EX-99.1

EX-99.1 2 d487028dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

APACHE ACHIEVES RECORD FOURTH QUARTER AND 2012 PRODUCTION;

FOURTH QUARTER PRODUCTION AVERAGED 800,000 BOEPD

HOUSTON, Feb. 14, 2013 – Apache Corporation (NYSE, Nasdaq: APA) today reported record overall production for its fourth consecutive year, as well as record oil and liquids production. Average daily production during 2012 increased to 779,000 barrels of oil equivalent (boe) per day, up 5.4 percent compared with the prior year’s production, adjusted for dispositions. Oil and gas revenues were a record $16.9 billion, up from $16.8 billion in the prior year.

These results contributed to full-year 2012 earnings of $1.9 billion or $4.92 per diluted common share, compared with $4.5 billion or $11.47 per share in 2011. Excluding certain items that management believes affect the comparability of operating results, such as the impact of a ceiling test write-down due primarily to substantially weaker Canadian natural gas prices, Apache reported adjusted earnings* of $3.8 billion or $9.48 per share, compared with $4.7 billion or $11.83 per share in 2011. Cash from operations before changes in operating assets and liabilities* was $10.2 billion, sustaining the record level achieved the prior year even with lower average North American natural gas prices.

“Having deepened and strengthened our global portfolio of growth projects since 2010, we are accelerating our operational momentum,” said G. Steven Farris, chairman and chief executive officer. “Apache exited 2012 producing in excess of 800,000 boe per day, driven primarily by our North American oil production, which increased 12 percent during the year.

“We have an extensive pipeline of opportunities that will fuel our profitable growth for years to come. This includes more than 67,000 technically evaluated drilling locations in the onshore U.S. It also includes a robust group of world-class development projects throughout our global portfolio, including Wheatstone and Kitimat, our two liquefied natural gas projects with products indexed to crude oil prices.”

Apache has become the leading oil and gas driller in the Permian Basin, operating more rigs than any industry competitor. Apache also is among the most active oil and gas companies in the Central Region’s Anadarko Basin, as the company accelerates development of its horizontal drilling play inventory. Year-over-year production from these two regions increased 18 and 37 percent, respectively.

Earlier this month, a company subsidiary completed a transaction with Chevron Canada Ltd., to jointly build and operate the Kitimat LNG project, enhancing our efforts to move this project to sanction and monetize natural gas resources we discovered in the Horn River and Liard basins of northern British Columbia. The incremental resources targeted for monetization through Kitimat have the potential to triple Apache’s total proved reserves.

In fourth-quarter 2012 earnings totaled $649 million or $1.64 per diluted share, compared with $1.17 billion or $2.98 per share in the prior-year period. Adjusted earnings for the period were $907 million, or $2.27 per share, compared with $1.2 billion, or $2.94 per share in the same period for 2011. Production reached a new quarterly milestone, averaging 800,000 boe per day, and cash from operations totaled $2.77 billion, compared with $2.66 billion in the same period of the prior year.

Apache’s oil and natural gas liquids production was 51 percent of total volume in 2012 and contributed 81 percent of revenues reflecting the wide gap between global crude oil and North American natural gas prices.

During 2012 the company added 372 MMboe of reserves, or 131 percent of production, through discoveries and extensions and 73 MMboe through acquisitions for a reserve replacement rate of 156 percent, excluding revisions. Low prices throughout the year for Canadian natural gas resulted in a ceiling test write-down and were the primary driver of negative revisions totaling 299 MMboe. Apache ended the year with proved reserves of 2.9 billion boe, after producing 285 MMboe. The company invested $9.0 billion on exploration and development during the year.

Apache to webcast conference call

Apache Corporation will discuss its fiscal 2012 and fourth-quarter results at 1 p.m. Central time on Thursday, Feb. 14. The conference call will be webcast from Apache’s website www.apachecorp.com. The webcast replay will be archived on Apache’s website. The conference call will be available for delayed playback by telephone for one week beginning at approximately 4 p.m. on Feb. 14. To access the telephone playback, dial 855-859-2056 or 404-537-3406 for international calls. The conference access code is 84095210.

About Apache

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. Apache posts announcements, operational updates, investor information and copies of all press releases on its website, www.apachecorp.com.

Forward-looking statements

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects” and similar references to future periods. These statements include, but are not limited to, statements about future growth plans, expectations, and objectives for Apache’s operations including statements about our drilling plans, planned wells, and Wheatstone and Kitimat LNG projects. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our

expectations and predictions depend on a number of risks and uncertainties which could cause our actual results, performance, and financial condition to differ materially from our expectations. See “Risk Factors” in our 2011 Form 10-K and our subsequent filings with the Securities and Exchange Commission for a discussion of risk factors that affect our business. Any forward-looking statement made by us in this news release speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future development, or otherwise, except as may be required by law.

Cautionary Note to Investors

The United States Securities and Exchange Commission (“SEC”) permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SEC’s definitions for such terms. Apache uses certain terms in this release, such as “resources,” and other similar terms that the SEC guidelines strictly prohibit Apache from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality and other factors, and are therefore not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in Apache’s Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2011, and amendments thereto, available from Apache at www.apachecorp.com or by writing Apache at: 2000 Post Oak Blvd., Suite 100, Houston, Texas 77056 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC’s website at www.sec.gov.

*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 http://www.apachecorp.com/financialinfo.

CONTACTS:


Media:	(713) 296-6100	Patrick Cassidy
	(713) 296-7276	Bill Mintz
	(281) 302-2646	John Roper
	(713) 296-6662	Bob Dye

Investors:	(713) 302-2286	Brady Parish
		Castlen Kennedy
		Christopher Cortez
		Alicia Reis

Website:	www.apachecorp.com

APACHE CORPORATION

STATEMENT OF CONSOLIDATED OPERATIONS

(In millions, except per share data)


	For the Quarter					For the Year
	Ended December 31,					Ended December 31,
	2012			2011		2012		2011
REVENUES AND OTHER:
Oil and gas production revenues	$	4,393		$	4,295	$	16,947	$	16,810
Other		(2	)		2		131		78

		4,391			4,297		17,078		16,888

COSTS AND EXPENSES:
Depreciation, depletion and amortization
Recurring		1,380			1,111		5,183		4,095
Additional		28			63		1,926		109
Asset retirement obligation accretion		60			40		232		154
Lease operating expenses		790			659		2,968		2,605
Gathering and transportation		68			75		303		296
Taxes other than income		235			236		862		899
General and administrative		147			132		531		459
Merger, acquisitions & transition		2			5		31		20
Financing costs, net		40			35		165		158

		2,750			2,356		12,201		8,795

INCOME BEFORE INCOME TAXES		1,641			1,941		4,877		8,093
Current income tax provision		506			571		2,235		2,263
Deferred income tax provision		467			181		641		1,246

NET INCOME		668			1,189		2,001		4,584
Preferred stock dividends		19			19		76		76

INCOME ATTRIBUTABLE TO COMMON STOCK	$	649		$	1,170	$	1,925	$	4,508

NET INCOME PER COMMON SHARE:
Basic	$	1.66		$	3.05	$	4.95	$	11.75
Diluted	$	1.64		$	2.98	$	4.92	$	11.47

WEIGHTED-AVERAGE NUMBER OF COMMON SHARES OUTSTANDING:
Basic		391			384		389		384
Diluted		407			400		391		400

DIVIDENDS DECLARED PER COMMON SHARE	$	0.17		$	0.15	$	0.68	$	0.60

APACHE CORPORATION

SUMMARY OF CAPITAL COSTS INCURRED

(In millions)


	For the Quarter				For the Year
	Ended December 31,				Ended December 31,
	2012		2011		2012		2011
CAPITAL EXPENDITURES:
Exploration & Development Costs
United States	$	1,543	$	792	$	5,151	$	2,768
Canada		131		208		590		817

North America		1,674		1,000		5,741		3,585

Egypt		265		222		1,074		896
Australia		355		131		873		576
North Sea		183		205		886		823
Argentina		67		101		289		346
New Ventures - International		14		12		98		61

International		884		671		3,220		2,702

Worldwide Exploration & Development Costs	$	2,558	$	1,671	$	8,961	$	6,287

Gathering, Transmission and Processing Facilities
United States	$	18	$	18	$	75	$	27
Canada		34		35		172		148
Egypt		18		37		33		111
Australia		103		90		441		345
Argentina		4		5		16		12
North Sea		1		—		1		—

Total Gathering, Transmission and Processing	$	178	$	185	$	738	$	643

Capitalized Interest	$	93	$	70	$	334	$	263

Capital Expenditures, excluding Acquisitions	$	2,829	$	1,926	$	10,033	$	7,193

Acquisitions	$	122	$	2,696	$	3,543	$	3,189

APACHE CORPORATION

SUMMARY BALANCE SHEET INFORMATION

(In millions)


	December 31,		December 31,
	2012		2011
Cash and Cash Equivalents	$	160	$	295
Other Current Assets		4,802		4,508
Property and Equipment, net		53,280		45,448
Goodwill		1,289		1,114
Other Assets		1,206		686

Total Assets	$	60,737	$	52,051

Short-Term Debt	$	990	$	431
Other Current Liabilities		4,546		4,532
Long-Term Debt		11,355		6,785
Deferred Credits and Other Noncurrent Liabilities		12,515		11,310
Shareholders' Equity		31,331		28,993

Total Liabilities and Shareholders' Equity	$	60,737	$	52,051

Common shares outstanding at end of period		392		384

APACHE CORPORATION

PRODUCTION INFORMATION


	For the Quarter				For the Year
	Ended December 31,				Ended December 31,
	2012		2011		2012		2011
OIL VOLUME - Barrels per day
Central		21,026		7,323		14,151		6,788
Permian		65,104		54,381		60,215		50,991
GOM Deepwater		8,355		6,507		6,848		6,022
GOM Shelf		44,752		47,780		42,873		46,031
GC Onshore		10,489		10,189		10,036		9,583

United States		149,726		126,180		134,123		119,415
Canada		17,377		14,882		15,830		14,252

North America		167,103		141,062		149,953		133,667

Egypt		103,056		103,908		99,756		103,912
Australia		26,483		38,169		28,884		38,228
North Sea		65,583		55,859		63,692		54,541
Argentina		9,859		9,655		9,741		9,597

International		204,981		207,591		202,073		206,278

Total		372,084		348,653		352,026		339,945

NATURAL GAS VOLUME - Mcf per day
Central		287,956		193,722		242,998		213,447
Permian		184,781		178,766		180,938		173,188
GOM Deepwater		48,177		48,144		46,048		52,193
GOM Shelf		265,918		335,434		291,356		341,242
GC Onshore		103,722		106,505		92,759		84,672

United States		890,554		862,571		854,099		864,742
Canada		550,495		631,122		600,680		632,550

North America		1,441,049		1,493,693		1,454,779		1,497,292

Egypt		350,406		355,091		353,738		365,418
Australia		204,961		189,852		214,013		185,079
North Sea		43,745		2,366		57,457		2,284
Argentina		204,724		221,523		213,464		212,311

International		803,836		768,832		838,672		765,092

Total		2,244,885		2,262,525		2,293,451		2,262,384

NGL VOLUME - Barrels per day
Central		10,231		5,566		6,518		2,268
Permian		21,997		12,256		17,966		11,799
GOM Deepwater		1,519		582		1,185		715
GOM Shelf		6,908		4,446		5,738		5,278
GC Onshore		2,229		2,556		2,120		2,051

United States		42,884		25,406		33,527		22,111
Canada		6,837		5,183		6,258		5,958

North America		49,721		30,589		39,785		28,069

Egypt		—		—		—		49
North Sea		1,085		—		1,618		4
Argentina		2,967		2,997		3,008		3,018

International		4,052		2,997		4,626		3,071

Total		53,773		33,586		44,411		31,140

BOE per day
Central		79,250		45,176		61,169		44,630
Permian		117,898		96,431		108,338		91,655
GOM Deepwater		17,903		15,114		15,708		15,436
GOM Shelf		95,980		108,132		97,170		108,183
GC Onshore		30,005		30,495		27,615		25,746

United States		341,036		295,348		310,000		285,650
Canada		115,963		125,252		122,201		125,636

North America		456,999		420,600		432,201		411,286

Egypt		161,458		163,090		158,713		164,864
Australia		60,643		69,812		64,552		69,074
North Sea		73,959		56,253		74,887		54,925
Argentina		46,946		49,572		48,326		48,000

International		343,006		338,727		346,478		336,863

Total		800,005		759,327		778,679		748,149

APACHE CORPORATION

PRICE INFORMATION


	For the Quarter Ended December 31,				For the Year Ended December 31,
	2012		2011		2012		2011
AVERAGE OIL PRICE PER BARREL
Central	$	82.55	$	89.36	$	86.48	$	89.89
Permian		81.40		89.99		88.18		90.87
GOM Deepwater		103.06		112.77		105.17		106.75
GOM Shelf		105.27		115.70		108.52		108.92
GC Onshore		105.21		112.66		107.83		105.98
United States ⁽¹⁾		91.01		99.54		94.98		95.51
Canada		82.08		94.38		84.89		93.19
North America ⁽¹⁾		90.08		98.99		93.91		95.27
Egypt ⁽¹⁾		107.80		106.65		110.92		109.92
Australia ⁽¹⁾		111.34		109.53		115.22		111.22
North Sea ⁽¹⁾		106.17		104.64		107.97		104.09
Argentina		74.53		76.67		75.89		68.02
International ⁽¹⁾		106.14		105.24		108.92		106.67
Total ⁽¹⁾		98.93		102.71		102.53		102.19

AVERAGE NATURAL GAS PRICE PER MCF
Central	$	3.79	$	3.92	$	3.26	$	4.44
Permian		3.75		5.05		3.34		5.17
GOM Deepwater		3.48		3.48		2.99		4.06
GOM Shelf		3.51		3.86		3.01		4.42
GC Onshore		3.47		3.73		2.92		4.34
United States ⁽¹⁾		4.05		4.59		3.74		4.91
Canada ⁽¹⁾		4.03		4.15		3.42		4.47
North America ⁽¹⁾		4.04		4.40		3.61		4.72
Egypt		4.02		4.82		3.90		4.66
Australia		4.88		2.64		4.55		2.69
North Sea		10.11		20.49		8.95		22.25
Argentina		2.98		2.82		2.87		2.64
International		4.30		3.75		4.15		3.67
Total ⁽¹⁾		4.14		4.18		3.80		4.37

AVERAGE NGL PRICE PER BARREL
Central	$	27.06	$	29.96	$	27.48	$	38.67
Permian		29.95		39.09		32.97		47.88
GOM Deepwater		32.34		58.28		33.06		50.44
GOM Shelf		28.17		55.07		32.04		49.63
GC Onshore		36.60		56.08		40.04		58.51
United States		29.40		42.03		32.19		48.42
Canada		33.59		50.16		34.63		45.72
North America		29.98		43.41		32.57		47.85
Egypt		—		—		—		66.36
North Sea		94.42		—		77.11		65.45
Argentina		22.76		27.00		21.55		27.90
International		41.96		27.00		40.98		28.56
Total		30.88		41.95		33.45		45.95

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

APACHE CORPORATION

NON-GAAP FINANCIAL MEASURES

(In millions, except per share data)

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:

•

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

•

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.

•

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 Ended December 31,						For the Year Ended December 31,
	2012			2011			2012		2011
Income Attributable to Common Stock (GAAP)	$	649		$	1,170		$	1,925	$	4,508

Adjustments:
Canada and other oil & gas property write-down, net of tax		18			60			1,427		60
Deferred tax adjustments		226			(75	)		226		(75	)
U.K. income tax adjustments		—			—			118		218
Commodity derivative mark-to-market, net of tax		51			—			51		—
Merger, acquisitions & transition, net of tax		2			4			19		13
Unrealized foreign currency fluctuation impact on deferred tax expense		(39	)		(5	)		1		(73	)

Adjusted Earnings (Non-GAAP)	$	907		$	1,154		$	3,767	$	4,651

Net Income per Common Share - Diluted (GAAP)	$	1.64		$	2.98		$	4.92	$	11.47

Adjustments:
Canada and other oil & gas property write-down, net of tax		0.04			0.15			3.53		0.15
Deferred tax adjustments		0.56			(0.19	)		0.56		(0.19	)
U.K. income tax adjustments		—			—			0.30		0.55
Commodity derivative mark-to-market, net of tax		0.13			—			0.13		—
Merger, acquisitions & transition, net of tax		—			0.01			0.04		0.03
Unrealized foreign currency fluctuation impact on deferred tax expense		(0.10	)		(0.01	)		—		(0.18	)

Adjusted Earnings Per Share - Diluted (Non-GAAP)	$	2.27		$	2.94		$	9.48	$	11.83

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 Ended December 31,					For the Year Ended December 31,
	2012		2011			2012		2011
Net cash provided by operating activities	$	2,082	$	2,782		$	8,504	$	9,953
Changes in operating assets and liabilities		685		(118	)		1,705		281

Cash from operations before changes in operating assets and liabilities	$	2,767	$	2,664		$	10,209	$	10,234

APACHE CORPORATION

OIL & GAS RESERVES INFORMATION

For the Year Ended December 31, 2012


OIL (Mbbl)

	U.S.			Canada			Egypt			Australia			North Sea			Argentina			Total
Balance - Dec 31, 2011		634,014			141,591			128,035			67,945			169,405			20,587			1,161,577
Extensions and Discoveries		84,656			18,935			36,188			6,277			346			1,133			147,535
Purchases		15,942			188			—			276			2,143			—			18,549
Revisions		(7,474	)		(4,577	)		(3,678	)		(66	)		(928	)		671			(16,052	)
Production		(49,089	)		(5,792	)		(36,511	)		(10,571	)		(23,312	)		(3,565	)		(128,840	)
Sales		(144	)		—			—			—			—			—			(144	)

Balance - Dec 31, 2012		677,905			150,345			124,034			63,861			147,654			18,826			1,182,625


NGL's (Mbbl)

	U.S.			Canada			Egypt			Australia			North Sea			Argentina			Total
Balance - Dec 31, 2011		160,033			31,450			—			—			9,262			7,153			207,898
Extensions and Discoveries		71,965			7,655			—			—			246			—			79,866
Purchases		230			9			—			—			231			—			470
Revisions		(4,559	)		(2,569	)		—			—			(6,329	)		(169	)		(13,626	)
Production		(12,272	)		(2,291	)		—			—			(592	)		(1,101	)		(16,256	)

Balance - Dec 31, 2012		215,397			34,254			—			—			2,818			5,883			258,352


Oil & NGL's

	U.S.			Canada			Egypt			Australia			North Sea			Argentina			Total
Balance - Dec 31, 2011		794,047			173,041			128,035			67,945			178,667			27,740			1,369,475
Extensions and Discoveries		156,621			26,590			36,188			6,277			592			1,133			227,401
Purchases		16,172			197			—			276			2,374			—			19,019
Revisions		(12,033	)		(7,146	)		(3,678	)		(66	)		(7,257	)		502			(29,678	)
Production		(61,361	)		(8,083	)		(36,511	)		(10,571	)		(23,904	)		(4,666	)		(145,096	)
Sales		(144	)		—			—			—			—			—			(144	)

Balance - Dec 31, 2012		893,302			184,599			124,034			63,861			150,472			24,709			1,440,977


GAS (MMcf)

	U.S.			Canada			Egypt			Australia			North Sea			Argentina			Total
Balance - Dec 31,2011		2,976,211			3,547,511			982,966			1,569,584			108,442			537,559			9,722,273
Extensions and Discoveries		365,863			252,130			55,967			176,969			16,397			2,623			869,949
Purchases		313,885			2,503			—			1,745			8,494			—			326,627
Revisions		(156,840	)		(1,443,989	)		(13,974	)		101			—			496			(1,614,206	)
Production		(312,600	)		(219,849	)		(129,468	)		(78,329	)		(21,029	)		(78,128	)		(839,403	)
Sales		(612	)		(422	)		—			—			—			—			(1,034	)

Balance - Dec 31, 2012		3,185,907			2,137,884			895,491			1,670,070			112,304			462,550			8,464,206


TOTAL BOE (Mboe)

	U.S.			Canada			Egypt			Australia			North Sea			Argentina			Total
Balance - Dec 31, 2011		1,290,082			764,293			291,863			329,542			196,741			117,333			2,989,854
Extensions and Discoveries		217,598			68,612			45,516			35,772			3,325			1,570			372,393
Purchases		68,486			614			—			567			3,790			—			73,457
Revisions		(38,173	)		(247,811	)		(6,007	)		(49	)		(7,257	)		585			(298,712	)
Production		(113,461	)		(44,725	)		(58,089	)		(23,626	)		(27,409	)		(17,687	)		(284,997	)
Sales		(246	)		(70	)		—			—			—			—			(316	)

Balance - Dec 31, 2012		1,424,286			540,913			273,283			342,206			169,190			101,801			2,851,679

Proved developed reserves:
Oil + NGL's (Mbbls)		629,345			101,691			106,746			29,053			122,073			20,852			1,009,760
Gas (Mboe)		392,264			289,109			115,073			99,342			15,554			60,843			972,185

Balance - Dec 31, 2012 (Mboe)		1,021,609			390,800			221,819			128,395			137,627			81,695			1,981,945

APACHE CORPORATION

OIL & GAS RESERVES AND COSTS

For the Year Ended December 31, 2012

Reserve Additions (Mboe)


	U.S.			Canada			Egypt			Australia			North Sea			Argentina		Other		Total
Extensions and Discoveries		217,598			68,612			45,516			35,772			3,325			1,570		—		372,393
Purchases		68,486			614			—			567			3,790			—		—		73,457

Additions excluding revisions		286,084			69,226			45,516			36,339			7,115			1,570		—		445,850

Revisions		(38,173	)		(247,811	)		(6,007	)		(49	)		(7,257	)		585		—		(298,712	)

Total		247,911			(178,585	)		39,509			36,290			(142	)		2,155		—		147,138

Capital Cost Information (Non-GAAP) (in millions)


	U.S.		Canada		Egypt		Australia		North Sea		Argentina		Other		Total
Exploration & Development, excluding Capitalized Interest and Asset Retirement Cost (ARC) ⁽¹⁾	$	5,151	$	590	$	1,074	$	873	$	886	$	289	$	98	$	8,961
Acquisitions, excluding ARC - Acquired
Proved		1,071		5		28		4		59		—		—		1,167
Unproved		2,329		—		—		—		26		—		—		2,355

Total	$	8,551	$	595	$	1,102	$	877	$	971	$	289	$	98	$	12,483

⁽¹⁾	Includes capital spending of $1.1 billion for leasehold and $365 million for seismic.

Reconciliation of Exploration and Development Costs to Exploration and Development Costs, excluding Capitalized Interest and Asset Retirement Cost, a Non-GAAP Financial Measure

Presented below is a reconciliation of exploration and development costs (GAAP) to exploration and development costs, excluding capitalized interest and asset retirement cost (Non-GAAP). Management believes exploration and development costs, excluding capitalized interest and asset retirement cost is a more accurate reflection of the expenditures during the current year.


	U.S.			Canada			Egypt			Australia			North Sea			Argentina			Other		Total
Exploration & Development Costs (in millions)	$	5,834		$	873		$	1,090		$	1,064		$	948		$	318		$	98	$	10,225
Less: Capitalized Interest		(215	)		(38	)		(16	)		(12	)		(24	)		(11	)		—		(316	)
Less: ARC		(468	)		(245	)		—			(179	)		(38	)		(18	)		—		(948	)

Total Adds	$	5,151		$	590		$	1,074		$	873		$	886		$	289		$	98	$	8,961

Reconciliation of Total Acquisition Costs to Acquisitions, excluding Asset Retirement Cost - Acquired, a Non-GAAP Financial Measure

Presented below is a reconciliation of total acquisition costs (GAAP) to acquisitions, excluding asset retirement cost - acquired (Non-GAAP). Management believes acquisitions, excluding asset retirement cost - acquired is a more accurate reflection of the costs of acquisitions during the current year.


	U.S.			Canada		Egypt		Australia			North Sea			Argentina		Other		Total
Total Acquisition Costs (in millions)
Proved	$	1,076		$	5	$	28	$	32		$	110		$	—	$	—	$	1,251
Unproved		2,329			—		—		—			26					—		2,355
Less: ARC - Acquired		(5	)		—		—		(28	)		(51	)		—		—		(84	)

Acquisitions, excluding ARC - Acquired	$	3,400		$	5	$	28	$	4		$	85		$	—	$	—	$	3,522