What assets will be sold versus spun-off is unclear, but Apache CEO Steve Farris singled out the goal of selling both Apache's 13% stake of the Wheatstone LNG project in WA and its 50% stake of the Kitimat LNG project in Canada.
"I want to reemphasise the strategic direction we laid out on our second quarter earnings call," Farris said overnight according to a conference call transcription.
"We remain committed to exiting our two LNG projects, Wheatstone and Kitimat. And we are continuing to evaluate the separation of our international assets through either strategic transactions or the capital markets."
According to the Australian Financial Review's Street Talk column, Woodside is "thought to be trying to nut out a deal" over the $A2.8 billion Wheatstone stake and could include other Apache assets in a resulting transaction.
"With Woodside on the hunt for growth, Apache's 13 per cent slice of Chevron-managed Wheatstone plus 65 per cent of the Julimar and Brunello gas fields has only limited appeal, though the fields could offer upside beyond the gas committed to LNG," the column claimed.
"Apache's Western Australian oil interests could be of interest, including its 65% of the 30,000 barrels-per-day Balnaves venture, but so could other assets in the global portfolio that are on the block. Those include about 350,000 barrels a day of production in Egypt, and a half stake in the Kitimat LNG project in western Canada, where Woodside is studying its own LNG project which is at a much earlier stage.
"Just how any such deal might come together remains unclear, with Macquarie Group and Goldman Sachs understood to hold the mandate for the Wheatstone asset alone."
The Australian claimed that Woodside wanted both the Kitimat and Wheatstone stakes in a bundled deal.
"The cashed-up, project-hungry Woodside Petroleum has been interested from the outset in the Kitimat stake, but is also said to be prepared to make an offer on Wheatstone if Apache is determined to sell the assets together," the newspaper reported.
"Pavilion Energy, wholly-owned by the Singapore government's investment vehicle Temasek, is also said to still be in the hunt."
In terms of Apache's domestic gas business in WA, the newspaper reported that Seven Group and its private equity partner KKR could make an offer "while Fortescue Metals Group is also in a consortium studying the assets".
Farris said headway was made in several Australian projects over the recent quarter - including the startup of a floating production, storage and offloading facility in the Northern Carnarvon Basin.
"Our Balnaves' FPSO came online at the end of August and is currently producing at 18,000 bpd net to our interest," he said overnight.
"We continue to progress our Coniston oil development [in the Exmouth Basin] and remain on track for first oil during the first half of 2015."
Asset write-downs and an Egyptian tax impairment made Apache post a $US1.3 billion ($A1.52 billion) net loss for the recent quarter. This was 533% down from the $300 million profit in posted in the corresponding period of 2013.
Its worldwide production averaged 637,000 barrels of oil equivalent per day in the September quarter - down 19% year-on-year.
