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HOUSTON (AP) — Apache Corp. said that net income dropped by 73 percent in the second quarter as lower natural gas prices cut into revenue and forced the company to write-down the value of its Canadian assets.
Apache, based in Houston, is one of the biggest oil producers in the U.S. It reported earnings of $337 million, or 86 cents per share, for the April-June period. That compares with $1.26 billion, or $3.17 per share, for the same part of 2011. Without special items, including a $480 million write-down on its Canadian assets, Apache earned $2.07 per share.
Revenue fell 8.4 percent to $3.97 billion.
Analysts, who typically exclude special items, expected $2.53 per share on revenue of $4.32 billion, according to FactSet.
During the second quarter, Apache produced a company record of 774,000 barrels per day of oil and natural gas. But it sold both for lower prices. Apache said that oil prices fell by an average of 8.1 percent in the quarter while natural gas prices dropped by 22.7 percent.
Apache, which has operations in North America, Egypt, the North Sea, Australia and Argentina, has pushed hard to find new sources of oil and natural gas. Capital spending in the second quarter rose 38 percent, to $2.5 billion, with most of that going to exploration and production.
The company expects to boost production by 6 to 9 percent this year.
Apache shares fell $4.02, or 4.6 percent, to $82.84 in morning trading.