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ATP Announces Second Quarter 2008 Results

HOUSTON-(Business Wire)-August 7, 2008 - ATP Oil & Gas Corporation (NASDAQ:ATPG) today announced second quarter 2008 results and hedging update.

Highlights include:

— A production increase of 26% over second quarter 2007;

— An increase in oil and gas revenues of 45% over second quarter 2007;

— The sale of an interest in our Gomez Hub for $82.0 million representing 4.5% of our Gomez Hub proved reserves at December 31, 2007;

— The acquisition of proved reserves at Clipper for a minimal upfront investment;

— The refinancing of our debt, significantly extending the maturity; and

— The addition in July 2008 of costless oil collars for 2010 and 2011 with $105 per Bbl floor prices and ceiling prices ranging from $187 to $197 per Bbl.

Oil and gas production increased 26% to 3.1 MMBoe (18.5 Bcfe) for the second quarter of 2008, compared to 2.4 MMBoe (14.6 Bcfe) for the second quarter of 2007. Oil production was 1.4 MMBbls and natural gas production was 10.0 Bcf for the second quarter of 2008, compared to 1.0 MMBbls and 8.4 Bcfe for the second quarter of 2007. Oil and gas production increased 31% to 6.7 MMBoe (40.0 Bcfe) for the six months ended June 30, 2008, compared to 5.1 MMBoe (30.5 Bcfe) for the six months ended June 30, 2007.

Revenues from oil and gas production increased 45% to $191.8 million for the second quarter of 2008, compared to $132.2 million for the second quarter of 2007. Revenues from oil and gas production increased 51% to $417.8 million for the six months ended June 30, 2008, compared to $276.9 million for the six months ended June 30, 2007.

ATP recorded a net loss of $11.8 million or $0.33 per basic and diluted share for the second quarter of 2008, compared to net income of $6.1 million or $0.20 per basic and diluted share for the second quarter of 2007. ATP recorded net income of $35.1 million or $0.98 per basic share and $0.97 per diluted share for the six months ended June 30, 2008, compared to $33.6 million or $1.12 per basic share and $1.10 per diluted share for the six months ended June 30, 2007.

Results for the second quarter of 2008 were impacted by two items that research analysts typically exclude from their published estimates, a charge related to the extinguishment of our prior debt of $24.2 million ($15.7 million after tax) and a net unrealized loss on derivatives no longer accounted for as hedges of $49.2 million ($26.8 million after tax). The $24.2 million charge related to the costs of our previous debt which was required to be written off as a result of the closing of a new senior secured term loan facility which extended the maturity of ATP's long-term debt and will provide flexibility with regard to the announced asset monetization program. Net income before these items, a non-GAAP measure, in the second quarter of 2008 was $30.8 million or $0.87 per basic share and $0.86 per diluted share. The same metric in the second quarter of 2007 is $11.9 million or $0.40 per basic and $0.39 per diluted share. A non-GAAP reconciliation is provided near the end of this press release.

In the second quarter of 2008, ATP sold a limited term overriding royalty interest at its Gomez Hub in the Gulf of Mexico for $82.0 million representing 5.8 Bcfe of proved reserves from this property. While this transaction is considered a sale for accounting purposes, the relevant guidance prevents ATP from recognizing a gain on this transaction. As such, the sale proceeds are recorded as deferred revenue on the balance sheet and will be recognized as oil and gas revenues as the reserves attributable to the sold interest are produced. During the second quarter of 2008 the production attributable to the sold interest was 0.5 Bcfe. The related reserves attributable to the sold interest have been removed from ATP's proved reserves and the production will be excluded from ATP's reported production.

Due to the sale, ATP's forecasted production from the Gomez Hub has been reduced accordingly. In addition, as a result of changes in timing of forecasted production related to the U.K. derivatives, certain contracts were restructured. In each case the derivative contracts related to the previously forecasted production no longer qualify for hedge accounting treatment and, as a result, unrealized losses previously deferred were charged to earnings in the current period. Accordingly, during the second quarter of 2008, ATP recorded derivatives expense of $50.2 million, which consists of the previously noted $49.2 million noncash unrealized loss and a $1.0 million realized loss. Subsequent changes in the fair value of these derivatives will be recorded on a mark-to-market basis in the income statement. In conjunction with changes in the timing of forecasted production in the UK, ATP unwound 2.2 Bcfe of natural gas swaps with an average price of $7.35 scheduled from October 2008 through March 2009, and replaced them with 3.1 Bcfe of natural gas swaps with an average price of $9.28 from April 2009 through March 2010.

During the second quarter of 2008, ATP acquired a 55% working interest in Clipper (Green Canyon Blocks 299 and 300), which includes proved reserves. ATP acquired a 100% working interest in Mississippi Canyon Block 304, expanding the Canyon Express Hub.

ATP has expanded its oil hedging program to include costless collars. These are listed below. A detailed hedge and derivative schedule is provided near the end of this press release.

Gulf of Mexico Oil Collars

— 3,000 Bbls/day calendar year 2010, $105/Bbl (floor) to $195 - $197/Bbl (ceiling)

— 2,000 Bbls/day calendar year 2011, $105/Bbl (floor) to $187 - $188/Bbl (ceiling)

ATP's selected operating statistics and financial information, included within this press release, contain additional information on the company's activities for the second quarter of 2008 and the comparable period of 2007. -0- *T Three Months Ended Six Months Ended June 30, June 30, ————————— ————————- 2008 2007 2008 2007 ————————— ————————- Selected Operating Statistics (Unaudited) Production Natural gas (MMcf) 9,969 8,426 21,813 18,250 Gulf of Mexico 5,475 6,937 11,940 13,074 North Sea 4,494 1,489 9,873 5,176 Oil and condensate (MBbls) 1,414 1,027 3,036 2,039 Gulf of Mexico 1,402 1,024 3,012 2,029 North Sea 12 3 24 10 Natural gas equivalents (MMcfe) 18,455 14,590 40,029 30,486 Gulf of Mexico 13,892 13,082 30,014 25,251 North Sea 4,564 1,508 10,015 5,235 Average Prices (includes effect of cash flow hedges) Natural gas (per Mcf) $ 7.93 $ 8.24 $ 8.49 $ 8.74 Gulf of Mexico 9.99 8.47 9.61 8.47 North Sea 5.42 7.19 7.14 9.40 Oil and condensate (per Bbl) 74.89 60.80 74.39 57.48 Natural gas, oil and condensate (per Mcfe) 10.02 9.05 10.26 9.07 Other Expenses, per Mcfe Lease operating expense $ 1.29 $ 1.38 $ 1.21 $ 1.35 Gulf of Mexico 1.29 1.25 1.19 1.26 North Sea 1.27 2.45 1.28 1.77 Depreciation, depletion and amortization 4.33 3.61 4.23 3.48 Gulf of Mexico 3.59 3.52 3.53 3.32 North Sea 6.57 4.32 6.31 4.22 Selected Unaudited Financial Data (Unaudited) (In Thousands, Except Per Share Data) Oil and gas revenues (1) $191,809 $131,919 $417,846 $276,593 Net income (loss) (11,780) 6,125 35,065 33,559 Net income (loss) per share: Basic $ (0.33) $ 0.20 $ 0.98 $ 1.12 ========= ======== ======== ======== Diluted $ (0.33) $ 0.20 $ 0.97 $ 1.10 ========= ======== ======== ======== Weighted average shares outstanding: Basic 35,440 30,058 35,631 30,031 ========= ======== ======== ======== Diluted 35,440 30,639 36,072 30,612 ========= ======== ======== ======== __________________ (1) Includes settlements on derivatives qualifying for hedge accounting. *T

2nd Quarter 2008 Conference Call

ATP Oil & Gas Corporation (NASDAQ:ATPG) will host a conference call on Thursday, August 7 at 10:00 am central time to discuss the company's second quarter results, followed by a Q&A session.

Date: Thursday, August 7, 2008

Time: 11:00 am ET;10:00 am CT; 9:00 am MT and 8:00 am PT

ATP invites interested persons to listen to the live Internet webcast on the company's website, www.atpog.com, linking through the Investor Info page and the Conference Calls link. Phone participants should dial (800) 524-3357. A digital replay of the conference call will be available at (888) 203-1112, ID number 4053448, for a period of 24 hours beginning at 12:00 pm CT, and the webcast will be archived for 30 business days at www.atpog.com.

About ATP Oil & Gas Corporation

ATP Oil & Gas is focused on development and production of oil and natural gas in the Gulf of Mexico and the North Sea. The Company trades publicly as ATPG on the NASDAQ Global Select Market. For more information about ATP Oil & Gas Corporation, visit www.atpog.com.

Forward-looking Statements

Certain statements included in this news release are "forward-looking statements" under the Private Securities Litigation Reform Act 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 ATP's ability to access them, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business. More information about the risks and uncertainties relating to ATP's forward-looking statements are found in the Company's SEC filings. -0- *T CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) June 30, December 31, 2008 2007 —————- —————— Assets Current assets: Cash and cash equivalents $ 278,323 $ 199,449 Restricted cash 14,027 13,981 Accounts receivable (net of allowances of $382 and $382) 92,255 127,891 Deferred tax assets 43,312 84,110 Derivative assets 40 1,286 Other current assets 13,404 15,934 —————- —————— Total current assets 441,361 442,651 —————- —————— Oil and gas properties: Oil and gas properties (using the successful efforts method of accounting) 2,977,575 2,556,938 Less: Accumulated depletion, impairment and amortization (897,550) (726,358) —————- —————— Oil and gas properties, net 2,080,025 1,830,580 —————- —————— Furniture and fixtures, net 700 860 Derivative assets 1,315 673 Deferred tax assets 25,134 - Deferred financing costs, net 15,348 19,873 Other assets, net 12,681 12,496 —————- —————— Total assets $2,576,564 $2,307,133 =========== ============ Liabilities and Shareholders' Equity Current liabilities: Accounts payable and accruals $ 188,642 $ 270,557 Current maturities of long-term debt 10,500 12,165 Asset retirement obligation 19,007 28,194 Derivative liabilities 54,397 11,335 Deferred tax liabilities 476 - Other current liabilities 13,650 23,512 —————- —————— Total current liabilities 286,672 345,763 Long-term debt 1,598,365 1,391,846 Asset retirement obligation 169,480 158,577 Deferred tax liabilities 64,963 85,256 Derivative Liabilities 34,126 13,242 Deferred revenue 75,144 - Other liabilities 2,582 2,583 —————- —————— Total liabilities 2,231,332 1,997,267 —————- —————— Shareholders' equity: Preferred stock: $0.001 par value - - Common stock: $0.001 par value 36 36 Additional paid-in capital 394,072 388,250 Accumulated deficit (56,996) (92,061) Accumulated other comprehensive income 9,031 14,552 Treasury stock, at cost (911) (911) —————- —————— Total shareholders' equity 345,232 309,866 —————- —————— Total liabilities and shareholders' equity $2,576,564 $2,307,133 =========== ============ *T -0- *T CONSOLIDATED INCOME STATEMENTS (In Thousands, Except Per Share Amounts) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, —————————- —————————— 2008 2007 2008 2007 ————- ————- ————— ————- Oil and gas revenues $191,809 $132,153 $ 417,846 $276,902 Other revenues - - 897 1,598 ————- ————- ————— ————- Total revenues 191,809 132,153 418,743 278,500 ————- ————- ————— ————- Costs and operating expenses: Lease operating 23,770 20,105 48,388 41,174 Exploration - 10,605 - 11,336 General and administrative 8,831 6,572 18,067 15,340 Depreciation, depletion and amortization 79,873 52,612 169,272 106,012 Impairment of oil and gas properties - 5,770 - 5,770 Accretion of asset retirement obligation 4,281 3,020 8,581 5,980 Loss on abandonment 1,036 2 1,413 79 Other, net (264) - (110) - ————- ————- ————— ————- Total costs and operating expenses 117,527 98,686 245,611 185,691 ————- ————- ————— ————- Income from operations 74,282 33,467 173,132 92,809 ————- ————- ————— ————- Other income (expense): Interest income 644 2,550 1,872 4,618 Interest expense (24,236) (31,025) (52,363) (57,824) Derivatives expense (50,190) - (50,150) - Loss on debt extinguishment (24,220) - (24,220) - ————- ————- ————— ————- Total other income (expense) (98,002) (28,475) (124,861) (53,206) ————- ————- ————— ————- Income (loss) before income taxes (23,720) 4,992 48,271 39,603 ————- ————- ————— ————- Income tax (expense) benefit: Current 2,078 22 (10,358) (34) Deferred 9,862 1,111 (2,848) (6,010) ————- ————- ————— ————- Total 11,940 1,133 (13,206) (6,044) ————- ————- ————— ————- Net income (loss) $(11,780) $ 6,125 $ 35,065 $ 33,559 ========= ========= ========== ========= Net income (loss) per share: Basic $ (0.33) $ 0.20 $ 0.98 $ 1.12 ========= ========= ========== ========= Diluted $ (0.33) $ 0.20 $ 0.97 $ 1.10 ========= ========= ========== ========= Weighted average shares outstanding: Basic 35,440 30,058 35,631 30,031 ========= ========= ========== ========= Diluted 35,440 30,639 36,072 30,612 ========= ========= ========== ========= *T -0- *T CONSOLIDATED CASH FLOW DATA (In Thousands) (Unaudited) Six Months Ended June 30, ———————————- 2008 2007 —————— ————— Cash flows from operating activities: Net income $ 35,065 $ 33,559 Adjustments to operating activities 255,865 141,536 Changes in assets and liabilities (126,138) 2,434 —————— ————— Net cash provided by operating activities 164,792 177,529 —————— ————— Cash flows from investing activities: Additions to oil and gas properties (349,008) (389,972) Additions to furniture and fixtures (93) (207) Proceeds from disposition of oil and gas properties 82,450 - Decrease in restricted cash - 1 —————— ————— Net cash used in investing activities (266,651) (390,178) —————— ————— Cash flows from financing activities: Proceeds from long-term debt 1,608,750 375,000 Principal payments of long-term debt (1,401,653) (181,369) Deferred financing costs (15,391) (8,445) Principal payments of capital lease - (23,950) Net profits interest payments (10,871) - Exercise of stock options 28 1,140 —————— ————— Net cash provided by financing activities 180,863 162,376 —————— ————— Effect of exchange rate changes on cash (130) 283 —————— ————— Net increase (decrease) in cash and cash equivalents 78,874 (49,990) Cash and cash equivalents, beginning of period 199,449 182,592 —————— ————— Cash and cash equivalents, end of period $ 278,323 $ 132,602 ============ ========== *T -0- *T Reconciliation of Non-GAAP Net Income (In Thousands, Except Per Share Amounts) (Unaudited) Three Months Six Months Ended Ended June 30, June 30, ————————- ———————- 2008 2007 2008 2007 ————- ———- ———- ———- Net income (loss) $(11,780) $ 6,125 $35,065 $33,559 Impairment of oil and gas properties - 5,770 - 5,770 Loss on debt extinguishment, net of tax 15,743 - 15,743 - Unrealized derivatives expense, net of tax 26,826 - 26,826 - ————- ———- ———- ———- Pro forma net income $ 30,789 $11,895 $77,634 $39,329 ========= ======= ======= ======= Pro forma net income per share: Basic $ 0.87 $ 0.40 $ 2.18 $ 1.31 ========= ======= ======= ======= Diluted $ 0.86 $ 0.39 $ 2.15 $ 1.28 ========= ======= ======= ======= Weighted average shares outstanding: Basic 35,440 30,058 35,631 30,031 ========= ======= ======= ======= Diluted 35,848 30,639 36,072 30,612 ========= ======= ======= ======= *T -0- *T Reconciliation of Non-GAAP Cash Flow Measures (In Thousands) (Unaudited) Six Months Ended June 30, ———————————- 2008 2007 —————- ————— Cash flows from operating activities: Net income $ 35,065 $ 33,559 Adjustments to operating activities 255,865 141,536 —————- ————— Pro forma cash flows from operating activities before changes in assets and liabilities 290,930 175,095 Changes in assets and liabilities (126,138) 2,434 —————- ————— Net cash provided by operating activities $ 164,792 $ 177,529 =========== ========== *T -0- *T 2008 ——————————- 3Q 4Q ——————————- Gulf of Mexico Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) 3,960 3,055 Price ($/MMBtu) $ 8.63 $ 8.62 Crude Oil Volumes (MBbls) 1,135 982 Price ($/Bbl) $ 77.84 $79.50 Equivalents Volumes (MMMBtue) 10,770 8,947 Price ($/MMBtue) $ 11.38 $11.67 Puts Crude Oil Volumes (MBbls) 626 626 Floor Price ($/Bbl) $ 54.67 $54.67 Collars Crude Oil Volumes (MBbls) - - Ceiling Price ($/Bbl) $ - $ - Floor Price ($/Bbl) $ - $ - North Sea Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) 4,610 4,370 Price ($/MMBtu) $ 6.65 $ 8.55 2009 —————————————————————- 1Q 2Q 3Q 4Q —————————————————————- Gulf of Mexico Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) 2,700 1,815 1,830 1,830 Price ($/MMBtu) $ 8.63 $ 7.56 $ 7.57 $ 8.10 Crude Oil Volumes (MBbls) 788 705 713 621 Price ($/Bbl) $78.61 $75.83 $75.83 $76.61 Equivalents Volumes (MMMBtue) 7,425 6,047 6,108 5,556 Price ($/MMBtue) $11.48 $11.12 $11.12 $11.23 Puts Crude Oil Volumes (MBbls) 369 373 377 377 Floor Price ($/Bbl) $54.00 $54.00 $54.00 $54.00 Collars Crude Oil Volumes (MBbls) - - - - Ceiling Price ($/Bbl) $ - $ - $ - $ - Floor Price ($/Bbl) $ - $ - $ - $ - North Sea Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) 3,668 1,843 1,863 1,219 Price ($/MMBtu) $ 8.39 $ 8.72 $ 8.72 $ 8.42 ——————————————————————————————————— Exchange rate = 2 USD/GBP The above are ATP's outstanding financial and physical commodity contracts. Additional hedges, derivatives and fixed price contracts, if any, will be announced during the year. ——————————————————————————————————— Recent North Sea Natural Gas Swaps unwound: June 30, 2008: 70,000 Btu/day October 2008 to March 2009 at GBP 3.00/MMBtu June 30, 2008: 50,000 Btu/day October 2008 to March 2009 at GBP 4.64/MMBtu Recent North Sea Natural Gas Swaps entered: June 30, 2008: 120,000 Btu/day April 2009 to September 2009 at GBP 4.65/MMBtu June 30, 2008: 50,000 Btu/day October 2009 to March 2010 at GBP 4.65/MMBtu Recent Gulf of Mexico Oil Collars: July 10, 2008: 1,000 Bbls/day calendar year 2010, $105/Bbl to $195/Bbl July 10, 2008: 1,000 Bbls/day calendar year 2010, $105/Bbl to $196/Bbl July 10, 2008: 1,000 Bbls/day calendar year 2010, $105/Bbl to $197/Bbl July 10, 2008: 1,000 Bbls/day calendar year 2011, $105/Bbl to $187/Bbl July 10, 2008: 1,000 Bbls/day calendar year 2011, $105/Bbl to $188/Bbl *T -0- *T 2010 ———————————————————- 1Q 2Q 3Q 4Q ———————————————————- Gulf of Mexico Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) - - - - Price ($/MMBtu) $ - $ - $ - $ - Crude Oil Volumes (MBbls) 90 91 92 92 Price ($/Bbl) $ 68.20 $ 68.20 $ 68.20 $ 68.20 Equivalents Volumes (MMMBtue) 540 546 552 552 Price ($/MMBtue) $ 11.37 $ 11.37 $ 11.37 $ 11.37 Puts Crude Oil Volumes (MBbls) - - - - Floor Price ($/Bbl) $ - $ - $ - $ - Collars Crude Oil Volumes (MBbls) 270 273 276 276 Ceiling Price ($/Bbl) $ 196.00 $196.00 $ 196.00 $196.00 Floor Price ($/Bbl) $ 105.00 $105.00 $ 105.00 $105.00 North Sea Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) 450 - - - Price ($/MMBtu) $ 9.30 $ - $ - $ - 2011 ———————————————————— 1Q 2Q 3Q 4Q ———————————————————— Gulf of Mexico Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) - - - - Price ($/MMBtu) $ - $ - $ - $ - Crude Oil Volumes (MBbls) 90 91 92 - Price ($/Bbl) $ 68.20 $ 68.20 $ 68.20 $ - Equivalents Volumes (MMMBtue) 540 546 552 - Price ($/MMBtue) $ 11.37 $ 11.37 $ 11.37 $ - Puts Crude Oil Volumes (MBbls) - - - - Floor Price ($/Bbl) $ - $ - $ - $ - Collars Crude Oil Volumes (MBbls) 180 182 184 184 Ceiling Price ($/Bbl) $187.50 $ 187.50 $187.50 $ 187.50 Floor Price ($/Bbl) $105.00 $ 105.00 $105.00 $ 105.00 North Sea Fixed Forwards & Swaps Natural Gas Volumes (MMMBtu) - - - - Price ($/MMBtu) $ - $ - $ - $ - ——————————————————————————————————— Exchange rate = 2 USD/GBP The above are ATP's outstanding financial and physical commodity contracts. Additional hedges, derivatives and fixed price contracts, if any, will be announced during the year. ——————————————————————————————————— *T

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