Atlantic Petroleum P/F - Ársreikningur

Operating profit in 2Q 2011 was DKK 50.3MM (2Q 2010: DKK 35.8MM). Operating profit 1H 2011 was DKK 77.0MM (1H 2010: DKK 58.1MM)

Tórshavn, Faroe Islands, 2011-08-17 11:55 CEST (GLOBE NEWSWIRE) -- Operating
profit in 2Q 2011 was DKK 50.3MM (2Q 2010: DKK 35.8MM). Operating profit 1H
2011 was DKK 77.0MM (1H 2010: DKK 58.1MM). Profit before taxation in 2Q 2011
was DKK 42.0MM (2Q 2010: DKK 76.7MM) and profit before taxation 1H 2011 was DKK
58.2MM (1H 2010: DKK 105.1MM). 



P/F Atlantic Petroleum (OMX: FO-ATLA) today announces its results for the first
six months 2011. This company announcement should be read in conjunction with
Atlantic Petroleum's Condensed Consolidated Interim Report attached to this
announcement. 



Ben Arabo, Atlantic Petroleum's CEO, stated:

“Atlantic Petroleum has had a good quarter with an EBIT in excess of DKK 50MM
and a pre-tax profit of DKK 42MM. 



Second quarter 2011 was in many ways a groundbreaking quarter where Atlantic
Petroleum took a large step towards growing the Company with the Volantis
acquisition. We now have a technical team in place with the experience and
skills to evaluate and create opportunities going forward. 



We will grow the company further by organic growth and by targeted acquistions.



The fact that we have spudded the Foxtrot exploration well 5th August is a
reminder of the change in direction for Atlantic Petroleum following new
management strategy. The Foxtrot well is the first in a sequence of exploration
and appraisal wells. We have 4 firm wells in our programme at the moment and
the target is to have participated, either on a carried or a paying basis, in
at least 10 wells by the end of 2013.” 

Highlights

Operational



  -- Total production in 1H 2011 amounted to 429,000 boe (barrels of oil
     equivalent) corresponding to an average of 2,370 boepd (barrels of oil
     equivalent per day) net to Atlantic Petroleum
  -- Production from the Ettrick field in 1H has been relatively steady however
     production was constrained at the beginning of the year by technical issues
     related to gas compression
  -- Due to lack of water injection the Chestnut field is producing under
     certain bottom hole pressure constraints in order to maintain stable
     conditions
  -- Blackbird tie-in to the Ettrick field has commenced and first oil is
     expected late 2011. Atlantic Petroleum´s equity in Blackbird increased from
     8.27% to 9.40%
  -- Perth field evaluation and development concept selection process is
     on-going as planned
  -- Atlantic Petroleum farmed into UK licence P.1556, Orchid, with a 10%
     working interest. An exploration well is planned to be drilled in 4Q 2011
  -- Atlantic Petroleum acquired privately held Volantis Exploration Limited.
     Volantis holds 15 exploration licences containing the Pegasus and Fulham
     discoveries. The acquisition more than doubles the number of Atlantic
     Petroleum licences from 14 to 29. Five staff members from Volantis joined
     Atlantic Petroleum UK Limited.
  -- As a result of the Volantis acquisition Atlantic Petroleum participates
     with a 35% working interest in the Tullow Oil operated Foxtrot exploration
     well on UK licence P.1716, which spudded on 5th August
  -- A firm well on the Spaniards prospect, Block 15/21g and part of Block
     15/21a, has been agreed. The Perth licence co-venturers on Block 15/21a
     reached a commercial agreement with the co-venturers on Block 15/21g on
     amalgamation of a sub area of the blocks to create a single conjoined area.
     The well is planned to be drilled in 2012.
  -- 

Financial



  -- Operating profit (EBIT) in 2Q 2011 of DKK 50.3MM (2Q 2010: DKK 35.8MM) and
     DKK 77.0MM in 1H 2011 (1H 2010: DKK 58.1MM) and earnings before interest,
     tax, depreciation and amortisation (EBITDA) in 2Q 2011 of DKK 81.6MM (2Q
     2010: DKK 65.5MM) and DKK 146.5MM in 1H 2011 (1H 2010: DKK 110.0MM)
  -- Profit before taxation in 2Q 2011 of DKK 42.0MM (2Q 2010: DKK 76.7MM) and
     DKK 58.2MM in 1H 2011 (1H 2010: DKK 105.1MM)
  -- Net cash from operating activities in 1H 2011 of DKK 168.2MM (1H 2010: DKK
     132.8MM)
  -- Cash position 1H 2011 was DKK 123.8MM (2010: DKK 74.3MM)
  -- Total assets 1H 2011 of DKK 679.5MM (2010: DKK 671.8MM)
  -- Total shareholder's equity 1H 2011 of DKK 365.9MM (2010: DKK 377.9MM)
  -- Bank debt of DKK 140.2MM at 1H 2011, DKK 97.5MM was long term. A total of
     DKK 22.1MM was repaid in 1H 2011
  -- During 2Q 2011 Atlantic Petroleum acquired a total of 173,250 own shares
     corresponding to 6.6% of the total amount of shares. As of 17th August 2011
     the cumulated holding of own shares was 130,514. The market value at the
     closing of the previous day, 16th August, on NASDAQ OMX Copenhagen was DKK
     20.2MM.





2011 Outlook

Operational



  -- Production is expected to be towards the lower end of the range of the
     2,100 - 2,600 boepd previous guidance due to the Blackbird tie-in
     interrupting Ettrick production and deferred production on the Chestnut
     field pending restoration of water injection
  -- A water injector well is budgeted for 2011 on the Ettrick field and if
     recommended, dependent on final planning, it will be drilled in 4Q 2011
  -- Options for reinstating water injection on the Chestnut field have been
     considered and a sidetrack to the existing water injector well will be
     spudded in 3Q 2011 and recompletion of the reservoir section is expected
     towards the end of  2011
  -- The Blackbird field development is progressing well and during the summer
     the subsea infrastructure will be installed. The operator estimates that
     first oil can be achieved by late 2011
  -- On the Perth field, the plan is to complete the development concept
     selection process and finalise a Field Development Plan
  -- The 49/30b-10 Foxtrot exploration well on UK Licence P.1716 in the Southern
     North Sea was spudded in August. The well will target the Triassic Bunter
     sandstones, and preliminary results from the well are expected by the end
     of 3Q 2011
  -- The drilling of an exploration well on the Orchid prospect on UK licence
     P.1556 is expected to commence in 4Q 2011



Financial



  -- Operating profit (EBIT) for the year 2011 is expected to be in the range
     DKK 90MM - 150MM. This is based on the initially estimated average oil
     price of 90 USD/bbl in 2011 and average currency exchange rates of USD/DKK
     5.50 and GBP/DKK 8.70
  -- Investments in exploration and appraisal activities are estimated to be
     around DKK 48MM for the whole year 2011
  -- Investments in field developments and producing assets are estimated to be
     around DKK 134MM for the whole year 2011
  -- The Company's debt is expected to be reduced by around DKK 50MM in 2011
  -- The Company has engaged in oil price hedging to secure a more stable
     revenue stream. Approximately 21% of current production has been hedged 12
     months ahead. Average oil price hedged at is USD 105 per barrel







Conference call

In connection with the publication of the 2Q 2011 Condensed Consolidated
Interim Report Atlantic Petroleum will host a webcast/conference call for
analysts and investors. 

The webcast/conference call will take place on Wedenesday 17th August, at 12.00
PM GMT.  If you would like to participate in the conference call, please dial
the relevant number below a few minutes before the conference starts: 

- DK: +45 70140453
- UK: +44 (0) 2071086303



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. 35/2011

Issued 17-08-2011


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

Attachments:

35 - 2Q 2011 Condensed Consolidated Interim report 30-06-2011.pdf