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                                                                    Exhibit 10.1

                               APACHE CORPORATION
                             1995 STOCK OPTION PLAN

                  (AS AMENDED AND RESTATED SEPTEMBER 15, 2005,
                        EFFECTIVE AS OF JANUARY 1, 2005)

                                    SECTION 1

                                  INTRODUCTION

1.1 Establishment. Apache Corporation, a Delaware corporation (hereinafter
referred to, together with its Affiliated Corporations (as defined in Section
2.1 hereof) as the "Company" except where the context otherwise requires),
hereby establishes the Apache Corporation 1995 Stock Option Plan (the "Plan")
for certain key employees of the Company. The Plan permits the grant of stock
options to certain key employees of the Company.

1.2 Purposes. The purposes of the Plan are to provide the key management
employees selected for participation in the Plan with added incentives to
continue in the long-term service of the Company and to create in such employees
a more direct interest in the future success of the operations of the Company by
relating incentive compensation to increases in stockholder value, so that the
income of the key management employees is more closely aligned with the
interests of the Company's stockholders. The Plan is also designed to attract
key employees and to retain and motivate participating employees by providing an
opportunity for investment in the Company.

1.3 Effective Date. The Effective Date of the Plan (the "Effective Date") is May
4, 1995. This Plan and each option granted hereunder is conditioned on and shall
be of no force or effect until approval of the Plan by the holders of the shares
of voting stock of the Company unless the Company, on the advice of counsel,
determines that stockholder approval is not necessary. The Committee (as defined
in Section 2.1 hereof) may grant options the exercise of which shall be
expressly subject to the condition that the Plan shall have been approved by the
stockholders of the Company.


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                                    SECTION 2

                                   DEFINITIONS

2.1 Definitions. The following terms shall have the meanings set forth below:

     (a) "Administrative Agent" means any designee or agent that may be
appointed by the Committee pursuant to Section 3.1(b) hereof.

     (b) "Affiliated Corporation" means any corporation or other entity
(including but not limited to a partnership) which is affiliated with Apache
Corporation through stock ownership or otherwise and is treated as a common
employer under the provisions of Sections 414(b) and (c) or any successor
section(s) of the Internal Revenue Code.

     (c) "Board" means the Board of Directors of the Company.

     (d) "Committee" means the Stock Option Plan Committee of the Board, which
is empowered hereunder to take actions in the administration of the Plan. The
Committee shall be constituted at all times as to permit the Plan to comply
with: (i) Rule 16b-3 or any successor rule(s) promulgated under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), and (ii) Section 162(m) or
any successor section(s) of the Internal Revenue Code and the regulations
promulgated thereunder.

     (e) "Deferred Delivery Plan" means the Company's Deferred Delivery Plan,
effective as of February 10, 2000 and as it may be amended from time to time, or
any successor plan.

     (f) "Depositary Shares" means the depositary shares representing the
Company's preferred stock convertible into Stock.

     (g) "Eligible Employees" means those full-time key employees (including,
without limitation, officers and directors who are also employees) of the
Company or any division thereof, upon whose judgment, initiative and efforts the
Company is, or will become, largely dependent for the successful conduct of its
business.

     (h) "Fair Market Value" means the per share closing price of the Stock or
Depositary Shares, as applicable, as reported on the New York Stock Exchange,
Inc. Composite Transactions Reporting System for a particular date. If on such
date there are no transactions in the Stock or Depositary Shares, as applicable,
the Fair Market Value shall be determined as of the immediately preceding date
on which there were transactions in the Stock or Depositary Shares, as
applicable.

     (i) "Internal Revenue Code" means the Internal Revenue Code of 1986, as it
may be amended from time to time.


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     (j) "Option" means a right to purchase shares of Stock at a stated price
for a specified period of time. All Options granted under the Plan shall be
Options which are not "incentive stock options" as described in Section 422 or
any successor section(s) of the Internal Revenue Code.

     (k) "Option Price" means the price at which shares of Stock subject to an
Option may be purchased, determined in accordance with subsection 7.2(b) hereof.

     (l) "Participant" means an Eligible Employee designated by the Committee
from time to time during the term of the Plan to receive one or more Options
under the Plan.

     (m) "Stock" means the $0.625 par value Common Stock of the Company.

     (n) "Stock Units" means investment units under the Deferred Delivery Plan,
each of which is deemed to be equivalent to one share of Stock.

2.2 Headings; Gender and Number. The headings contained in the Plan are for
reference purposes only and shall not affect in any way the meaning or
interpretation of the Plan. Except when otherwise indicated by the context, the
masculine gender shall also include the feminine gender, and the definition of
any term herein in the singular shall also include the plural.

                                    SECTION 3

                               PLAN ADMINISTRATION

3.1 Administration by the Committee.

     (a) The Plan shall be administered by the Committee. In accordance with the
provisions of the Plan, the Committee shall, in its sole discretion, select the
Participants from among the Eligible Employees, determine the Options to be
granted pursuant to the Plan, the number of shares of Stock to be issued
thereunder, the time at which such Options are to be granted, fix the Option
Price, and establish such other terms and requirements as the Committee may deem
necessary, or desirable and consistent with the terms of the Plan. The Committee
shall determine the form or forms of the agreements with Participants which
shall evidence the particular provisions, terms, conditions, rights and duties
of the Company and the Participants with respect to Options granted pursuant to
the Plan, which provisions need not be identical except as may be provided
herein.

     (b) The Committee may from time to time adopt such rules and regulations
for carrying out the purposes of the Plan as it may deem proper and


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in the best interests of the Company. The Committee may appoint an
Administrative Agent, who need not be a member of the Committee or an employee
of the Company, to assist the Committee in administration of the Plan and to
whom it may delegate such powers as the Committee deems appropriate, except that
the Committee shall determine any dispute. The Committee may correct any defect,
supply any omission or reconcile any inconsistency in the Plan, or in any
agreement entered into hereunder, in the manner and to the extent it shall deem
expedient and it shall be the sole and final judge of such expediency. No member
of the Committee shall be liable for any action or determination made in good
faith. The determination, interpretations and other actions of the Committee
pursuant to the provisions of the Plan shall be binding and conclusive for all
purposes and on all persons.

3.2 Compliance with Section 162(m).

The Plan is intended to comply with the requirements of Section 162 or any
successor section(s) of the Internal Revenue Code ("Section 162") as to any
"covered employee" as defined in Section 162, and shall be administered,
interpreted and construed consistently therewith. In accordance with this
intent, the amount of income a Participant may receive from Options granted
under the Plan shall be based solely on an increase in the value of the Stock
after the date of the grant of the Option, or such other bases as may be
permitted by applicable law. The Committee is authorized to take such additional
action, if any, that may be required to ensure that the Plan satisfies the
requirements of Section 162 and the regulations promulgated or revenue rulings
published thereunder.

                                    SECTION 4

                            STOCK SUBJECT TO THE PLAN

4.1 Number of Shares. Subject to Section 7.1 and to adjustment pursuant to
Section 4.3 hereof, 2,500,000 shares of Stock (adjusted to 5,775,000 shares of
Stock for (i) the Company's ten-percent stock dividend, record date December 31,
2001, paid January 21, 2002, (ii) the Company's five-percent stock dividend,
record date March 12, 2003, paid April 2, 2003, and (iii) the Company's
two-for-one stock split, record date December 31, 2003, distributed January 14,
2004) are authorized for issuance under the Plan in accordance with the
provisions of the Plan and subject to such restrictions or other provisions as
the Committee may from time to time deem necessary. This authorization may be
increased from time to time by approval of the Board and the stockholders of the
Company if, on the advice of counsel for the Company, such stockholder approval
is required. Shares of Stock which may be issued upon exercise of Options shall
be applied to reduce the maximum number of shares of Stock remaining available
for use under the Plan. The Company shall at all times during the term of the
Plan and while any Options are outstanding retain as authorized and unissued


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Stock, or as Stock in the Company's treasury, at least the number of shares from
time to time required under the provisions of the Plan, or otherwise assure
itself of its ability to perform its obligations hereunder.

4.2 Other Shares of Stock. Any shares of Stock that are subject to an Option
which expires, is forfeited, is cancelled, or for any reason is terminated
unexercised, and any shares of Stock that for any other reason are not issued to
a Participant or are forfeited shall automatically become available for use
under the Plan.

4.3 Adjustments for Stock Split, Stock Dividend, etc. If the Company shall at
any time increase or decrease the number of its outstanding shares of Stock or
change in any way the rights and privileges of such shares by means of the
payment of a Stock dividend or any other distribution upon such shares payable
in Stock, or through a Stock split, subdivision, consolidation, combination,
reclassification or recapitalization involving the Stock then in relation to the
Stock that is affected by one or more of the above events, the numbers, rights
and privileges of the following shall be, in each case, equitably and
proportionally adjusted to take into account the occurrence of any of the above
events, (i) the shares of Stock as to which Options may be granted under the
Plan; (ii) the shares of Stock then included in each outstanding Option granted
hereunder; and (iii) the Option Price for each outstanding Option granted
hereunder.

4.4 Dividend Payable in Stock of Another Corporation, Etc. If the Company shall
at any time pay or make any dividend or other distribution upon the Stock
payable in securities or other property (except money or Stock), a proportionate
part of such securities or other property shall be set aside and delivered to
any Participant then holding an Option for the particular type of Stock for
which the dividend or other distribution was made, upon exercise thereof. Prior
to the time that any such securities or other property are delivered to a
Participant in accordance with the foregoing, the Company shall be the owner of
such securities or other property and shall have the right to vote the
securities, receive any dividends payable on such securities, and in all other
respects shall be treated as the owner. If securities or other property which
have been set aside by the Company in accordance with this Section are not
delivered to a Participant because an Option is not exercised, then such
securities or other property shall remain the property of the Company and shall
be dealt with by the Company as it shall determine in its sole discretion.

4.5 Other Changes in Stock. In the event there shall be any change, other than
as specified in Sections 4.3 and 4.4 hereof, in the number or kind of
outstanding shares of Stock or of any stock or other securities into which the
Stock shall be changed or for which it shall have been exchanged, and if the
Committee shall in its discretion determine that such change equitably requires
an adjustment in the number or kind of shares subject to outstanding Options or


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which have been reserved for issuance pursuant to the Plan but are not then
subject to an Option, then such adjustments shall be made by the Committee and
shall be effective for all purposes of the Plan and on each outstanding Option
that involves the particular type of stock for which a change was effected.

4.6 Rights to Subscribe. If the Company shall at any time grant to the holders
of its Stock rights to subscribe pro rata for additional shares thereof or for
any other securities of the Company or of any other corporation, there shall be
reserved with respect to the shares then under Option to any Participant of the
particular class of Stock involved the Stock or other securities which the
Participant would have been entitled to subscribe for if immediately prior to
such grant the Participant had exercised his entire Option. If, upon exercise of
any such Option, the Participant subscribes for the additional shares or other
securities, the aggregate Option Price shall be increased by the amount of the
price that is payable by the Participant for such additional shares or other
securities.

4.7 General Adjustment Rules. No adjustment or substitution provided for in this
Section 4 shall require the Company to sell a fractional share of Stock under
any Option, or otherwise issue a fractional share of Stock, and the total
substitution or adjustment with respect to each Option shall be limited by
deleting any fractional share. In the case of any such substitution or
adjustment, the aggregate Option Price for the shares of Stock then subject to
the Option shall remain unchanged but the Option Price per share under each such
Option shall be equitably adjusted by the Committee to reflect the greater or
lesser number of shares of Stock or other securities into which the Stock
subject to the Option may have been changed.

4.8 Determination by the Committee, Etc. Adjustments under this Section 4 shall
be made by the Committee, whose determinations with regard thereto shall be
final and binding upon all parties.

                                    SECTION 5

                          REORGANIZATION OR LIQUIDATION

In the event that the Company is merged or consolidated with another corporation
and the Company is not the surviving corporation, or if all or substantially all
of the assets or more than 20 percent of the outstanding voting stock of the
Company is acquired by any other corporation, business entity or person, or in
case of a reorganization (other than a reorganization under the United States
Bankruptcy Code) or liquidation of the Company, and if the provisions of Section
8 hereof do not apply, the Committee, or the board of directors of any
corporation assuming the obligations of the Company, shall, as to the Plan and
outstanding Options either (i) make appropriate provision for the adoption and
continuation of


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the Plan by the acquiring or successor corporation and for the protection of any
such outstanding Options by the substitution on an equitable basis of
appropriate stock of the Company or of the merged, consolidated or otherwise
reorganized corporation which will be issuable with respect to the Stock,
provided that no additional benefits shall be conferred upon the Participants
holding such Options as a result of such substitution, and the excess of the
aggregate Fair Market Value of the shares subject to the Options immediately
after such substitution over the aggregate Option Price thereof is not more than
the excess of the aggregate Fair Market Value of the shares subject to such
Options immediately before such substitution over the aggregate Option Price
thereof, or (ii) upon written notice to the Participants, provide that all
unexercised Options shall be exercised within a specified number of days of the
date of such notice or such Options will be terminated. In the latter event, the
Committee shall accelerate the vesting dates of outstanding Options so that all
Options become fully vested and exercisable prior to any such event.

                                    SECTION 6

                                  PARTICIPATION

Participants in the Plan shall be those Eligible Employees who, in the judgment
of the Committee, are performing, or during the term of their incentive
arrangement will perform, vital services in the management, operation and
development of the Company or an Affiliated Corporation, and significantly
contribute, or are expected to significantly contribute, to the achievement of
the Company's long-term corporate economic objectives. Participants may be
granted from time to time one or more Options; provided, however, that the grant
of each such Option shall be separately approved by the Committee, and receipt
of one such Option shall not result in automatic receipt of any other Option.
Upon determination by the Committee that an Option is to be granted to a
Participant, written notice shall be given to such person, specifying the terms,
conditions, rights and duties related thereto. Each Participant shall, if
required by the Committee, enter into an agreement with the Company, in such
form as the Committee shall determine and which is consistent with the
provisions of the Plan, specifying such terms, conditions, rights and duties.
Options shall be deemed to be granted as of the date specified in the grant
resolution of the Committee, which date shall be the date of any related
agreement with the Participant. In the event of any inconsistency between the
provisions of the Plan and any such agreement entered into hereunder, the
provisions of the Plan shall govern.


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                                    SECTION 7

                                  STOCK OPTIONS

7.1 Grant of Stock Options. Coincident with or following designation for
participation in the Plan, an Eligible Employee may be granted one or more
Options. Grants of Options under the Plan shall be made by the Committee. In no
event shall the exercise of one Option affect the right to exercise any other
Option or affect the number of shares of Stock for which any other Option may be
exercised, except as provided in subsection 7.2(j) hereof. During the life of
the Plan, no Eligible Employee may be granted Options which in the aggregate
pertain to in excess of 25 percent of the total shares of Stock authorized under
the Plan.

7.2 Stock Option Agreements. Each Option granted under the Plan shall be
evidenced by a written stock option agreement which shall be entered into by the
Company and the Participant to whom the Option is granted (the "Stock Option
Agreement"), and which shall contain the following terms and conditions, as well
as such other terms and conditions, not inconsistent therewith, as the Committee
may consider appropriate in each case.

     (a) Number of Shares. Each Stock Option Agreement shall state that it
covers a specified number of shares of Stock, as determined by the Committee.

     (b) Price. The price at which each share of Stock covered by an Option may
be purchased shall be determined in each case by the Committee and set forth in
the Stock Option Agreement, but in no event shall the price be less than the
Fair Market Value of the Stock on the date the Option is granted.

     (c) Duration of Options; Employment Required For Exercise. Each Stock
Option Agreement shall state the period of time, determined by the Committee,
within which the Option may be exercised by the Participant (the "Option
Period"). The Option Period must end, in all cases, not more than ten years from
the date an Option is granted. Except as otherwise provided in Sections 5 and 8
and subsection 7.2(d)(iv) hereof, each Option granted under the Plan shall
become exercisable in increments such that 25 percent of the Option will become
exercisable on each of the four subsequent one-year anniversaries of the date
the Option is granted, but each such additional 25-percent increment shall
become exercisable only if the Participant has been continuously employed by the
Company from the date the Option is granted through the date on which each such
additional 25-percent increment becomes exercisable.

     (d) Termination of Employment, Death, Disability, Etc. Each Stock Option
Agreement shall provide as follows with respect to the exercise of the Option
upon termination of the employment or the death of the Participant:


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          (i) If the employment of the Participant by the Company is terminated
within the Option Period for cause, as determined by the Company, the Option
shall thereafter be void for all purposes. As used in this subsection 7.2(d),
"cause" shall mean a gross violation, as determined by the Company, of the
Company's established policies and procedures, provided that the effect of this
subsection 7.2(d) shall be limited to determining the consequences of a
termination and that nothing in this subsection 7.2(d) shall restrict or
otherwise interfere with the Company's discretion with respect to the
termination of any employee.

          (ii) If the Participant retires from employment by the Company on or
after attaining age 60, the Option may be exercised by the Participant within 36
months following his or her retirement (provided that such exercise must occur
within the Option Period), but not thereafter. In the event of the Participant's
death during such 36-month period, each Option may be exercised by those
entitled to do so in the manner referred to in (iv) below. In any such case, the
Option may be exercised only as to the shares as to which the Option had become
exercisable on or before the date of the Participant's retirement.

          (iii) If the Participant becomes disabled (as determined pursuant to
the Company's Long-Term Disability Plan or any successor plan), during the
Option Period while still employed, or within the three-month period referred to
in (v) below, or within the 36-month period referred to in (ii) above, the
Option may be exercised by the Participant or by his or her guardian or legal
representative, within twelve months following the Participant's disability, or
within the 36-month period referred to in (ii) if applicable and if longer
(provided that such exercise must occur within the Option Period), but not
thereafter. In the event of the Participant's death during such twelve-month
period, each Option may be exercised by those entitled to do so in the manner
referred to in (iv) below. In any such case, the Option may be exercised only as
to the shares of Stock as to which the Option had become exercisable on or
before the date of the Participant's disability.

          (iv) In the event of the Participant's death while still employed by
the Company, each Option of the deceased Participant may be exercised by those
entitled to do so under the Participant's will or under the laws of descent and
distribution within twelve months following the Participant's death (provided
that in any event such exercise must occur within the Option Period), but not
thereafter, as to all shares of Stock which are subject to such Option,
including each 25-percent increment of the Option, if any, which has not yet
become exercisable at the time of the Participant's death. In the event of the
Participant's death within the 36-month period referred to in (ii) above or
within the twelve-month period referred to in (iii) above, each Option of the
deceased Participant that is exercisable at the time of death may be exercised
by those entitled to do so


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under the Participant's will or under the laws of descent and distribution
within twelve months following the Participant's death or within the 36-month
period referred to in (ii), if applicable and if longer (provided that in any
event such exercise must occur within the Option Period). The provisions of this
paragraph (iv) of subsection 7.2(d) shall be applicable to each Stock Option
Agreement as if set forth therein word for word. Each Stock Option Agreement
executed by the Company prior to the adoption of this provision shall be deemed
amended to include the provisions of this paragraph and all Options granted
pursuant to such Stock Option Agreements shall be exercisable as provided
herein.

          (v) If the employment of the Participant by the Company is terminated
(which for this purpose means that the Participant is no longer employed by the
Company or by an Affiliated Corporation) within the Option Period for any reason
other than cause, the Participant's retirement on or after attaining age 60, the
Participant's disability or death, the Option may be exercised by the
Participant within three months following the date of such termination (provided
that such exercise must occur within the Option Period), but not thereafter. In
any such case, the Option may be exercised only as to the shares as to which the
Option had become exercisable on or before the date of termination of the
Participant's employment.

     (e) Transferability. Each Stock Option Agreement shall provide that the
Option granted therein is not transferable by the Participant except by will or
pursuant to the laws of descent and distribution, and that such Option is
exercisable during the Participant's lifetime only by him or her, or in the
event of the Participant's disability or incapacity, by his or her guardian or
legal representative.

     (f) Agreement to Continue in Employment. Each Stock Option Agreement shall
contain the Participant's agreement to remain in the employment of the Company,
at the pleasure of the Company, for a continuous period of at least one year
after the date of such Stock Option Agreement, at the salary rate in effect on
the date of such agreement or at such changed rate as may be fixed, from time to
time, by the Company.

     (g) Exercise, Payments, Etc.

          (i) Each Stock Option Agreement shall provide that the method for
exercising the Option granted therein shall be by delivery to the Office of the
Secretary of the Company or to the Administrative Agent of written notice
specifying the number of shares of Stock with respect to which such Option is
exercised and payment to the Company of the aggregate Option Price. Such notice
shall be in a form satisfactory to the Committee and shall specify the
particular Options (or portions thereof) which are being exercised and the
number of shares of Stock with respect to which the Options are being exercised.
The


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exercise of the Option shall be deemed effective on the date such notice is
received by the Office of the Secretary or by the Administrative Agent and
payment is made to the Company of the aggregate Option Price (the "Exercise
Date"); however, if payment of the aggregate Option Price is made pursuant to a
sale of shares of Stock as contemplated by subsection 7.2(g)(iii)(F) below, the
Exercise Date shall be deemed to be the date of such sale. If requested by the
Company, such notice shall contain the Participant's representation that he or
she is purchasing the Stock for investment purposes only and his or her
agreement not to sell any Stock so purchased in any manner that is in violation
of the Securities Act of 1933, as amended, or any applicable state law, and such
restriction, or notice thereof, shall be placed on the certificates representing
the Stock so purchased. The purchase of such Stock shall take place upon
delivery of such notice to the Office of the Secretary of the Company or to the
Administrative Agent, at which time the aggregate Option Price shall be paid in
full to the Company by any of the methods or any combination of the methods set
forth in 7.2(g)(iii) below.

          (ii) Except as referenced below in connection with the Deferred
Delivery Plan, the shares of Stock to which the Participant is entitled as a
result of the exercise of the Option shall be issued by the Company and (A)
delivered by electronic means to an account designated by the Participant, or
(B) delivered to the Participant in the form of a properly executed certificate
or certificates representing such shares of Stock. If shares of Stock and/or
Depositary Shares are used to pay all or part of the aggregate Option Price, the
Company shall issue and deliver to the Participant the additional shares of
Stock, in excess of the aggregate Option Price or portion thereof paid using
shares of Stock or Depositary Shares, to which the Participant is entitled as a
result of the Option exercise. If the Participant exercising an Option (x) is
eligible for participation in the Deferred Delivery Plan, (y) pays the aggregate
Option Price pursuant to 7.2(g)(iii)(A), (B), (C), (D) or (E) below, and (z) has
made an irrevocable election at least six months prior to the Exercise Date as
required under the Deferred Delivery Plan, the income resulting from the Option
exercise shall be deferred into the Participant's Deferred Delivery Plan account
and no additional shares of Stock shall be delivered to the Participant. The
income resulting from the Option exercise may not be deferred into the
Participant's Deferred Delivery Plan account except to the extent that the
Option was vested by December 31, 2004, the deferral election was made by
December 31, 2004, and the deferral into the Deferred Delivery Plan occurs
before January 1, 2006.

          (iii) the aggregate Option Price shall be paid by any of the following
methods or any combination of the following methods:

               (A) in cash, including the wire transfer of funds in U.S. dollars
to one of the Company's bank accounts located in the United States, with such
bank account to be designated from time to time by the Company;


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               (B) by personal, certified or cashier's check payable in U.S.
dollars to the order of the Company;

               (C) by delivery to the Company or the Administrative Agent of
certificates representing a number of shares of Stock then owned by the
Participant, the aggregate Fair Market Value of which (as of the Exercise Date)
is not greater than the aggregate Option Price of the Option being exercised,
properly endorsed for transfer to the Company; provided that the shares of Stock
used for this purpose must have been owned by the Participant for a period of at
least six months;

               (D) by certification or attestation to the Company or the
Administrative Agent of the Participant's ownership as of the Exercise Date of
the number of shares of Stock and/or Depositary Shares, the aggregate Fair
Market Value of which (as of the Exercise Date) is not greater than the
aggregate Option Price of the Option being exercised, provided that the shares
of Stock and/or Depositary Shares used for this purpose have been owned by the
Participant for a period of at least six months;

               (E) if the income resulting from the Option exercise is to be
deferred into the Participant's Deferred Delivery Plan account, by certification
or attestation to the Company or the Administrative Agent of the Participant's
ownership (as of the Exercise Date) of a number of vested Stock Units held in
the Participant's Deferred Delivery Plan account, the equivalent aggregate Fair
Market Value of which (as of the Exercise Date) is not greater than the
aggregate Option Price of the Option being exercised, provided that the Stock
Units used for this purpose were vested as of the Exercise Date; or

               (F) by delivery to the Company or the Administrative Agent of a
properly executed notice of exercise together with irrevocable instructions to a
broker to promptly deliver to the Company, by wire transfer or check as noted in
(A) and (B) above, the amount of the proceeds of the sale of all or a portion of
the Stock or of a loan from the broker to the Participant necessary to pay the
aggregate Option Price.

          (iv) For purposes of the Plan, the income resulting from an Option
exercise shall be based on the Fair Market Value of the Stock for the Exercise
Date; however, if payment of the aggregate Option Price is made pursuant to a
sale of shares of Stock as contemplated by subsection 7.2(g)(iii)(F) hereof, the
Fair Market Value shall be deemed to be the per share sale price and the
Exercise Date shall be deemed to be the date of such sale.

     (h) Date of Grant. An Option shall be considered as having been granted on
the date specified in the grant resolution of the Committee.


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     (i) Tax Withholding. Each Stock Option Agreement shall provide that, upon
exercise of the Option, the Participant shall make appropriate arrangements with
the Company to provide for the amount of tax withholding required by Sections
3102 and 3402 or any successor section(s) of the Internal Revenue Code and
applicable state and local income tax laws, including payment of such taxes in
cash, by check or as provided in Section 13.2 hereof.

     (j) Adjustment of Options. Subject to the provisions of Sections 4, 5, 7, 8
and 12 hereof, the Committee may make any adjustment in the number of shares of
Stock covered by, or the terms of an outstanding Option and a subsequent
granting of an Option, by amendment or by substitution for an outstanding
Option; however, except as provided in Sections 4, 5, 8 and 12 hereof, the
Committee may not adjust the Option Price of any outstanding Option. Such
amendment or substitution may result in terms and conditions (including the
number of shares of Stock covered, vesting schedule or Option Period) that
differ from the terms and conditions of the original Option. The Committee may
not, however, adversely affect the rights of any Participant to previously
granted Options without the consent of such Participant. If such action is
effected by amendment, the effective date of such amendment will be the date of
grant of the original Option.

7.3 Stockholder Privileges. No Participant shall have any rights as a
stockholder with respect to any shares of Stock covered by an Option until the
Participant becomes the holder of record of such Stock. Except as provided in
Section 4 hereof, no adjustments shall be made for dividends or other
distributions or other rights as to which there is a record date preceding the
date on which such Participant becomes the holder of record of such Stock.

                                    SECTION 8

                                CHANGE OF CONTROL

8.1 In General. In the event of the occurrence of a change of control of the
Company, as defined in Section 8.3 hereof, all outstanding Options shall become
automatically vested, without further action by the Committee or the Board, so
as to make all such Options fully vested and exercisable as of the date of such
change of control.

8.2 Limitation on Payments. If the provisions of this Section 8 would result in
the receipt by any Participant of a payment within the meaning of Section 280G
or any successor section(s) of the Internal Revenue Code, and the regulations
promulgated thereunder, and if the receipt of such payment by any Participant
would, in the opinion of independent tax counsel of recognized standing selected
by the Company, result in the payment by such Participant of any excise tax


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provided for in Sections 280G and 4999 or any successor section(s) of the
Internal Revenue Code, then the amount of such payment shall be reduced to the
extent required, in the opinion of independent tax counsel, to prevent the
imposition of such excise tax; provided, however, that the Committee, in its
sole discretion, may authorize the payment of all or any portion of the amount
of such reduction to the Participant.

8.3 Definition. For purposes of the Plan, a "change of control" shall mean any
of the events specified in the Company's Income Continuance Plan or any
successor plan which constitute a change of control within the meaning of such
plan.

                                    SECTION 9

                        RIGHTS OF EMPLOYEES, PARTICIPANTS

9.1 Employment. Nothing contained in the Plan or in any Option granted under the
Plan shall confer upon any Participant any right with respect to the
continuation of his or her employment by the Company or any Affiliated
Corporation, or interfere in any way with the right of the Company or any
Affiliated Corporation, subject to the terms of any separate employment
agreement to the contrary, at any time to terminate such employment or to
increase or decrease the level of the Participant's compensation from the level
in existence at the time of the grant of an Option. Whether an authorized leave
of absence, or absence in military or government service, shall constitute a
termination of employment shall be determined by the Committee at the time.

9.2 Nontransferability. No right or interest of any Participant in an Option
granted pursuant to the Plan shall be assignable or transferable during the
lifetime of the Participant, either voluntarily or involuntarily, or subjected
to any lien, directly or indirectly, by operation of law, or otherwise,
including execution, levy, garnishment, attachment, pledge or bankruptcy. In the
event of a Participant's death, a Participant's rights and interests in Options
shall, to the extent provided in Section 7 hereof, be transferable by
testamentary will or the laws of descent and distribution, and payment of any
amounts due under the Plan shall be made to, and exercise of any Options may be
made by, the Participant's legal representatives, heirs or legatees. If in the
opinion of the Committee, a person entitled to payments or to exercise rights
with respect to the Plan is disabled from caring for his or her affairs because
of mental condition, physical condition or age, payment due such person may be
made to, and such rights shall be exercised by, such person's guardian,
conservator or other legal personal representative upon furnishing the Committee
with evidence of such status satisfactory to the Committee.


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<PAGE>
                                   SECTION 10

                              GENERAL RESTRICTIONS

10.1 Investment Representations. The Company may require a Participant, as a
condition of exercising an Option, to give written assurances in substance and
form satisfactory to the Company and its counsel to the effect that such person
is acquiring the Stock subject to the Option for his own account for investment
and not with any present intention of selling or otherwise distributing the
same, and to such other effects as the Company deems necessary or appropriate in
order to comply with federal and applicable state securities laws.

10.2 Compliance with Securities Laws. Each Option shall be subject to the
requirement that, if at any time counsel to the Company shall determine that the
listing, registration or qualification of the shares of Stock subject to such
Option upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental or regulatory body, is necessary as a
condition of, or in connection with, the issuance or purchase of shares of Stock
thereunder, such Option may not be accepted or exercised in whole or in part
unless such listing, registration, qualification, consent or approval shall have
been effected or obtained on conditions acceptable to the Committee. Nothing
herein shall be deemed to require the Company to apply for or to obtain such
listing, registration, qualification, consent or approval.

                                   SECTION 11

                             OTHER EMPLOYEE BENEFITS

The amount of any income deemed to be received by a Participant as a result of
an Option exercise shall not constitute "earnings" or "compensation" with
respect to which any other employee benefits of such Participant are determined
including, without limitation benefits under any pension, profit sharing, life
insurance or salary continuation plan.

                                   SECTION 12

                  PLAN AMENDMENT, MODIFICATION AND TERMINATION

The Board may at any time terminate, and from time to time may amend or modify
the Plan provided, however, that no amendment or modification may become
effective without approval of the amendment or modification by the Company's
stockholders if stockholder approval is required to enable the Plan to satisfy
any applicable statutory or regulatory requirements unless the Company, on the
advice of counsel, determines that stockholder approval is otherwise necessary
or desirable.


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<PAGE>
No amendment, modification or termination of the Plan shall in any manner
adversely affect any Option theretofore granted under the Plan, without the
consent of the Participant holding such Option.

The Committee shall have the authority to adopt such modifications, procedures
and subplans as may be necessary or desirable to comply with the provisions of
the laws (including, but not limited to, tax laws and regulations) of countries
other than the United States in which the Company may operate, so as to assure
the viability of the benefits of the Plan to Participants employed in such
countries.

                                   SECTION 13

                                   WITHHOLDING

13.1 Withholding Requirement. The Company's obligations to deliver shares of
Stock upon the exercise of an Option, or to defer income resulting from an
Option exercise into the Deferred Delivery Plan, shall be subject to the
Participant's satisfaction of all applicable federal, state and local income and
other tax withholding requirements.

13.2 Satisfaction of Required Withholding. At the time the Committee grants an
Option, it may, in its sole discretion, grant the Participant an election to pay
all such amounts of required tax withholding, or any part thereof:

     (a) by the delivery to the Company or the Administrative Agent of a number
of shares of Stock then owned by the Participant, the aggregate Fair Market
Value of which (as of the Exercise Date) is not greater than the amount required
to be withheld, provided that such shares have been held by the Participant for
a period of at least six months;

     (b) by certification or attestation to the Company or the Administrative
Agent of the Participant's ownership (as of the Exercise Date) of a number of
shares of Stock and/or Depositary Shares, the aggregate Fair Market Value of
which (as of the Exercise Date) is not greater than the amount required to be
withheld, provided that such shares of Stock and/or Depositary Shares have been
owned by the Participant for a period of at least six months;

     (c) if the income resulting from the Option exercise is to be deferred into
the Participant's Deferred Delivery Plan account, by certification or
attestation to the Company or the Administrative Agent of the Participant's
ownership (as of the Exercise Date) of a number of vested Stock Units held in
the Participant's Deferred Delivery Plan account, the equivalent aggregate Fair
Market Value of which (as of the Exercise Date) is not greater than the amount
required to be withheld, provided that such Stock Units were vested as of the
Exercise Date; or


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<PAGE>
     (d) by the Company or the Administrative Agent withholding from the shares
of Stock otherwise issuable to the Participant upon exercise of the Option, a
number of shares of Stock, the aggregate Fair Market Value of which (as of the
Exercise Date) is not greater than the amount required to be withheld. Any such
elections by Participants to have shares of Stock withheld for this purpose will
be subject to the following restrictions:

          (i) all elections shall be made on or prior to the Exercise Date; and

          (ii) all elections shall be irrevocable.

13.3 Excess Withholding. At the time the Committee grants an Option, it may, in
its sole discretion, grant the Participant an election to pay additional or
excess amounts of tax withholding, beyond the required amounts and up to the
Participant's marginal tax rate:

     (a) by delivery to the Company or the Administrative Agent of a number of
Shares of Stock then owned by the Participant, the aggregate Fair Market Value
of which (as of the Exercise Date) is not greater than such excess withholding
amount, provided that such shares of Stock have been owned by the Participant
for a period of at least six months; or

     (b) by certification or attestation to the Company or the Administrative
Agent of the Participant's ownership (as of the Exercise Date) of a number of
shares of Stock and/or Depositary Shares, the aggregate Fair Market Value of
which (as of the Exercise Date) is not greater than such excess withholding
amount, provided that such shares of Stock and/or Depositary Shares have been
owned by the Participant for a period of at least six months.

13.4 Section 16 Requirements. If the Participant is an officer or director of
the Company within the meaning of Section 16 or any successor section(s) of the
1934 Act ("Section 16"), the Participant must satisfy the requirements of such
Section 16 and any applicable rules and regulations thereunder with respect to
the use of shares of Stock, Depositary Shares and/or Stock Units to satisfy such
tax withholding obligation.

                                   SECTION 14

                               REQUIREMENTS OF LAW

14.1 Requirements of Law. The issuance of Stock and the payment of cash pursuant
to the Plan shall be subject to all applicable laws, rules and regulations.


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<PAGE>
14.2 Federal Securities Laws Requirements. If a Participant is an officer or
director of the Company within the meaning of Section 16, Options granted
hereunder shall be subject to all conditions required under Rule 16b-3, or any
successor rule(s) promulgated under the 1934 Act, to qualify the Option for any
exception from the provisions of Section 16 available under such Rule. Such
conditions are hereby incorporated herein by reference and shall be set forth in
the Stock Option Agreement with the Participant which describes the Option.

14.3 Governing Law. The Plan and all Stock Option Agreements hereunder shall be
construed in accordance with and governed by the laws of the State of Texas.

                                   SECTION 15

                              DURATION OF THE PLAN

The Plan shall terminate at such time as may be determined by the Board, and no
Option shall be granted after such termination. If not sooner terminated under
the preceding sentence, the Plan shall fully cease and expire at midnight on May
4, 2000. Options outstanding at the time of the Plan termination shall continue
to be exercisable in accordance with the Stock Option Agreement pertaining to
each such Option, as such Stock Option Agreement may be modified pursuant to
Section 12.

Dated: September 15, 2005.

                                        APACHE CORPORATION

ATTEST:


/s/ Cheri L. Peper                      By: /s/  Jeffrey M. Bender
-------------------------------------       ------------------------------------
Cheri L. Peper                              Jeffrey M. Bender
Corporate Secretary                         Vice President, Human Resources


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