Apache to buy Mariner for $2.7 billion

The Houston-based independent energy company Apache has announced it will buy its rival Mariner Energy for $2.7 billionÔÇöits second acquisition in the space of a week.  The deal is in line with ApacheÔÇÖs strategy of trying to extend into deepwater projects in the Gulf of Mexico. Houston, Texas-based Mariner's deepwater portfolio includes nearly 100 blocks, seven discoveries in developmentÔÇöincluding interests in Lucius and HeidelbergÔÇöand more than 50 prospects.  Mariner also has more than 240 blocks on the Gulf Shelf and more than 200,000 net acres across several emerging onshore plays.  Mariner produces about 63,000 barrels of oil a day, with estimated proven reserves of 181 million barrels of oil equivalentÔÇö47 percent of it oil or other hydrocarbon liquids.  Commenting on the deal, G. Steven Farris, Apache's chairman and chief executive officer, said: "This is a strategic step and a natural extension into the deepwater Gulf for Apache. Mariner provides an exciting new platform for growth in the deepwater and complements our strengths in the Gulf Shelf and the Permian Basin. Based on our experience working with the Mariner team, we also believe the two companies will make an excellent cultural fit."  Scott D. Josey, Mariner's chairman, chief executive officer and president added: "The combination with Apache is an excellent outcome for Mariner's stakeholders.┬áOur shareholders will be rewarded for their faith and support in our company with the opportunity to further benefit from the upside provided from the merger.  ÔÇ£Our partners will work with a world-class company with the financial and technical resources to fully exploit our assets. Our employees will benefit from the opportunities provided in a large┬ácompany with┬ávalues similar to Mariner's.ÔÇØ  Apache and Mariner have teamed up beforeÔÇöin the 2008 deepwater Geauxpher discovery and development at Garden Banks 462 in the Gulf of Mexico. In addition to Geauxpher, Apache has drilled several deepwater discoveries in Egypt and Western Australia. Its last corporate transactionÔÇöwith the Phoenix Resource Companies in 1996ÔÇöestablished it as an operator in Egypt, lining the area up to become one of the company's principal growth areas.  At the start of the week, Apache said that it would also be acquiring Devon EnergyÔÇÖs oil and gas assets in the Gulf of Mexico for $1.05 billionÔÇöaround $250 million more than some analysts had expected.  The Mariner transaction is subject to approval by Mariner's shareholders as well as regulatory approvals, and is expected to close in the third quarter of this year.