the European Union. As a part of the acquisition, Apache will advance $5 billion of the purchase price to BP on July 30, 2010, ahead of the anticipated closing. This advance will be returned to Apache or applied to the purchase price at closing. Apache intends to finance the acquisition with a combination of debt and equity securities as well as cash on hand. The company has also obtained a $5 billion bridge loan facility to backstop any financing requirements.

     Apache expects the transaction to be modestly accretive to cash flow and per-share production and reserves and neutral to earnings per share in the first full year.

Permian Basin acquisition

     Apache is acquiring 10 field areas in the Permian Basin with estimated proved reserves of 141 million boe (65 percent liquids), first-half 2010 net production of 15,110 barrels of liquids and 81 MMcf of gas per day, and two operated gas processing plants.

     “These are under-exploited assets with 1.7 million gross acres — including 405,000 net mineral and fee acres — in prospective areas of the basin with substantial opportunities for new drilling.” Farris said.

     Apache produced 42,287 barrels of liquids and 86 MMcf of gas per day (net) in the Permian Basin during the second quarter of 2010. At year-end 2009, Apache had proved reserves of 469 million boe and 961,000 gross acres in the Permian.

Canada acquisition

     Apache is acquiring resource-rich acreage in western Canada with estimated proved reserves of 224 million boe (94 percent gas) and first-half 2010 net production of 6,529 barrels of liquids and 240 MMcf of gas per day.

     “We are buying a substantial production base and 1.3 million net acres that include significant positions in several emerging unconventional plays including the Montney, Cadomin, Doig and coalbed methane,” Farris said.

     In the second quarter, Apache’s Canadian operations produced 340 MMcf of gas and 16,557 barrels of liquids per day. At year-end 2009, Apache had 531 million boe of proved reserves and 5.6 million gross acres in Canada.

Egypt acquisition

     Apache is acquiring four development leases and one exploration concession across 394,300 acres in Egypt’s Western Desert. The assets have estimated proved reserves of 20 million boe (59 percent liquids), and first-half 2010 net production of 6,016 barrels of oil and 11 MMcf of gas per day.

     “This is under-explored acreage in a highly prospective area of the Western Desert; a 3-D seismic acquisition program is under way,” Farris said. “BP’s holdings also include strategically positioned infrastructure including a natural gas processing plant, a liquefied petroleum gas plant and oil and gas export lines. These facilities will enable Apache to increase production from our existing fields in the Western Desert.”

     Apache’s second-quarter net production in Egypt averaged 98,495 barrels of oil per day — up 8.5 percent from the first quarter — and 388 MMcf of gas per day, up 7 percent. At year-end 2009, Apache had estimated proved reserves of 309 million boe and 11.1 million gross acres in Egypt.

     “This transaction provides a sustainable growth platform for Apache’s onshore North America operations that complements our recent transaction with Devon Energy Corp. in the Gulf of Mexico and our pending merger with Mariner Energy, as well as strategic infrastructure and exploration potential in Egypt,” Farris said. “We appreciate the opportunity and the professional manner in which BP employees conducted themselves. Their cooperation was a key ingredient for this transaction to come together.”

     Apache’s financial advisors for these transactions were Goldman, Sachs & Co., BofA Merrill Lynch, Citi and J.P. Morgan.

     Apache Corporation is an oil and gas exploration and production company with operations in the United States, Canada, Egypt, the United Kingdom North Sea, Australia and Argentina. From time to time, Apache posts announcements, updates and investor information, in addition to copies of all press releases, on its Web site, www.apachecorp.com.

     Note: Apache will conduct a conference call to discuss the acquisition of BP’s assets in the Permian Basin, Canada and Egypt at 4 p.m. Central time on Tuesday, July 20. The call will be webcast from Apache’s website, www.apachecorp.com. The webcast replay and podcast will be archived on Apache’s web site. The conference call will be available for delayed playback by telephone for one week beginning at approximately 6 p.m. on July 20. To access the telephone playback, dial (800) 642-1687 and enter conference ID #89490183.

Additional Information

     This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. Apache has filed with the Securities and Exchange Commission (“SEC”) a registration statement on Form S-4 containing a preliminary proxy statement of Mariner that also constitutes a preliminary prospectus of Apache. A definitive proxy statement/prospectus will be mailed to stockholders of Mariner. Apache and Mariner also plan to file other documents with the SEC regarding the proposed transaction. INVESTORS AND SECURITY HOLDERS OF MARINER ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain the documents (when available) free of charge at the SEC’s web site, www.sec.gov. Copies of the documents filed with the SEC by Apache will be available free of charge on Apache’s website at www.apachecorp.com under the tab “Investors” or by contacting Apache’s Investor Relations Department at 713-296-6000. Copies of the documents filed with the SEC by Mariner will be available free of charge on Mariner’s website at www.mariner-energy.com under the tab “Investor Information” or by contacting Mariner’s Investor Relations Department at 713-954-5558. You may also read and copy any reports, statements and other information filed with the SEC at the SEC public reference room at 100 F Street N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at (800) 732-0330 or visit the SEC’s website for further information on its public reference room.

     Apache, Mariner, their respective directors and executive officers and other persons may be deemed, under SEC rules, to be participants in the solicitation of proxies from stockholders of Mariner in connection with the proposed transaction. Information regarding Apache’s directors and officers can be found in its proxy statement filed with the SEC on March 31, 2010, and information regarding Mariner’s directors and officers can be found in its proxy statement filed with the SEC on April 1, 2010. Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interests in the transaction, by security holdings or otherwise, will be contained in the definitive proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available.

Forward-Looking Statements

     Statements in this document include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The opinions, forecasts, projections, future plans or other statements other than statements of historical fact, are forward-looking statements. We can give no assurance that such expectations will prove to have been correct. Actual results could differ materially as a result of a variety of risks and uncertainties, including: the timing to consummate the proposed transaction; the risk that a condition to closing of the proposed transaction may not be satisfied; the risk that a regulatory approval that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; negative effects from the pendency of the merger; our ability to achieve the synergies and value creation contemplated by the proposed transaction; our ability to promptly and effectively integrate the merged businesses; and the diversion of management time on transaction-related issues. Other factors that could materially affect actual results are discussed in Apache’s and Mariner’s most recent Forms 10-K as well as each company’s other filings with the SEC available at the SEC’s website at www.sec.gov. Actual results may differ materially from those expected, estimated or projected. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to publicly update or revise any of them in light of new information, future events or otherwise.