Highlights
- Net income of $36.5 million or $1.03 per share;
- Record nine month production and revenues despite the impact of hurricanes Gustav and Ike;
- Executed an agreement to sell 80% of certain assets in the U.K. North Sea for approximately $430 million, which represents significant progress toward our previously announced monetization program;
- Continued progress on our 2008 development program including completion and first production at West Cameron 462 during early fourth quarter 2008.
Oil and gas production for the third quarter of 2008 was 2.0 MMBoe (12.2 Bcfe) compared to 2.2 MMBoe (13.3 Bcfe) for the third quarter of 2007. Production for the quarter was significantly impacted by hurricanes Gustav and Ike resulting in a deferral of production during the quarter of approximately 1.0 MMBoe (5.7 Bcfe). Despite these deferrals our quarterly production was down only 9% from the comparable quarter in 2007. Oil production was 0.8 MMBbls and natural gas production was 7.3 Bcf for the third quarter of 2008, compared to 0.9 MMBbls and 8.0 Bcfe for the third quarter of 2007. Oil and gas production increased 19% to 8.7 MMBoe (52.2 Bcfe) for the nine months ended September 30, 2008, compared to 7.3 MMBoe (43.8 Bcfe) for the nine months ended September 30, 2007.
Revenues from oil and gas production were $118.3 million for the third quarter of 2008, compared to $117.0 million for the third quarter of 2007. Revenues from oil and gas production increased 36% to $536.2 million for the nine months ended September 30, 2008, compared to $393.6 million for the nine months ended September 30, 2007.
ATP recorded net income of $36.5 million or $1.03 per basic and $1.02 per diluted share for the third quarter of 2008, compared to net income of $2.3 million or $0.08 per basic and diluted share for the third quarter of 2007. ATP recorded net income of $71.5 million or $2.02 per basic share and $1.99 per diluted share for the nine months ended September 30, 2008, compared to $35.9 million or $1.19 per basic share and $1.17 per diluted share for the nine months ended September 30, 2007. During the third quarter of 2008 ATP recognized $12.6 million of oil and gas production revenue from the amortization of deferred revenue related to the second quarter 2008 sale of a limited-term overriding royalty interest. In addition, ATP recorded $12.5 million in capitalized interest.
Results for the third quarter included items that research analysts typically exclude from their published estimates, such as unrealized gains and losses on derivatives and impairments. Net income before these items, a non-GAAP measure, in the third quarter of 2008 was $21.6 million or $0.61 per basic share and $0.60 per diluted share, compared to $4.9 million or $0.16 per basic and diluted share in the third quarter of 2007. A non-GAAP reconciliation is provided near the end of this press release.
ATP previously announced that it had entered into a sale and purchase agreement for GBP 265.0 million (approximately $430 million) with EDF Production U.K. Limited, a subsidiary of EDF International of France, for certain of ATP's assets in the U.K. North Sea. Upon closing, the agreement will transfer 80% of ATP's interest in Tors (a 68% working interest) and Wenlock (an 80% working interest) to EDF, effective July 1, 2008. The sale has been approved by the respective boards and parents of ATP and EDF and is subject to approval by the U.K. regulatory authority. Closing and funding of the sale is expected before the end of 2008. ATP will remain as operator of both Tors and Wenlock.