Oil and gas exploration firm Apache has recently rejected an unsolicited $18 billion takeover offer from an unnamed suitor, according to knowledgeable sources that spoke to the media.

Apparently Apache rejected the first offer as insufficient, and has hired Goldman Sachs to help them craft a defense strategy, according to the sources who prefer to remain anonymous. The potential acquirer has not be identified, but the sources say the firm sent a letter to Apache a couple of weeks weeks ago and there is no guarantee the merger talks will continue beyond the initial offer.

Apache Corporation APA

Representatives for both Apache and Goldman Sachs declined to comment on the story.

Apache shares were up more than 10% in early trading on the NYSE. As of Friday, Houston-based Apache’s share price is down more than 50% from its peak in early 2014.

More on new Apache offer

The O&G exploration firm was a major player in the shale boom of the 2000s, but Apache has been held back the last couple of years due to major projects in Argentina and Australia that did not work out. The firm appointed a new CEO at  the first of the year, has been selling off leases in Texas and Australia given that low energy prices seem to be here to stay.

According to Charles Robertson, an analyst at Cowen & Co., it’s not surprising to see this kind of M&A activity in the oil patch today, as rock-bottom oil prices are forcing oil companies to reduce costs, which makes firms with have strong balance sheets attractive to larger companies.

Robertson also noted that Apache’s $1.6 billion “in cash and low leverage would help a larger company by strengthening their balance sheet and funding a dividend.”

The firm reported third-quarter earnings last week, and beat the street with a smaller-than-expected adjusted loss. Apache also boosted its 2015 production schedule.

Of note, Apache is one of the largest leaseholders in the Permian Basin (West Texas), the largest U.S. shale play and where oil output has continued to grow even as drillers cut operations and idle rigs elsewhere. The firm also has ongoing exploration projects in Egypt, the Gulf of Mexico and Canada.