Apache restructures organization and makes key leadership changes

Apache Corp. (NYSE, Nasdaq: APA) is reorganizing its operating regions and making key leadership changes, the company said June 1.

"Today's announcement marks the formation of our operational leadership team and a reorganization that will position Apache for continued success,” said John J. Christmann IV, Apache's CEO and president. “These changes represent a significant step toward streamlining our operations in a way that will greatly enhance our ability to maximize recovery and minimize costs. This new structure will enable us to allocate resources and personnel expediently as industry conditions dictate. In addition, we have consolidated our technical expertise into centers of excellence, which will support each operating region and strengthen our ability to share best practices around the globe."

Following a series of acquisitions and divestitures over the last five years, Apache has completed a strategic repositioning of its portfolio that emphasizes the growth potential of its North American business and the strong free-cash-flow-generation of its Egypt and North Sea assets. To realign organizational resources with the company's updated portfolio, Apache is implementing a more integrated, super-region structure that will reduce redundancy and increase operational efficiency.

The new organization includes three super regions. In North America, the company is merging resources into two super regions: the Permian Region and the Houston Region. Apache's Egypt Region, North Sea Region, and Gulf of Mexico Region will form the International and Offshore Region.

The newly formed Houston Region will consolidate operational activities for the Eagle Ford, Anadarko Basin, Texas Panhandle, and Canadian properties into one region. The Canadian properties will continue to be operated out of the existing Calgary, Alberta, office. The Permian Region will continue to include the Midland Basin and the Central Basin Platform operated out of Midland, Texas, with the Delaware Basin receiving separate and individualized management in San Antonio, Texas, to realize the exceptional potential of these unconventional assets.

The Houston Region reorganization includes the closing of Apache's regional office in Tulsa, Oklahoma, and relocating a number of Tulsa employees. This will consolidate employee expertise in a single office location to foster increased collaboration and technology transfer among asset teams.

Other organizational optimization is also under way consistent with the high-graded portfolio. By the end of 2015, Apache will reposition its overall cost structure to establish itself as a strong and efficient competitor. The company will provide an update on its plans and progress on its second-quarter earnings call.

Apache is realigning its senior operational leadership to support the company's organizational restructuring. The following key management changes are effective immediately but will include a transition period through the end of July: 

Timothy J. Sullivan has been appointed to the newly created role of senior vice president of operations support and will be based in Houston. In this role, he will support the CEO in operational strategy, capital allocation, market intelligence, and marketing.

Thomas E. Voytovich will assume the role of executive vice president of international and offshore region and exploration and production technology. In addition to his current management of Apache's operations in Egypt, the North Sea, and the Gulf of Mexico, he will also oversee the Exploration and Production Technology and Engineering Technology service teams. Voytovich will remain in Apache's Houston headquarters.

James L. House has been named to the newly created position of senior region vice president for the Houston Region and will be based in Apache's Houston headquarters.

Grady L. Ables will assume the role of region vice president for the Canada Region and president of Apache Canada, and will report up through the Houston Region. Ables will be based in Apache's Calgary, Alberta, office.

Faron J. Thibodeaux will continue to oversee the company's operations in the Midland Basin and Central Basin Platform as the senior region vice president for the Permian Region, based in Apache's Midland, Texas, office.

Steven J. Keenan will oversee the North American Unconventional Resources Technology team, Unconventional Resources New Ventures team, and the company's operations in the Delaware Basin as senior region vice president for the Delaware Basin. Keenan will remain in Apache's San Antonio, Texas, office.

Cory L. Loegering will assume the role of region vice president for the UK Region and managing director for Apache North Sea, following House's relocation to Houston. Loegering will be based in Apache's Aberdeen, Scotland, office and will continue to report to Voytovich.

Thomas M. Maher will continue to oversee the company's operations in Egypt as the region vice president for the Egypt Region and general manager of Apache Egypt, from Apache's Cairo, Egypt, office.

The organizational changes and realignment of Apache's operating areas will not impact the reporting of production in the company's quarterly supplement. The company will continue to report production as Permian (Midland Basin, Central Basin Platform, Delaware Basin), Central (Anadarko Basin, Texas Panhandle), Gulf Coast (Eagle Ford), Canada, Gulf of Mexico, Egypt, and the North Sea.

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