HOUSTON, Sept. 30 /PRNewswire-FirstCall/ -- W&T Offshore, Inc. (NYSE: WTI) today announced its update on the impact of Hurricanes Gustav and Ike on its operations in the Gulf of Mexico. Two operated and nine non-operated platforms sank, including the operated Eugene Island 371 "B" and Eugene Island 397 "A" platforms (in which we have a 50% working interest in each such operated platform). The Company is currently evaluating its alternatives for those facilities including utilizing other platforms. Production associated with these platforms prior to the hurricane was approximately 7.5 MMcfe per day, net to our interest. All other operated structures inspected by air or by physical inspection appear to be intact, but some have incurred damage. The Company has begun the remediation process.
The Company is currently producing 72 MMcfe net per day (2,264 barrels per day and 58 MMcfe per day). Based on current production rates and actual production thus far in the quarter we believe that our production for the third quarter of 2008 will be between 19 Bcfe and 21 Bcfe. In addition to addressing the damage to our facilities, in order to increase production above current levels, we are dependent on the completion of repairs to third party owned pipelines and processing facilities that carry or process our production. Although we are working diligently to increase our production, at this time our production for the fourth quarter and therefore full year of 2008 is not determinable with any certainty. We intend to provide an update of the hurricane impact and production guidance for the fourth quarter of 2008 in connection with our third quarter 2008 earnings release.
Prior to Hurricanes Gustav and Ike we had eight rigs drilling and have been able to recommence drilling operations at seven of the eight locations thus far.
W&T maintains adequate insurance coverage for property damage due to named windstorms. Our insurance policy has a retention of $10 million. The Company does not carry business interruption insurance.
The Company will continue to provide additional information and guidance as to the impact from Hurricanes Gustav and Ike as it becomes available.
About W&T Offshore
Founded in 1983, W&T Offshore is an independent oil and natural gas company focused primarily in the Gulf of Mexico, including exploration in the deepwater and deep shelf regions, where it has developed significant technical expertise. W&T has grown through acquisition, exploitation and exploration and now holds working interests in over 155 fields in federal and state waters and a majority of its daily production is derived from wells it operates. For more information on W&T Offshore, please visit its Web site at www.wtoffshore.com.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements reflect our current views with respect to future events, based on what we believe are reasonable assumptions. No assurance can be given, however, that these events will occur. These statements are subject to risks and uncertainties that could cause actual results to differ materially including, among other things, market conditions, oil and gas price volatility, uncertainties inherent in oil and gas production operations and estimating reserves, unexpected future capital expenditures, competition, the success of our risk management activities, governmental regulations, uncertainties and other factors discussed in our Annual Report on 10-K for the year ended December 31, 2007 (www.sec.gov).
Manuel Mondragon, Vice President of Finance
Ken Dennard / firstname.lastname@example.org
Lisa Elliott / email@example.com
DRG&E / 713-529-6600
SOURCE W&T Offshore, Inc.