May 1, 2008 / 1:27 PM / in 9 years

UPDATE 2-Apache profit up; shares fall on output concerns

(Adds analyst comment, byline, share drop, additional details)

By Anna Driver

HOUSTON, May 1 (Reuters) - Oil and gas company Apache Corp (APA.N) said on Thursday quarterly earnings more than doubled, but production growth fell short of investor expectations and the company’s shares tumbled 8 percent.

Higher energy prices boosted results, but production rose just 4 percent.

”I think the bottom line is that production was a fraction light,“ said Ben Dell, analyst at Bernstein Research. ”In the exploration and production space, production growth is a focus for investors.

The Houston-based company said first-quarter production totaled 557,631 barrels of oil equivalent (boe) per day, driven by higher oil output in the United States, the North Sea and Egypt.

Dell said he had forecast 579,000 boe per day.

Steven Farris, Apache chief executive officer, said in a statement that the company expects production to accelerate into the second half of the year, fueled by activity in the United States, Argentina and Canada.

First-quarter net income was $1.02 billion, or $3.03 per share, up from $492 million, or $1.47 per share, a year earlier.

Excluding the impact of foreign currency fluctuations on deferred tax balances, earnings were $2.99 per share.

Analysts on average had forecast a profit of $3.01 per share, according to Reuters Estimates.

First-quarter revenue was $3.2 billion, up from $2 billion a year earlier.

In the quarter, Apache’s average price per barrel of crude oil soared to $89.25 from $55.87 a year earlier. Its average natural gas price jumped to $6.42 per thousand cubic feet from $5.22.

Apache shares were down $10.88 to $123.80 in late-morning trade on the New York Stock Exchange. (Editing by John Wallace)

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