Apache (APA) agreed to sell some of its deepwater assets in the Gulf of Mexico to Freeport-McMoRan Copper & Gold (FCX) on Thursday for $1.4 billion.

The Houston-based energy giant said it is selling the assets to focus on shallower-water assets on the shelf that have quicker cycle times, require less capital, and provide more options to bring oil and gas to market.

"We have combined our deepwater and shelf technical teams to focus on subsalt and other deeper exploration opportunities in water depths less than 1,000 feet, which have been relatively untested by industry," Apache chief operating officer Thomas Voytovich said in a statement.

The purchase comes a day after Freeport-McMoRan sold its entire portfolio of Eagle Ford Shale assets to Canada’s Encana (ECA) for $3.1 billion, an effort to free up cash for more strategic deepwater acquisitions.

Half those proceeds will fund the Apache deal, while the remainder will pay down debt. 

This deal includes Apache's interests in the Lucius and Heidelberg oil production development projects and 11 exploration leases. The company said none of its producing operations, which contributed 9,167 barrels of oil equivalent a day in the fourth quarter, are involved in the sale.

Meanwhile, Apache reported an adjusted first-quarter profit on Thursday of $1.90 a share, topping average analyst estimates of $1.62 in a Thomson Reuters poll, though its profit slid year-over-year. Its onshore North American liquids production increased 21%.

Apache’s shares were down 0.72% to $87.13 in recent trade.

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