Good afternoon, my name is Jennifer and I will be your conference operator today. At this time, I would like to welcome everyone to the Apache's Third Quarter 2015 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Thank you. And Mr. Gary Clark, you may begin your conference.

Thank you and good afternoon. Welcome to Apache Corporation's third quarter 2015 earnings conference call. Speakers making prepared remarks on today's call will be Apache's CEO and President, John Christmann; and CFO, Steve Riney. Also joining us in the room is Tom Voytovich, Executive Vice President of International and Offshore; and Tim Sullivan, Senior Vice President of Operations. In conjunction with this morning's press, I hope you have had the opportunity to review our quarterly earnings supplement, which summarizes Apache's regional operating activities and well highlights. The supplement also includes our revised full-year 2015 guidance, details of our capital expenditures in the quarter, as well as a chart that illustrates cash sources and uses and reconciles Apache's change in net debt during the third quarter of 2015. Our earnings release, the accompanying financial tables and non-GAAP reconciliations and our quarterly earnings supplement can all be found on our website at www.apachecorp.com. I'd like to remind everyone that today's discussions will contain forward-looking estimates and assumptions based on our current views and most reasonable expectations. However, a number of factors could cause actual results to differ materially from what we discuss today. A full disclaimer is located with the supplemental data on our website. Also, please note that in this morning's press we have consolidated our production and pricing information for the Midcontinent and Gulf Coast regions, which is were reported separately. I would now like to turn the call over to John. John J. Christmann - President, Chief Executive Officer & Director: Thank you, Gary. Good afternoon and thank you for joining us today. Before I dive into our results for the quarter I would like to take a step back to highlight the progress we have made so far this year. We have significantly streamlined and high graded our…

Our first question comes from Pearce Hammond with Simmons & Company. Pearce Wheless Hammond - Simmons & Company International: Good afternoon, guys. Thanks for taking my questions. Just to follow-up on the commentary just now about matching cash flow with CapEx, would that include the dividend or would the dividend be upside of that? Stephen J. Riney - Chief Financial Officer & Executive Vice President: Yes. For 2016, our goal would be to match that including the dividend. So it would be cash flow neutral. Pearce Wheless Hammond - Simmons & Company International: Including the dividend. Okay, great. And then I know you're working through this still, but could you provide any color on what you think maintenance CapEx might be to hold exit rate 2015 production flat through 2016? John J. Christmann - President, Chief Executive Officer & Director: Hi, Pearce, this is John. What I would say is the best thing to do is look at 2015 right now. I mean, we've guided to $3.6 billion to $3.8 billion of CapEx spend. As you will recall in February, we guided to relatively flat North American production and slight growth internationally. When you look at the CapEx levels, we had $1 billion outspend in the first quarter alone for this year. When you look at the capital numbers, clearly now, with the updated ranges today, at 307,000 boe to 309,000 boe on North America and 172,000 boe to 174,000 boe on international, we're showing 2% plus growth in North America and 10% to 12% growth on the international side on that type of capital program. I think the best thing we can do given this price environment; the commodity price is going be a big driver. As Steve mentioned, we're going to live within cash flow. And so as we start to pour that plan, that's a big key. And I'd say, looking into 2016 with the reductions we've had on the cost structure side, specifically on the costs we have in the house at this point at 30% down, capital's going to continue to go further. I can also tell you that a lot of that CapEx this year was spent early in the year when we had higher costs. And we see things even now that are going to point to lower costs going forward. So, the best thing to do is look at what we've done this year and kind of translate off of that.

Your next question comes from Evan Calio with Morgan Stanley. Evan Calio - Morgan Stanley & Co. LLC: Good afternoon, guys. Maybe just a follow-up on that, the 2016 budget parameters. I mean you say that living within cash flow excludes asset sales and includes the dividends. So, do asset sales then just create a buffer on your balance sheet? How do you contemplate the redeployment of those proceeds such as the $500 million announced in the quarter? I mean it's been a relatively sizable program and just curious how you think about that capital coming back into the business. Stephen J. Riney - Chief Financial Officer & Executive Vice President: Yeah. I'll let John comment on this as well. But I think at this point in time, the right answer to that question is the fact that we're not contemplating any material asset sales in 2016. And therefore, we're not planning to spend the proceeds on any of those. And therefore, cash flow neutrality needs to be on an operating basis. Now, that's – I'd just caution all of that with the fact that we're not going to get dogmatic about being cash flow neutral. And we reserve the right to not be cash flow neutral. But it's going to be – it's a prudent assumption going into the year at this point in time. And then 2016, I have no doubt, will be just as exciting as 2015 has been. And we'll, no doubt, adjust plans as we go through the year. But I think the prudent thing to do at this point in time is to go into the year planning on being cash flow neutral. Evan Calio - Morgan Stanley & Co. LLC: Got it, I would agree. Maybe my second, if I could, following up on the comments on the JV process, the positive progress there and then the plans to run three rigs in Canada next year versus zero today. Can you discuss the cost environment in Canada and how you kind of see those returns stacking up against the rest of your portfolio? I presume that the JV details could also augment those returns for you. If you could. John J. Christmann - President, Chief Executive Officer & Director: In general, Evan, we want to remain cash flow neutral in Canada. I mean what I don't want to do is take cash flow from our Lower 48 properties and spend that in Canada. So that's the main reason why we are looking at and are making progress on a JV in the Montney. And the way that would be structured is we would be using other capital to get that program kicked off. In terms of how the Montney and the Duvernay compete in terms of – they compete very nicely with the portfolio. And I'm going ask Tim Sullivan to dig in a little bit on the cost structure we're seeing on the Duvernay at this point.

Yes. As John mentioned, we just put on the first Duvernay pad that we drilled. This was a seven well pad. It was a spacing test. Half of the section was designed to test eight wells per section; the other half to test six wells per section. We're going through a third party facility. So, we're a little bit curtailed, we only have four of the wells online. But those four wells are doing just under 13 million boe (34:50) a day and 3,350 barrels of condensate per day. Again those are curtailed with the flowing tubing pressure of over 3,300 pounds. Next week we hope to have that facility up and running and we'll be able to bring the other three wells online. And we should have everything flowing at capacity on December 1. Now to the cost structure question, last year we spent about $18.1 million drilling one-off wells out there. We went to pad operations. This year where we had two walking rigs and we batch drilled each section of the well. We were able to reduce our well cost by 36%, 8% of that savings was due to foreign exchange, but the rest of it was primarily due to cost savings and operational efficiencies. And most of those operational efficiencies were made up on the completion side. In those seven laterals we did 124 different frac stages and we pumped that in just six days. We averaged 7.9 fracs per day, with only 34 minutes between stages. And we got down to as low as 6 minutes between two of the stages. So we were pumping 82% of the time when we had the equipment on location. And really the Canadian team there, we're really leveraging the learnings that we had from the Horn River drilling that we've done in the past. And we see future costs there as we get our water facility in place even going down further and we think we can get these costs down to $8.5 million to $9 million per well.

Your next question comes from Doug Leggate with Bank of America Merrill Lynch.

Hi, good afternoon, everybody. John, I appreciate the disclosure I guess on the pursuit of a joint venture. If I could just have a quick follow-up. If we look at your position up there, it seems that, if I'm not mistaken, the bulk of your locations is in the area where you have the lowest working interest. And the highest working interest I guess you've got about half the number of locations, so I'm thinking Duvernay being the one with the small working interest. So when you think about structuring a joint venture and I guess getting someone to fund you or carry you, is that the kind of structure we should think about? In which case, what kind of working interest would you anticipate getting to and how would you think about that? I've got a follow-up, please. John J. Christmann - President, Chief Executive Officer & Director: Well, Doug, I got to be a little bit careful. We're talking about the Montney and it's an area we have 100%. So we do not have partners. We're not at this point looking at the Duvernay. The area you're talking about, the current wells we've got about 37.5%. We're in there with Chevron and, of course, their joint venture partner. So, we're really talking about an area in the Montney where we have 100%. And that is the area we're looking at and I don't want to get into too much color because we're in the heat of battle of negotiations. But it would be structured where we would obviously be able to keep the majority and would get significant carry upfront, and which would unease our infrastructure and costs going, over the next couple years.

I appreciate that. I don't know if I missed that earlier. That would make perfect sense given your working interest there. Thank you for that. My follow-up is really about – I realize you don't want to give production guidance, but if you look at the spend level in the third quarter – and obviously there's a lot of moving parts on production declines and so on. But if you continue to spend at the third-quarter level, based on what we saw in Q3, what would you say your underlying decline rate would look like? John J. Christmann - President, Chief Executive Officer & Director: Well, I mean in terms of our decline rate, if I take North America, we're still running about a 25% overall decline, our Permian's about 22%. I do anticipate those numbers coming down as we start to look at the pace because we just haven't drilled as many new wells this year as we have historically. So I think those numbers will be dropping slightly, but it's early. We're still working through those planned numbers. The one thing I would say about the back half of the year, as we alluded to on the call, with the drop in prices we held off picking up three rigs, two in the Permian and one in the Eagle Ford. And it's going to have very minimal impact; we're still in a position to raise guidance on our North American position. So, we feel good about our properties, we feel good about how we're executing and we're really starting to see efficiencies drive into the numbers.

Great stuff. I will jump back in queue. Thanks, John.

And your next question comes from Brian Singer with Goldman Sachs. Brian A. Singer - Goldman Sachs & Co.: Good afternoon. John J. Christmann - President, Chief Executive Officer & Director: Hi, Brian. Brian A. Singer - Goldman Sachs & Co.: How are you thinking about the role of the international assets here, particularly in light of some of the positives you reported on in Egypt and the North Sea? Are there any changes in, A, how these areas are competing for capital relative to the rest of the portfolio, and B, the strategic thoughts on retaining versus divesting? John J. Christmann - President, Chief Executive Officer & Director: No, Brian, I think at this point, when we look into the future, our primary growth is going to come from North America. I think you have to recognize the benefit of the portfolio. And we came out with that early in the year with the drop in prices, and the international both are less sensitive to the drop in oil price and you've seen that come through in cash flow from both those operations. Secondly, if you take Egypt and take Ptah and Berenice, tell me how many places in the world you can have a discovery and within seven, eight months you're producing from two handfuls of wells to 26,000 barrels of oil a day? So we've got quick tie-in, quick infrastructure to those things, so very high rates of return. In the North Sea, there's a couple of things there. Number one, we've invested in the infrastructure. We spent $1.3 billion over the last decade at Forties and that infrastructure is in really good shape. That's why we can operate at 92%. In our Beryl area we spent over $300 million on the infrastructure there. So, I don't…

Your next question comes from Bob Morris with Citi.

Thank you. John, in the Permian and pulling back two rigs you originally intended to add, does that mean you're going to ramp up now to only 16 rigs by year-end? And where are you right now? John J. Christmann - President, Chief Executive Officer & Director: Right now, we're at 14 rigs, Bob. I think we really just deferred. And all that's really done for us is we will end the year with fewer drilled-but-uncompleted wells. But we felt like that's the prudent thing to do right now based on where oil prices are and trying to feather our programs going into 2016, living within cash flow.

And so the two rigs you won't add, where had you intended to add those rigs in the Permian? John J. Christmann - President, Chief Executive Officer & Director: They were going to be predominantly Midland Basin, Central Basin Platform.

Okay. And then the drilled-but-uncompleted inventory you ran, where is that? And is that steady-state or is that an inventory that you can draw down further in 2016? John J. Christmann - President, Chief Executive Officer & Director: Well, I mean first and foremost, we had guided to on the last quarter a range in the 80 to 100 range of drilled-but-uncompleted horizontals in North America. We now see that number ending the year around 60 plus. And it's not that during the quarter we consumed a lot of drill – picked up our completion pace. We just elected to wait. And the main reason is we've got visibility on costs coming down further. We've got a few drilling rigs that some term is rolling off in the next 30 days. And we're going to see those rig rates drop 37%, 38%. So we made a decision over this last quarter not to, in fact, we lowered the top end of our capital guidance range by $100 million. We decided not to spend that $100 million now, and we can wait and spend those in the future.

And your next question comes from John Herrlin with Société Generale.

Yes. Hi. Not trying to preempt the North Sea discussion that you will have in two weeks, but is it fair to say that you may dedicate a little bit more CapEx in 2016 to the North Sea? John J. Christmann - President, Chief Executive Officer & Director: John, I wouldn't see, mix is changing too much. I mean, we've had, if you look at our capital this year, North Sea actually is down 25% over last year. So I don't see a major shift. You're not going to see us shift a ton of money by any means. But I think you're going to see we've got a lot more running room. And we've got some very material things that could come on that can be very impactful.

Okay. Thanks, John. Regarding the switch to successful efforts, any kind of a ballpark sense about what kind of a balance sheet hit it would be? John J. Christmann - President, Chief Executive Officer & Director: I'll let Steve jump in on that one. Stephen J. Riney - Chief Financial Officer & Executive Vice President: I was hoping you'd answer that, John. No, I think it's too early to say. We've got in the 10-Q what we believe the fourth quarter hit to the balance sheet will be because of staying on full cost accounting and further softness in the commodity prices. But it's too early to say at this point in time what will happen if and when we switch to successful efforts to the balance sheet.

And your next question comes from Ed Westlake with Credit Suisse. Edward George Westlake - Credit Suisse Securities (USA) LLC (Broker): Thanks for taking the question. Just coming back to the Midland. Obviously the industry has had success delineating various different zones in the Delaware. I mean you've got some very good wells out at the Pecos Bend. You've got a lot of wells or you've got some acreage, Wildfire, Azalea, Powell-Miller, over on the Midland. I'm just wondering if you are able to give us, having had more time working with the acreage, some kind of, as others do, inventory that works at say $50 in terms of well locations and then $60, $70. So some un-risked sense of the inventories in those two particular areas. John J. Christmann - President, Chief Executive Officer & Director: What I would say, Ed, is we have not done a – I mean, obviously we're working those areas. We continue to test lots of zones. You look in the Midland Basin, we've got multiple zones in there we're testing. As I mentioned, we're about to drill or in the process of drilling Spraberry shale wells. You look at our Pecos Bend area; we've gone in now and added a second landing zone within the 3rd Bone Springs. So, we continue to make progress. We continue to test zones and really scope opportunities and work on the cost structure so that when we get to a position where we feel like it makes sense to put more rigs and more capital to work, we're ready to do that. In terms of counts, we have not come out with a bunch of updated numbers. Really, the best look would be going back to what we did a year ago where we did a very…

And your next question comes from John Freeman with Raymond James. John A. Freeman - Raymond James & Associates, Inc.: So nice well results in the Delaware Basin, but what really jumped out at me in particular was you completed 22 wells in the area versus 12 last quarter, despite still using just the one frac crew. And so I'm trying to get an idea of – you completing nearly twice as many wells with the same number of frac crews. Is that all huge efficiency gains or is there some other moving parts that doesn't make the quarters comparable? John J. Christmann - President, Chief Executive Officer & Director: No, I think, number one, is just the pace at which we had them, but number two, we are making tremendous headway on efficiencies everywhere. We also are getting wells drilled significantly faster as well as getting more wells fracked. Tim gave you some color on the Duvernay pad, how quickly those went off. We're seeing tremendous success operationally everywhere, and that's just a function of it doesn't take as much equipment to go as far as it did a year ago. John A. Freeman - Raymond James & Associates, Inc.: Okay, great. And then on Egypt you disclosed that you've initiated this large seismic reprocessing project that you hope to have done by the end of the year. I guess I'm just curious sort of what kind of took place in the field that kind of drove the decision to have it; what you hope to kind of get out of that shoot or reprocessing? Excuse me.

Reprocessing? John J. Christmann - President, Chief Executive Officer & Director: In Egypt.

Yeah. John J. Christmann - President, Chief Executive Officer & Director: In Egypt.

And where is it, or? John J. Christmann - President, Chief Executive Officer & Director: He asked the scope and what we thought we could get from it with the large reprocessing in Egypt.

Well, as you're well aware, the whole basis of our success in Egypt is that 3D seismic, and with continued technological advances, improved processing and basically combining previous shoots, adding new data, we just get a more clear picture of the same areas we've been working for years. So, all this is going to do is help us identify previously unseen prospects and continue to deliver inventory in future years. John J. Christmann - President, Chief Executive Officer & Director: And two perfect examples are Ptah and Berenice. I mean they're right there at our Khalda Offset area, right near our existing stuff. So, it's just a function of taking the technology up that can quantify and get really solid ties and – to the – some of the plays out there.

Our next question comes from Charles Meade with Johnson Rice. Charles A. Meade - Johnson Rice & Co. LLC: Good afternoon, guys. John, last quarter you and Steve spent some time laying out your new planning process where you guys were running scenarios at three different price points for WTI, or for oil I should say. I was wondering if you could give us an update if you've moved where those prices are in your scenarios. And perhaps more broadly, as you've been working that process over the last several months, if you're finding any areas that are surprising to you either in terms of their rigidity or new areas of flexibility you've discovered. John J. Christmann - President, Chief Executive Officer & Director: Charles, we did move those. I mean we started the year with a – kind of a $50, $65 and $80, and we planned on $50 at the start, and then in April, May timeframe when things ran up into the mid-$60s we were using those decks. Clearly, we've moved those down. In the last call we talked kind of $45, $55, $65. We're not too far off of those cases as we think about things today. The one thing I would say is the resiliency of the projects moves a little bit. The bigger tie is what are you doing with gas prices and how does that link in with some of these plays that we've got that have a little higher GOR and gas rates? But in general, we're seeing projects and wells in every play that works very well and it's really a function of the cash flow that comes off of those scenarios and the cost structure assumptions are the biggest variables we're trying to get pinned down right now. Charles A.…

Yes, we can get back with you on those, Charles. We've got those numbers for that area.

Your next question is from Leo Mariani with RBC.

Hey, guys. Just a question around the acreage acquisitions that you all were talking about. Looks like you did a healthy portion. You guys commented that you're sort of paying prices which were a lot less than some of these hot high-profile deals we've seen recently. Can you guys just let us know where are you concentrating the acreage acquisitions? Is it sort of Delaware, Midland, or Midcon? Can you just help us with where you're looking to buy? John J. Christmann - President, Chief Executive Officer & Director: Yeah. Number one, we're within our core areas. Number two, we are looking at some things that would be significantly lower than what I'd call the retail prices that are being paid. And it's where we're applying technology and science and we think we've got some things that could be material. It is new ventures acreage, so there's always risk with that and that's why we wouldn't want to talk about it now. But we're talking significant multiples lower in terms of what that acreage might be viewed as and what it potentially could be worth. And I think that's the zip-code that we feel like makes the most sense in this price environment because we can pick it up and we can work the science and you can have something that could be material.

Okay. I guess jumping over to Egypt; you obviously had good performance in terms of your increases in gross production in the third quarter. I noticed that the net production, though, went down a fair bit in 3Q versus 2Q, despite lower commodity prices. What's driving that and how should we think about that going forward? John J. Christmann - President, Chief Executive Officer & Director: It's the tax barrels. I'm going let Steve Riney give you the exact color on that. Stephen J. Riney - Chief Financial Officer & Executive Vice President: Yeah, Leo. As you said, rightfully, so gross production in the third quarter was about 3.5% above second quarter. And actually net entitlement to the venture owners, us and Sinopec, was also up about a little over 3%, about 3.5%. The issue is around tax barrels and tax barrels on a three-thirds basis for the PSC owners, tax barrels were down 20,000 barrels a day between oil and gas. And the reason for that, there's no economic effect of that. It's the in-quarter reimbursement of taxes associated with income taxable in Egypt. And the bottom line issue is in the third quarter, prices had declined to a point where there was practically no taxable income. As a matter of fact, in one month I think we had a negative tax barrel effect. And so therefore both the tax, income tax expense and the barrels associated with reimbursing that income tax expense were much lower.

Your next question comes from Mike Hall with Heikkinen Energy Advisors.

A lot of mine have been answered, but I guess just curious on the longer-range outlook. You guys have talked about providing that in the past. Should we expect to hear about that in February as well, or what sort of I guess timeframe in your current thinking; when we will hear about that? John J. Christmann - President, Chief Executive Officer & Director: Well, Michael, we obviously will give you a full-year 2016 update in February, and we'll see how things look at that point. So, clearly we're working multi-year plans. But obviously with the volatility and the uncertainty around the prices right now, we're going to continue working that.

Okay. And then just looking at the mix of production in North America; got a bit more NGL relative to our expectations in gas. Is there anything driving that from an infrastructure standpoint or is that more the focus of the capital program from a reservoir perspective? John J. Christmann - President, Chief Executive Officer & Director: No, I mean actually I think when you look at our numbers, and you look at 2014 and 2015, and our percent oil in 2014 averaged about 52.7% for the year, we'll be 52.5%. We're right in line. In fact if you add our NGLs in 2014 and 2015, 65%. So you step back, big picture there's virtually no change in our mix. And we have the luxury of being more liquids rich and heavy than a lot of others. I will say you see some small swings when we've ramped our programs down to some of the GORs and some of the programs. For example, last quarter we brought on some gas here, Area A, Eagle Ford wells. If you look at our North Sea production, we've shifted more to the Beryl area where we've got a little higher GOR than we do at Forties, but I should say we get a very premium gas price up there, over $7. When you look at the Permian right now, we've had as a percentage more in the Delaware. Those wells had the luxury of having very flat GORs, but they come on at higher levels. So it's just a function of the portfolio, but in general, if you step back and take a big picture look, it's virtually where it's been historically.

Your next question comes from Jeff Campbell with Tuohy Brothers.

The first question I wanted to ask is if we could talk about the Canyon Lime upper interval. You highlighted shallower declines. I was wondering, are you doing anything to influence the decline? And while we're at it, how pervasive do you think the upper interval is throughout your acreage? John J. Christmann - President, Chief Executive Officer & Director: Yes, I'm going to – I'll let Tim Sullivan comment on the Quanah well on the Canyon Lime.

The Quanah well is a new landing zone. It's the only well that we've got in that landing zone. It's been producing about 2.5 months. The IP 30 on that was about 1,662 barrels of oil equivalent per day. In that 2.5 months it's cumed already 91,000 barrels of oil equivalent per day and is still doing just under a 1,000 barrels of oil equivalent per day. So, it is a standalone well, but it's just a function of getting the spacing right. We have not been curtailing production or anything. It's just a shallower decline and we're excited about that zone.

Okay, thank you. And I wanted to just ask another broader question. Not too long ago there was talk about revived industry interest in vertical Permian drilling based on returns. I was just wondering have you increased your vertical drilling any on that basis? John J. Christmann - President, Chief Executive Officer & Director: Jeff, we haven't. But I think, one thing I'll say we've got the luxury of having about 60 water floods and seven CO2 floods in the Permian. And we have a ton of vertical locations; infill locations that do make economic sense. And right now we do not have any vertical rigs running. That's an option that we could have for next year. But we have not made any decision at this point yet.

Our final question for today comes from David Tameron with Wells Fargo.

Hi, glad I got in. John, can you – if I think about the Permian and just obviously the slowdown in the rig count and look at production quarter-over-quarter down-ticking a little bit, gas up, oil down, when should we anticipate that inflection point as far as when we see stabilization and then move higher? John J. Christmann - President, Chief Executive Officer & Director: Well, I mean I think that really comes down to when we feel like it's time to go back to work with more rigs. And so I mean that's just a function of how much capital we want to spend and we made a decision not to add two more rigs here within the last quarter. We'll go and do 16 and see, but I mean that's all going to hinge off of cash flow and investable projects. I mean we've got a ton of inventory that they're chomping at the bit to drill, but it's just a function of trying to go back to our guiding principles of living within cash flow, focusing on our returns, focusing on the cost structure and growing value for our shareholders.

All right, everything else has been asked. Thanks, appreciate it. John J. Christmann - President, Chief Executive Officer & Director: Thank you.

Jennifer, thanks. We're going to wrap it up there. We're well past the top of the hour. We had a long queue today, so if we didn't get to your call please give the IR team a call. Otherwise, we look forward to speaking with you in February. Thank you very much.

Thank you for your participation. This does conclude today's conference call and you may now disconnect.