SOURCE: Atlas Energy Resources, LLC

February 21, 2008 07:00 ET

Atlas Energy Resources, LLC Increases Estimated Reserve Potential From the Marcellus Shale to Between 4 and 6 Tcf Due to Continued Drilling Success

PITTSBURGH, PA--(Marketwire - February 21, 2008) - Atlas Energy Resources, LLC (NYSE: ATN) ("Atlas Energy" or "the Company") announces continued drilling success in the Marcellus Shale. To date, Atlas Energy has drilled 27 vertical wells and is currently producing 21 wells into a pipeline. The remaining 6 wells are scheduled to be completed and turned into line shortly.

Atlas Energy currently controls approximately 483,000 Marcellus acres in Pennsylvania, New York and West Virginia and continues to aggressively add to its position. The Company is currently focused on its approximately 224,000 existing Marcellus acres in southwestern Pennsylvania, where it has drilled all but one of its Marcellus wells and has now, through this drilling, largely delineated its acreage. Almost all of this acreage in southwestern Pennsylvania has ample pipeline capacity that is controlled by Atlas Energy's affiliate, Atlas Pipeline Partners, L.P. (NYSE: APL).

Wright & Company, Inc., the Company's independent petroleum engineering consultants, has evaluated Atlas Energy's first 14 southwestern Pennsylvania Marcellus wells and assigned proved reserves that averaged 961 million cubic feet ("Mmcf") per well. These wells included 5 initial wells where the Company utilized first generation completion techniques. For the 9 subsequent wells where Atlas Energy implemented its advanced drilling, completion and production techniques, Wright & Company assigned reserves that averaged 1.3 billion cubic feet ("Bcf") per well and were as high as 1.8 Bcf. These results imply finding and development costs of approximately $1.00 per thousand cubic feet ("mcf").

Since implementing the advanced drilling, completion and production techniques, Atlas Energy's initial daily rates (24 hours) into a pipeline have averaged 1.3 Mmcf per day, and have been as high as 2.6 Mmcf per day, in southwestern Pennsylvania. Based on published reports, to the Company's knowledge, these are the best initial daily production rates of any vertical wells in the Marcellus play. In response to these results, Atlas Energy plans to drill and complete at least 150 vertical Marcellus Shale wells over the next 18 months.

After reviewing the effective length of its fracs, the Company believes that it will be able to develop its southwestern Pennsylvania Marcellus acreage through vertical drilling on approximately 40-acre spacing. As a result, the Company believes it has between 4,000 and 6,000 potential vertical drilling locations in southwestern Pennsylvania which, after factoring in the average results of its Marcellus drilling to date, represent between 4 trillion cubic feet ("Tcf") and 6 Tcf of potential natural gas reserves.

Atlas Energy has drilled one horizontal well in southwestern Pennsylvania with an industry partner and plans to drill at least 4 additional horizontal wells during the remainder of 2008.

"The results of our vertical Marcellus program are very gratifying and we believe validate the exceptional quality of our acreage position and expertise of our operating team," stated Richard D. Weber, President and Chief Operating Officer of Atlas Energy. "While the finding and development costs of our vertical drilling program compares favorably with the reported results from horizontal drilling of other shale operators in the Appalachian Basin and elsewhere, we believe that our horizontal drilling program has the potential to even further enhance our economic returns from the Marcellus Shale."

Atlas Energy will release its results for the fourth quarter 2007 today after market hours, and invites investors and other interested parties to listen to the live webcast of its quarterly conference call on Friday, February 22, 2008, at 9:00 a.m. Eastern Time. This call is being webcast live and can be accessed by investors and other interested parties from the Investor Relations section of Atlas Energy's website at www.atlasenergyresources.com. For those unavailable to listen to the live broadcast, the replay of the webcast will be available following the live call on the Atlas Energy Resources website and telephonically beginning at 11:00 a.m. ET on February 22, 2008 by dialing 888-286-8010, passcode: 72776757.

Atlas Energy Resources, LLC develops and produces domestic natural gas and to a lesser extent, oil. Atlas Energy is one of the largest independent energy producers in the Appalachian Basin and northern Michigan. Atlas Energy sponsors and manages tax-advantaged investment partnerships, in which it co-invests, to finance the exploration and development of the Company's acreage in the Appalachian Basin. Atlas Energy is active principally in Pennsylvania, Michigan and Tennessee. For more information, visit Atlas Energy's website at www.atlasenergyresources.com or contact investor relations at bbegley@atlasamerica.com.

Atlas America, Inc. (NASDAQ: ATLS) owns an approximate 64% limited partner interest in Atlas Pipeline Holdings, L.P. (NYSE: AHD), which holds the general partner interest and 5.5 million limited partner units of Atlas Pipeline Partners, L.P. (NYSE: APL), and an approximate 48% common unit interest and all of the Class A and management incentive interests in Atlas Energy Resources, LLC. For more information, please visit our website at www.atlasamerica.com, or contact Investor Relations at bbegley@atlasamerica.com.

Certain matters discussed within this press release are forward-looking statements. Although Atlas Energy believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from expectations include natural gas and oil prices, industry conditions, drilling results, mechanical and other inherent risks associated with gas and oil production, uncertainties in estimating reserves, uncertainties in estimating future production, availability of drilling rigs and other services and other factors detailed in reports Atlas Energy has filed or may file with the Securities and Exchange Commission.

The SEC has generally permitted oil and gas companies, in filings made with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use the term "potential" to describe volumes of reserves potentially recoverable through additional drilling or recovery techniques that the SEC's guidelines may prohibit us from including in filings with the SEC. These estimates are by their nature more speculative than estimates of proved reserves and, accordingly, are subject to substantially greater risk of being actually realized by Atlas Energy. While we believe our calculations of potential drill sites and estimation of potential reserves are reasonable, such calculations and estimates have not been reviewed by our independent petroleum engineering consultants.

Contact Information

  • CONTACT:
    Brian J. Begley
    Investor Relations
    Atlas Energy Resources, LLC
    1845 Walnut Street
    Philadelphia, PA 19103
    215/546-5005
    215/553-8455 (fax)