APA Corp beat Wall Street estimates for quarterly profit on Wednesday, as stronger natural gas production in Egypt and higher prices helped blunt the impact of weaker oil prices and lower total output.
Shares of the company climbed 2% in extended trade.
Natural gas prices rebounded from last year’s lows, driven by hotter weather, stronger demand for power generation and lower U.S. storage injections.
APA’s average realized gas prices rose nearly 29% in the second quarter to $2.28 per thousand cubic feet, from last year.
Natural gas volumes rose 7% to 894 million cubic feet per day, driven by a strong performance in Egypt.
“In Egypt, we exceeded our quarterly gas production guidance and have once again increased our expectations for the gas program in the second half of the year,” APA CEO John Christmann said.
APA added that it secured presidential approval for about 2 million additional acres in Egypt, unlocking significant oil and gas potential it plans to start drilling by year-end.
The results from Egypt help cushion the impact of lower crude prices across assets.
Brent crude averaged about 20% lower in the second quarter compared to a year earlier, weighed down by U.S. import tariffs, concerns over global economic growth, rising OPEC+ supply and persistent geopolitical tensions.
Prices briefly rose above $80 a barrel in June after Israel struck Iranian nuclear sites, but later retreated to around $67 by quarter-end.
APA said its average realized crude price stood at $65.58 per barrel in the quarter, down from $82.28 per barrel last year.
The company said its quarterly total production fell 2% to 465,078 barrels of oil equivalent per day, from last year.
The Houston, Texas-based company posted adjusted profit of 87 cents per share for the three months ended June 30, compared with the average analysts’ estimate of 48 cents per share, according to data compiled by LSEG.
(Reporting by Arunima Kumar in Bengaluru; Editing by Alan Barona)