EXHIBIT 12.1
APACHE CORPORATION
STATEMENT OF COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(In Thousands)
STATEMENT OF COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(In Thousands)
| Quarter Ended | ||||||||||||||||||||||||||||
| March 31, | ||||||||||||||||||||||||||||
| 2006 | 2005 | 2005 | 2004 | 2003 | 2002 | 2001 | ||||||||||||||||||||||
| EARNINGS | ||||||||||||||||||||||||||||
| Pretax income from continuing operations before preferred interests of subsidiaries | $ | 1,073,262 | $ | 898,580 | $ | 4,206,254 | $ | 2,663,083 | $ | 1,930,925 | $ | 915,194 | $ | 1,206,863 | ||||||||||||||
| Add: Fixed charges excluding capitalized interest and preferred interest requirements of consolidated subsidiaries | 33,575 | 36,613 | 138,399 | 134,797 | 132,820 | 128,730 | 134,484 | |||||||||||||||||||||
| Adjusted Earnings | $ | 1,106,837 | $ | 935,193 | $ | 4,344,653 | $ | 2,797,880 | $ | 2,063,745 | $ | 1,043,924 | $ | 1,341,347 | ||||||||||||||
| FIXED CHARGES AND PREFERRED STOCK DIVIDENDS | ||||||||||||||||||||||||||||
| Interest expense including capitalized interest (1) | $ | 42,863 | $ | 45,266 | $ | 175,419 | $ | 168,090 | $ | 173,045 | $ | 155,667 | $ | 178,915 | ||||||||||||||
| Amortization of debt expense | 508 | 658 | 3,748 | 2,471 | 2,163 | 1,859 | 2,460 | |||||||||||||||||||||
| Interest component of lease rental expenditures (2) | 4,397 | 4,098 | 16,220 | 14,984 | 14,458 | 11,895 | 9,858 | |||||||||||||||||||||
| Preferred interest requirements of consolidated subsidiaries (3) | – | – | – | – | 11,805 | 19,581 | 8,608 | |||||||||||||||||||||
| Fixed charges | 47,768 | 50,022 | 195,387 | 185,545 | 201,471 | 189,002 | 199,841 | |||||||||||||||||||||
| Preferred stock dividend requirements (4) | 2,306 | 2,277 | 9,105 | 9,058 | 9,968 | 17,540 | 32,495 | |||||||||||||||||||||
| Combined Fixed Charges and Preferred Stock Dividends | $ | 50,074 | $ | 52,299 | $ | 204,492 | $ | 194,603 | $ | 211,439 | $ | 206,542 | $ | 232,336 | ||||||||||||||
| Ratio of Earnings to Fixed Charges | 23.17 | 18.70 | 22.24 | 15.08 | 10.24 | 5.52 | 6.71 | |||||||||||||||||||||
| Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends | 22.10 | 17.88 | 21.25 | 14.38 | 9.76 | 5.05 | 5.77 | |||||||||||||||||||||
| (1) | The Company did not receive a tax benefit for $5 million of transaction costs written off to interest expense when the Company retired its preferred interests of subsidiaries in September 2003. Given the non-deductibility of the charge, $9 million of pre-tax income was required to cover the $5 million write-off. Accordingly, interest expense has been grossed up by $4 million. | |
| (2) | Represents the portion of rental expense assumed to be attributable to interest factors of related rental obligations determined at interest rates appropriate for the period during which the rental obligations were incurred. Approximately 32 to 34 percent applies to rental payments for all periods presented. | |
| (3) | The Company did not receive a tax benefit for a portion of its preferred interests of consolidated subsidiaries. This amount represents the pre-tax earnings that would be required to cover preferred interests requirements of consolidated subsidiaries. In September 2003, the Company retired its preferred interests of subsidiaries. | |
| (4) | The Company does not receive a tax benefit for its preferred stock dividends. This amount represents the pre-tax earnings that would be required to cover its preferred stock dividends. |