#1Apache 751659 77 MAR / APR INVESTOR PRESENTATION#2NOTICE TO INVESTORS Certain statements in this presentation contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 including, without limitation, expectations, beliefs, plans and objectives regarding anticipated financial and operating results, asset divestitures, estimated reserves, drilling locations, capital expenditures, price estimates, typical well results and well profiles, type curve, and production and operating expense guidance included in this presentation. Any matters that are not historical facts are forward looking and, accordingly, involve estimates, assumptions, risks and uncertainties, including, without limitation, risks, uncertainties and other factors discussed in our most recently filed Annual Report on Form 10-K, recently filed Quarterly Reports on Form 10-Q, recently filed Current Reports on Form 8-K available on our website, www.apachecorp.com, and in our other public filings and press releases. These forward-looking statements are based on Apache Corporation's (Apache) current expectations, estimates and projections about the company, its industry, its management's beliefs, and certain assumptions made by management. No assurance can be given that such expectations, estimates, or projections will prove to have been correct. A number of factors could cause actual results to differ materially from the projections, anticipated results, or other expectations expressed in this presentation, including, Apache's ability to meet its production targets, successfully manage its capital expenditures and to complete, test, and produce the wells and prospects identified in this presentation, to successfully plan, secure necessary government approvals, finance, build, and operate the necessary infrastructure, and to achieve its production and budget expectations on its projects. Whenever possible, these "forward-looking statements" are identified by words such as "expects," "believes," "anticipates," "projects," "guidance," "outlook," and similar phrases. Because such statements involve risks and uncertainties, Apache's actual results and performance may differ materially from the results expressed or implied by such forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. Unless legally required, we assume no duty to update these statements as of any future date. However, you should review carefully reports and documents that Apache files periodically with the Securities and Exchange Commission. Cautionary Note to Investors: The United States Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only proved, probable, and possible reserves that meet the SEC's definitions for such terms. Apache may use certain terms in this presentation, such as "resource," "resource potential," "net resource potential," "potential resource," "resource base," "identified resources," "potential net recoverable," "potential reserves," "unbooked resources," "economic resources," "net resources," "undeveloped resource," "net risked resources," "inventory," "upside," and other similar terms that the SEC guidelines strictly prohibit Apache from including in filings with the SEC. Such terms do not take into account the certainty of resource recovery, which is contingent on exploration success, technical improvements in drilling access, commerciality, and other factors, and are therefore not indicative of expected future resource recovery and should not be relied upon. Investors are urged to consider carefully the disclosure in Apache's Annual Report on Form 10-K for the fiscal year ended December 31, 2017, available from Apache at www.apachecorp.com or by writing Apache at: 2000 Post Oak Blvd., Suite 100, Houston, Texas 77056 (Attn: Corporate Secretary). You can also obtain this report from the SEC by calling 1-800-SEC-0330 or from the SEC's website at www.sec.gov. Certain information may be provided in this presentation that includes financial measurements that are not required by, or presented in accordance with, generally accepted accounting principles (GAAP). These non-GAAP measures should not be considered as alternatives to GAAP measures, such as net income or net cash provided by operating activities, and may be calculated differently from, and therefore may not be comparable to, similarly titled measures used at other companies. For a reconciliation to the most directly comparable GAAP financial measures, please refer to Apache's fourth quarter 2017 earnings release at www.apachecorp.com and the "Appendix" of this presentation. None of the information contained in this document has been audited by any independent auditor. This presentation is prepared as a convenience for securities analysts and investors and may be useful as a reference tool. Apache may elect to modify the format or discontinue publication at any time, without notice to securities analysts or investors. Apache 2#3APACHE STRATEGIC APPROACH: 2015-2017 Repositioning the Business Financial Discipline Aligned capital spend with cash flow Reduced debt, protected investment grade credit rating Sustained dividend, did not issue equity Portfolio Exited Australia, LNG, Canada and other non-core assets Shifted focus to Permian and unlocked value Leased and discovered enormous resource play at Alpine High Returns Focus Redesigned incentive compensation metrics Implemented centralized capital allocation process; fully burdened economics Deemphasized production growth, focused on cost alignment Apache 3#4APACHE'S INVESTMENT EVOLUTION ■■Permian Basin now attracting the majority of Apache's capital investment Capital as % of APA Total 100% ■Driving profitable growth for years to come ■ Permian program balanced between Alpine High and Midland/other Delaware Apache 80% Other Other Int'l 60% 40% Int'l 20% Permian Increase from 11% to 69% Permian Permian 0% 2011 2017 Adjusted Production Mix Other Int'l 41% 14% Permian Permian 45% 13% Int'l Other 41% 46% 2011 2017 4#5APACHE'S PORTFOLIO TODAY Apache United States 1 CBP Midland Delaware Anadarko Woodford SCOOP Eagle Ford Permian Growth Engine S. LA Minerals Gulf of Mexico International UK North Sea Suriname Egypt Positive Free Cash Flow Generator + Exploration Long-Term Growth Cash Flow Future Potential Focus Area 5#6PERMIAN BASIN OVERVIEW Production Growth Resumed in 2H17 Production & Rig Count Mboe/d Avg Rig Count 177 171 165 159 161 149 148 146 New Mexico 4 2 17 17 16 13 7 6 4 5 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 4Q17 Production Mix Delaware Basin 23% CBP/NW Shelf 32% Apache Midland Basin 45% 1.6 MM Net Acres in the Permian Basin 6#7MIDLAND AND DELAWARE BASIN 2017 Step Change in Performance ■Consolidating and accelerating 2015/2016 learnings ■Increased efficiencies and operating performance ■Multi-well pads / longer laterals ■Few retention wells required (outside of Alpine High) Key Focus Areas Midland & Delaware Basin Oil Production Mbo/d Apache 42 38 36 55 1Q17A 2Q17A 3Q17A 4Q17A Wildfire Pecos Bend Dixieland Powell Alpine High Azalea 7#8ALPINE HIGH Apache 8#9ALPINE HIGH: UPSTREAM Developing a World-Class Wet Gas Play Unprecedented hydrocarbon column up to 6,000 ft. Vertically stacked oil, wet gas and dry gas fairways Scale ~340,000 contiguous leasehold acres Execution 5,000+ locations identified to date Large operated position / economies of scale Strategically positioned to deliver NGLs and gas in scale to the Gulf Coast Achieved key production milestones and targets Economics Highly economic wet gas play; proven oil upside Liquids uplift combined with low F&D and operating costs strong recycle ratios Apache CULBERSON JEFF DAVIS REEVES Alpine High 9#10INDUSTRY ACTIVITY HAS INCREASED SIGNIFICANTLY SINCE ANNOUNCEMENT Apache JEFF DAVIS September 2016 20 Miles REEVES ERSON BREWSTER 目 February 2018 JEFF DAVIS 20 Miles ✓✓ ☑APA Operated Rig Competitor Permit Wells Competitor Wells Drilled/Drilling Source: Drilling Info. BREWSTER ☐ Apache Acreage Outline 10#11Apache DISTINCT SOURCE ROCK AND PARASEQUENCE INTERVALS High frequency, rapidly rising and falling sea level environment UNCONFORMITY Tranquil marine environment, gradually rising worldwide sea level conditions Source Rock Parasequences 3rd BONE SPRINGS WOLFCAMP PENNSYLVANIAN BARNETT WOODFORD DEVONIAN ORGANIC SHALE PARASEQUENCE CARBONATE DEBRIS FLOW ORGANIC SHALE Woodford + Barnett + Penn I Thick, laterally continuous deposition I Oil, wet gas and dry gas windows I Minimal in-situ water Indigenous, organic shale 3rd Bone Springs + Wolfcamp Higher variability with sweet spots I Oil and wet gas windows I Water wet rock I Indigenous shale and migrated hydrocarbons 11#12STRUCTURAL CROSS SECTION OF ALPINE HIGH 7,500' NORTHERN FLANK 8,500' OIL 9,500' 10,500' 8 11,500' WET GAS 12,500' 13,500' DRY GAS Apache Note Vertical and horizontal scales are not equivalent. ~60 miles CREST SOUTHERN FLANK Evaporites Transgressive Parasequences Transgressive Source Interval Devonian High Stand 12#13Apache CURRENT LOCATION COUNT OF 5,000+ Transgressive Source Interval Transgressive Parasequences Formation Wet Gas Bone Spring Wolfcamp Pennsylvanian Location Distribution Dry Gas Additional Location Potential Additional Location Potential Oil 10 500+ Barnett Woodford 3,500+ 1,000+ Additional Location Potential 13#14Apache NORTHERN FLANK DEVELOPMENT EXAMPLE Transgressive Source Interval Parasequences POPLAR UNIT 12 WELLS 800 FT SPACING REDWOOD UNIT 6 WELLS 660 FEET SPACING BLACKFOOT UNIT 24 WELLS 660 FT SPACING 14#15ALPINE HIGH: MIDSTREAM Foundational Delaware Basin Midstream Enterprise ■ Greenfield, fit-for-purpose system enables optimal wet gas development ~$700 mm invested through year-end 2017 Cherokee CPF Targeting 830 MMcf/d of gross inlet processing capacity by year-end 2018 ■First cryogenic capacity expected online 2019 ■Evaluating midstream funding options 5 CENTRAL PROCESSING FACILITIES 330 MMCF/D PROCESSING CAPACITY INSTALLED 45 MILES OF 30" TRUNKLINE IN SERVICE 110 MILES OF GATHERING SYSTEMS INSTALLED Apache 21 CENTRAL TANK BATTERIES 15#16ACCESS TO SALES LINES WITH ~4 BCF PER DAY OF CAPACITY Constructing ~70 Miles of 30" Trunkline Through the Play Northern Sales Connection Gas Flow WARD Sales Pipeline WAHA HUB 2018 2 REEVES CULBERSON ALPINE HIGH PLAY 3 NEW MEXICO JEFF DAVIS TEXAS Apache Source: Map not built to scale, general depiction of trunkline pathway. Sales Pipeline Gas Flow 5 PECOS Southern Sales Connection Trunkline segments 1, 2 and 5 in operation today Segments 3 and 4 in service around mid 16#17WET GAS PLAY: FULLY BURDENED ECONOMICS Development Scenario (4,400' Lateral) Typical Well EUR/Well (Bcfe) 15 Upper Range Well EUR/Well (Bcfe) 16 21 Fully Burdened Economics @ $50 WTI / $3.00 HHub Fully Burdened Economics @ $50 WTI / $3.00 HHub NPV-10 ($ MM) $5 $8 NPV-10 ($ MM) BTAX IRR 44% 79% BTAX IRR $8 $19 133% 345% Product Mix Product Mix % Oil (Mbbls) 3% 15% % Oil (Mbbls) 0% 9% % NGL (Mbbls) 51% 56% % NGL (Mbbls) 41% 55% Well Cost ($ MM) $4.0 $6.0 Well Cost ($ MM) $4.0 $6.0 Single Well Economic Assumptions: • Prices: $50 WTI / $3.00HH / NGL = 60% WTI • Waha basis = $0.35/MMbtu; midstream fee = $0.93/Mcf Apache ⚫NGL yields and midstream fees assume cryogenic processing. • Economics include overhead, workover, abandonment and E&P facility burdens. Note: end points shown for EUR, NPV, Product Mix and Well Costs are ranges and may not correlate directly when read in a column 17#18RAMPING A LARGE-SCALE GREENFIELD PLAY 4Q '18 Outlook Today Versus a Year Ago ■Reservoir and well performance continues to be very strong Proven oil potential ■Some volume ramp deferred due to less capital and fewer wells in 2017/2018 Deliberate, strategic changes to the program ➤ Shift to multi-well pads / patterns, midstream integration, shifting some dry gas wells to wet gas ➤ Increased investment in science, testing and delineation, which deferred some development ■ Other factors reflected in current outlook Apache ➤ Cost inflation higher today ➤ Surface use and right-of-way agreement delays; equipment delivery and construction delays 18#19RAMPING A LARGE-SCALE GREENFIELD PLAY Comparison of Feb. '17 and Feb. '18 Alpine High Outlook ■■ Previous 4Q'18 production target shifted to 2H 2019 ■~37% fewer wells online at year-end 2017 than previously expected, 42 versus 70 ■■~23% fewer new wells planned in 2018, resulting in 50 fewer wells producing at year-end 2018, approximately 140 versus 190 ➤ Reduced 2018 D&C and facilities budget by ~$140 million and average rig count by 1.5 ➤ Increased average well cost assumption from $5.7 million to $6.2 million for cost inflation ■Replaced higher Boe/d dry gas wells with higher margin, lower Boe/d wet gas wells. Trading gas Boe's for oil and NGL barrels. Apache 19#20PERMIAN GAS MARKETING Apache Well Positioned in 2018-2019 100% of Permian gas production outside of Alpine High covered by sales contracts or firm transport to the Gulf Coast. Provides flow assurance and mitigates oil shut-in risk 25% to 30% of projected Alpine High gas production linked to Gulf Coast index pricing 1 70% to 75% of projected Alpine High gas production linked to Waha/Permian index pricing 1 Attractive hedges (~$.50/Mcf Waha basis), mitigate basis risk on significant portion of volumes Every $.25/Mcf increase in Waha/Permian index basis results in an approximate $20 million and $30 million decrease in 2018 and 2019 cash flow, respectively 2 1 Assumes GCX pipeline in-service on Oct. 1, 2019 2 2018 budget based on NYMEX gas price of $2.80 per Mcf and Waha basis differential of $0.75 per MMBtu Apache 20#21MANAGING WAHA EXPOSURE ■ Basis hedges Average of 156 MMBtu/d swapped at average of $0.51 for 1/1/18 through 6/30/19 ■Firm transport to Gulf Coast Atmos to Katy Hub ➤ GCX to Aqua Dulce (projected in-service October 2019) ■ Marketing ➤ Contracting at Alpine High interconnects using non-Waha pricing Apache 21#22APACHE'S STRATEGIC APPROACH: 2018-2020 Financial Discipline Portfolio Returns Focus Apache Maintain strong balance sheet; protect capital program Target living within cash flow Relentless cost focus Expand and high-grade Permian inventory Sustain International free cash flow generation Strategic transaction for Alpine High midstream Long-term, corporate-level returns Growth as an outcome of returns-focused investment Technology and big data focus to improve capital efficiency 22 22#23INVESTMENT HIGHLIGHTS ■Financial discipline - manage to cash flow neutrality / strong balance sheet ■Dividend yield currently >2% ■Free cash flow from high-margin International businesses Returns focused, long-term growth in the Midland and Delaware basins ■Massive, long-term opportunity at Alpine High - a game changer ■Large scale, differentiated, long-term, 3-product optionality in the Permian ■ Significant future investment opportunities outside the Permian Technology as a strategic focus Apache 23#24APPENDIX Apache 24#25APA ADJUSTED PRODUCTION AND RETURNS 2018-2020 Outlook (Mboe/d) 350 2017A 375-395 11-13% CAGR 410-440 475-510 20% 22% 18% CROIC CROIC CROIC 2018E Apache See Glossary of Referenced Terms in Appendix for a definition of Cash Return on Capital Invested (CROIC) 2019E 2020E 25#26PERMIAN PRODUCTION 2018-2020 Outlook (Mboe/d) 158 26-28% CAGR 195-205 245 - 260 315-335 2017A 2018E 2019E 2020E Apache 26#27ALPINE HIGH PRODUCTION 2018-2020 Outlook (Mboe/d) Apache 9 40 - 50 >150% CAGR 85-100 160-180 2017A 2018E 2019E 2020E 27#28INT'L ADJUSTED PRODUCTION 2018-2020 Outlook (Mboe/d) Shallow Decline 144 130-140 2017A 2018E 125-140 125-140 2019E Apache Note: Adjusted production excludes Egypt tax barrels and noncontrolling interest. Comprises North Sea and Egypt production. 2020E 28#29NORTH SEA: GARTEN Large Commercial Discovery in Beryl Area Nevis North Sea Beryl Area Ness Beryl Bravo Beryl Alpha Garten Callerter Buckland Skene Garten discovery well encountered more than 700' of net oil pay in Block 9/18a Area-W Recoverable resource is expected to exceed 10 million barrels of light oil Apache holds a 100% working interest Future producer tied back to the Beryl Alpha platform, 6 kilometres north Initial production anticipated during the first quarter of 2019 Apache's fourth commercial exploration discovery in the Beryl area in the past three years Apache 10 Km Storr 29#30APACHE EAGLE FORD POSITION Apache Bastrop Lee San Marcos Arch Lavaca ~250,000 Net Acres Burleson Robertson Fayette Colorado Brazos Grimes 4Q 2017 Production ~5,300 Boe/d (~50% oil) 78 wells completed in the Eagle Ford Formation Most recent completion early 2016 Washington Walker Austin APA Acreage 30#31ALPINE HIGH Middle Permian Paleostructure Map 7000 #500 2000 500 1000 8000 8000 0000 0006 000 Apache -9000 70000 10000 800. 0000 5000 10000 10000 7000 9000 8000 8000 5000 4800 3000 2000 10000 9000 8000 1000 6000 STABLE SHELF ~450,000 ACRES 10 Miles 6000 4000 6000- 3000 10000 9000. 8000 7000 7000 0006 Critical Aspects Regional anomaly 10000 Stable Devonian shelf 9000- 9000 8000 Subsiding eastern limb 8000 9000 Later thrust of Davis Mountains 10000 9000 0006- 8000 -8000 8000 7000 10000 31#32PALEOGEOGRAPHIC RECONSTRUCTION Woodford Time Apache SCOOP / STACK DEPOCENTER TRANSGRESSIVE TOBOSA BASIN ALPINE HIGH ARKOMA WOODFORD Same geologic age as Arkoma Woodford and SCOOP / STACK Similar depositional environment http://jan.ucc.nau.edu/rcb7/namD385.jpg 32#33GEOLOGY OF THE SOUTHERN DELAWARE BASIN Apache 5,000' South Alpine High West IMMATURE Evaporites 10,000' OIL 15,000' 20,000' 25,000' 30,000' Bone Springs / Wolfcamp wwwww- Penh Barnett Woodford Bone Springs / Wolfcamp WET GAS ナ DRY GAS Alpine High: ►Stable shelf (Paleo high) ► Prospective section in the wet gas and oil window ▸ Thermal maturation controlled by depth of burial Low clay content and low ductility 15% CLAY CONTENT North East ww Penn / Barnett / Woodford 40% 33#34Apache 4,000'-5,000' OF STACKED POTENTIAL PAY Wet Gas Oil MONT BLANC 1H Correlation FINAL GR ( Depth Lology Moresby Muding Gas Correlation 250. DERTH ( VTOC FINALIQRKTH CH 250 Mad RHET (dec) MPH (+) MBW (dec) MUDUG (UNITS) MUDUG 2 (UNITS) MUOLO CI (UNITS) 2000 FINAL OR (GAP) 2006 20 Miles Depth DEPTH (FT) Lithology UTOC 0.2 FINAL: GRTH (GAR SPANISH TRAIL 1H Parasy Hudlog Gas MUCUGC (unit) MUDUG (unit) MPH (4) Uranium Voy 2000 Misal: Phie (dec) MWW (8) MUCUGC (un) VO +50 Hydrocarbon Gan VQuarta Hydrocarbon VILM Clay Bound Water Wet Gas Viime Clay Bound Water Wetas Waber 2 Wool Water Vanhy 8000 9000 10000 11000 12000 Wauc WHydrocarbo wwwater TRANSGRESSIVE SOURCE INTERVAL TRANSGRESSIVE PARASEQUENCES Delaware Basin Stratigraphy Santa Ros Rustler Salado Castle Bell Canyon Cherry Canyon Brushy Canyon Bone Springs Wolfcamp Penn Barnett/Miss Lime Woodford Devonian Fusselman Montoya (Simpson) El Paso Ellenburger TRANSGRESSIVE SOURCE INTERVAL TRANSGRESSIVE PARASEQUENCES 7000 8000 9000 10000 11000 Volke WHydrocarbo Water Oil Wet Gas 34#35Apache DIVIDING ALPINE HIGH INTO THREE SETTINGS ~56% of Alpine High acreage Northern Activity driven primarily by lease expiration Flank Over-pressured Initiated parasequence testing CULBERSON Crest ~16% of Alpine High acreage Moderately over-pressured Currently mapping parasequences ALPINE HIGH FAIRWAY 8 NORTHERN FLANK CREST NEW MEXICO JEFF DAVIS TEXAS REEVES • 0© SOUTHERN FLANK Southern Flank ~28% of Alpine High acreage Over-pressured Cooler temperature regime Currently mapping parasequences ▲ Concept Test Parasequence Oil TSI Wet Gas TSI Dry Gas WA 35#36Apache WATER RATE COMPARISON Alpine High Source Rock Versus Pecos Bend Area Water Rate, BWPD 10,000 1,000 100 10 10 1 10 100 Producing Time, Days Alpine High Water Production Pecos Bend Wolfcamp/Bone Springs 1,000 36#37APACHE SURINAME 1.8 Million Net Acres on Two Blocks Apache Guyana 50 25 W 57°0'0"W 56 in w Kilometers Ranger Stabroek Area Exxon Discoveries Payara Liza Snoek Turbot 5600 W 5500W 5400W Block 58 Apache WI 100% Acreage 50306 sq km Block 53 Apache Wi 45% Age: 3509 km Suriname 5700W 5000W 100% Legend Existing Apache 3D Seismic 5400 W Proprietary 3-D seismic surveys over both blocks 37#38NON-GAAP RECONCILIATION Regional Cash Flows Reconciliation of net cash provided by operating activities to cash flows from continuing operations before changes in operating assets and liabilities Apache Cash flows from continuing operations before changes in operating assets and liabilities is a non-GAAP financial measure. Apache uses it internally and provides the information because management believes it is useful for investors 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 flows 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. North Sea Egypt For the Quarter Ended December 31, 2017 Canada U.S. and Other Consolidated ($ in millions) Net cash provided by operating activities Changes in operating assets and liabilities $ 309 $ 3 166 (136) $ $ 193 $ 668 (9) (142) Cash flows from operations before changes in operating assets and liabilities $ 306 $ 302 $ $ 202 $ 810 For the Year North Sea Egypt Ended December 31, 2017 Canada U.S. and Other Consolidated ($ in millions) Net cash provided by operating activities Changes in operating assets and liabilities $ 742 18 956 (242) $ 27 $ (28) 703 (68) $ 2,428 (320) Cash flows from operations before changes in operating assets and liabilities $ 724 $ 1,198 $ 55 $ 771 $ 2,748 (1) Includes non-controlling interest in Egypt. 38#39ENVIRONMENTAL, SOCIAL AND GOVERNANCE Apache is an Industry Leader in Prioritizing ESG Vision Methane Emissions By 2025, Apache is committed to reducing its methane emissions to 0.36% or less of total methane production Water Usage We seek to use alternatives to potable fresh water-such as recycled produced water-in all of our operating regions, especially in areas of the U.S. and Egypt that could be considered "water scarce," depending on conditions, location, pricing and regulations Safety The safety of our employees, contractors and communities is Apache's highest priority and is deeply rooted in our Core Values APA Results Reduced methane emissions intensity by 43% since 2012 In 2016, 97% of water withdrawals were from nonpotable sources Reduced Workforce Total Recordable Incident Rate (TRIR) (3) by 54% over last five years GLOBAL METHANE EMISSIONS INTENSITY (1) GLOBAL WATER USAGE INTENSITY(2) WORKFORCE TOTAL RECORDABLE INCIDENT RATE (4) Metrics 2014 2015 2016 2014 2015 2016 2014 2015 2016 0.53% 0.49% 0.43% 3.3 3.7 2.7 0.89 0.76 0.52 (1) tCO2e/Mboe metric tons of carbon dioxide equivalent per thousands of barrels of oil equivalent (2) Bbls/Boe barrels of water produced with oil and gas per barrels of oil equivalent Apache produced (3) Workforce TRIR includes employees and contractors (4) Total recordable incident rate is calculated by multiplying total number of recordable injuries by 200,000 hours and then dividing by total person-hours worked Apache 39#40APACHE INCENTIVE COMPENSATION STRUCTURE Short and Long-Term Compensation Aligned for Returns-Focused Outcomes Annual Incentive 2018 Plan Long-Term Incentive (1) Performance Shares Drilling Rate of Return Health, Safety, Security and Environmental Economic Reserve Replacement Operational Goals Strategic Goals 40% 40% Lease Operating Expense and G&A expense Production CROIC 20% Added Cash Return on Invested Capital Metric in 2018 (1) Long-term compensation plan also includes restricted stock units and stock options. Performance is evaluated over a three-year period. Apache Reserve Adds / Debt Adj Share 25% Total Shareholder Return 50% Cash Flow from Operations 25% 50% Absolute Performance Targets Reset Annually 50% Relative Performance 40 40#41GLOSSARY OF REFERENCED TERMS Capital Budget: Includes exploration and production capital, gathering, transportation and processing capital, capitalized general and administrative expenses, capitalized interest; excludes non-oil & gas capital and noncontrolling interest capital CROIC (Cash Return On Invested Capital): Calculated with the numerator as cash flow from operations before changes in working capital, excluding noncontrolling interest, with financing costs added back; and the denominator as average debt plus average Apache shareholders' equity Net Debt: Total debt (long-term and short-term) less cash and cash equivalents ROCE (Return on Capital Employed): Calculated with the numerator as adjusted earnings plus financing costs and taxes (excluding Egypt taxes); and the denominator as average debt plus average Apache shareholders' equity In addition to the terms above, a list of commonly used definitions and abbreviations can be found in Apache's Form 10-K for the year ended December 31, 2017. Apache 41