Leading independent energy firm Apache Corporation (APA - Analyst Report) announced that an extension well drilled on the Beryl Field has encountered the highest initial production rate in the last ten years.

Located in the U.K. North Sea, the B72 well was explored as a deviated well from the Beryl Bravo Platform. The well, through its three separate Jurassic aged reservoir units, registered a total of 619 feet measured depth of net oil pay.

The well, which is termed as one of the best drilled since 2001, presented a daily production rate of 11,625 barrels of oil per day and 13.1 million cubic feet of natural gas.

Houston, Texas-based Apache acts as the operator of the Beryl Field with 50% interest. The other partners of the asset are Hess Ltd. (22.22%) – a subsidiary of Hess Corporation (HES - Analyst Report), Enterprise Oil Ltd. (22.78%) – an affiliate of Royal Dutch Shell plc (RDS.A - Analyst Report), and U.K. based energy firm OMV Ltd. (5%).

In late 2011, Apache acquired the Beryl field along with the Nevis, Ness, Nevis South, Skene and Buckland properties from ExxonMobil Corporation (XOM - Analyst Report) for $1.25 billion.

We believe that this discovery will pave way for more exploration opportunities in the coming days and will aid in attracting more investors to develop the oil and gas fields in the North Sea region.

We like Apache’s large geographically diversified reserve base, as well as its balanced exposure to natural gas and crude oil, and multi-year trends in reserve replacement and production growth. This allows management to allocate capital and resources to high-return projects.

Additionally, Apache exhibits a strong financial position that will enable it to capitalize on investment opportunities and strategic acquisitions, thereby improving growth visibility.

However, our optimistic view on the company is clouded by the unstable gas/oil prices, geopolitical risks associated with international operations and project costs overruns and delays. Hence, we expect Apache to perform in line with the broader market and maintain a long-term Neutral rating on the stock.

Apache currently retains a Zacks #3 Rank (short-term Hold rating).