ATP Oil & Gas Corporation Announces Record Proved Reserves, Fourth Quarter and Annual 2005 Results and Operations Update.HOUSTON Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; -- ATP ATP: see adenosine triphosphate. ATP in full adenosine triphosphate Organic compound, substrate in many enzyme-catalyzed reactions (see catalysis) in the cells of animals, plants, and microorganisms. Oil & Gas Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : ATPG ATPG Automatic Test Pattern Generation ATPG Automatic Test Program Generator ) today announced record proved reserves proved reserves The quantity of minerals expected to be recoverable under current economic and operating conditions. The amount of proved reserves is important in valuing the stock of a company with significant holdings in natural resources. , fourth quarter and annual 2005 results and an operations update. --Record reserve replacement ratio of 1,367%; the 2005 ATP target was 200% --Record $2.7 billion pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta PV-10 value and 527.5 Bcfe of proved reserves at year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. 2005 --Production of 5.4 Bcfe, revenue of $49.9 million, and net income available to common shareholders of $0.3 million for the fourth quarter 2005 --Production of 19.9 Bcfe, record revenue of $146.7 million, and a net loss available to common shareholders of $12.6 million for 2005 --First production from L-06d in the Dutch North Sea --Proved reserves of 182 Bcfe at our Cheviot Cheviot (shĭv`ēət, shĕv`–), city (1990 pop. 9,616), Hamilton co., extreme SW Ohio, a residential suburb of Cincinnati; settled early 1800s, inc. 1904. It has diverse light manufacturing industries. property in the U.K. North Sea Oil and Gas Reserves ATP's 2005 proved reserve reports have been prepared by independent third-party reservoir reservoir (rĕz`əvôr, -vwär), storage tank or wholly or partly artificial lake for storing water. Building an embankment or dam to preserve a supply of water for irrigation is an ancient practice; India and Egypt have many old and engineers. The proved reserve quantities and classifications contained in the reports prepared by the independent reservoir engineers conform to Verb 1. conform to - satisfy a condition or restriction; "Does this paper meet the requirements for the degree?" fit, meet coordinate - be co-ordinated; "These activities coordinate well" the definition provided by the Securities and Exchange Commission ("SEC"). ATP will make accessible copies of the certification letters from the independent third-party reservoir engineers on the Company's web site www.atpog.com. The reports will be posted under Investor Info-Annual/Quarterly Reports and will be made available on March 9, 2006. At December December: see month. 31, 2005, the Company achieved a record reserve replacement ratio of 1,367% for 2005. The Company's year-end natural gas and oil proved reserves were 527.5 Bcfe (67% natural gas) with a pre-tax PV-10 of $2.7 billion, compared to 275.2 Bcfe and a $733 million pre-tax PV-10 at year-end 2004. Pre-tax PV-10 is a non-GAAP financial measure that we believe to be an important measure for evaluating the relative significance of our natural gas and oil properties. Proved developed reserves more than doubled (up 112%) to a record 128.4 Bcfe (72% natural gas) during 2005.
Proved Reserves
Prepared by independent reservoir engineers
December 31, 2005
Gulf of
Mexico North Sea Consolidated
---------- ---------- ------------
Proved
(MMcfe)
Developed 114,379.5 13,989.2 128,368.8
Undeveloped 117,650.3 281,476.0 399,126.3
---------- ---------- ------------
Total 232,029.8 295,465.2 527,495.1
========== ========== ============
Pre-tax PV-10(1)
($'s in millions)
Developed $784.8 $82.6 $867.4
Undeveloped $607.7 $1,209.2 $1,817.0
---------- ---------- ------------
Total $1,392.5 $1,291.8 $2,684.3
========== ========== ============
----------------------
(1) See pre-tax PV-10 reconciliation at the end of this press release.
Top 5 Properties
(Based on Proved Reserves)
Prepared by independent reservoir engineers
December 31, 2005
King's
Cheviot MC 711 Tors Peak Venture
-------- ------- ------- ------- --------
North Gulf of North Gulf of North
Sea Mexico Sea Mexico Sea
-------- --------------- ----------------
Proved
Reserves (Bcfe) 182.3 93.1 72.9 55.7 26.3
======== ======= ======= ======= ========
Results of Operations Natural gas and oil production was 5.4 Bcfe for the fourth quarter and 19.9 Bcfe for 2005. Hurricanes Dennis Dennis is a male first name derived from the Greco-Roman name Dionysius meaning "servant of Dionysus", the Thracian god of wine, which is ultimately derived from the Greek Dios (Διος, "of Zeus") combined with Nysos or Nysa (Νυσα), where the , Emily EMILY Early Money Is Like Yeast EMILY Electronic Membrane-Information Library EMILY Every Moment I Love You , Katrina KATRINA Keeping All the Resources in New Orleans Alive KATRINA Krewe Aiding Trash Removal In the New Orleans Area , and Rita severely disrupted dis·rupt tr.v. dis·rupt·ed, dis·rupt·ing, dis·rupts 1. To throw into confusion or disorder: Protesters disrupted the candidate's speech. 2. oil and gas production during the third and fourth quarters of 2005 for all oil and gas companies doing business in the Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east . These hurricanes negatively impacted ATP's production by deferring approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 9.0 Bcfe of anticipated production during this period. Natural gas and oil production was 5.9 Bcfe for the fourth quarter 2004 and 22.4 Bcfe for 2004. Overall higher commodity prices and cash flow hedges A cash flow hedge is a hedge of the exposure to the variability of cash flow that
Natural gas and oil revenues totaled $49.9 million for the fourth quarter and $146.7 million for 2005, compared to $32.9 million for the fourth quarter 2004 and $116.1 million for 2004. Natural gas and oil revenues were higher primarily due to higher commodity prices and improved hedge prices during this period. Lease operating expense Operating Expense The essential things that a company must purchase in order to maintain business. Notes: For example, the payment of employees wages are an operating expense. Also known as OPEX. (LOE LOE Ley Orgánica de Educación (Spanish) LOE Level Of Effort LOE Limited Objective Experiment LOE Letter of Explanation LOE Language Other than English. ) per Mcfe was $1.53 for the fourth quarter and $1.19 for 2005, compared to $1.00 for the fourth quarter 2004 and $0.87 for 2004. The increase in LOE per Mcfe was primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to uninsured hurricane hurricane, tropical cyclone in which winds attain speeds greater than 74 mi (119 km) per hr. Wind speeds reach over 190 mi (289 km) per hr in some hurricanes. related expenses and generally higher service costs. General and administrative expense (G&A) totaled $11.0 million for the fourth quarter and $24.2 million for 2005, compared to $4.7 million for the fourth quarter 2004 and $15.8 million for 2004. The increase in G&A was primarily attributable to year-end compensation related costs. Depreciation, depletion depletion n. when a natural resource (particularly oil) is being used up. The annual amount of depletion may, ironically, provide a tax deduction for the company exploiting the resource because if the resource they are exploiting runs out, they will no longer be able , and amortization (DD&A) per Mcfe was $2.99 for the fourth quarter and $3.22 for 2005, compared to $3.12 for the fourth quarter 2004 and $2.48 for 2004. The increase in DD&A per Mcfe was primarily due to increased production from relatively higher cost properties developed in 2003 and 2004. For the fourth quarter 2005, ATP recorded net income available to common shareholders of $0.3 million or $0.01 per basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to a net loss available to common shareholders in the fourth quarter 2004 of $3.8 million or $(0.14) per basic and diluted share. For 2005, ATP incurred a net loss available to common shareholders of $12.6 million or $(0.43) per basic and diluted share, compared to net income available to common shareholders of $1.4 million or $0.05 per basic and diluted share for 2004. The Company's selected operating statistics and financial information, included within this press release, contain additional information on our activities for the fourth quarter 2005 and year ended December 31, 2005 and comparable periods in 2004.
Three Months Ended Year Ended
December 31, December 31,
----------------- -------------------
2005 2004 2005 2004
-------- -------- --------- ---------
Selected Operating Statistics
Production
Natural gas (MMcf) 4,582 4,514 15,614 17,816
Oil and condensate (MBbls) 133 229 717 765
Natural gas equivalents (MMcfe) 5,377 5,887 19,914 22,408
Gulf of Mexico (MMcfe) 5,034 4,951 18,659 17,940
North Sea (MMcfe) 343 936 1,255 4,468
Average Prices (includes effect
of cash flow hedges)
Natural gas (per Mcf) $9.64 $5.35 $7.46 $5.05
Natural gas (per Mcf) - GOM 9.20 5.43 7.31 5.41
Natural gas (per Mcf) - N. Sea 15.06 5.05 9.17 4.00
Oil and condensate (per Bbl) -
GOM 43.03 38.07 41.92 33.93
Natural gas, oil and condensate
(per Mcfe) 9.27 5.59 7.36 5.18
Lease operating expense (per
Mcfe) 1.53 1.00 1.19 0.87
Lease operating expense (per
Mcfe) - GOM 1.54 1.01 1.16 0.88
Lease operating expense (per
Mcfe) - N. Sea 1.50 0.97 1.60 0.84
Other Expenses, per Mcfe
Depreciation, depletion and
amortization (DD&A) $2.99 $3.12 $3.22 $2.48
DD&A - GOM 2.93 2.90 3.17 2.29
DD&A - N. Sea 3.80 4.30 3.93 3.27
Selected Financial Data
(In Thousands, Except Per Share Data)
Oil and gas revenues, including
settled derivatives (1) $49,864 $32,858 $146,484 $116,023
Net income (loss) 6,426 (3,774) (2,716) 1,356
Preferred dividends (6,102) - (9,858) -
Net income (loss) available to
common shareholders 324 (3,774) (12,574) 1,356
Per share, basic and diluted $0.01 $(0.14) $(0.43) $0.05
Average number of common shares
outstanding
Basic 29,301 26,142 29,080 24,944
======== ======== ========= =========
Diluted 30,113 26,142 29,080 25,271
======== ======== ========= =========
------------------------
(1) See oil and gas revenue reconciliation on the last page of this
press release.
Gulf of Mexico Acquisitions ATP was active in both of the Minerals Management Service sponsored offshore lease sales during 2005. In addition, ATP closed three private company transactions during 2005. These purchases, which total $67.9 million in acquisition costs, resulted in recording 72.8 Bcfe of proved reserves, of which 40.4% were classified as proved developed. Western Gulf of Mexico Offshore Lease Sale - ATP acquired three blocks for $2.9 million at the Western Gulf of Mexico Offshore Lease Sale 196 held on August 17, 2005. The blocks are located in approximately 200 to 750 feet of water. All three of the blocks have been previously drilled and the related logs indicate the presence of hydrocarbons hydrocarbons (hīˈ·drō·kärˑ·b  nz),n. . One of the blocks, High Island A-589, which was awarded to ATP in December 2005, has already been added to ATP's 2006 development program. ATP holds a 100% working interest and serves as operator of each of the blocks. Central Gulf of Mexico Offshore Lease Sale - ATP acquired seven blocks for $2.4 million at the Central Gulf of Mexico Offshore Lease Sale held March 16, 2005. Two of the blocks are adjacent to the Company's wholly-owned Mississippi Mississippi, state, United States Mississippi (mĭs'əsĭp`ē), one of the Deep South states of the United States. It is bordered by Alabama (E), the Gulf of Mexico (S), Arkansas and Louisiana, with most of the border formed by Canyon canyon Very narrow, deep valley cut by a river through resistant rock and having steep, almost vertical sides. Canyons occur most often in arid or semiarid regions. Some canyons (e.g., the Grand Canyon) are spectacular natural features. See also submarine canyon. 711 development. Two additional blocks are contiguous Adjacent or touching. Contrast with fragmentation. See contiguous file. to an existing ATP operated development in the West Cameron Cam·er·on , Mount A peak, 4,342.6 m (14,238 ft) high, in the Rocky Mountains of central Colorado. area and the remaining three blocks provide access to new development area opportunities. The blocks are located in approximately 125 to 2,900 feet of water. ATP owns a 100% working interest and serves as operator of each property. South Marsh Island 166 - During the second quarter, ATP acquired South Marsh Island 166. We reentered and completed a temporarily abandoned well which had previously encountered hydrocarbons. As a result of this development work, proved developed reserves were recorded for this property at year-end 2005. ATP holds a 100% working interest in and operates South Marsh Island 166. King's Peak King's Peak is a mountain located on Vancouver Island, British Columbia. The mountain is located in Strathcona Provincial Park 25 km NE of Gold River and 2 km N of Elkhorn Mountain. Kings Peak is close to Highway 28 along the Elk River. - ATP acquired a 55% working interest in the producing property King's Peak in late September September: see month. 2005. ATP operates this property located on Mississippi Canyon Blocks 173 and 217 and Desoto DeSoto is the name of several places in the United States of America:
Gulf of Mexico Shelf Package - On October October: see month. 31, 2005, ATP acquired substantially all of the oil and gas properties of a privately held company privately held company A firm whose shares are held within a relatively small circle of owners and are not traded publicly. . These properties are located on the Gulf of Mexico Shelf and contain proved developed producing and proved developed non-producing reserves. Net production from these properties is currently averaging 15-20 MMcfe per day. North Sea Acquisitions Tors - ATP increased its net working interest ownership to 85% in the Tors fields, Garrow
Venture - During the fourth quarter of 2005, our wholly-owned subsidiary, ATP Oil & Gas (UK) Limited, increased its working interest ownership to 100% in the Venture field (Block 49/12a North) in the Southern Gas Basin BASIN Boulder Area Sustainability Information Network (Boulder, Colorado) BASIN Brothers And Sisters In Need of the U.K. North Sea. The Venture field is located in 75' of water and has been defined by two vertical wells that have tested at rates of 35 MMcf per day and 74 MMcf per day. Development plans in 2006 include the design and construction of a production platform, the installation of a pipeline to an offset host platform, and the drilling of one to two wells. Planned production is for the first half of 2007. Operations and Development Gulf of Mexico Shelf - On the Gulf of Mexico Shelf during 2005, six wells were drilled, including one dry hole. Four of the wells, WC 432 #1, MI 709 A4ST1, HI 74 #1, and BA 578 #1, were completed and placed on production. The remaining well, the SMI (1) (Storage Management Initiative) The initiative developed by the SNIA in 2003 to create a single standard interface for storage management technologies used by multiple vendors and networking communities. 166 #1, will be placed on production following hurricane related repairs and tie-ins to third-party infrastructure. Mississippi Canyon 711 (MC 711) - During 2005, two wells were completed and made ready for production from the southern portion of the block, two 27-mile pipelines were installed, and the drilling vessel VESSEL, mar. law. A ship, brig, sloop or other craft used in navigation. 1 Boul. Paty, tit. 1, p. 100. See sup. 2. By an act of congress, approved July 29, 1850, it is provided that any person, not being an owner, who shall on the high seas, willfully, with. , Rowan rowan ash tree which guards against fairies and witches. [Br. Folklore: Briggs, 344] See : Protection Midland, was converted into a floating production platform and moored moor 1 v. moored, moor·ing, moors v.tr. 1. To make fast (a vessel, for example) by means of cables, anchors, or lines: on location. As of March 8, 2006, development work was essentially complete and we are awaiting first production. ATP operates MC 711 with a 100% working interest. Tors (Kilmar and Garrow) - During 2005, we constructed and installed the Kilmar jacket A plastic housing that contains a floppy disk. The 5.25" disk is built into a flexible jacket; the 3.5" disk uses a rigid jacket. and deck (1) The part of a magnetic tape unit that holds and moves the tape reels. The term may refer to any equipment that serves as a physical framework for electronic or mechanical devices. See rack. See also DEC. , commenced well operations, and installed a 23-kilometer pipeline from Garrow to Kilmar and a 22-kilometer pipeline from Kilmar to an offsetting third-party platform. ENSCO The name ENSCO may mean:
L-06d - On February February: see month. 27, 2006, we announced first production at L-06d in the Dutch North Sea. ATP now enjoys flowing production in all three of its core areas: the U.S. Gulf of Mexico, the U.K. North Sea, and Dutch North Sea. L-06d production is limited by the capacity of the facilities to 40 - 45 MMcf per day gross. Cheviot - During 2005, we evaluated the 3-D seismic survey acquired in 2004, which along with comprehensive Geological ge·ol·o·gy n. pl. ge·ol·o·gies 1. The scientific study of the origin, history, and structure of the earth. 2. The structure of a specific region of the earth's crust. 3. A book on geology. and Geophysical ge·o·phys·ics n. (used with a sing. verb) The physics of the earth and its environment, including the physics of fields such as meteorology, oceanography, and seismology. (G&G) studies, helped to form a more detailed geologic ge·ol·o·gy n. pl. ge·ol·o·gies 1. The scientific study of the origin, history, and structure of the earth. 2. The structure of a specific region of the earth's crust. 3. A book on geology. picture of the Cheviot field. We then incorporated this information into a reservoir simulation Reservoir simulation is an area of reservoir engineering in which computer models are used to predict the flow of fluids (typically, oil, water, and gas) through porous media. model and completed the history match of the previous four-year production history of the field. Following optimization optimization Field of applied mathematics whose principles and methods are used to solve quantitative problems in disciplines including physics, biology, engineering, and economics. studies, we presented all data to a third-party reservoir engineering Reservoir engineering is a branch of petroleum engineering, typically concerned with maximizing the economic recovery of hydrocarbons from the subsurface. Of particular interest to reservoir engineers is generating accurate reserves estimates for use in financial reporting company, who ultimately assigned as·sign tr.v. as·signed, as·sign·ing, as·signs 1. To set apart for a particular purpose; designate: assigned a day for the inspection. 2. 182 Bcfe of proved reserves to the field. ATP operates Cheviot with a 100% working interest. Capital Resources and Liquidity The tremendous progress we made in 2005 moving our projects closer to commercial production, despite a difficult hurricane season Hurricane season refers to a period in a year when hurricanes usually form. For more information see: Tropical cyclone#Times of formation. For a lists of past seasons, see:
v. a·mend·ed, a·mend·ing, a·mends v.tr. 1. To change for the better; improve: amended the earlier proposal so as to make it more comprehensive. 2. and improved the terms of our Senior Secured Credit Facility by expanding it to $350.0 million, reducing the interest rate, and extending the maturity to April 2010. Net of transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). , this amendment added $121.0 million in additional liquidity. During the third quarter, we issued $175.0 million of non-convertible perpetual PERPETUAL. That which is to last without limitation as to time; as, a perpetual statute, which is one without limit as to time, although not expressed to be so. preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. , which raised net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). of $169.4 million. The security does not have a stated maturity Stated maturity For the CMO tranche, the date the last payment would occur at zero CPR. and pays a non-cash dividend of 13.5%, which becomes payable in cash upon the earlier of full repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of our existing Term Loan or April 15, 2011. During the fourth quarter, we structured a $44.8 million capital lease to finance the purchase of the drilling vessel, Rowan Midland, to serve as the floating production platform at our Mississippi Canyon 711 property. Cash flow from operating activities was $51.9 million for the year ended December 31, 2005, compared to $41.2 million in cash flow from operating activities for 2004. Cash flow from operating activities prior to changes in assets and liabilities, a non-GAAP measure frequently used by research analysts, was $69.0 million for year ended December 31, 2005, compared to $62.3 million for the same period in 2004. A reconciliation of this measure is included at the end of this press release. We had working capital at December 31, 2005 of $0.6 million, a decrease of approximately $67.8 million from December 31, 2004. This decrease is attributable to our active 2005 capital program, which includes our two relatively large projects Mississippi Canyon 711 and Tors. We had $65.6 million in cash and cash equivalents on hand at December 31, 2005, compared to $102.8 million in cash and cash equivalents at December 31, 2004. Cash paid for acquisition and development activities for the year 2005 was $420.5 million, compared to $87.4 million in 2004. 2006 Operational and Financial Objectives We will continue to devote considerable resources to our developments in 2006. During the early part of the year, efforts will be spent completing and bringing to production two of our major developments begun in 2005, Mississippi Canyon 711 in the Gulf of Mexico and the Tors fields in the U.K. Sector of the North Sea. As of February 27, 2006, L-06d had been placed on production. The first of three wells planned at the Kilmar portion of Tors fields has reached total depth and the well is going through completion activities. Additional drilling and completion activities are scheduled at both Mississippi Canyon 711 and at the Garrow portion of the Tors fields later in 2006. In addition to these developments, projects with proved undeveloped reserves at December 31, 2005 that are scheduled for 2006 development, include Venture in the U.K. North Sea and South Marsh Island 189/190 and other properties in the Gulf of Mexico. We also have scheduled for drilling or completion properties in which previous drilling into targeted reservoirs indicates to the Company the presence of commercially productive quantities of hydrocarbons, although these reservoirs did not meet the SEC definition of proved reserves at the end of 2005. For example, High Island A-589 is a property that the Company believes to have commercially productive hydrocarbons and intends to develop in 2006 that is not included in our reserve report at year-end 2005. We have commenced engineering and procurement The fancy word for "purchasing." The procurement department within an organization manages all the major purchases. activities on our Cheviot property in the U.K. North Sea. Cheviot, our largest property in terms of proved reserves, is a multi-year development with first production targeted in 2008. Other potential developments for 2006 in the Gulf of Mexico and North Sea are currently being evaluated. We believe that 2006 production will far exceed that of 2005 as a result of our 2003 through 2005 development programs and projects scheduled for development in 2006. Our production may command higher realized oil and gas prices in 2006 than in recent years, based on our current hedge position and relatively strong commodity prices. Our revenues, profitability and cash flows are highly dependent upon many factors, particularly our production results and the price of oil and natural gas. During the first quarter of 2006, we have been active in the futures market futures market, a commodity exchange where contracts for the future delivery of grain, livestock, and precious metals are bought and sold. Speculation in futures serves to protect both the developers and the users of the commodities from unfavorable and unpredictable . We have purchased floors at $57.50 for 962.5 thousand barrels of crude oil in 2006 and 315.0 thousand barrels of crude oil in 2007. We also entered into swaps at $67.76 for 182.5 thousand barrels of crude oil for 2007. Including these recent hedges, we have hedged hedge n. 1. A row of closely planted shrubs or low-growing trees forming a fence or boundary. 2. A line of people or objects forming a barrier: a hedge of spectators along the sidewalk. 13.6 Bcfe for 2006 and 3.4 Bcfe for 2007. To mitigate mit·i·gate v. To moderate in force or intensity. mit  i·ga tion n. future price volatility Volatility1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the , we may hedge additional production. A more complete summary of our hedges, derivatives derivatives In finance, contracts whose value is derived from another asset, which can include stocks, bonds, currencies, interest rates, commodities, and related indexes. Purchasers of derivatives are essentially wagering on the future performance of that asset. or fixed price contracts can be found at the end of this press release. 4th Quarter 2005 Conference Call ATP management will host a conference call on March 9, 2006 to review reserves, production, and financial results for the fourth quarter and year 2005. T. Paul Paul, 1901–64, king of the Hellenes (1947–64), brother and successor of George II. He married (1938) Princess Frederika of Brunswick. During Paul's reign Greece followed a pro-Western policy, and the Cyprus question was temporarily resolved. Bulmahn, Chairman and President; Gerald Gerald - ["Gerald: An Exceptional Lazy Functional Programming Language", A.C. Reeves et al, in Functional Programming, Glasgow 1989, K. Davis et al eds, Springer 1990]. W. Schlief, Senior Vice President; Leland Leland is the name of several places:
The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. ; and Albert Albert, German churchman Albert, 1490–1545, German churchman, cardinal of the Roman Catholic Church. A member of the house of Brandenburg, he became (1514) Archbishop of Mainz. L. Reese REESE Research and Evaluation on Education in Science and Engineering (National Science Foundation) , Jr., Chief Financial Officer, will discuss the details. Date: Thursday Thursday: see week. , March 9, 2006 Time: 11:00 AM EST EST electroshock therapy. EST abbr. electroshock therapy , 10:00 AM CST CST abbr. 1. Central Standard Time 2. convulsive shock treatment CST Central Standard Time Noun 1. , 9:00 AM MST See micro systems technology. , 8:00 AM PST PST Paroxysmal supraventricular tachycardia, see there To participate in the live webcast, simply log on to ATP's website at www.atpog.com at least ten minutes prior to the start of the call and click on Investor Info INFO Information INFO Information (logging abbreviation) INFO Inform(ed/ation) INFO Ionic Difluoroamino Oxidizer and then Conference Calls. To listen to the conference call via the telephone, dial 1-877-704-5378. If you are unable to participate during the live webcast, the webcast will be archived on ATP's website at www.atpog.com for 30 business days. A recorded replay of the conference call will be available for a period of 24 hours after the call starting at 1:00 p.m. CST. To listen to the replay, dial 1-888-203-1112 with the conference identification number 1499558. About ATP Oil & Gas ATP Oil & Gas is focused on development and production of natural gas and oil in the Gulf of Mexico and the North Sea. The Company trades publicly as ATPG on the NASDAQ National Market. Forward-looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Certain statements included in this news release are "forward-looking statements" under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 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 An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. and other legal or regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. developments affecting our business. More information about the risks and uncertainties relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc ATP's forward-looking statements are found in our SEC filings.
CONSOLIDATED BALANCE SHEETS
(In Thousands)
December December
31, 31,
2005 2004
--------- ---------
Assets
Current assets:
Cash and cash equivalents $65,566 $102,774
Restricted cash 12,209 -
Accounts receivable (net of allowances of $367
and $1,499) 83,571 36,991
Derivative asset - 791
Other current assets 4,454 3,788
--------- ---------
Total current assets 165,800 144,344
--------- ---------
Oil and gas properties:
Oil and gas properties (using the successful
efforts method of accounting) 899,284 450,403
Less: Accumulated depletion, impairment and
amortization (271,863) (237,197)
--------- ---------
Oil and gas properties, net 627,421 213,206
--------- ---------
Furniture and fixtures, net 1,175 741
Deferred tax asset 4,025 -
Other assets, net 25,342 13,856
--------- ---------
30,542 14,597
--------- ---------
Total assets $823,763 $372,147
========= =========
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accruals $144,675 $68,573
Current maturities of long-term debt 3,500 2,200
Current maturities of long-term capital lease 8,679 -
Asset retirement obligation 7,097 4,925
Derivative liability 1,282 316
--------- ---------
Total current liabilities 165,233 76,014
Long-term debt 337,489 208,109
Long-term capital lease 34,437 -
Asset retirement obligation 60,267 19,998
Deferred revenue - 741
Other long-term liabilities and deferred
obligations 8,826 10,121
--------- ---------
Total liabilities 606,252 314,983
--------- ---------
Shareholders' equity:
Preferred stock: $0.001 par value 184,858 -
Common stock: $0.001 par value 29 29
Additional paid-in capital 149,267 140,628
Accumulated deficit (101,333) (88,759)
Accumulated other comprehensive income (4,693) 6,177
Unearned compensation (9,706) -
Treasury stock, at cost (911) (911)
--------- ---------
Total shareholders' equity 217,511 57,164
--------- ---------
Total liabilities and shareholders' equity $823,763 $372,147
========= =========
CONSOLIDATED INCOME STATEMENTS
(In Thousands, Except Per Share Amounts)
Three Months Ended Year Ended
December 31, December 31,
----------------- -------------------
2005 2004 2005 2004
-------- -------- --------- ---------
Oil and gas revenues $49,864 $32,927 $146,674 $116,123
-------- -------- --------- ---------
Costs and operating expenses:
Lease operating 8,252 5,913 23,629 19,531
Exploration 633 688 6,208 997
General and administrative 11,028 4,743 24,274 15,806
Non-cash compensation 57 - 57 -
Credit facility costs - - - 1,850
Depreciation, depletion and
amortization 16,076 18,396 64,069 55,637
Accretion 1,437 595 3,238 2,069
(Gain) loss on abandonment (1,056) 20 (732) (251)
(Gain) on disposition of
properties (2,743) - (2,743) (6,011)
Other - 400 - 400
-------- -------- --------- ---------
Total costs and operating
expenses 33,684 30,755 118,000 90,028
-------- -------- --------- ---------
Income from operations 16,180 2,172 28,674 26,095
-------- -------- --------- ---------
Other income (expense):
Interest income 1,058 336 4,064 627
Interest expense (11,076) (6,324) (35,720) (22,262)
Loss on extinguishment of debt - - - (3,326)
Other 417 100 419 280
-------- -------- --------- ---------
Total other income (expense) (9,601) (5,888) (31,237) (24,681)
-------- -------- --------- ---------
Income (loss) before income taxes 6,579 (3,716) (2,563) 1,414
Provision for income taxes (153) (58) (153) (58)
-------- -------- --------- ---------
Net income (loss) $6,426 $(3,774) $(2,716) $1,356
======== ======== ========= =========
Preferred dividends (6,102) - (9,858) -
-------- -------- --------- ---------
Net income (loss) available to
common shareholders $324 $(3,774) $(12,574) $1,356
======== ======== ========= =========
Basic and diluted income (loss)
per common share:
Net income (loss) per common
share $0.01 $(0.14) $(0.43) $0.05
======== ======== ========= =========
Weighted average number of
common shares:
Basic 29,301 26,142 29,080 24,944
======== ======== ========= =========
Diluted 30,113 26,142 29,080 25,271
======== ======== ========= =========
CONSOLIDATED CASH FLOW DATA
(In Thousands)
Year Ended
December 31,
2005 2004
--------- ---------
Cash flows from operating activities:
Net income (loss) $(2,716) $1,356
Adjustments to operating activities 71,739 60,976
Changes in assets and liabilities (17,133) (21,114)
--------- ---------
Net cash provided by operating activities 51,890 41,218
--------- ---------
Cash flows from investing activities:
Additions to oil and gas properties (420,516) (87,368)
Proceeds from disposition of assets 11,518 19,200
Increase in restricted cash (12,476) -
Additions to furniture and fixtures (900) (483)
--------- ---------
Net cash used in investing activities (422,374) (68,651)
--------- ---------
Cash flows from financing activities:
Proceeds from issuance of common stock, net - 53,066
Proceeds from long-term debt 132,113 262,000
Principal payments of long-term debt (3,175) (166,230)
Proceeds from capital lease 44,774 -
Principal payments of capital lease (1,658) -
Deferred financing costs (10,416) (13,502)
Repurchase of warrants - (12,311)
Exercise of stock options 4,507 2,675
Issuance of preferred stock, net of issuance
costs 169,437 -
Other (68) -
--------- ---------
Net cash provided by financing activities 335,514 125,698
--------- ---------
Effect of exchange rate changes on cash (2,238) (55)
--------- ---------
Net increase (decrease) in cash and cash
equivalents (37,208) 98,210
Cash and cash equivalents, beginning of year 102,774 4,564
--------- ---------
Cash and cash equivalents, end of year $65,566 $102,774
========= =========
Hedges, Derivatives and Fixed Price Contracts
2006
-------------------------------------------------
1Q 2Q 3Q 4Q FY
-------------------- -------------------------------------------------
Gulf of Mexico:
Fixed Forwards and
Swaps
--------------------
Natural Gas
Volumes (MMMBtu) 2,160 1,363 1,376 768 5,667
Price ($/MMbtu) $8.08 $8.50 $8.50 $9.16 $8.43
Crude Oil
Volumes (MBbls) 108.0 63.7 64.4 64.4 300.5
Price
($/bbl) $47.14 $48.41 $48.41 $48.41 $47.96
Equivalents
Volumes (MMMBtue) 2,808 1,745 1,762 1,154 7,470
Price ($/MMbtue) $8.03 $8.41 $8.41 $8.79 $8.32
Puts
-----------
Crude Oil
Volumes (MBbls) 318.5 322.0 322.0 962.5
Floor Price ($/bbl) $57.50 $57.50 $57.50 $57.50
North Sea:
Swaps
-----------
Natural Gas
Volumes (MMMBtu) 399 399
Price (GBP/MMBtu) GBP 6.20 GBP 6.20
----------------------------------------------------------------------
2007
-------------------------------------------------
1Q 2Q 3Q 4Q FY
----------------------------------------------------------------------
Gulf of Mexico:
Fixed Forwards and
Swaps
---------------------
Natural Gas
Volumes (MMMBtu) 450 - - - 450
Price ($/MMbtu) $10.16 $- $- $- $10.16
Crude Oil
Volumes (MBbls) 45.0 45.5 46.0 46.0 182.5
Price ($/bbl) $67.76 $67.76 $67.76 $67.76 $67.76
Equivalents
Volumes (MMMBtue) 720 273 276 276 1,545
Price ($/MMbtue) $10.59 $11.29 $11.29 $11.29 $10.96
Puts
---------------------
Crude Oil
Volumes (MBbls) 315.0 - - - 315.0
Floor Price ($/bbl) $57.50 $- $- $- $57.50
North Sea:
Swaps
---------------------
Natural Gas
Volumes (MMMBtu)
Price (GBP /MMBtu)
----------------------------------------------------------------------
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 Gulf of Mexico Crude Oil Fixed Forwards:
February 24, 2006: 500 bopd January - December 2007 at $67.76/bbl.
Recent Gulf of Mexico Gas Fixed Forwards:
February 24, 2006: 5,000 MMBtu/d November 2006 - March 2007 at
$10.16/MMBtu
Recent Gulf of Mexico Crude Oil Puts:
January 19, 2006: 1,000 bopd April 2006 - March 2007 at $57.50/bbl
floor.
February 2, 2006: 1,500 bopd April 2006 - March 2007 at $57.50/bbl
floor.
February 24, 2006: 1,000 bopd April 2006 - March 2007 at $57.50/bbl
floor.
----------------------------------------------------------------------
Oil and Gas Revenue Reconciliation (1)
(In Thousands)
Three Months Ended Year Ended
December 31, December 31,
----------------- -------------------
2005 2004 2005 2004
-------- -------- --------- ---------
Oil and gas revenues, including
the effects of settled
derivatives (1) $49,864 $32,858 $146,484 $116,023
Hedging ineffectiveness for the
period (2) - 15 190 (190)
Other (3) - 54 - 290
-------- -------- --------- ---------
Oil and gas revenue per income
statements $49,864 $32,927 $146,674 $116,123
======== ======== ========= =========
(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.
(3) These amounts are reclassifications of prior period
disclosures that segregated the mark-to-market value changes
on instruments that did not qualify for SFAS No. 133 hedge
accounting treatment as income on derivative instruments on
the statement of operations. Also included is the marketing
activity of ATP Energy.
Cash Flow From Operating Activities
(In Thousands)
Year Ended
December 31,
-----------------
2005 2004
-------- --------
Cash flows from operating activities:
Net income (loss) $(2,716) $1,356
Adjustments to operating activities 71,739 60,976
-------- --------
Cash flows from operating activities
before changes in assets and liabilities 69,023 62,332
Changes in assets and liabilities (17,133) (21,114)
-------- --------
Net cash provided by operating activities $51,890 $41,218
======== ========
Reconciliation of Pre-tax PV-10 to the Standardized Measure
(In Thousands)
December 31, 2005
-----------------------
Net present value of future cash flows, before
income taxes $2,684,342
Future income taxes, discounted at 10% $818,762
-----------------------
Standardized measure of discounted future net
cash flows $1,865,580
=======================
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