Attached files

file filename
EX-31.1 - EX-31.1 - Atlas America Series 27-2006 L.P.d510301dex311.htm
EX-32.1 - EX-32.1 - Atlas America Series 27-2006 L.P.d510301dex321.htm
EXCEL - IDEA: XBRL DOCUMENT - Atlas America Series 27-2006 L.P.Financial_Report.xls
10-K - FORM 10-K - Atlas America Series 27-2006 L.P.d510301d10k.htm
EX-23.1 - EX-23.1 - Atlas America Series 27-2006 L.P.d510301dex231.htm
EX-32.2 - EX-32.2 - Atlas America Series 27-2006 L.P.d510301dex322.htm
EX-31.2 - EX-31.2 - Atlas America Series 27-2006 L.P.d510301dex312.htm

Exhibit 99.1

 

LOGO

March 8, 2013

Atlas Resource Partners, L.P.

3500 Massillon Road

Uniontown, OH 44685

Attention: Mr. Jeffrey C. Simmons

 

  SUBJECT: Evaluation of Various Atlas Partnerships

To the Interests of the Partnerships

Pursuant to the Requirements of the

Securities and Exchange Commission

Effective January 1, 2013

Job 12.1463-A

Wright & Company, Inc. (Wright) has performed an evaluation to estimate proved reserves and associated cash flow and economics from certain properties that are a part of various Atlas Partnerships (Partnerships). This evaluation was authorized by Mr. Jeffrey C. Simmons of Atlas Resource Partners, L.P. (Atlas), the Managing General Partner. Projections of the reserves and cash flow to the evaluated interests were based on specified economic parameters, operating conditions, and government regulations considered applicable at the effective date. This reserves evaluation is pursuant to the financial reporting requirements of the United States (U.S.) Securities and Exchange Commission (SEC) as specified in Regulation S-X, Rule 4-10(a) and Regulation S-K, Rule 1202(a)(8). It is the understanding of Wright that the purpose of this evaluation is for inclusion in relevant registration statements or other filings to the SEC. The effective date of this report is January 1, 2013. The report was completed March 8, 2013. The attached Exhibit A contains a list of the various Partnerships and provides a summary of the results of this report. The properties evaluated in this report are located in Colorado, Indiana, Michigan, New York, Ohio, Pennsylvania, Tennessee, and West Virginia.

Proved oil and gas reserves are those quantities of oil and gas which can be estimated with reasonable certainty to be economically producible under existing economic conditions, operating methods, and government regulations. As specified by the SEC regulations, when calculating economic producibility, the base product price must be the 12-month average price, calculated as the unweighted arithmetic average of the first-day-of-the-month price for each month within the prior 12-month period. The benchmark base prices used for this evaluation were $94.71 per barrel for West Texas Intermediate oil at Cushing, OK, and $2.757 per Million British thermal units (MMBtu) for natural gas at Henry Hub, LA. The price for the Natural Gas Liquids (NGL) is estimated to be approximately 36 percent of the base oil price. These benchmark base prices were adjusted for energy content, quality, and basis differential, as appropriate. The resultant average adjusted product prices can be found in Exhibit A, as appropriate. The product prices and adjustments were held constant for the life of the properties.

Oil and other liquid hydrocarbon volumes are expressed in thousands of U.S. barrels (Mbbl), one barrel equaling 42 U.S. gallons. Gas volumes are expressed in millions of standard cubic feet (MMcf) at 60 degrees Fahrenheit and at the legal pressure base that prevails in the state in which the reserves are located. No adjustment of the individual gas volumes to a common pressure base has been made.

Twelve Cadillac Drive • Suite 260

Brentwood, Tennessee 37027

(615) 370-0755 Fax (615) 370-0756

mail@wrightandcompany.com


Mr. Jeffrey C. Simmons

Atlas Resource Partners, L.P.

March 8, 2013

Page 2

 

Net income to the evaluated interests is the cash flow after consideration of royalty revenue payable to others, standard state and county taxes or fees, operating expenses, and investments, as applicable. The cash flow is before federal income tax (BTAX) and excludes consideration of any encumbrances against the properties if such exist. The Cash Flow (BTAX) was discounted at an annual rate of 10.00 percent (PCT) in accordance with the reporting requirements of the SEC.

The estimates of reserves contained in this report were determined by accepted industry methods, and the procedures used in this evaluation are appropriate for the purpose served by the report. Where sufficient production history and other data were available, reserves for producing properties were determined by extrapolation of historical production or sales trends. Analogy to similar producing properties was used for those properties that lacked sufficient production history to yield a definitive estimate of reserves. Wright has used all methods and procedures as it considered necessary under the circumstances to prepare this report.

Oil and gas reserves were evaluated for the proved developed producing (PDP) and proved developed nonproducing (PDNP) categories. Atlas requested that Wright include summaries of shut-in (PDNP-SI) and temporarily abandoned (PDNP-TA) properties. The summary classification of PDNP includes the PDNP, PDNP-SI, and PDNP-TA categories. The summary classification of total proved reserves combines all of the above categories. In preparing this evaluation, no attempt has been made to quantify the element of uncertainty associated with any category. Reserves were assigned to each category as warranted. Wright is not aware of any local, state, or federal regulations that would preclude Atlas from continuing to produce from currently active wells or to fully develop those properties included in this report.

There are significant uncertainties inherent in estimating reserves, future rates of production, and the timing and amount of future costs. The estimation of oil and gas reserves must be recognized as a subjective process that cannot be measured in an exact way, and estimates of others might differ materially from those of Wright. The accuracy of any reserves estimate is a function of the quantity and quality of available data and of subjective interpretations and judgments. It should be emphasized that production data subsequent to the date of these estimates or changes in the analogous properties may warrant revisions of such estimates. Accordingly, reserves estimates are often different from the quantities of oil and gas that are ultimately recovered.

All data utilized in the preparation of this report were provided by Atlas. No inspection of the properties was made as this was not considered to be within the scope of this evaluation. Wright has not independently verified the accuracy and completeness of information and data furnished by Atlas with respect to ownership interests, oil and gas production or sales, historical costs of operation and development, product prices, or agreements relating to current and future operations and sales of production. Wright requested and received detailed information allowing Wright to check and confirm any calculations provided by Atlas with regard to product pricing, appropriate adjustments, lease operating expenses, and capital investments. Furthermore, if in the course of Wright’s examination something came to our attention that brought into question the validity or sufficiency of any information or data, Wright did not rely on such information or data until we had satisfactorily resolved our questions relating thereto or independently verified such information or data. In accordance with the requirements of the SEC, all operating costs were held constant for the life of the properties.


Mr. Jeffrey C. Simmons

Atlas Resource Partners, L.P.

March 8, 2013

Page 3

 

In accordance with the instructions of Atlas, abandonment costs net of salvage values were included, as appropriate. Wright has not performed a detailed study of the abandonment costs nor the salvage values and offers no opinion as to Atlas’s calculations.

Wright is not aware of any potential environmental liabilities that may exist concerning the properties evaluated. There are no costs included in this evaluation for potential property restoration, liability, or clean up of damages, if any, that may be necessary due to past or future operating practices.

Wright is an independent petroleum consulting firm founded in 1988 and owns no interests in the oil and gas properties covered by this report. No employee, officer, or director of Wright is an employee, officer, or director of the Partnerships or Atlas, nor does Wright or any of its employees have direct financial interest in the Partnerships or Atlas. Neither the employment of nor the compensation received by Wright is contingent upon the values assigned or the opinions rendered regarding the properties covered by this report.

This report is prepared for the information of the Partnerships, their investors, and for the information and assistance of its independent public accountants in connection with their review of and report upon the financial statements of the Partnerships, and for reporting disclosures as required by the SEC. This report is also intended for public disclosure as an exhibit in filings made to the SEC by the Partnerships.

Based on data and information provided by Atlas, and the specified economic parameters, operating conditions, and government regulations considered applicable at the effective date, it is Wright’s conclusion that this report provides a fair and accurate representation of the oil and gas reserves to the interests of the Partnerships in those certain properties included in this report.

The professional qualifications of the petroleum consultants responsible for the evaluation of the reserves and economics information presented in this report meet the standards of Reserves Estimator as defined in the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information as promulgated by the Society of Petroleum Engineers.

It has been a pleasure to serve you by preparing this evaluation. All related data will be retained in our files and are available for your review.

 

Very truly yours,
Wright & Company, Inc.
By:   /s/ D. Randall Wright
 

D. Randall Wright

President


 

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EXHIBIT A

Job 12.1463-A

 

Partner        Average Adjusted
Product Prices
    Total Proved
Net Reserves
    Cash Flow     10.00 PCT
Cum. Disc.
 

ID No.

  

Partnership

  Oil, Mbbl     Gas, MMcf     NGL, Mbbl     Oil, Mbbl     Gas, MMcf     NGL, Mbbl     (BTAX), M$     (BTAX), M$  
100918    ATLAS RESOURCES SERIES 28 2010 LP     0.00        2.814        0.00        0.000        51,991.395        0.000        82,667.961        43,311.387   
100938    ATLAS RESOURCES PUBLIC #18-2009 (C) LP     0.00        2.902        0.00        0.000        56,701.488        0.000        98,897.484        51,013.754   
100939    ATLAS RESOURCES PUBLIC #18-2009 (B) LP     92.45        2.898        37.88        20.532        18,465.889        57.633        30,417.539        15,498.909   
100940    ATLAS RESOURCES PUBLIC #18-2008 (A) LP     92.43        2.957        37.88        36.833        10,176.641        106.740        12,986.924        7,716.649   
100941    ATLAS RESOURCES PUBLIC #17-2008 (B) LP     86.25        2.834        37.88        83.869        9,580.135        2.281        12,825.501        8,194.735   
100942    ATLAS RESOURCES PUBLIC #17-2007 (A)     87.95        2.805        0.00        16.557        6,617.360        0.000        5,576.529        3,993.370   
100943    ATLAS AMERICA SERIES 27-2006 L.P.     90.18        2.823        0.00        6.114        1,621.353        0.000        1,227.600        958.323   
100944    ATLAS AMERICA PUB #16-2007     87.40        2.783        0.00        45.656        7,653.113        0.000        8,233.697        5,564.106   
100945    ATLAS AMERICA PUB #15-2006 (B)     89.02        2.816        0.00        8.762        4,522.478        0.000        3,790.043        2,700.929   
100946    ATLAS AMERICA PUB #15-2005 (A)     90.12        2.897        0.00        3.043        754.774        0.000        612.094        493.984   
100947    ATLAS AMERICA SERIES 26-2005     92.51        2.888        0.00        12.259        1,002.479        0.000        1,106.855        837.093   
100948    ATLAS AMERICA PUB #14-2005 (A)     92.50        2.829        0.00        18.231        1,435.287        0.000        1,511.365        1,143.885   
100949    ATLAS AMERICA PUB #14-2004 LTD     91.99        2.714        0.00        5.660        879.898        0.000        610.627        510.266   
100959    ATLAS AMERICA SERIES 25-2004A     92.51        2.881        0.00        3.180        625.072        0.000        419.838        361.807   
100976    ATLAS AMERICA PUB. #11-2002 LTD     92.51        2.879        0.00        2.845        330.582        0.000        191.095        167.105   
100992    ATLAS AMERICA PUB #12-2003 LTD     92.51        2.968        0.00        0.186        588.310        0.000        318.872        261.117   
100993    ATLAS AMERICA SERIES 25-2004B     90.90        2.889        0.00        2.112        1,082.982        0.000        993.490        673.261   
100996    ATLAS AMERICA PUBLIC 9 LTD     92.51        3.075        0.00        5.261        402.871        0.000        314.687        259.426   
100998    ATLAS AMERICA PUBLIC 10 LTD     92.51        3.016        0.00        4.879        891.899        0.000        591.735        469.278   

Please note numbers in table may not add due to rounding techniques in the ARIESTM petroleum software program.


Professional Qualifications

D. Randall Wright

President

I, D. Randall Wright, am the primary technical person in charge of the estimates of reserves and associated cash flow and economics on behalf of Wright & Company, Inc. (Wright) for the results presented in this report to Atlas Resource Partners, L.P. I have a Master of Science degree in Mechanical Engineering from Tennessee Technological University.

I am a qualified Reserves Estimator as set forth in the “Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information” promulgated by the Society of Petroleum Engineers. This qualification is based on more than 38 years of practical experience in the estimation and evaluation of petroleum reserves with Texaco, Inc., First City National Bank of Houston, Sipes, Williamson & Associates, Inc., Williamson Petroleum Consultants, Inc., and Wright which I founded in 1988.

I am a registered Professional Engineer in the state of Texas (TBPE #43291), granted in 1978, a member of the Society of Petroleum Engineers (SPE) and a member of the Order of the Engineer.

 

/s/ D. Randall Wright
D. Randall Wright, P.E.

 

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DEFINITIONS OF OIL AND GAS RESERVES

Wright & Company, Inc. frequently prepares estimates of oil and gas reserves. Such reserves estimates usually include quantities which are represented as “proved” and, depending upon the data base and/or the desire of the client, may include additional reserves which are classified as “unproved”. The scope of the analyses may also incorporate “contingent resources”. These definitions as presented are an abridged version of the disclosure guidelines as set forth by the Securities and Exchange Commission (SEC) Rule 4-10(a) (1)-(32) of Regulation S-X and the Modernization of Oil and Gas Reporting, Final Rule dated January 14, 2009 in the Federal Register. The definitions of oil and gas reserves used by Wright & Company, Inc. are briefly set forth below.

RESERVES are estimated remaining quantities of oil and gas and related substances anticipated to be economically producible as of a given date, by application of development projects to known accumulations. In addition, there must exist, or there is a reasonable expectation that there will exist, the legal right to produce or a revenue interest in the production, installed means of delivering oil and gas or related substances to market, and all permits and financing required to implement project.

PROVED OIL AND GAS RESERVES are those quantities of oil and gas, which by analysis of geoscience and engineering data can be estimated with reasonable certainty to be economically producible from a given date forward from known reservoirs and under existing economic conditions, operating methods, and government regulation. The area of the reservoir considered as proved includes, but is not necessarily limited to, the area identified by drilling and limited by fluid contacts, if any, and adjacent undrilled portions of the reservoir that can, with reasonable certainty, be judged to be continuous with it and to contain economically producible oil or gas on the basis of available geoscience and engineering data.

In the absence of data on fluid contacts, proved quantities in a reservoir are limited by the lowest known hydrocarbons unless geoscience, engineering, or performance data and reliable technology establish a lower contact with reasonable certainty.

Reserves that can be produced economically through application of improved recovery techniques are included in the proved classification when both the following occur: (i) successful testing by a pilot in an area of the reservoir with properties no more favorable than in the reservoir as a whole, or the operation of an installed program in the reservoir or an analogous reservoir, or other evidence using reliable technology establishes the reasonable certainty of the engineering analysis on which the project or program is based and, (ii) the project has been approved for development by all necessary parties and entities, including governmental entities.

Existing economic conditions include prices and costs at which the economic producibility of a reservoir is to be determined. The base product price shall be the 12-month average price, calculated as the unweighted arithmetic average of the first-day-of-the-month price for each month within the prior 12-month period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions.

PROVED DEVELOPED OIL AND GAS RESERVES are proved reserves that can be expected to be recovered through existing wells with existing equipment and operating methods or in which the cost of the required equipment is relatively minor compared to the cost of a new well or through installed extraction equipment and infrastructure operational at the time of the reserves estimate if the extraction is by means not involving a well.

PROVED UNDEVELOPED OIL AND GAS RESERVES are proved reserves that are expected to be recovered from new wells on undrilled acreage, or from existing wells where a relatively major expenditure is required for recompletion. Reserves on undrilled acreage shall be limited to those offsetting development spacing areas that are reasonably certain of production when drilled, unless evidence using reliable technology exists that establishes reasonable certainty of economic producibility at greater distances. Undrilled locations can be classified as having undeveloped reserves only if a development plan has been adopted indicating that they are scheduled to be drilled within five years, unless the specific circumstances justify a longer time.

ANALOGOUS RESERVOIRS have similar rock and fluid properties, reservoir conditions and drive mechanisms, but one typically at a more advanced stage of development than the reservoir of interest and this may provide concepts to assist in the interpretation of more limited data and estimation recovery.

REASONABLE CERTAINTY means a higher degree of confidence that the quantities will be recovered. A high degree of confidence exists if the quantity is much more likely to be achieved than not and, as changes due to increased availability of geoscience (geological, geophysical, and geomechanical), engineering, and economic data are made to estimated ultimate recovery (EUR) with time, reasonably certain EUR is much more likely to increase or remain constant than to decrease.

RELIABLE TECHNOLOGY is a grouping of one or more technologies (including computerized methods) that have been field tested and have demonstrated to provide reasonably certain results with consistency and repeatability in the formation being evaluated or in an analogous formation.

PROBABLE reserves are those additional reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely to be recovered as not. Probable reserves estimates also include potential incremental quantities associated with a greater percentage recovery of the hydrocarbons in place than assumed for proved reserves.

POSSIBLE reserves are those additional reserves that are less certain to be recovered than probable reserves. Portions of the reservoir that do not meet the reasonable certainty criterion may be assigned probable and possible oil and gas reserves based on reservoir fluid properties and pressure gradient interpretations.

Wright & Company, Inc. may separate proved developed reserves into proved developed producing and proved developed non-producing reserves. This is to identify proved developed producing reserves as those to be recovered from actively producing wells. Proved developed nonproducing reserves are those to be recovered from wells or intervals within wells, which are completed but shut-in waiting on equipment or pipeline connections, or wells where a relatively minor expenditure is required for recompletion to another zone.

 

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