ATP Oil weathering drilling moratorium, poised for growth, CEO says

By Jennifer Lanning Drey

Portland, Ore., Aug. 25 - ATP Oil & Gas Corp. will weather the effects of the Gulf of Mexico drilling moratorium and is poised to deliver major near-term production growth, T. Paul Bulmahn, its chief executive officer, said Wednesday during a presentation at EnterCom, Inc.'s Oil and Gas Conference in Denver.

"While we have seen the lows of the BP oil spill aftermath, we have not yet begun to see the fruits of our 60% oil-driven reserves and production increases," he said.

Between its existing production and the ATP Titan platform, which achieved its first production in the first quarter of 2010, the company has already experienced a 57% production increase in the first half of the year, he said.

The production ramp-up will continue with ATP's next Telemark well, which is expected to begin production in the third quarter, he said.

"ATP is on schedule and just weeks away from significant oil-focused deepwater production growth at Telemark," Bulmahn said.

ATP projects four additional wells at Telemark that are expected to be online in 2011.

Bulmahn also said during the presentation that several government officials have hinted at an early termination of the deepwater drilling ban. However, he noted, uncertainty remains.

"This administration has demonstrated a real talent for creating a climate of uncertainty, which is very damaging to those of us trying to effectively run a business," he said.

Additionally, Bulmahn highlighted the fact that ATP's financial circumstances were strengthened in the first half of 2010 through the company's closing on a high-yield bond issuance and first-lien term loan. The transactions added $303 million of liquidity and allow ATP to move forward without financial maintenance covenants.

Bulmahn also said Wednesday that he expects the present trading discount on ATP to be removed with the termination of the moratorium.

"Whether you are looking at just our proved, or you include probable, reserves...our equity upside is huge under any pricing scenario," he said.

ATP is a Houston-based developer and producer of oil and natural gas.

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