Atlas Pipeline Partners, L.P. Accelerates Growth, Adds Margin Protection And Confirms Guidance -- Announces acceleration of WestTX 200 mmcfd Driver expansion to early 2013

-- Partnership enters into long-term POP deal with largest producer in Mississippi Lime formation

-- Reaffirms 2013 Adjusted EBITDA guidance of $310-360 Million

PHILADELPHIA, Jan. 14, 2013 /PRNewswire/ -- Atlas Pipeline Partners, L.P. (NYSE: APL) ("APL", "Atlas Pipeline", or the "Partnership") announced today that the Partnership is updating the timing of its WestTX expansion, the 200 Million cubic feet per day ("mmcfd") Driver cryogenic processing facility.  This facility was originally expected to come online in two phases with phase one online in 1Q'13 and phase two online in 1Q'14, with each phase consisting of 100 mmcfd of processing capacity.  The Driver facility is now expected to have the entire 200 mmcfd come online by the end of the first quarter or early second quarter of 2013.  Based on the continued volume growth from the Partnership's producer customers in the Permian Basin, management expects to utilize approximately 60% of the Driver facility's capacity at start-up and anticipates steady growth in volumes throughout the year.

Management is also pleased to announce that the Partnership has entered into a new contract with SandRidge Energy, Inc. ("SandRidge") (NYSE: SD).  SandRidge is currently the Partnership's largest producer customer in the Mississippian Lime.  The new agreement, a five year contract commencing January 1, 2013, is extendable at the option of SandRidge to a nine year term if a minimum level of throughput volume is met.  It is a percent-of-proceeds (POP) contract, complimented by additional fixed-fee gathering cash flow associated with underlying throughput volumes from SandRidge.  At the termination of the existing contract, all volumes under that agreement will be transferred to this new agreement, materially reducing the Partnership's keep-whole exposure.  In addition to the extension in tenor from the previous contract, SandRidge has agreed to dedicate three additional areas in Southern Kansas, including Harper, Sumner, and Cowley counties.  Including the originally dedicated areas within SandRidge's Oklahoma Mississippian position, the new agreement now includes the majority of SandRidge's developed acreage within the burgeoning Mississippi Lime formation.

"We are pleased to be announcing a new long term agreement with a key producer in the Mississippi Lime as well as the acceleration of the start of the full Driver plant in West Texas within the next couple of months.  These positive developments will secure future growth through our growing relationships with our producer customers.  Accordingly, we have added a significant amount of further protection through our risk management program that will preserve margin over the next several years.  We will continue to pursue additional value creation opportunities for the long term for our customers, stakeholders, and employees", stated Eugene Dubay, Chief Executive Officer of the Partnership.

As a result of this new POP agreement with SandRidge, the Partnership has added significant natural gas protection to its risk management portfolio, as well as continuing to elongate the program and adding further margin protection through hedging activities.  Atlas Pipeline now has 76% of expected 2013 margin protected (ex-ethane) and a full table of risk management positions is included at the end of this release. 

The Partnership is reaffirming its guidance for 2013 for Adjusted EBITDA of $310 - $360 Million based on current commodity prices and management's volume expectations.  These forecasted amounts are based on various assumptions, including, among others, the Partnership's expected cost and timing for completion of its announced capital expenditure program, timing of incremental volumes on its gathering and processing systems, known contract structures, scheduled maintenance of facilities including those of third-parties that impact the Partnership's operations, estimated interest rates, and budgeted operating and general administrative costs. Management does not forecast certain items, including GAAP revenues, depreciation, amortization, and non-cash changes in derivatives, and therefore is unable to provide forecasted Net Income, a comparable GAAP measure, for the periods presented. The reconciling items between these non-GAAP measures and Net Income are expected to be similar to those for the most recently completed quarterly period and are not expected to be significant to the Partnership's cash flows.

ATLAS PIPELINE PARTNERS, L.P. AND SUBSIDIARIES

Unaudited Current Commodity Risk Management Positions

(as of January 9, 2013)



Note: The natural gas, natural gas liquid and condensate price risk management positions shown below represent the contracts in place through December 31, 2015. NGL contracts are traded at Mt. Belvieu unless otherwise disclosed.



SWAP CONTRACTS



NATURAL GAS HEDGES








Production Period

Purchased /Sold

Commodity

MMBTUs

Avg. Fixed Price


2Q 2013

Sold

Natural gas

600,000

3.43


3Q 2013

Sold

Natural gas

600,000

3.52


4Q 2013

Sold

Natural gas

1,000,000

3.60


1Q 2014

Sold

Natural gas

1,350,000

3.90


2Q 2014

Sold

Natural gas

2,350,000

3.86


3Q 2014

Sold

Natural gas

2,350,000

3.89


4Q 2014

Sold

Natural gas

2,350,000

3.96


1Q 2015

Sold

Natural gas

1,000,000

4.24


2Q 2015

Sold

Natural gas

1,000,000

4.00


3Q 2015

Sold

Natural gas

1,000,000

4.06


4Q 2015

Sold

Natural gas

1,000,000

4.23



NATURAL GAS LIQUIDS HEDGES




Production Period

Purchased /Sold

Commodity

Gallons

Avg. Fixed Price


1Q 2013

Sold

Propane - Conway

3,780,000

0.94


1Q 2013

Sold

Propane

9,072,000

1.22


1Q 2013

Sold

Isobutane

504,000

1.86


1Q 2013

Sold

Normal butane

1,134,000

1.66


2Q 2013

Sold

Propane - Conway

1,260,000

1.06


2Q 2013

Sold

Propane

10,836,000

1.27


2Q 2013

Sold

Isobutane

630,000

1.77


2Q 2013

Sold

Normal butane

1,260,000

1.66


3Q 2013

Sold

Propane - Conway

1,260,000

1.06


3Q 2013

Sold

Propane

11,718,000

1.28


4Q 2013

Sold

Propane - Conway

1,260,000

1.06


4Q 2013

Sold

Propane

12,222,000

1.28


1Q 2014

Sold

Propane

6,930,000

1.02


1Q 2014

Sold

Natural gasoline

1,260,000

2.08


2Q 2014

Sold

Propane

3,780,000

1.00


2Q 2014

Sold

Normal butane

1,260,000

1.50


2Q 2014

Sold

Natural gasoline

2,520,000

1.92


3Q 2014

Sold

Propane

3,780,000

1.00


3Q 2014

Sold

Normal butane

1,260,000

1.50


3Q 2014

Sold

Natural gasoline

1,890,000

1.92


4Q 2014

Sold

Propane

3,780,000

1.00


4Q 2014

Sold

Normal butane

1,260,000

1.53


4Q 2014

Sold

Natural gasoline

1,890,000

1.93


1Q 2015

Sold

Natural gasoline

630,000

1.97


2Q 2015

Sold

Natural gasoline

630,000

1.97


3Q 2015

Sold

Natural gasoline

630,000

1.97


4Q 2015

Sold

Natural gasoline

630,000

1.97



CONDENSATE HEDGES




Production Period

Purchased /Sold

Commodity

Barrels

Avg. Fixed Price


1Q 2013

Sold

Crude

93,000

97.49


2Q 2013

Sold

Crude

99,000

97.33


3Q 2013

Sold

Crude

78,000

97.08


4Q 2013

Sold

Crude

75,000

96.66


1Q 2014

Sold

Crude

78,000

95.49


2Q 2014

Sold

Crude

75,000

93.12


3Q 2014

Sold

Crude

75,000

89.86


4Q 2014

Sold

Crude

30,000

88.09


OPTION CONTRACTS


NGL OPTIONS


Production Period

Purchased/Sold

Type

Commodity

Gallons

Avg. Strike Price

1Q 2013

Purchased

Put

Isobutane

504,000

1.79

1Q 2013

Purchased

Put

Normal Butane

1,512,000

1.74

1Q 2013

Purchased

Put

Natural Gasoline

5,292,000

2.15

2Q 2013

Purchased

Put

Isobutane

630,000

1.72

2Q 2013

Purchased

Put

Normal Butane

1,638,000

1.66

2Q 2013

Purchased

Put

Natural Gasoline

5,796,000

2.10

3Q 2013

Purchased

Put

Isobutane

1,512,000

1.66

3Q 2013

Purchased

Put

Normal Butane

3,528,000

1.64

3Q 2013

Purchased

Put

Natural Gasoline

6,300,000

2.09

4Q 2013

Purchased

Put

Isobutane

1,512,000

1.66

4Q 2013

Purchased

Put

Normal Butane

3,780,000

1.66

4Q 2013

Purchased

Put

Natural Gasoline

6,552,000

2.09


CRUDE OPTIONS


Production Period

Purchased/Sold

Type

Commodity

Barrels

Avg. Strike Price

1Q 2013

Purchased

Put

Crude Oil

66,000

100.10

2Q 2013

Purchased

Put

Crude Oil

69,000

100.10

3Q 2013

Purchased

Put

Crude Oil

72,000

100.10

4Q 2013

Purchased

Put

Crude Oil

75,000

100.10

1Q 2014

Purchased

Put

Crude Oil

166,500

101.86

2Q 2014

Purchased

Put

Crude Oil

45,000

88.18

3Q 2014

Purchased

Put

Crude Oil

60,000

88.85

4Q 2014

Purchased

Put

Crude Oil

90,000

91.56

1Q 2015

Purchased

Put

Crude Oil

15,000

91.00

2Q 2015

Purchased

Put

Crude Oil

15,000

90.25

3Q 2015

Purchased

Put

Crude Oil

15,000

89.85

4Q 2015

Purchased

Put

Crude Oil

15,000

89.35

Atlas Pipeline Partners, L.P. (NYSE: APL) is active in the gathering and processing segments of the midstream natural gas industry.  In Oklahoma, southern Kansas, northern and western Texas, and Tennessee, APL owns and operates 12 active gas processing plants, 18 gas treating facilities as well as approximately 10,100 miles of active intrastate gas gathering pipeline.  APL also has a 20% interest in West Texas LPG Pipeline Limited Partnership, which is operated by Chevron Corporation. For more information, visit the Partnership's website at www.atlaspipeline.com or contact IR@atlaspipeline.com.

Atlas Energy, L.P. (NYSE: ATLS) is a master limited partnership which owns and operates the general partner of its midstream oil & gas subsidiary, Atlas Pipeline Partners, L.P., through all of the general partner interest, all the incentive distribution rights and an approximate 9% limited partner interest. Additionally, Atlas Energy owns all of the general partner Class A units and incentive distribution rights and an approximate 44% limited partner interest in its upstream oil & gas subsidiary, Atlas Resource Partners, L.P.  For more information, please visit the Partnership's website at www.atlasenergy.com, or contact Investor Relations at InvestorRelations@atlasenergy.com.

Certain matters discussed within this press release are forward-looking statements. Although Atlas Pipeline Partners, L.P. 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. Atlas Pipeline does not undertake any duty to update any statements contained herein (including any forward-looking statements), except as required by law. Factors that could cause actual results to differ materially from expectations include general industry considerations, regulatory changes, changes in commodity process and local or national economic conditions and other risks detailed from time to time in Atlas Pipeline's reports filed with the SEC, including quarterly reports on Form 10-Q, reports on Form 8-K and annual reports on Form 10-K.

Contact:

Matthew Skelly


Vice President


Investor Relations


1845 Walnut Street


Philadelphia, PA 19103


(877) 950-7473


(215) 561-5692 (facsimile)

SOURCE Atlas Pipeline Partners, L.P.



RELATED LINKS
http://www.atlaspipeline.com
http://www.atlasenergy.com

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