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ATP actively negotiating transaction to monetize Titan; proceeds slated for debt reduction
By Jennifer Lanning Drey
Portland, Ore., March 12 - ATP Oil & Gas Corp. is in active negotiations regarding a transaction to monetize the ATP Titan, which would allow the company to repay a significant portion of debt, Leland Tate, ATP's president, said Friday during its fourth-quarter and year-end earnings conference call.
Tate said he believes the company will be able to deliver on the transaction and expects it will be "sooner rather than later."
The potential transaction is being negotiated as part of ATP's ongoing monetization program that has carried over from 2009.
Under the program, the company completed a $140 million limited-term overriding royalty interest transaction in early January.
Additionally, in 2009, ATP closed a series of capital market, asset monetization and financing transactions that, combined with the recent overriding royalty interest asset monetization, allowed the company to reduce its term loans to $1.2 billion at Dec. 31.
ATP's term loans stood at $1.4 billion at the end of 2008.
The company said substantially all of the reduction related to the asset sale facility tranche of its term loan facility, which decreased to $160.7 million at year-end 2009 from $326.7 million at the end of 2008.
Additional reductions in 2010 have decreased the outstanding balance to $146.0 million at March 11, ATP reported Friday.
ATP was in compliance with all of the covenants of its term loans and expects to remain in compliance throughout 2010.
For the fourth quarter, ATP recorded a net loss of $40.0 million, compared to net income of $50.2 million in the fourth quarter of 2008.
ATP is a Houston-based natural gas and oil company.
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