AAPAAPA Corporation

APA produces oil in Texas and Egypt and is exploring for new reserves offshore Suriname.

The portfolio is unusually varied for a company of this size. The American shale part gives a short cycle and predictability; the Egyptian one runs under a production sharing agreement, where the company's share responds to the oil price differently than in ordinary production and requires constant drilling to hold volumes.

The third part is exploration offshore Suriname, where large reserves were found and a project is being built with a partner. That is a bet on the future with a long horizon and a high cost of error. Risks: the barrel price, operating conditions in Egypt, the schedule and cost of the offshore project and obligations to plug old wells. A dividend is paid.