In 2009, Apache (NYSE:APA) pulled in its horns in response to low commodity prices, as is the company's long-standing practice. Capital spending dropped to $4.1 billion from $6.8 billion in 2008. In North America, the company drilled 61% fewer wells.

In that light, the region's mere 1% decrease in production is pretty impressive. Meanwhile, international production (led by Egypt and Australia) ripped higher by 21%, taking overall production up a very fine 9%.

As far as reserves growth, well ... there was none to speak of. Apache replaced 101% of production before price revisions, adding 216 million barrels of oil equivalent, mostly through the drill bit, at a reasonable cost of around $16 per barrel. Anadarko Petroleum (NYSE:APC) sported finding costs this year of around $15, so Apache is in the same ballpark. Devon Energy (NYSE:DVN) sported much lower finding costs this year, but that turned out to be something of an anomaly.

With a commodity price outlook of $70 oil and $5 natural gas, Apache sees a lot more cash coming in the front door, and hence is ready to ratchet up spending in 2010. The company expects cash flow and spending to hit $6 billion to $6.5 billion, and detailed its major North American and international development plays on its conference call yesterday. Here at home, the Granite Wash and the Permian are two of Apache's top targets, while Egypt and the U.K. North Sea are getting major attention abroad. We recently sized up the Granite Wash play and tapped Cimarex Energy (NYSE:XEC) as an interesting way to play it.

Apache hasn't done too much in the way of mergers and acquisitions lately, but the company said it's "actively screening" opportunities. The Permian was mentioned as one place where the company would like to do a deal, so clearly the acquisition from Marathon Oil (NYSE:MRO) last year left Apache hungry for more. SandRidge Energy (NYSE:SD) picked up Forest Oil's (NYSE:FST) Permian acreage for $800 million a few months back, so larger deals have already begun to fly in this area.

If Apache wants to make a big move, Cimarex would be a pretty complementary target, in terms of both operations and culture. With an enterprise value of less than $5.5 billion, it's not out of Apache's reach.

Fool contributor Toby Shute doesn't have a position in any company mentioned. Check out his Motley Fool CAPS profile or follow his articles using Twitter. The Motley Fool has a disclosure policy.