ATP Oil & Gas update on its ongoing development activities
In the North Sea, ATP drilled the Wenlock #2 well to a total depth of 15,200'. The well successfully encountered the targeted reservoir sands and was completed with a 3,000' horizontal section. Completion and connection operations are underway with initial production expected before the end of the first quarter 2009. Following completion of the Wenlock #2 well ATP will commence drilling a well in the Bodbury prospect, an exploratory offset immediately northwest of Wenlock. ATP has a 20% working interest (WI) and is operator of Bodbury and both Wenlock wells.
On the Gulf of Mexico shelf, two wells at High Island A-589 ("HI A-589") were drilled, completed and placed on production during December 2008. The wells were completed in the 9,800' and 10,000' sands. At South Marsh Island 190 ("SMI 190"), ATP is working on final pipeline connections for one new well. First production at SMI 190 is projected in the third quarter 2009. Connection and completion of HI A-589 and SMI 190 were delayed because of third-party pipeline outages as a result of Hurricane Ike. ATP has a 100% WI in HI A-589, a 75% WI in SMI 190, and is operator of all three wells.
In the deepwater Gulf of Mexico, development activities continue at ATP's Telemark Hub. Construction of the ATP Titan - a floating drilling and production platform and ATP's first MinDOC - is nearly complete and it is scheduled for sail-out and mooring in mid-2009. The ATP Titan has a design capacity of 25 MBbls of oil per day, 60 MMcf of gas per day and a useful life of 50 years. In the northern part of the Telemark Hub, the initial drilling of three wells was performed in the third quarter 2008 at Mirage (Mississippi Canyon Block 941) and Morgus (Mississippi Canyon Block 942). All three wells were drilled to a depth of approximately 5,900' and 22" casing was set. The ATP Titan will be moored initially at Mirage/Morgus to complete the drilling of the three wells to the targeted total vertical depths of 14,600' to 17,250' and to serve as the production platform for the life of the reserves. In the southern part of the Telemark Hub, ATP recently revised its drilling and production program at Atwater Valley Block 63 ("AT 63") to include a subsea well at AT 63 for completion and production through the ATP Titan. This revision will result in an increase in production rates through the ATP Titan in 2010 and 2011 and an immediate cost savings, as MinDOC II, originally scheduled for installation at AT 63, is postponed and will be utilized at another ATP location in the future. After the reserves at Mirage and Morgus are produced, the ATP Titan is scheduled to be moved to AT 63 where it will recover the remaining reserves. First production at ATP's Telemark Hub is expected in late 2009 or early 2010. ATP has a 100% WI and is the operator of the Telemark Hub.
During January 2009, the Discovery Pipeline was restored to service enabling ATP to resume production at its Gomez Hub in Mississippi Canyon 711. The impact of the delayed sales revenue due to the prolonged outage of the Discovery Pipeline was partially mitigated by ATP's loss of production income insurance proceeds. Additionally, the Mississippi Canyon 711 #8ST2 well has reached total depth, successfully encountering targeted reservoirs and is undergoing completion operations. Production is expected before the end of the first quarter 2009. ATP has a 100% WI and is operator of the Gomez Hub.
