News Release
For Immediate Release 11/2/06
Company contacts:
T. Paul Bulmahn, Chairman and President
Albert L. Reese Jr., Chief Financial Officer
713-622-3311 www.atpog.com
ATP Oil & Gas Reports Back-to-Back Quarterly Record Production and Third Quarter Results
HOUSTON - November 2, 2006 - (Business Wire) - ATP Oil & Gas Corporation (NASDAQ: ATPG) today released its operations update and third quarter 2006 results:
| · | Achieving a second consecutive quarter of record production with an average rate of 174.1 MMcfe/d, exceeding guidance of 170.0 MMcfe/d; |
| · | Recording quarterly revenue of $132.8 million and net income available to common shareholders of $1.2 million; |
| · | Adding six wells to production during the first nine months of 2006, with nine additional near-term wells scheduled to come online, three in the fourth quarter 2006 and six in the first half 2007; |
| · | Acquiring seven blocks in the Gulf of Mexico in 2006 and executed the contract to build a MinDOC floating production platform, which will service the company’s deepwater properties - Mirage, Morgus, and Telemark. |
Results of Operations
As a result of the continued ramp-up in production at ATP’s Mississippi Canyon (“MC”) 711 and Tors properties, production for the third quarter of 16.0 Bcfe (174.1 MMcfe/d) was 18% higher than the second quarter 2006 (148.6 MMcfe/d) and 321% higher than the third quarter 2005 (41.4 MMcfe/d). Price realizations of $8.30 per Mcfe in the third quarter were 3% above the second quarter and 20% above the third quarter 2005. Revenues for the third quarter of $132.8 million were 22% above the second quarter and 404% above the third quarter 2005. Production for the nine months ending September 30, 2006 was 35.5 Bcfe, an increase of 144% over the same period in 2005. Revenues during the nine month 2006 period were $287.0 million, an increase of 196% over the comparable 2005 period.
Lease operating expense (LOE) per Mcfe was $1.43 for the third quarter of 2006, compared with $1.57 per Mcfe in the second quarter of 2006 and $1.26 in the third quarter of 2005. LOE per Mcfe has improved from the second quarter of 2006 (9% lower) and from the first quarter of 2006 (21% lower) primarily due to our rapid increase in production this year and our focus on reducing costs at properties with low production rates. The increase in LOE per Mcfe compared with the third quarter of 2005 (13% higher) was primarily due to increases in insurance and other operating costs and costs of uninsured hurricane repairs. With our expectation of significant near-term production growth and our focus on reducing operating costs, we anticipate further improvement in the company’s per unit LOE.
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 1 of 10 |
General and administrative expenses (G&A) of $4.6 million for the third quarter were 14% above the second quarter 2006 and 19% above the third quarter 2005. The increase is primarily attributed to legal, professional and consulting fees, partially offset by the prior year provision that was recorded for the successful ATP Employee Volvo Challenge Plan.
Depreciation, depletion, and amortization (DD&A) per Mcfe was $3.44 in the third quarter, 7% above the second quarter and 6% above the third quarter 2005. The overall DD&A expense increase is mainly due to increased production from newly developed properties in 2006. In addition to DD&A, ATP also recorded a noncash charge for impairment of $11.8 million related to three properties acquired in a package of properties in late 2005. While ATP believes that it could have performed additional activities at these three locations that, over time, might have resulted in added revenue, the decision was made to forego these capital expenditures.
ATP recorded a tax provision during the third quarter relating to its foreign jurisdictions based on the expected 2006 effective tax rate of each jurisdiction. The rates were determined based on the projected results of operations for the year, the valuation allowance that had previously been recorded at each jurisdiction and any permanent differences affecting the overall tax rate.
ATP recorded net income available to common shareholders of $1.2 million or $0.04 per basic and diluted share in the third quarter 2006, compared to net income of $6.4 million in the second quarter and a net loss of $10.6 million in the third quarter 2005. For the nine months ending September 30, 2006, ATP recorded a net loss available to common shareholders of $2.3 million or $0.08 per basic and diluted share compared with a net loss available to common shareholders of $12.9 million or $0.44 per basic and diluted share during the same nine-month period in 2005.
Third quarter net income available to common shareholders was impacted by the impairment expense noted above. Research analysts typically exclude this charge from their published estimates. Accordingly, after adjusting for this item, ATP had net income available to common shareholders before impairment expense of $12.9 million or $0.44 and $0.43 per basic and diluted share.
ATP’s selected operating statistics and financial information, included within this press release, contain additional information on the company’s activities for the third quarter 2006 and comparable period in 2005.
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 2 of 10 |
| | | Three Months Ended | | Nine Months Ended | |
| | | | September 30, | | | September 30, | |
| | | | 2006 | | | 2005 | | | 2006 | | | 2005 | |
Selected Operating Statistics | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
Production | | | | | | | | | | | | | |
| Natural gas (MMcf) | | | 8,726 | | | 2,718 | | | 22,380 | | | 11,033 | |
| Oil and condensate (MBbls) | | | 1,215 | | | 182 | | | 2,181 | | | 584 | |
| Natural gas equivalents (MMcfe) | | | 16,017 | | | 3,807 | | | 35,469 | | | 14,537 | |
| Gulf of Mexico (GOM, in MMcfe) | | | 11,836 | | | 3,807 | | | 27,151 | | | 13,625 | |
| North Sea (MMcfe) | | | 4,181 | | | - | | | 8,318 | | | 913 | |
| | | | | | | | | | | | | | |
Average Prices (includes effect of cash flow hedges) | | | | | | | | | | | | | |
| Natural gas (per Mcf) | | $ | 7.22 | | $ | 6.94 | | $ | 7.29 | | $ | 6.55 | |
| Natural gas (per Mcf) - GOM | | | 7.35 | | | 6.94 | | | 7.47 | | | 6.52 | |
| Natural gas (per Mcf) - N. Sea | | | 7.07 | | | - | | | 6.98 | | | 6.95 | |
| Oil and condensate (per Bbl) | | | 57.52 | | | 41.16 | | | 56.74 | | | 41.67 | |
| Natural gas, oil and condensate (per Mcfe) | | | 8.30 | | | 6.92 | | | 8.09 | | | 6.65 | |
| | | | | | | | | | | | | | |
Other Expenses, per Mcfe | | | | | | | | | | | | | |
| Lease operating expense (per Mcfe) | | $ | 1.43 | | $ | 1.26 | | $ | 1.55 | | $ | 1.06 | |
| Lease operating expense (per Mcfe) - GOM | | | 1.46 | | | 1.17 | | | 1.61 | | | 1.02 | |
| Lease operating expense (per Mcfe) - N. Sea | | | 1.34 | | | - | | | 1.34 | | | 1.63 | |
| Depreciation, depletion and amortization (DD&A) | | | 3.44 | | | 3.23 | | | 3.26 | | | 3.30 | |
| DD&A - GOM | | | 3.50 | | | 3.22 | | | 3.24 | | | 3.26 | |
| DD&A - N. Sea | | | 3.24 | | | - | | | 3.31 | | | 3.97 | |
| | | | | | | | | | | | | | |
Selected Financial Data | | | | | | | | | | | | | |
(In Thousands, Except Per Share Data) | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
| Oil and gas revenues, including settled derivatives (1) | | $ | 132,822 | | $ | 26,342 | | $ | 286,952 | | $ | 96,810 | |
| Net income (loss) | | | 12,709 | | | (6,821 | ) | | 27,024 | | | (9,142 | ) |
| Preferred dividends | | | (11,536 | ) | | (3,756 | ) | | (29,340 | ) | | (3,756 | ) |
| Net income (loss) available to common shareholders | | | 1,173 | | | (10,577 | ) | | (2,316 | ) | | (12,898 | ) |
| | | | | | | | | | | | | | |
| Net income (loss) per common share - basic and diluted | | $ | 0.04 | | $ | (0.36 | ) | $ | (0.08 | ) | $ | (0.44 | ) |
| | | | | | | | | | | | | | |
| Average number of common shares outstanding | | | | | | | | | | | | | |
| Basic | | | 29,776 | | | 29,109 | | | 29,643 | | | 29,005 | |
| Diluted | | | 30,406 | | | 29,922 | | | 30,342 | | | 29,833 | |
| __________________ | | | | | | | | | | | | | |
| (1) See oil and gas revenue reconciliation on the last page of this press release. | | | | | | | | | | | | | |
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 3 of 10 |
Acquisitions, Development and Operations Update
Thus far in 2006, ATP has acquired seven blocks in the Gulf of Mexico, all with a 100% working interest and operated by ATP. Four deepwater blocks were acquired in two separate private transactions: Telemark (Atwater Valley 63), Mirage (Mississippi Canyon - “MC” - 941), Oasis (MC 943) and Morgus (MC 942). ATP was also successful at both Gulf of Mexico lease sales conducted in 2006. At the March sale, ATP was awarded Green Canyon 37, a deepwater lease. At the August sale, ATP was awarded Garden Banks 388 and Garden Banks 187. Five of these properties have had previous drilling, which encountered hydrocarbons and all are scheduled for development during the next three year period.
ATP placed on production six new wells during the first nine months of 2006. An additional nine wells are scheduled for first production between now and the middle of 2007. The new producing wells, particularly those at Mississippi Canyon 711 (Gomez) and Tors, have been the primary drivers for ATP’s 144% increase in production during the first nine months of 2006 compared to the same period in 2005. New wells scheduled in the next nine months are projected to continue to increase production into 2007.
In the first nine months of 2006, ATP paid $390.9 million for acquisition and development of oil and gas properties compared to $272.6 million during the same period in 2005.
Hedging Update
Since ATP reported second quarter earnings in August 2006, the company has hedged with fixed forward contracts an additional 6.7 Bcf of natural gas in the U.K. The hedges cover projected volumes for the fourth quarter 2006, calendar 2007 and first quarter 2008 at a weighted average price of $10.06 per Mcf. A detailed listing of the new hedges as well as previously existing hedges is provided near the end of this press release.
Capital Resources and Liquidity
Cash flow from operating activities was $105.3 million for the nine months ended September 30, 2006, compared to $61.4 million for the same period in 2005. Cash flow from operating activities prior to changes in assets and liabilities, a non-GAAP measure frequently used by research analysts, was a record $179.4 million for the nine months ended September 30, 2006, compared to $49.9 million for the same period in 2005. A non-GAAP reconciliation is provided near the end of this press release. ATP had $61.3 million in cash and cash equivalents on hand at September 30, 2006, compared to $65.6 million at December 31, 2005.
3rd Quarter 2006 Conference Call
ATP’s Chairman & President T. Paul Bulmahn, Senior Vice President Gerald W. Schlief, Chief Financial Officer Albert L. Reese, Jr. and Chief Operating Officer Leland E. Tate will host a conference call to discuss the company’s third quarter results on Friday, November 3 at 10:00 am central time.
Web listeners will need to log in to www.atpog.com at least 10 minutes prior to the start of the call. Phone participants should dial (800) 819-9193. The audio download file in MP3 format will be released within 48 hours of the call. A recorded phone replay will be available at 888-203-1112, access code 5084901, for a period of 24 hours beginning at 1:00 pm CT, and the Web cast will be archived for 30 business days at www.atpog.com.
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 4 of 10 |
About ATP Oil & Gas
ATP Oil & Gas is an international offshore oil and gas development and production company with operations in the Gulf of Mexico and the North Sea. The company trades publicly as ATPG on the NASDAQ Global Select Market.
Forward-looking Statements
Certain statements included in this news release are “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. ATP cautions that assumptions, expectations, projections, intentions, or beliefs about future events may, and often do, vary from actual results and the differences can be material. Some of the key factors which could cause actual results to vary from those ATP expects include changes in natural gas and oil prices, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as our ability to access them, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business. More information about the risks and uncertainties relating to ATP's forward-looking statements are found in our SEC filings.
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 5 of 10 |
CONSOLIDATED BALANCE SHEETS |
(In Thousands) |
| | | | | | | | |
| | | | September 30, | | | December 31, | |
| | | | 2006 | | | 2005 | |
Assets | | | | | | | |
| | | | | | | | |
| Current assets: | | | | | | | |
| Cash and cash equivalents | | $ | 61,263 | | $ | 65,566 | |
| Restricted cash | | | 26,298 | | | 12,209 | |
| Accounts receivable (net of allowances of $308 and $367) | | | 148,714 | | | 83,571 | |
| Deferred tax asset | | | 4,633 | | | - | |
| Derivative asset | | | 1,272 | | | - | |
| Other current assets | | | 12,464 | | | 4,454 | |
| Total current assets | | | 254,644 | | | 165,800 | |
| | | | | | | | |
| Oil and gas properties: | | | | | | | |
| Oil and gas properties (using the successful efforts | | | | | | | |
| method of accounting) | | | 1,382,682 | | | 899,284 | |
| Less: Accumulated depletion, impairment and amortization | | | (400,646 | ) | | (271,863 | ) |
| Oil and gas properties, net | | | 982,036 | | | 627,421 | |
| | | | | | | | |
| Furniture and fixtures, net | | | 1,136 | | | 1,175 | |
| Deferred tax asset | | | 1,342 | | | 4,025 | |
| Derivative asset | | | 177 | | | - | |
| Deferred financing costs, net | | | 24,337 | | | 17,922 | |
| Other assets, net | | | 11,549 | | | 7,420 | |
| | | | 38,541 | | | 30,542 | |
| Total assets | | $ | 1,275,221 | | $ | 823,763 | |
| | | | | | | | |
Liabilities and Shareholders' Equity | | | | | | | |
| | | | | | | | |
| Current liabilities: | | | | | | | |
| Accounts payable and accruals | | $ | 208,987 | | $ | 144,675 | |
| Current maturities of long-term debt | | | 5,250 | | | 3,500 | |
| Current maturities of long-term capital lease | | | 22,962 | | | 8,679 | |
| Asset retirement obligation | | | 13,201 | | | 7,097 | |
| Derivative liability | | | - | | | 1,282 | |
| Total current liabilities | | | 250,400 | | | 165,233 | |
| | | | | | | | |
| Long-term debt | | | 513,301 | | | 337,489 | |
| Long-term capital lease | | | - | | | 34,437 | |
| Asset retirement obligation | | | 87,967 | | | 60,267 | |
| Deferred tax liability | | | 5,738 | | | - | |
| Other long-term liabilities and deferred obligations | | | - | | | 8,826 | |
| Total liabilities | | | 857,406 | | | 606,252 | |
| | | | | | | | |
| Shareholders' equity: | | | | | | | |
| Preferred stock: $0.001 par value | | | 364,198 | | | 184,858 | |
| Common stock: $0.001 par value | | | 30 | | | 29 | |
| Additional paid-in capital | | | 148,125 | | | 149,267 | |
| Accumulated deficit | | | (103,649 | ) | | (101,333 | ) |
| Accumulated other comprehensive income | | | 10,022 | | | (4,693 | ) |
| Unearned compensation | | | - | | | (9,706 | ) |
| Treasury stock, at cost | | | (911 | ) | | (911 | ) |
| Total shareholders' equity | | | 417,815 | | | 217,511 | |
| Total liabilities and shareholders' equity | | $ | 1,275,221 | | $ | 823,763 | |
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 6 of 10 |
CONSOLIDATED INCOME STATEMENTS |
(In Thousands, Except Per Share Amounts) |
| | | | | | | | | | |
| | | Three Months Ended | | Nine Months Ended | |
| | | September 30, | | September 30, | |
| | | 2006 | | 2005 | | 2006 | | 2005 | |
| | | | | | | | | | | | | | |
| Oil and gas revenues | | $ | 132,822 | | $ | 26,342 | | $ | 286,952 | | $ | 96,810 | |
| | | | | | | | | | | | | | |
| Costs and operating expenses: | | | | | | | | | | | | | |
| Lease operating | | | 22,848 | | | 4,796 | | | 54,800 | | | 15,377 | |
| Exploration | | | 1,660 | | | 3,067 | | | 2,168 | | | 5,574 | |
| General and administrative | | | 4,643 | | | 3,893 | | | 14,477 | | | 13,247 | |
| Stock-based compensation | | | 3,160 | | | - | | | 8,686 | | | - | |
| Depreciation, depletion and amortization | | | 55,026 | | | 12,289 | | | 115,545 | | | 47,993 | |
| Impairment of oil and gas properties | | | 11,760 | | | - | | | 11,760 | | | - | |
| Accretion | | | 2,255 | | | 622 | | | 5,473 | | | 1,801 | |
| (Gain) loss on abandonment | | | 349 | | | 248 | | | 3,855 | | | 324 | |
| Total costs and operating expenses | | | 101,701 | | | 24,915 | | | 216,764 | | | 84,316 | |
| Income from operations | | | 31,121 | | | 1,427 | | | 70,188 | | | 12,494 | |
| | | | | | | | | | | | | | |
| Other income (expense): | | | | | | | | | | | | | |
| Interest income | | | 1,377 | | | 1,518 | | | 3,157 | | | 3,006 | |
| Interest expense | | | (14,780 | ) | | (9,760 | ) | | (38,049 | ) | | (24,644 | ) |
| Other income | | | - | | | (6 | ) | | - | | | 2 | |
| Total other income (expense) | | | (13,403 | ) | | (8,248 | ) | | (34,892 | ) | | (21,636 | ) |
| | | | | | | | | | | | | | |
| Income (loss) before income taxes | | | 17,718 | | | (6,821 | ) | | 35,296 | | | (9,142 | ) |
| Provision for income taxes | | | (5,009 | ) | | - | | | (8,272 | ) | | - | |
| | | | | | | | | | | | | | |
| Net income (loss) | | $ | 12,709 | | $ | (6,821 | ) | $ | 27,024 | | $ | (9,142 | ) |
| | | | | | | | | | | | | | |
| Preferred dividends | | | (11,536 | ) | | (3,756 | ) | | (29,340 | ) | | (3,756 | ) |
| | | | | | | | | | | | | | |
| Net income (loss) available to common shareholders | | $ | 1,173 | | $ | (10,577 | ) | $ | (2,316 | ) | $ | (12,898 | ) |
| | | | | | | | | | | | | | |
| Net income (loss) per common share - basic and diluted | | $ | 0.04 | | $ | (0.36 | ) | $ | (0.08 | ) | $ | (0.44 | ) |
| | | | | | | | | | | | | | |
| Weighted average number of common shares: | | | | | | | | | | | | | |
| Basic | | | 29,776 | | | 29,109 | | | 29,643 | | | 29,005 | |
| Diluted | | | 30,406 | | | 29,922 | | | 30,342 | | | 29,833 | |
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 7 of 10 |
CONSOLIDATED CASH FLOW DATA |
(In Thousands) |
| | | | | | | | |
| | | Nine Months Ended | |
| | | September 30, | |
| | | | 2006 | | | 2005 | |
| | | | | | | | |
Cash flows from operating activities: | | | | | | | |
| Net income (loss) | | $ | 27,024 | | $ | (9,142 | ) |
| Adjustments to operating activities | | | 152,418 | | | 59,071 | |
| Changes in assets and liabilities | | | (74,096 | ) | | 11,461 | |
| Net cash provided by operating activities | | | 105,346 | | | 61,390 | |
| | | | | | | | |
Cash flows from investing activities: | | | | | | | |
| Additions to oil and gas properties | | | (390,916 | ) | | (272,603 | ) |
| Additions to furniture and fixtures | | | (331 | ) | | (427 | ) |
| Increase in restricted cash | | | (13,296 | ) | | (12,312 | ) |
| Net cash used in investing activities | | | (404,543 | ) | | (285,342 | ) |
| | | | | | | | |
Cash flows from financing activities: | | | | | | | |
| Proceeds from long-term debt | | | 178,500 | | | 132,113 | |
| Principal payments of long-term debt | | | (2,188 | ) | | (2,300 | ) |
| Deferred financing costs | | | (11,116 | ) | | (10,416 | ) |
| Issuance of preferred stock, net of issuance costs | | | 145,463 | | | 169,440 | |
| Principal payments of capital lease | | | (20,869 | ) | | - | |
| Exercise of stock options | | | 4,416 | | | 3,536 | |
| Other | | | - | | | (68 | ) |
| Net cash provided by financing activities | | | 294,206 | | | 292,305 | |
| | | | | | | | |
| Effect of exchange rate changes on cash | | | 688 | | | (3,757 | ) |
| | | | | | | | |
| Net increase (decrease) in cash and cash equivalents | | | (4,303 | ) | | 64,596 | |
| Cash and cash equivalents, beginning of period | | | 65,566 | | | 102,774 | |
| | | | | | | | |
| Cash and cash equivalents, end of period | | $ | 61,263 | | $ | 167,370 | |
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 8 of 10 |
Hedges, Derivatives and Fixed Price Contracts
| | | 2006 | | 2007 | | 2008 |
| | | 4Q | | 1Q | 2Q | 3Q | 4Q | FY | | 1Q | 2Q | 3Q | 4Q | FY |
Gulf of Mexico: | | | | | | | | | | | | | | |
Fixed Forwards and Swaps | | | | | | | | | | | | | | |
Natural Gas | | | | | | | | | | | | | | |
| Volumes (MMMBtu) | | 1,073.0 | | 1,350.0 | | | | 1,350.0 | | - | - | - | - | |
| Price ($/MMBtu) | | $ 9.83 | | $ 10.89 | | | | $ 10.89 | | $ - | $ - | $ - | $ - | |
Crude Oil | | | | | | | | | | | | | | |
| Volumes (MBbls) | | 294.4 | | 297.0 | 345.8 | 395.6 | 395.6 | 1,434.0 | | 91.0 | 91.0 | 92.0 | 92.0 | 366.0 |
| Price ($/Bbl) | | $ 65.21 | | $ 69.61 | $ 70.74 | $ 70.90 | $ 70.90 | $ 70.60 | | $ 76.55 | $ 76.55 | $ 76.55 | $ 76.55 | $ 76.55 |
Equivalents | | | | | | | | | | | | | | |
| Volumes (MMMBtue) | | 2,839.4 | | 3,132.0 | 2,074.8 | 2,373.6 | 2,373.6 | 9,954.0 | | 546.0 | 546.0 | 552.0 | 552.0 | 2,196.0 |
| Price ($/MMBtue) | | $ 10.48 | | $ 11.30 | $ 11.79 | $ 11.82 | $ 11.82 | $ 11.65 | | $ 12.76 | $ 12.76 | $ 12.76 | $ 12.76 | $ 12.76 |
| | | | | | | | | | | | | | | |
Puts | | | | | | | | | | | | | | |
Crude Oil | | | | | | | | | | | | | | |
| Volumes (MBbls) | | 506.0 | | 585.0 | 91.0 | 92.0 | 92.0 | 860.0 | | - | - | - | - | |
| Floor Price ($/Bbl) | | $ 57.50 | | $ 57.88 | $ 60.00 | $ 60.00 | $ 60.00 | $ 58.56 | | $ - | $ - | $ - | $ - | |
| | | | | | | | | | | | | | | |
North Sea: | | | | | | | | | | | | | | |
Fixed Forwards and Swaps | | | | | | | | | | | | | | |
Natural Gas | | | | | | | | | | | | | | |
| Volumes (MMMBtu) | | 1,680.0 | | 2,250.0 | 910.0 | 920.0 | 920.0 | 5,000.0 | | 910.0 | - | - | - | 910.0 |
Price ($/MMBtu) (1) | | $ 11.95 | | $ 12.81 | $ 7.51 | $ 7.51 | $ 9.83 | $ 10.32 | | $ 11.33 | $ - | $ - | $ - | $ 11.33 |
| The above are hedges, derivatives and fixed price contracts that are currently in effect or have settled prior to such date. |
| Additional hedges, derivatives and fixed price contracts, if any, will be announced during the year. |
Recent North Sea Gas Fixed Forwards: | | | | | | | | | | |
| October 9, 2006: 10,000 MMBtu/d November 2006 at £5.250/MMBtu |
| October 9, 2006: 10,000 MMBtu/d December 2006 at £6.69/MMBtu |
| October 9, 2006: 10,000 MMBtu/d January 2007 to March 2007 at £6.800/MMBtu |
| October 9, 2006: 10,000 MMBtu/d April 2007 to September 2007 at £4.010/MMBtu |
| October 25, 2006: 10,000 MMBtu/d November 2006 at £4.300/MMBtu |
| October 25, 2006: 10,000 MMBtu/d December 2006 at £5.750/MMBtu |
| October 25, 2006: 10,000 MMBtu/d January 2007 to March 2007 at £5.950/MMBtu |
| October 25, 2006: 10,000 MMBtu/d October 2007 to December 2007 at £5.250/MMBtu |
| October 25, 2006: 10,000 MMBtu/d January 2008 to March 2008 at £6.050/MMBtu |
| (1) Assumes $1.8726 to £1.00 currency translation rate. | | | | | | |
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 9 of 10 |
Oil and Gas Revenue Reconciliation (1)
(In Thousands)
| | | Three Months Ended | | | Nine Months Ended | |
| | | September 30, | | | September 30, | |
| | | | 2006 | | | 2005 | | | 2006 | | | 2005 | |
Oil and gas revenues, including the effects of settled derivatives (1) | | $ | 132,895 | | $ | 26,327 | | $ | 286,997 | | $ | 96,622 | |
Hedging ineffectiveness and other (2) | | | (73 | ) | | 15 | | | (45 | ) | | 188 | |
| Oil and gas revenue per income statements | | $ | 132,822 | | $ | 26,342 | | $ | 286,952 | | $ | 96,810 | |
| (1) | Oil and gas revenues including the effects of settled derivative activities differ from our reported revenues from oil and gas production because such numbers omit the effects of previously recognized changes in the fair market value of derivatives settled during the period. Set forth above is a table reconciling the presented information with revenues from oil and gas production. The total of oil and gas revenues, including the effects of settled derivative activities, is presented because of its acceptance as an indicator of the Company's realized cash flow from its oil and gas production during the period for which it is presented. |
| (2) | Hedging ineffectiveness is the portion of gains (losses) on derivatives that is based on imperfect correlations to benchmark oil and natural gas prices. |
Cash Flow From Operating Activities |
(In Thousands) |
| | | Nine Months Ended | |
| | | September 30, | |
| | | | 2006 | | | 2005 | |
Cash flows from operating activities: | | | | | | | |
| Net income (loss) | | $ | 27,024 | | $ | (9,142 | ) |
| Adjustments to operating activities | | | 152,418 | | | 59,071 | |
| Cash flows from operating activities before changes in assets and liabilities | | | 179,442 | | | 49,929 | |
| Changes in assets and liabilities | | | (74,096 | ) | | 11,461 | |
| Net cash provided by operating activities | | $ | 105,346 | | $ | 61,390 | |
Net Income Before Impairment of Oil and Gas Properties |
(In Thousands) |
| | | Nine Months Ended | |
| | | September 30, | |
| | | | 2006 | | | 2005 | |
| Net income (loss) available to common shareholders | | $ | 1,173 | | $ | (2,316 | ) |
| Impairment of oil and gas properties | | | 11,760 | | | - | |
| Net income (loss) available to common shareholders | | | | | | | |
Net income (loss) available to common shareholders before impairment of oil and gas properties | | $ | 12,933 | | $ | (2,316 | ) |
| | | | | | | | |
| Net income (loss) per common share: | | | | | | | |
| Basic | | $ | 0.44 | | $ | (0.08 | ) |
| Diluted | | $ | 0.43 | | $ | (0.08 | ) |
| | | | | | | | |
| Weighted average number of common shares: | | | | | | | |
| Basic | | | 29,643 | | | 29,109 | |
| Diluted | | | 30,406 | | | 29,922 | |
| ATP Oil & Gas Corporation | 4600 Post Oak Place | Suite 200 | Houston, TX 77027 | www.atpog.com Page 10 of 10 |
