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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the Quarterly Period Ended September 30, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
 For the Transition Period from  to
 Commission File Number 0-13546
 APACHE OFFSHORE INVESTMENT PARTNERSHIP
  Delaware
    
    41-1464066(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (I.R.S. Employer
Identification No.)Suite 100, One Post Oak Central2000 Post Oak Boulevard, Houston, TX
    
    77056-4400(Address of Principal Executive Offices)
    
    (Zip Code)
   þ o
  o o þ
  o þ
 Number of Registrants units, outstanding as of September 30, 2007
    
    
    1,044




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONITEM 1  FINANCIAL STATEMENTSITEM 2  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 3  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 4  CONTROLS AND PROCEDURESPART II  OTHER INFORMATIONITEM 1. LEGAL PROCEEDINGSITEM 1A. RISK FACTORSITEM 2. UNREGISTERED SALES OF EQUITY IN SECURITIES AND USE OF PROCEEDSITEM 3. DEFAULTS UPON SENIOR SECURITIESITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSITEM 5. OTHER INFORMATIONITEM 6. EXHIBITS AND REPORTS ON FORM 8-KSIGNATURESCertification of CEO Pursuant to Rule 13a-14(a)Certification of CFO Pursuant to Rule 13a-14(a)Certification of CEO & CFO Pursuant to Section 1350    Table of Contents  
 PART I  FINANCIAL INFORMATION
 
 ITEM 1  FINANCIAL STATEMENTS
 APACHE OFFSHORE INVESTMENT PARTNERSHIP
STATEMENT OF INCOME
(Unaudited)
 For the Quarter
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2007
    
    
    2006
    
    
    2007
    
    
    2006REVENUES:Oil and gas sales
    
    $
    1,870,931
    
    
    $
    2,172,494
    
    
    $
    5,565,260
    
    
    $
    8,389,518Interest income
    
    
    32,105
    
    
    
    56,558
    
    
    
    83,768
    
    
    
    118,8551,903,036
    
    
    
    2,229,052
    
    
    
    5,649,028
    
    
    
    8,508,373EXPENSES:Depreciation, depletion and amortization
    
    
    249,533
    
    
    
    344,282
    
    
    
    757,448
    
    
    
    1,186,555Asset retirement obligation accretion
    
    
    11,211
    
    
    
    10,576
    
    
    
    33,147
    
    
    
    31,272Lease operating expenses
    
    
    255,896
    
    
    
    249,075
    
    
    
    959,343
    
    
    
    812,527Gathering and transportation expense
    
    
    22,011
    
    
    
    27,230
    
    
    
    72,509
    
    
    
    115,329Administrative
    
    
    107,000
    
    
    
    107,000
    
    
    
    321,000
    
    
    
    321,000645,651
    
    
    
    738,163
    
    
    
    2,143,447
    
    
    
    2,466,683NET INCOME
    
    $
    1,257,385
    
    
    $
    1,490,889
    
    
    $
    3,505,581
    
    
    $
    6,041,690NET INCOME ALLOCATED TO:Managing Partner
    
    $
    296,888
    
    
    $
    378,288
    
    
    $
    841,755
    
    
    $
    1,427,520Investing Partners
    
    
    960,497
    
    
    
    1,112,601
    
    
    
    2,663,826
    
    
    
    4,614,170$
    1,257,385
    
    
    $
    1,490,889
    
    
    $
    3,505,581
    
    
    $
    6,041,690NET INCOME PER INVESTING PARTNER UNIT
    
    $
    920
    
    
    $
    1,057
    
    
    $
    2,545
    
    
    $
    4,382WEIGHTED AVERAGE INVESTING PARTNER
UNITS OUTSTANDING
    
    
    1,044.0
    
    
    
    1,052.3
    
    
    
    1,046.5
    
    
    
    1,052.9
 
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APACHE OFFSHORE INVESTMENT PARTNERSHIP
STATEMENT OF CASH FLOWS
(Unaudited)
 For the Nine Months EndedSeptember 30,2007
    
    
    2006CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    3,505,581
    
    
    $
    6,041,690Adjustments to reconcile net income to net cash
provided by operating activities:Depreciation, depletion and amortization
    
    
    757,448
    
    
    
    1,186,555Asset retirement obligation accretion
    
    
    33,147
    
    
    
    31,272Changes in operating assets and liabilities:(Increase) decrease in accrued revenues receivable
    
    
    221,933
    
    
    
    989,329Increase (decrease) in accrued operating expenses
    
    
    17,195
    
    
    
    20,694(Increase) decrease in payable to/receivable from
Apache Corporation
    
    
    (296,887
    )
    
    
    436,185Net cash provided by operating activities
    
    
    4,238,417
    
    
    
    8,705,725CASH FLOWS FROM INVESTING ACTIVITIES:Additions to oil and gas properties
    
    
    (146,488
    )
    
    
    (539,828
    )Net cash used in investing activities
    
    
    (146,488
    )
    
    
    (539,828
    )CASH FLOWS FROM FINANCING ACTIVITIES:Repurchase of Partnership Units
    
    
    (55,568
    )
    
    
    (15,084
    )Distributions to Investing Partners
    
    
    (2,096,555
    )
    
    
    (3,686,932
    )Distributions to Managing Partner
    
    
    (881,792
    )
    
    
    (1,625,906
    )Net cash used in financing activities
    
    
    (3,033,915
    )
    
    
    (5,327,922
    )NET INCREASE IN CASH AND CASH EQUIVALENTS
    
    
    1,058,014
    
    
    
    2,837,975CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR
    
    
    2,358,999
    
    
    
    2,611,653CASH AND CASH EQUIVALENTS, END OF PERIOD
    
    $
    3,417,013
    
    
    $
    5,449,628
 
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APACHE OFFSHORE INVESTMENT PARTNERSHIP
BALANCE SHEET
(Unaudited)
 September 30,
    
    
    December 31,2007
    
    
    2006ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    3,417,013
    
    
    $
    2,358,999Accrued revenues receivable
    
    
    311,244
    
    
    
    533,177Receivable from Apache Corporation
    
    
    122,334
    
    
    
    3,850,591
    
    
    
    2,892,176OIL AND GAS PROPERTIES, on the basis of full cost accounting:Proved properties
    
    
    185,720,513
    
    
    
    185,574,025Less  Accumulated depreciation, depletion and amortization
    
    
    (180,594,535
    )
    
    
    (179,837,087
    )5,125,978
    
    
    
    5,736,938$
    8,976,569
    
    
    $
    8,629,114LIABILITIES AND PARTNERS CAPITALCURRENT LIABILITIES:Distributions payable
    
    $
    2,088,055
    
    
    $
    Accrued operating expenses
    
    
    104,801
    
    
    
    87,606Payable to Apache Corporation
    
    
    
    
    
    
    174,5532,192,856
    
    
    
    262,159ASSET RETIREMENT OBLIGATION
    
    
    775,303
    
    
    
    742,156PARTNERS CAPITAL:Managing Partner
    
    
    35,235
    
    
    
    75,272Investing Partners (1,044.0 and 1,048.3 units outstanding, respectively)
    
    
    5,973,175
    
    
    
    7,549,5276,008,410
    
    
    
    7,624,799$
    8,976,569
    
    
    $
    8,629,114
 
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APACHE OFFSHORE INVESTMENT PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
  1. RECEIVABLE FROM/PAYABLE TO APACHE CORPORATION
  2. RIGHT OF PRESENTMENT
   3. ASSET RETIREMENT OBLIGATIONS
  Asset retirement obligation at December 31, 2006
    
    $
    742,156Accretion expense
    
    
    33,147Balance at September 30, 2007
    
    $
    775,303
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ITEM 2  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
 RESULTS OF OPERATIONS
 Net Income and Revenue
     For the Quarter Ended September 30,
    
    For the Nine Months Ended September 30,Increase
    
    
    
    
    
    
    
    
    
    Increase2007
    
    2006
    
    (Decrease)
    
    2007
    
    2006
    
    (Decrease)Gas volume  Mcf per day
    
    
    1,428
    
    
    
    1,659
    
    
    
    (14
    %)
    
    
    1,571
    
    
    
    2,329
    
    
    
    (33
    %)Average gas price  per Mcf
    
    $
    6.14
    
    
    $
    6.99
    
    
    
    (12
    %)
    
    $
    7.05
    
    
    $
    7.79
    
    
    
    (9
    %)Oil volume  barrels per day
    
    
    128
    
    
    
    147
    
    
    
    (13
    %)
    
    
    120
    
    
    
    160
    
    
    
    (25
    %)Average oil price  per barrel
    
    $
    77.16
    
    
    $
    69.88
    
    
    
    10
    %
    
    $
    68.13
    
    
    $
    67.24
    
    
    
    1
    %NGL volume  barrels per day
    
    
    31
    
    
    
    41
    
    
    
    (24
    %)
    
    
    25
    
    
    
    46
    
    
    
    (46
    %)Average NGL price  per barrel
    
    $
    53.05
    
    
    $
    43.06
    
    
    
    23
    %
    
    $
    44.68
    
    
    $
    39.73
    
    
    
    12
    %
 Oil and Gas Sales
     5




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Operating Expenses
    Capital Resources and Liquidity
     6




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Capital Commitments
       7




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ITEM 3  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Commodity Risk
   
 ITEM 4  CONTROLS AND PROCEDURES
  FORWARD-LOOKING STATEMENTS AND RISK
   8




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PART II  OTHER INFORMATION
 
   
   
   
   
   
   
   31.1
    
     Certification (pursuant to Rule 13a-14(a) or Rule 15d-14(a)
of the Exchange Act) by Chief Executive Officer31.2
    
     Certification (pursuant to Rule 13a-14(a) or Rule 15d-14(a)
of the Exchange Act) by Chief Financial Officer32.1
    
     Section 1350 Certification (pursuant to Sarbanes-Oxley
Section 906) by Chief Executive Officer and Chief Financial Officer
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SIGNATURES
  APACHE OFFSHORE INVESTMENT PARTNERSHIP
By: Apache Corporation, General PartnerDated: November 9, 2007
    /s/ Roger B. PlankRoger B. PlankExecutive Vice President and Chief Financial OfficerDated: November 9, 2007
    /s/ Rebecca A. HoytRebecca A. HoytVice President and Controller
(Chief Accounting Officer)