Apache Corp.’s share price up, locates big oil reserves off the coast of Australia

Apache Corp. announced the discovery of crude reserves amounting to as much as 300 million barrels off the coast of Western Australia, prompting a surge for its partners shares, ahead of Wall Street trade opening later today.

According to the companys statement, oil in at least four locations was found by the companys drills at the Phoenix South-1 well, with six samples confirming a sizable cache of crude.

“The oil and reservoir quality we have seen point to a commercial discovery,” Thomas E. Voytovich, Apache executive vice president and chief operating officer – International, said in the statement. “If these results are borne out by further appraisal drilling, Phoenix South may represent a new oil province for Australia.”

Carnarvon Petroleum Ltd, one of Apaches partners, with a 20% stake in the exploration license, saw its shares soar by as much as 245% to close Mondays session in Sydney at 0.240 AUD, up ~200%.

“This is the most significant new oil play in the North West Shelf since the Enfield discovery opened up the Exmouth Basin almost 20 years ago,” Adrian Cook, Carnarvon Managing Director, said. “The implications on the rest of our acreage are still being assessed, but the potential is extraordinary.”

The news comes as a discontinuation of Apaches Australia operations was on the table for some time. Wells in the country have been drying up, with daily production dropping 17% last year, according to BP. All the partners of the Phoenix South-1 well, however, have now committed to further exploration of the area.

Apache Corp. was 0.76% up to close at $98.68 per share on Friday, marking a one-year change of +22.94% and valuing the company at $37.74bn. According to CNN Money, 29 analysts offering 12-month price forecasts for Apache Corp. have a median target of $110.00, with a high estimate of $130.00 and a low estimate of $95.00. The median estimate represents a +11.47% increase from the last price of $98.68.