The last couple of days have been huge for ATP. On Monday, the company announced that it has started production on the 2nd Telemark Well. The results from the well are expected to exceed the management’s initial expectations. The management had expected production of 7-10K from the well. The first zone of the well is producing 7K and management expects that once the second zone is in production, the total production will exceed the expectation of 10K. This is a huge event for the company and will create substantial cash flow for the company.
Today, the government announced that they have lifted the ban on the GOM drilling. This is good news for the GOM drillers, although I expect getting permits for drilling will take much longer than before and the costs will be higher.
The promotional management team of ATP will be at its usually on Wednesday. The company will be presenting at IPAA conference will discuss the production increase, liquidity, and update on reserves. I expect the shares to keep move up as once the presentation is make public.
The shares have moved up almost 20% in the last 2 days. I expect substantial more increase to come as shorts look to cover and cash flow projections show that the company will not have liquidity issues.