Apache 8-K Record production of 513,000 boe/day on 35 percent increase in gas output

Exhibit 99.1

CONTACTS:

(Media):	Tony Lentini	(713) 296-6227
	Bill Mintz	(713) 296-7276
(Investor):	Robert Dye	(713) 296-6662
	David Higgins	(713) 296-6690
(Web site):	www.apachecorp.com

FOR RELEASE AT 7:45 A.M. CENTRAL TIME

APACHE THIRD-QUARTER EARNINGS: $646 MILLION OR $1.94 PER SHARE

Record production of 513,000 boe/day on 35 percent increase in gas output

     Houston, Oct. 26, 2006 – Apache Corporation (NYSE, Nasdaq: APA) today reported third-quarter earnings of $646 million or $1.94 per diluted common share as worldwide production rose to a record 513,000 barrels of oil equivalent (boe) per day, up 13 percent from the prior-year period. Apache earned $686 million or $2.05 per share in the prior-year period.

     Third-quarter results include a non-recurring gain of $174 million on the sale of assets in China; a $92 million, one-time prior-period adjustment reflecting increased tax rates in the United Kingdom; and a $24 million negative adjustment related to foreign currency fluctuations.

     Cash from operations before changes in operating assets and liabilities totaled $1.3 billion, up from $1.26 billion in the year-earlier period. (This is a non-GAAP measure; see reconciliation below.)

     Apache’s gas production averaged 1.7 billion cubic feet (Bcf) per day, up 35 percent from the prior-year period and up 9 percent from the second quarter. Apache produced 228,551 barrels of liquid hydrocarbons per day, down 6 percent from the third quarter of 2005 and a 5 percent decline from the second quarter, as a result of the sale of the Zhao Dong field in China and shut-ins in the North Sea and Egypt.

     “We are pleased with Apache’s progress thus far in 2006,” said G. Steven Farris, president and chief executive officer. “We plowed through a lot of variables during the third quarter; despite extended shut-ins in the North Sea and Egypt and the sale of our China assets, Apache’s worldwide production increased 2.4 percent from the second quarter to an all-time high of 513,000 boe per day.

     “Our North Sea production has been stable thus far in October and, barring any unforeseen events, we should exit 2006 with production rates 20 percent higher than we started the year, giving us good momentum going into 2007,” Farris said.

     “We remain on track to achieve 10 to 15 percent production growth this year,” Farris said. “We expect a strong finish to a record year in nearly every financial and operational aspect.”

     Apache received $63.66 per barrel of oil in the quarter, up about 9 percent from the prior-year period and down 1 percent from the second quarter; and $4.83 per thousand cubic feet of gas, down 26 percent from the year-earlier period and a 3 percent drop from the second quarter of 2006.

THIRD-QUARTER OPERATIONAL UPDATE

     U.S. Central Region production increased to 265 million cubic feet (MMcf) and 31,727 barrels of liquids per day on drilling success at Stiles Ranch in the Texas Panhandle, the Red Fork and Springer formations in Western Oklahoma, and in the Permian Basin.

     Gulf Coast Region production increased to 455 MMcf of gas and 44,165 barrels of liquids per day during the third quarter as Apache took over operations on 96 platforms acquired from BP. Recovery from hurricanes Katrina and Rita is progressing, although net production of

3,000 barrels and 10 MMcf per day will likely remain shut-in at year end. Apache expects to recover those volumes during the first half of 2007.

     In Canada, Apache’s third-quarter production was flat with the second quarter, averaging 422 MMcf and 22,613 barrels per day. Production was up 8 percent from the prior-year period on a barrel-equivalent basis.

     Although the BP pipeline shut-in impacted third-quarter production from the North Sea, the company shifted planned maintenance at the Delta platform to coincide with the pipeline shut-in. The downtime reduced the region’s production by 13,000 barrels per day during the quarter. During October, gross production has averaged approximately 70,000 barrels per day.

     The North Sea Region continues to make progress on facilities upgrade projects, including the electric generation/gas and power ring project, which should result in substantial fuel savings and reliability. The first well from the Charlie platform to determine the westerly extent of the Forties Field was spudded; if successful, this project could extend the field to the west. Apache also began its North Sea exploration program.

     In Australia, Apache established a single-day gas production record of 240 MMcf and a quarterly record of 204 MMcf per day, up 11 percent from the second quarter. Apache submitted a field development plan to regulatory agencies for the Van Gogh/Theo oil field in the Exmouth area off Western Australia. The project is expected to commence production in the second half of 2008 with net production rates of 20,000 barrels per day.

     Net production in Egypt declined 3 percent from the second quarter, mainly the result of a 14-day shut-in at the Shell-operated Obayied gas processing plant and 10-day shut-ins at Apache’s Salam and Tarek plants for maintenance; the shut-ins also impacted condensate production associated with the gas. However, Apache set records for gross operated production: 120,374 barrels of oil per

day on July 7 and 525 MMcf of gas per day on Sept. 13. Apache also drilled a new-field discovery: The Hathor Deep 1X wildcat tested 12 MMcf per day from the Alem el Buieb formation. The Qasr 34 well extended the Qasr field – already Apache’s largest discovery – approximately 1.6 miles to the northwest and appraised a previously unproven area of 2,700 acres.

     Apache’s operating costs increased 12 percent from the second quarter to $7.67 per boe. Costs in Canada, Australia, Egypt and Argentina were flat to lower, and Central Region costs were up slightly. North Sea operating costs were up 39 percent because they were spread over much lower volumes. Gulf Coast Region costs were up 31 percent because the focus shifted from hurricane-related activity to the backlog of workovers and maintenance.

     In China, the $174 million gain was the result of Apache’s sale of its 24.5 percent interest the Zhao Dong block for $260 million.

     Apache Corporation is a discoverer and producer of oil and gas energy resources for the advancement of mankind in the interest of long-term investors seeking share appreciation.

-end-

     EDITOR’S NOTE: Apache will webcast a conference call to discuss its third-quarter results at 1 p.m. Central Time, Thursday, Oct. 26, from Apache’s Web site, http://www.apachecorp.com . The conference call will be available for delayed playback by telephone for one week beginning at approximately 5 p.m. on Oct. 26. To access the telephone playback, dial (719) 457-0820 and provide Apache’s confirmation code, 2427547. The webcast replay and podcast will be archived on Apache’s Web site. To have the podcast delivered to you, sign up for Financial RSS Feeds at http://investor.apachecorp.com/rss.cfm. To be reminded of the live webcast, sign up for E-mail Alerts at http://investor.apachecorp.com/alerts.cfm.

     This news release contains certain “forward-looking statements” as defined by the Private Securities Litigation Reform Act of 1995 including, without limitation, expectations, beliefs, plans and objectives regarding production, operating costs, exploration and acquisition activities. Any matters that are not historical facts are forward-looking and, accordingly, involve estimates, assumptions and uncertainties. There is no assurance that Apache’s expectations will be realized, and actual results may differ materially from those expressed in the forward-looking statements.

APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands, except per share data)

	For the Quarter						For the Nine Months
	Ended September 30,						Ended September 30,
	2006			2005			2006			2005
REVENUES AND OTHER:
Oil and gas production revenues	$	2,072,815		$	2,051,744		$	6,108,240		$	5,452,928
Gain on China divestiture		173,545			—			173,545			—
Other		15,121			9,308			40,316			29,643
		2,261,481			2,061,052			6,322,101			5,482,571
OPERATING EXPENSES:
Depreciation, depletion and amortization		487,542			357,159			1,301,557			1,055,583
Asset retirement obligation accretion		22,762			13,527			64,268			40,016
Lease operating costs		361,784			279,995			965,800			768,596
Gathering and transportation costs		24,815			23,571			76,728			73,529
Severance and other taxes		117,704			150,394			432,520			309,173
General and administrative		53,781			50,047			151,644			152,460
Total operating expenses		1,068,388			874,693			2,992,517			2,399,357
OPERATING INCOME		1,193,093			1,186,359			3,329,584			3,083,214
FINANCING COSTS:
Interest expense		61,074			43,517			154,073			133,590
Amortization of deferred loan costs		501			521			1,530			3,226
Capitalized interest		(16,108	)		(14,990	)		(46,183	)		(42,653	)
Interest income		(3,481	)		(2,201	)		(13,112	)		(4,003	)
Net financing costs		41,986			26,847			96,308			90,160
INCOME BEFORE INCOME TAXES		1,151,107			1,159,512			3,233,276			2,993,054
Provision for income taxes		504,043			472,517			1,201,666			1,157,546
NET INCOME		647,064			686,995			2,031,610			1,835,508
Preferred stock dividends		1,420			1,420			4,260			4,260
INCOME ATTRIBUTABLE TO COMMON STOCK	$	645,644		$	685,575		$	2,027,350		$	1,831,248
BASIC NET INCOME PER COMMON SHARE	$	1.96		$	2.08		$	6.14		$	5.57
DILUTED NET INCOME PER COMMON SHARE	$	1.94		$	2.05		$	6.08		$	5.49
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING		329,643			329,219			329,971			328,615

APACHE CORPORATION
FINANCIAL INFORMATION
(In thousands)

	For the Quarter				For the Nine Months
	Ended September 30,				Ended September 30,
	2006		2005		2006		2005
COSTS INCURRED:
North America exploration and development	$	581,483	$	617,123	$	1,830,782	$	1,657,329
International exploration and development		307,837		308,507		777,267		874,165
	$	889,320	$	925,630	$	2,608,049	$	2,531,494
Oil and gas property acquisitions	$	518,588	$	10,172	$	2,252,163	$	35,826
Capitalized interest	$	16,108	$	14,990	$	46,183	$	42,653
Asset retirement costs	$	231,022	$	39,417	$	375,708	$	76,706

	September 30,		December 31,
	2006		2005
BALANCE SHEET DATA:
Current Assets	$	2,380,231	$	2,162,077
Property and Equipment, net		20,637,689		16,791,340
Goodwill		189,252		189,252
Other Assets		218,753		129,127
Total Assets	$	23,425,925	$	19,271,796
Current Liabilities	$	3,489,819	$	2,186,564
Long-Term Debt		2,189,487		2,191,954
Deferred Credits and Other Noncurrent Liabilities		5,111,575		4,352,063
Shareholders’ Equity		12,635,044		10,541,215
Total Liabilities and Shareholders’ Equity	$	23,425,925	$	19,271,796
Common shares outstanding at end of period		329,413		330,121

NON-GAAP FINANCIAL MEASURES:

The press release discusses Apache’s cash from operations before changes in operating assets and liabilities. It is presented because management believes the information is useful for investors because it is used internally and widely accepted by those following the oil and gas industry as a financial indicator of a company’s ability to generate cash to internally fund exploration and development activities, fund dividend programs, and service debt. It is also used by research analysts to value and compare oil and gas exploration and production companies, and is frequently included in published research when providing investment recommendations. Cash from operations before changes in operating assets and liabilities, therefore, is an additional measure of liquidity, but is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating, investing, or financing activities.

The following table reconciles net cash provided by operating activities to cash from operations before changes in operating assets and liabilities.

	For the Quarter					For the Nine Months
	Ended September 30,					Ended September 30,
	2006		2005			2006		2005
Net cash provided by operating activities	$	1,134,745	$	1,330,915		$	3,399,012	$	3,160,096
Changes in operating assets and liabilities		161,824		(67,354	)		387,436		232,181
Cash from operations before changes in operating assets and liabilities	$	1,296,569	$	1,263,561		$	3,786,448	$	3,392,277

APACHE CORPORATION
FINANCIAL INFORMATION

	For the Quarter				For the Nine Months
	Ended September 30,				Ended September 30,
	2006		2005		2006		2005
FINANCIAL DATA(In thousands, except per share data):
Revenues and other	$	2,261,481	$	2,061,052	$	6,322,101	$	5,482,571
Income Attributable to Common Stock	$	645,644	$	685,575	$	2,027,350	$	1,831,248
Basic Net Income Per Common Share	$	1.96	$	2.08	$	6.14	$	5.57
Diluted Net Income Per Common Share	$	1.94	$	2.05	$	6.08	$	5.49
Weighted Average Common Shares Outstanding		329,643		329,219		329,971		328,615
Diluted Shares Outstanding		332,855		334,164		333,402		333,602
PRODUCTION AND PRICING DATA:
OIL VOLUME — Barrels per day
United States		67,996		64,906		64,277		71,860
Canada		20,509		21,974		21,123		22,226
Egypt		54,634		54,728		55,756		54,110
Australia		12,249		16,499		12,146		15,323
North Sea		49,375		67,713		58,370		64,966
Argentina		8,960		1,339		5,632		1,074
China		2,745		6,533		4,234		9,224
Total		216,468		233,692		221,538		238,783
AVERAGE OIL PRICE PER BARREL
United States	$	58.39	$	53.85	$	55.38	$	47.72
Canada		66.09		60.66		62.30		52.12
Egypt		66.88		60.38		65.66		53.29
Australia		73.80		66.52		71.67		58.06
North Sea		67.04		60.46		64.68		52.33
Argentina		46.41		39.18		45.03		36.96
China		62.53		50.76		62.73		42.35
Total		63.66		58.66		61.85		51.05
NATURAL GAS VOLUME — Mcf per day
United States		719,324		586,111		653,379		625,716
Canada		422,397		373,079		408,758		366,892
Egypt		207,686		162,386		213,097		154,839
Australia		204,465		138,267		181,143		120,759
North Sea		1,738		2,384		2,055		2,287
Argentina		151,122		2,715		86,275		3,142
Total		1,706,732		1,264,942		1,544,707		1,273,635
AVERAGE NATURAL GAS PRICE PER MCF
United States	$	6.27	$	7.73	$	6.62	$	6.71
Canada		5.38		7.17		6.22		6.28
Egypt		4.63		4.97		4.50		4.67
Australia		1.70		1.69		1.65		1.73
North Sea		13.20		10.57		10.79		7.63
Argentina		0.89		1.35		0.91		1.14
Total		4.83		6.54		5.32		5.86
NGL VOLUME — Barrels per day
United States		7,896		7,097		8,088		8,529
Canada		2,104		2,232		2,169		2,187
Argentina		2,083		—		1,154		—
Total		12,083		9,329		11,411		10,716
AVERAGE NGL PRICE PER BARREL
United States	$	42.19	$	34.54	$	39.73	$	31.10
Canada		38.66		32.13		36.83		27.59
Argentina		42.15		—		40.31		—
Total		41.57		33.97		39.23		30.38