DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

6 Months Ended

Jun. 30, 2013

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Open Crude Oil and Natural Gas Derivative Instruments

As of June 30, 2013, Apache had the following open crude oil derivative positions:

		Fixed-Price Swaps				Collars
Production Period	Settlement Index	Mbbls		Weighted Average Fixed Price		Mbbls		Weighted Average Floor Price		Weighted Average Ceiling Price
2013 (1)	NYMEX WTI		444	$	77.66		1,058	$	78.48	$	103.20
2013 (1)	Dated Brent		—		—		1,656		86.39		117.93
2013	NYMEX WTI		11,040		90.85		—		—		—
2013	Dated Brent		11,956		106.47		—		—		—
2014 (1)	NYMEX WTI		76		74.50		—		—		—
2014	NYMEX WTI		22,813		90.83		—		—		—
2014	Dated Brent		22,812		100.05		—		—		—

⁽¹⁾  For 2013 and 2014, these fixed-price swaps and collars have been designated as cash flow hedges with unrealized gains and losses deferred in accumulated other comprehensive loss.

As of June 30, 2013, Apache had the following open natural gas derivative positions:

	Fixed-Price Swaps				Collars
Production Period	MMBtu (in 000’s)		Weighted Average Fixed Price(1)		MMBtu (in 000’s)		Weighted Average Floor Price (1)		Weighted Average Ceiling Price (1)
2013		5,034	$	6.71		2,300	$	5.35	$	6.67
2013 (2)		44,160		4.20		—		—		—
2014		1,295		6.72		—		—		—

⁽¹⁾  U.S. natural gas prices represent a weighted-average of several contracts entered into on a per-million British thermal units (MMBtu) basis and are settled primarily against NYMEX Henry Hub.

⁽²⁾  For 2013, these fixed-price swaps have not been designated as cash flow hedges, and changes in fair value are reflected directly in earnings. All other derivative positions have been designated as cash flow hedges.

Assets and Liabilities Measured at Fair Value on Recurring Basis

The following table presents the Company’s derivative assets and liabilities measured at fair value on a recurring basis:

	Fair Value Measurements Using
	Quoted Price in Active Markets (Level 1)		Significant Other Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total Fair Value		Netting(1)			Carrying Amount
	(In millions)
June 30, 2013
Assets:
Derivatives designated as cash flow hedges	$	—	$	24	$	—	$	24
Derivatives not designated as cash flow hedges		—		148		—		148
Total Derivative assets	$	—	$	172	$	—	$	172	$	(21	)	$	151
Liabilities:
Derivatives designated as cash flow hedges	$	—	$	9	$	—	$	9
Derivatives not designated as cash flow hedges		—		34		—		34
Total Derivative liabilities	$	—	$	43	$	—	$	43	$	(21	)	$	22
December 31, 2012
Assets:
Derivatives designated as cash flow hedges	$	—	$	48	$	—	$	48	$	(15	)	$	33
Liabilities:
Derivatives designated as cash flow hedges	$	—	$	51	$	—	$	51
Derivatives not designated as cash flow hedges		—		80		—		80
Total Derivative liabilities	$	—	$	131	$	—	$	131	$	(15	)	$	116

⁽¹⁾  The derivative fair values are based on analysis of each contract on a gross basis, excluding the impact of netting agreements with counterparties.

Fair Values of Derivative Instruments Recorded in Consolidated Balance Sheet

The carrying value of the Company’s derivative assets and liabilities and their locations on the consolidated balance sheet are as follows:

	June 30,		December 31,
	2013		2012
	(In millions)
Current Assets: Derivative instruments	$	87	$	31
Other Assets: Deferred charges and other		64		2
Total Assets	$	151	$	33
Current Liabilities: Derivative instruments	$	22	$	116
Total Liabilities	$	22	$	116

Commodity Derivative Activity Recorded in Statement of Consolidated Operations

The following table summarizes the effect of derivative instruments on the Company’s statement of consolidated operations:

	Gain (Loss) on Derivatives Recognized in Income	For the  Quarter Ended June 30,					For the Six  Months Ended June 30,
		2013			2012		2013			2012
		(In millions)
Gain (loss) on cash flow hedges reclassified from accumulated other comprehensive loss	Oil and Gas Production Revenues	$	(11	)	$	78	$	(20	)	$	119
Gain (loss) for ineffectiveness on cash flow hedges	Derivative instrument gains (losses), net	$	—		$	—	$	—		$	—
Gain (loss) on derivatives not designated as cash flow hedges	Derivative instrument gains (losses), net	$	247		$	—	$	147		$	—

Commodity Derivative Activity in Accumulated Other Comprehensive Loss

A reconciliation of the components of accumulated other comprehensive loss in the statement of consolidated shareholders’ equity related to Apache’s cash flow hedges is presented in the table below. Derivative activity represents all of the reclassifications out of accumulated other comprehensive loss to income for the periods presented.

	For the Six Months Ended June 30,
	2013						2012
	Before tax			After tax			Before tax			After tax
	(In millions)
Unrealized gain (loss) on derivatives at beginning of period	$	(10	)	$	(6	)	$	145		$	114
Realized amounts reclassified into earnings		20			14			(119	)		(92	)
Net change in derivative fair value		—			(1	)		171			112
Ineffectiveness reclassified into earnings		—			—			—			—
Unrealized gain on derivatives at end of period	$	10		$	7		$	197		$	134