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Atlas Pipeline Partners, L.P. (APL)
Q1 2010 Earnings Call
May 05, 2010 9:00 AM ET
Brian Begley - VP, IR
Gene Dubay - President & CEO
Glenn Powell - COO
Eric Kalamaras - CFO
John Tysseland - Citi
Sharon Lui - Wells Fargo
» Lancashire Holdings Limited Q1 2010 Earnings Call Transcript
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Thank you. Good morning and thank you for joining us for today’s call. Before our management team provides comments on our first quarter results, I’d like to remind everyone of the following safe harbor provision.
During this conference call we may make certain forward-looking statements, that is statements related to future and not past events and in this context forward-looking statements often address our expected future business and financial performance and financial condition often contains and often the same words such as expects, anticipates, intends, believes, and similar words or phrases.
The forward-looking statements by their nature address matters that are to different degrees uncertain and are subject to certain risks and uncertainties which could cause actual events and results to differ materially from those projected in the forward-looking statements. We discussed these risks in our quarterly report on Form 10-Q and our Annual Report also on Form 10-K, particularly in Item 1.
And I also like to caution you not to place undue reliance on these forward-looking statements which reflect management’s analysis only as of the date hereof. The company undertakes no obligations to publicly update our forward-looking statements or to publicly release the results of any revisions to forward-looking statements which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
And lastly, managements presentation this morning includes references to such items as adjusted EBITDA and recurring adjusted EBITDA, as well as attributable cash flow which represents non-GAAP measures, a reconciliation of these non-GAAP measures is provided in our financial tables of our first quarter earnings release as well as our Form 10-Q.
With that, I’ll turn the call over to our Chief Executive Officer, Gene Dubay’s remarks.
Thank you, Brian. Ladies and gentlemen, thank you for your participation and your interest in Atlas Pipeline Partners. Since our last call this past January, there have been a number of very positive developments for Atlas Pipeline. The announced joint venture encompassing Atlas Energy and Reliance Industries has tremendous positive implications for Atlas Pipeline. We expect that the new drilling program will bring volumes to the infrastructure earlier and more robustly than we would have otherwise seen.
Result for Atlas Pipeline is that we will have a major position and what is certainly the most significant gas development play in lower continental United States. The potential for growth for Laurel Mountain joint venture with Williams should surpass anything we’ve experienced.
We are enormously pleased that across our field operating areas we saw a significant increase in drilling activity in the first quarter and the result of that activity will become evident in the second quarter and beyond. Our core acreage positions in Oklahoma and Texas are in liquids rich areas that are the focus of the exploration and production companies development activities and in West Texas our consolidated plan, which became operational in November continues to operate at or above our expectations.
Our Chief Operating Officer, Glenn Powell will speak to you shortly in greater detail about the activity we are seeing in each of our operating areas and the volumes gathered and processed in each of those areas. Though we are generally pleased with the operating results of the first quarter those results were adversely influenced by the colder than normal winter weather which affected operations across Oklahoma and West Texas.
Our financial results were also negatively impacted by the legacy commodity positions that we have spoken to you about previously, but the second quarter is the last quarter for which we have significant exposure to the legacy commodity positions. We will begin the third quarter without the encumbrances of prior hedging decisions. We have made a great deal of progress in the past year and we believe that we could not choose better operating areas for our gathering and processing business.
Certainly challenges remain; we need to manage our business, so that we can take advantage of the opportunities which are presenting themselves to us in the Marcellus and mid-continent areas. We’ll need to improve our balance and begin a distribution. We believe that this business will flourish if we maintain our focus and the necessary discipline in our decision making and we will do that. Our vision anticipates that we will grow this business in a manner that overwhelmingly benefits our equity investors and the shares returns of our debt holders.
I’m now going to ask Glenn Powell, our Chief Operating Officer to talk you about the performance of each business unit. Thank you.
Thank you, Gene. The announcement concerning the Atlas Energy joint venture with Reliance and the increased drilling activity in all of our operating areas, will lead to volume growth in the periods ahead. During the first quarter we have seen increases in rig activity in the Sprayberry and in the Granite Wash. We have also seen steady improvement in the number of rigs working in all of our operating areas. The success from running our mid-continent assets is efficiently and as reliably as possible allowed us to transport approximately 787 million cubic feet of natural gas per day and produced approximately 54,100 barrels per day of NGLs.