Atlantic Petroleum P/F - Ársreikningur

Operating profit (EBIT) was DKK 35.6MM in 3Q and DKK 93.6MM for the nine first months of 2010.

Operating profit (EBIT) was DKK 35.6MM in 3Q and DKK 93.6MM for the nine first
months of 2010. Expected production for the 2010 increased to 930,000 - 980,000
barrels of oil equivalents (boe) and expected EBIT increased to the range DKK
110MM - 130MM. 

Tórshavn, Faroe Islands 3rd November 2010 - Atlantic Petroleum (OMX: FO-ATLA)
today announced its results for the first nine months 2010. This company
announcement should be read in conjunction with Atlantic Petroleum's Interim
Consolidated Financial Statement attached to this announcement. 

Ben Arabo, Atlantic Petroleum's CEO, stated:
“Atlantic Petroleum has had another strong quarterly performance, taking the
operating profit for the first 9 months of 2010 to DKK 93.6MM and the profit
before tax to DKK 109.2MM. The equity ratio is 55.2% compared to 14.0% at the
end of 3Q 2009. 

With the substantial base provided by a good cash flow and a prudent debt
position, Atlantic Petroleum will focus on re-populating its exploration
portfolio and building its production potential by organic growth and selective
acquisitions. 

One step in building the exploration portfolio to provide potential upside for
the company was the award on 27th October of two new licenses in the UK 26th
Round. One of these two licenses contains the Anglesey prospect which lies in
Blocks 14/9 & 14/14 and Atlantic Petroleum has 30% equity. The Anglesey
prospect has an unrisked potential in the range of 7 MMBbls to 190 MMBbls. 

In order to improve potential near term production Atlantic Petroleum has
exercised its pre-emption rights in the proposed Petro Canada divestment to
Dana and expect to get at least the proportionate share of the equity to be
sold which would take the Atlantic Petroleum equity in the Perth discovery from
3.75% to 6.62%. This will make the Perth discovery more material to Atlantic
Petroleum and we look forward to be working with the Perth partners in moving
the asset forward. 

The continued good performance of Atlantic Petroleum's producing assets and the
potential short term production from Blackbird will enable Atlantic Petroleum
to develop and grow the company organically from investing in the company's
growing exploration portfolio in the Faroes, UK and Ireland and to grow the
company through selective acquisitions.” 


Highlights

Operational 

Total production in 3Q 2010 was 268,370 boe corresponding to an average
production of 2,917 boepd (barrels of oil equivalents per day). The total
production for the first 9 months of the year amounts to 687,970 boe (2,520
boepd). Production in 3Q 2010 was associated with stable production from the
Chestnut field and continued good operational performance of the Ettrick
production facilities and the addition of two new producers, the 20/2a-E3Z and
the 20/2a-E7Z wells 

•	Evaluation of the Blackbird field potential is nearing completion and the
final decision for developing Blackbird over Ettrick is expected later this
year 

•	Seismic interpretation of the new data over Faroes L016 is ongoing. The sea
bed sampling programme has been successfully completed 

•	A site survey has been initiated on Faroes L006 in preparation for a
potential well in 2011 

•	Various projects have been initiated in Irish Licence SEL 2/07 to evaluate
whether it is possible to develop the Helvick and Hook Head fields via an
unmanned production buoy facility and whether the low API oil accumulation at
Nemo (Ardmore) can be commercialised. An agreement has been made with Nautical
Petroleum to receive 25% equity in the Nemo field in return for carrying out
feasibility studies looking into developing the heavy oil accumulation. On Hook
Head it has been agreed that Sosina will carry out and fund a study
investigating developing the oil accumulation in return for an increased share
of equity 

•	The Perth Licence has been granted a one year extension to end 3Q 2011 for
the partnership to file a Field Development Plan. Nexen has recently divested
42.08% of equity in Perth to DEO Petroleum plc. The aim of the partnership is
to develop Perth either as a subsea tie back to Tartan production platform or
alternatively as a standalone project utilising a leased FPSO 


Financial 

•	Revenues of DKK 106.2MM in 3Q 2010 (3Q 2009: DKK 60.7MM) and DKK 287.3MM in
the first nine months of 2010 (first nine months of 2009: DKK 137.3MM). Average
realised oil price increased to 77.79 USD/bbl in 3Q 2010 from 76.81 USD/bbl in
2Q 2010. The average realised oil price for the first nine months of 2010 was
77.20 USD/bbl 

•	Gross profit of DKK 40.6MM in 3Q 2010 (3Q 2009: DKK 13.1MM) and DKK 106.2MM
in the first nine months of 2010 (The first nine months of 2009: DKK 24.1MM) 

•	Operating profit (EBIT) of DKK 35.6MM in 3Q 2010 (3Q 2009: DKK 10.0MM) and
DKK 93.6MM in the first nine months of 2010 (The first nine months of 2009: DKK
-102.9MM) 

•	Profit before taxation of DKK 4.1MM in 3Q 2010 (3Q 2009: DKK -36.8MM) and DKK
109.2MM in the first nine months of 2010 (The first nine months of 2009: DKK
-85.0MM) 

•	Net cash flow from operating activities in the first nine months of 2010 of
DKK 176.7MM (The first nine months of 2009: DKK 35.8MM) 

•	Total assets of DKK 631.2MM (At year end 2009: 646.8MM)

•	Total shareholder's equity of DKK 348.6MM (at year end 2009: 279.0MM)

•	In 3Q General and administration costs were DKK 4.2MM reduced from DKK 4.5MM
in 3Q 2009. In the first nine months of 2010 General and administration costs
were DKK 11.4MM reduced from DKK 14.2MM in the first nine months of 2009 

•	In order to secure a more stable revenue, the Company has engaged in oil
price hedging during 2010. In 3Q the Company hedged 5,000 barrels a month,
equivalent to 6% of 3Q average monthly production, and realised a gain of DKK
1.0MM. In the first nine months of 2010 the Company has realised a gain on oil
price hedging of DKK 1.5MM by hedging 4% of average monthly production 

•	On 30th September 2010 the Company's bank debt was DKK 163.0MM of which DKK
130.0MM was long term. In the first nine months of 2010 a total of DKK 120.7MM
of bank debt has been repaid 


2010 Outlook

Operational

•	Production in the first 9 months of 2010 amounted to 687,970 barrels of oil
equivalents (boe). The total production for the year is now expected to be
between 930,000 - 980,000 boe compared to the previously quoted range of
850,000-930,000 boe. Production in October 2010 was 98,000 boe 

•	The Blackbird evaluation work is nearing completion and a decision is
expected to be taken later in the year whether to develop the field over the
Ettrick production facilities located 6 km to the north of Blackbird 


•	A Pre-FEED study (Pre-Front End Engineering and Design) has been completed on
the Perth field to determine the feasibility of developing Perth as a subsea
tieback to the Tartan field. A previous study has investigated a standalone
development of Perth utilising a leased FPSO. Nexen has recently divested
42.08% to DEO Petroleum plc who is likely to become operator of the license
going forward. The Perth Licence has been granted a one year extension to end
3Q 2011 during which time the partnership will file a Field Development Plan
based on the best development concept 


Financial 

•	EBIT is expected to increase to DKK 110 - 130MM for the year 2010 compared to
DKK 90 - 110MM previously announced. The guidance is based on an oil price of
77 USD/bbl in 2010 and an average currency exchange rate of DKK/USD of 5.6 

•	Investments in exploration and appraisal activities are estimated to be
around DKK 37MM for 2010 

•	Investments in field developments are estimated to be around DKK 61MM for 2010

•	The Company has engaged in oil price hedging to secure a more stable revenue
stream. On average 9 per cent of current production has been hedged 12 months
ahead. Average oil price hedged at is 86 USD/bbl 



Audio cast/Conference call
In connection with the publication of the 3Q 2010 interim report Atlantic
Petroleum will host a conference call for analysts and investors. 
The conference call will take place on Wednesday 3rd November, at 12.00 (CET). 
If you would like to participate in the conference call, please dial the
relevant number below a few minutes before the conference starts: 
- Danish  +45 32 71 47 67
- Other international +44 207 509 5139

More details about the conference call can be found on the Company's website
www.petroleum.fo. 


Further Details:

Further details can be obtained from Ben Arabo, CEO, tel +298 350100
(ben.arabo@petroleum.fo). This announcement will be available, together with
other information about Atlantic Petroleum, on the Company's website:
www.petroleum.fo. 

On the website, it is also possible to sign up for the Company's e-mail
newsletter. 

Announcement no. 29/2010		                  Issued 03-11-2010

P/F Atlantic Petroleum 		                     Telephone +298 350 100
Gongin 9		                                   Fax +298 350 101
P.O. Box 1228		                          Website: www.petroleum.fo
FO-110 Tórshavn 		             E-mail: petroleum@petroleum.fo
Faroe Islands

Attachments:

ap 3q 2010 interim report 30-09-2010.pdf

29 - 2010 3q 2010 announcement 03-11-2010.pdf