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Income Taxes
3 Months Ended
Mar. 31, 2013
Income Tax Disclosure [Abstract]  
Income Taxes

7. INCOME TAXES

The Company estimates its annual effective income tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which the Company operates. Statutory tax rate changes and other significant or unusual items are recognized as discrete items in the quarter in which they occur. Accordingly, the Company recorded the income tax impact of a $65 million and $521 million non-cash write-down of its Argentinian and Canadian proved oil and gas properties, respectively, as a discrete item in the first quarter of 2013 and 2012.

Additionally, the Company recorded an increase in the valuation allowances in Argentina and Canada during the first quarter of 2013 totaling $27 million and $12 million, respectively, for deferred tax assets the Company does not expect to realize.

Apache and its subsidiaries are subject to U.S. federal income tax as well as income or capital taxes in various state and foreign jurisdictions. The Company’s tax reserves are related to tax years that may be subject to examination by the relevant taxing authority. The Company is under audit with the Internal Revenue Service (IRS) for the 2009, 2010, and 2011 tax years. The Company is also under audit in various states and in most of the Company’s foreign jurisdictions as part of its normal course of business.