10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2008

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 000-32261

ATP OIL & GAS CORPORATION

(Exact name of registrant as specified in its charter)

Texas	76-0362774
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

4600 Post Oak Place, Suite 200

Houston, Texas 77027

(Address of principal executive offices)

(Zip Code)

(713) 622-3311

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x    No  ¨

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  ¨    No  x

The number of shares outstanding of the issuer’s common stock, par value $0.001, as of November 3, 2008, was 35,897,830.

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
Consolidated Balance Sheets: September 30, 2008 and December 31, 2007	3
Consolidated Statements of Operations: For the three and nine months ended September 30, 2008 and 2007	4
Consolidated Statements of Cash Flows: For the nine months ended September 30, 2008 and 2007	5
Consolidated Statements of Comprehensive Income: For the three and nine months ended September 30, 2008 and 2007	6
Notes to Consolidated Financial Statements	7
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	18
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS	28
ITEM 4. CONTROLS AND PROCEDURES	30
PART II. OTHER INFORMATION	31

2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Share and Per Share Amounts)

(Unaudited)

	September 30,			December 31,
	2008			2007
Assets
Current assets:
Cash and cash equivalents	$	178,358		$	199,449
Restricted cash		—			13,981
Accounts receivable (net of allowance of $358 and $382, respectively)		44,460			127,891
Deferred tax asset		45,049			84,110
Derivative asset		1,409			1,286
Other current assets		12,582			15,934
Total current assets		281,858			442,651
Oil and gas properties (using the successful efforts method of accounting):
Proved properties		3,026,918			2,468,523
Unproved properties		141,001			88,415
		3,167,919			2,556,938
Less accumulated depletion, impairment and amortization		(931,092	)		(726,358	)
Oil and gas properties, net		2,236,827			1,830,580
Furniture and fixtures (net of accumulated depreciation)		589			860
Derivative asset		431			673
Deferred tax asset		19,841			—
Deferred financing costs, net		14,504			19,873
Other assets		17,741			12,496
Total assets	$	2,571,791		$	2,307,133
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable and accruals	$	220,317		$	270,557
Current maturities of long-term debt		10,500			12,165
Asset retirement obligation		19,075			28,194
Derivative liability		32,659			11,335
Other current liabilities		14,164			23,512
Total current liabilities		296,715			345,763
Long-term debt		1,598,392			1,391,846
Asset retirement obligation		167,778			158,577
Deferred tax liability		83,814			85,256
Derivative liability		12,185			13,242
Deferred revenue		62,549			—
Other liabilities		2,582			2,583
Total liabilities		2,224,015			1,997,267
Commitments and contingencies (Note 10)
Shareholders’ equity:
Preferred stock: $0.001 par value, 10,000,000 shares authorized; none issued		—			—
Common stock: $0.001 par value, 100,000,000 shares authorized; 35,973,670 issued and 35,897,830 outstanding at September 30, 2008; 35,808,188 issued and 35,732,348 outstanding at December 31, 2007		36			36
Additional paid-in capital		397,354			388,250
Accumulated deficit		(20,513	)		(92,061	)
Accumulated other comprehensive income (loss)		(28,190	)		14,552
Treasury stock		(911	)		(911	)
Total shareholders’ equity		347,776			309,866
Total liabilities and shareholders’ equity	$	2,571,791		$	2,307,133

See accompanying notes to consolidated financial statements.

3

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Amounts)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007
Revenues:
Oil and gas production	$	118,347		$	116,738		$	536,193		$	393,640
Other revenues		—			—			897			1,598
		118,347			116,738			537,090			395,238
Costs, operating expenses and other:
Lease operating		24,723			21,152			73,111			62,326
Exploration		48			1,799			48			13,135
General and administrative		9,212			7,610			27,279			22,950
Depreciation, depletion and amortization		52,825			53,617			222,097			159,629
Impairment of oil and gas properties		—			4,028			—			9,798
Accretion of asset retirement obligation		4,211			3,039			12,792			9,019
Loss on abandonment		896			300			2,309			379
Other, net		(149	)		(1,785	)		(259	)		(1,785	)
		91,766			89,760			337,377			275,451
Income from operations		26,581			26,978			199,713			119,787
Other income (expense):
Interest income		1,079			1,329			2,951			5,947
Interest expense, net		(26,606	)		(29,717	)		(78,969	)		(87,541	)
Derivatives income (expense)		40,963			284			(9,187	)		284
Loss on debt extinguishment		—			—			(24,220	)		—
		15,436			(28,104	)		(109,425	)		(81,310	)
Income (loss) before income taxes		42,017			(1,126	)		90,288			38,477
Income tax (expense) benefit:
Current		6,710			1,566			(3,648	)		1,532
Deferred		(12,244	)		1,881			(15,092	)		(4,129	)
		(5,534	)		3,447			(18,740	)		(2,597	)
Net income	$	36,483		$	2,321		$	71,548		$	35,880
Net income per share:
Basic	$	1.03		$	0.08		$	2.02		$	1.19
Diluted	$	1.02		$	0.08		$	1.99		$	1.17
Weighted average shares outstanding:
Basic		35,452			30,118			35,441			30,060
Diluted		35,815			30,771			35,871			30,669

See accompanying notes to consolidated financial statements.

4

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands)

(Unaudited)

	Nine Months Ended September 30,
	2008			2007
Cash flows from operating activities
Net income	$	71,548		$	35,880
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization		222,097			159,629
Impairment of oil and gas properties		—			9,798
Gain on disposition of assets		(160	)		—
Accretion of asset retirement obligation		12,792			9,019
Deferred income taxes		15,092			4,129
Dry hole costs		—			10,251
Stock-based compensation		9,071			5,095
Amortization of deferred revenue		(19,451	)		—
Derivatives expense		23,435			—
Loss on extinguishment of debt		15,370			—
Noncash interest expense		12,751			5,212
Other noncash items, net		1,855			1,668
Changes in assets and liabilities:
Accounts receivable and other current assets		85,947			31,339
Accounts payable and accruals		(196,999	)		(31,879	)
Other assets		—			(2,390	)
Net cash provided by operating activities		253,348			237,751
Cash flows from investing activities
Additions to oil and gas properties		(544,176	)		(636,597	)
Decrease in restricted cash		13,864			14,096
Proceeds from disposition of oil and gas properties		82,644			—
Additions to furniture and fixtures		(129	)		(296	)
Net cash used in investing activities		(447,797	)		(622,797	)
Cash flows from financing activities
Proceeds from long-term debt		1,608,750			574,500
Payments of long-term debt		(1,404,278	)		(184,552	)
Deferred financing costs		(15,523	)		(13,449	)
Payments of capital lease		—			(23,950	)
Net profits interest payments		(13,602	)		—
Exercise of stock options		33			2,004
Net cash provided by financing activities		175,380			354,553
Effect of exchange rate changes on cash and cash equivalents		(2,022	)		882
Decrease in cash and cash equivalents		(21,091	)		(29,611	)
Cash and cash equivalents, beginning of period		199,449			182,592
Cash and cash equivalents, end of period	$	178,358		$	152,981
Noncash investing and financing activities:
Change in accrued property additions		136,176			(12,419	)
Asset retirement costs capitalized under SFAS No. 143		4,313			19,659
Property acquired in exchange for a net profits interest		—			22,468

See accompanying notes to consolidated financial statements.

5

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In Thousands)

(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2008			2007			2008			2007
Net income	$	36,483		$	2,321		$	71,548		$	35,880
Other comprehensive income (loss):
Reclassification adjustment for settled hedge contracts (net of taxes of $(82), $59, $(4,987) and $59, respectively)		151			75			6,002			1,712
Changes in fair value of outstanding hedge positions (net of taxes of $(8,446), $3,177, $22,711 and $3,177, respectively)		9,855			(6,727	)		(23,139	)		(8,878	)
Reclassification adjustment for de-designated hedge contracts (net of taxes of $0, $0, $(19,288) and $0, respectively)		—			—			21,258			—
Foreign currency translation adjustment		(47,227	)		8,350			(46,863	)		17,893
Other comprehensive income (loss)		(37,221	)		1,698			(42,742	)		10,727
Comprehensive income (loss)	$	(738	)	$	4,019		$	28,806		$	46,607

See accompanying notes to consolidated financial statements.

6

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 — Organization

ATP Oil & Gas Corporation was incorporated in Texas in 1991. We are engaged in the acquisition, development and production of oil and natural gas properties in the Gulf of Mexico and the U.K. and Dutch Sectors of the North Sea (the “North Sea”). We primarily focus our efforts on oil and natural gas properties where previous drilling has encountered reservoirs that appear to contain commercially productive quantities of oil and gas. Many of these properties contain proved undeveloped reserves that are economically attractive to us but are not strategic to major or exploration-oriented independent oil and natural gas companies. Occasionally we will acquire properties that are already producing or where previous drilling has encountered reservoirs that appear to contain commercially productive quantities of oil and gas even though the reservoirs do not meet the Securities and Exchange Commission (“SEC”) definition of proved reserves.

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results of operations for the interim periods. All intercompany transactions are eliminated upon consolidation. The interim financial information and notes hereto should be read in conjunction with our 2007 Annual Report on Form 10-K. The results of operations for the quarter and nine months ended September 30, 2008 are not necessarily indicative of results to be expected for the entire year. We have reclassified certain amounts applicable to prior periods to conform to the current classifications. Such reclassifications do not affect earnings.

Note 2 — Recent Accounting Pronouncements

During the first quarter of 2008, the Financial Accounting Standards Board (“FASB”) issued Statement of Financial Accounting Standards (“SFAS”) No. 161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment of FASB Statement No. 133.” This statement requires enhanced disclosures about an entity’s derivative and hedging activities and is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. We expect to adopt this standard in the first quarter of 2009 and do not anticipate that it will have a material effect on our financial statements.

During the second quarter of 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles.” This statement identifies a consistent framework, or hierarchy, for selecting accounting principles to be used in preparing financial statements that are presented in conformity with U.S. generally accepted accounting principles and is expected to be effective later in 2008. We do not anticipate that it will have a material effect on our financial statements.

Note 3 — Income Taxes

Income tax expense during interim periods is based on the estimated annual effective income tax rate plus any significant unusual or infrequently occurring items which are recorded in the period the specific item occurs. Our year-to-date interim effective tax rate is derived from our expectations of net income for the year, taking into consideration permanent differences. We compute income taxes using an asset and liability approach which results in the recognition of deferred tax liabilities and assets for the expected future tax consequences of temporary differences between the financial basis and the tax basis of those assets and liabilities. We recognized income tax expense of $18.7 million and $2.6 million for the nine months ended September 30, 2008 and 2007, respectively. For the three months ended September 30, 2008 and 2007 we recognized income tax expense of $5.5 million and benefit of $3.4 million, respectively. The worldwide effective tax rates for the first nine months of 2008 and 2007 were 20.8% and 6.8%, respectively. In 2007 the provision was partially offset by the release of valuation allowance on the books related to our deferred tax assets in the United States jurisdiction.

7

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 4 — Oil and Gas Properties

Acquisitions

During the first nine months of 2008, we acquired in the Gulf of Mexico a 100% working interest in Mississippi Canyon (“MC”) Block 304 and a 55% working interest in Green Canyon Blocks 299 and 300 (collectively, “Clipper”). Also during this period, we were awarded leases for 100% of the working interests in Viosca Knoll Block 863, De Soto Canyon Block 355 and Atwater Valley Blocks 19 and 62 by the U.S. Department of Interior Minerals Management Service. The total paid for these acquisitions was $1.8 million.

During the first nine months of 2007, we completed the acquisition of a 100% working interest in the northwest quarter of MC Block 755, a 25% working interest in MC Block 754, and a 10% working interest in MC Block 800. A portion of the acquisition price of MC Block 755 was financed by the seller. The financing was full recourse and initially due on December 31, 2009. However, the amount due was converted to a net profits interest at the time of initial production. As of September 30, 2008, the amount outstanding under the net profits interest was $11.2 million and was included in current liabilities on the consolidated balance sheet.

Dispositions

During the second quarter of 2008, we completed the sale of 5.76 Bcfe of proved reserves in the form of a 15% limited-term overriding royalty interest for $82.0 million. The interest is carved out of our net revenue interests in production from MC Blocks 711, 754, 755 and 800. In accordance with SFAS No. 19, “Financial Accounting and Reporting by Oil & Gas Producing Companies,” the sale is accounted for as a volumetric production payment. The net proceeds received were recorded as deferred revenue to be recognized in earnings as the production is delivered and is presented on the consolidated statements of cash flows as proceeds from disposition of oil and gas properties. The reserves associated with the interest have been removed from our proved oil and natural gas reserves.

See also Note 13-Subsequent Events.

Note 5 — Asset Retirement Obligation

Following are reconciliations of the beginning and ending asset retirement obligation for the following periods (in thousands):

	Nine Months Ended September 30,
	2008			2007
Asset retirement obligation at beginning of year	$	186,771		$	108,389
Liabilities incurred		2,848			21,639
Liabilities settled		(14,785	)		(9,393	)
Property dispositions		(1,104	)		—
Changes in estimates		331			—
Accretion		12,792			9,019
Total		186,853			129,654
Less current portion		19,075			15,832
Total long-term asset retirement obligation at end of period	$	167,778		$	113,822

Note 6 — Long-Term Debt

Long-term debt consisted of the following (in thousands):

	September 30, 2008		December 31, 2007
Term Loans (includes unamortized discount of $38,483 as of September 30, 2008)	$	1,608,892	$	1,202,154
Subordinated Notes		—		201,857
Total		1,608,892		1,404,011
Less current maturities		10,500		12,165
Total long-term debt	$	1,598,392	$	1,391,846

8

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

We entered into new senior secured term loan facilities, effective June 27, 2008 (collectively, the “Term Loans”). Key components of the Term Loans included a tranche of $1.05 billion, maturing July 2014, and a tranche of $600.0 million (the “Asset Sale Facility”), maturing January 2011. The Term Loans were issued with an original issue discount of 2.5% and bear interest at LIBOR plus 5.25% (with a LIBOR floor of 3.25%). The $1.05 billion tranche requires a $2.63 million principal repayment per calendar quarter until September 2013, and four quarterly repayments of $249.4 million thereafter. The Asset Sale Facility is due in full at maturity and allows for prepayment at any time at par. The Term Loans are secured by substantially all of our oil and gas assets in the Gulf of Mexico and a pledge of 65% of the common stock of our wholly owned subsidiaries, ATP Oil & Gas (UK) Limited and ATP Oil and Gas (Netherlands) B.V.

We also have a $50.0 million revolving credit facility which has the same interest obligations as the Term Loans and has a final maturity of January 2014. Available borrowing capacity is reduced by outstanding letters of credit issued against the facility.

The Term Loans carry the following restrictions and covenants, among others:

• Minimum Current Ratio of 1.0 to 1.0;

• Ratio of Total Net Debt to Consolidated EBITDAX of not greater than 3.0 to 1.0 at the end of each quarter;

• Ratio of Consolidated EBITDAX to Consolidated Interest Expense of not less than 2.5 to 1.0 for any four consecutive fiscal quarters;

• Ratio of pre-tax PV-10 of our total Proved Developed Producing oil and gas reserves adjusted for current oil and gas price estimates, to Net Debt of at least 0.5 to 1.0 at June 30 and December 31 of any fiscal year;

• Ratio of pre-tax PV-10 of our Total Proved oil and gas reserves plus 50% of our pre-tax probable oil and gas reserves, both adjusted for current oil and gas price estimates, to Net Debt of at least 2.5 to 1.0 at June 30 or December 31 of any fiscal year;

• Commodity Hedging Agreements, based on forecasted production attributable to our proved producing reserves of (i) 60% of the projected PDP production from the Oil and Gas Properties of the Borrower and the Subsidiaries for the succeeding twelve calendar months on a rolling twelve calendar month basis and (ii) 40% of such projected PDP production on a rolling basis for the twelve calendar month period subsequent to the twelve calendar month period ;

• Permitted Business Investments during any fiscal year of no more than $150.0 million or 7.5% of PV-10 value of our total proved reserves;

• Requirement that at least 75% of net proceeds from all Asset Sales be applied to the Asset Sale Facility as long as any balance is outstanding on the Asset Sale Facility.

Capitalized terms in the foregoing restrictions and covenants have the meaning set forth in our credit agreement dated June 27, 2008. The combined effective interest rate under the Term Loans at September 30, 2008 was approximately 9.34% per annum.

Note 7 — Stock–Based Compensation

We recognized stock option compensation expense of approximately $0.9 million and $0.4 million for the three months ended September 30, 2008 and 2007, respectively. We recognized stock option compensation expense of approximately $2.2 million and $1.0 million for the nine months ended September 30, 2008 and 2007, respectively. The weighted average grant-date fair value of options granted during the nine months ended September 30, 2008 and 2007 was $9.96

9

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

and $14.82, respectively. The fair values of options granted during the nine months ended September 30, 2008 and 2007 were estimated at the date of grant using a Black-Scholes option-pricing model assuming no dividends and with the following weighted average assumptions for grants during the following periods:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2008		2007		2008		2007
Weighted average volatility	41	%	36	%	41	%	36	%
Expected term (in years)	3.8		3.8		3.8		3.8
Risk-free rate	3.2	%	4.0	%	3.1	%	4.0	%

The following table sets forth a summary of option transactions for the nine month period ended September 30, 2008:

	Number of Options		Weighted Average Grant Price		Aggregate Intrinsic Value ($000) (1)		Weighted Average Remaining Contractual Life
							(in years)
Outstanding at beginning of year	800,069		$	33.83
Granted	323,600			28.56
Exercised	(2,250	)		14.05
Forfeited	(22,439	)		43.16
Outstanding at end of period	1,098,980			32.12	$	269	3.3
Vested and expected to vest	1,001,158			24.76		252	3.2
Options exercisable at end of period	296,350			24.79		186	1.8

(1) Based upon the difference between the market price of the common stock on the last trading date of the period and the option exercise price of in-the-money options.

At September 30, 2008, unrecognized compensation expense related to nonvested stock option grants totaled $4.9 million. Such unrecognized expense will be recognized as vesting occurs over the weighted average remaining vesting period of 2.8 years.

At September 30, 2008, unrecognized compensation expense related to restricted stock totaled $8.9 million. Such unrecognized expense will be recognized as vesting occurs over a weighted average period of 1.9 years. The following table sets forth the restricted stock transactions for the nine-month period ended September 30, 2008 during which we recognized $6.8 million of compensation expense:

	Number of Shares		Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value ($000) (1)
Nonvested at beginning of year	305,789		$	43.79
Granted	163,232			39.87
Vested	(24,171	)		40.24
Nonvested at end of period	444,850			42.54	$	7,923

(1) Based upon the market price of the common stock on the last trading date of the period.

10

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 8 — Earnings Per Share

Basic earnings per share (“EPS”) is computed by dividing net income or loss available to common shareholders by the weighted average number of shares of common stock (other than nonvested restricted stock) outstanding during the period. Weighted average shares outstanding for diluted EPS also includes a hypothetical number of shares assuming all in-the-money options and warrants would have been exercised and vesting of restricted stock. Potential common shares are excluded from the computation of weighted average common shares outstanding when their effect is antidilutive. For the three months ended September 30, 2008 and 2007, respectively, stock-based awards for 699,000 and 25,500 average shares of common stock, were excluded from the diluted EPS calculation because their inclusion would have been antidilutive. For the nine months ended September 30, 2008 and 2007, respectively, stock-based awards for 488,000 and 294,000 average shares of common stock were excluded from the diluted EPS calculation because their inclusion would have been antidilutive.

Basic and diluted net income per share is computed based on the following information (in thousands, except per share amounts):

	Three Months Ended September 30,				Nine months Ended September 30,
	2008		2007		2008		2007
Net income	$	36,483	$	2,321	$	71,548	$	35,880
Shares outstanding:
Weighted average shares outstanding - basic		35,452		30,118		35,441		30,060
Effect of potentially dilutive securities - stock options and warrants		251		507		289		471
Nonvested restricted stock		112		146		141		138
Weighted average shares outstanding - diluted		35,815		30,771		35,871		30,669
Net income per share:
Basic	$	1.03	$	0.08	$	2.02	$	1.19
Diluted	$	1.02	$	0.08	$	1.99	$	1.17

Note 9 — Derivative Instruments and Risk Management Activities

At September 30, 2008 and December 31, 2007, accumulated other comprehensive income included $13.2 million and $17.3 million of unrealized after-tax losses, respectively, on our cash flow hedges. In the period the forecasted hedged transactions occur, gains and losses are reclassified from accumulated other comprehensive income to the consolidated statement of operations as components of the revenue or expense items to which they relate. Hedge ineffectiveness is recorded directly to the consolidated statement of operations.

11

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

At September 30, 2008, we had financial derivative contracts in place for the following natural gas and oil volumes:

					Net Fair Value Asset (Liability)
Description	Type	Volumes	Price
			$/Unit		($000)
Oil (Bbl) – Gulf of Mexico
Remainder of 2008	Puts	625,600	$	54.67	$	12
2009	Puts	1,496,500		54.00		1,093
Remainder of 2008	Swaps	92,000		100.11		(660	)
2009	Swaps	90,000		100.11		(60	)
Natural Gas (MMBtu)
North Sea
Remainder of 2008	Swaps	690,000	$	8.47	$	(4,357	)
2009	Swaps	5,892,250		7.92		(36,365	)
2010	Swaps	450,000		8.45		(3,403	)
Gulf of Mexico
Remainder of 2008	Swaps	310,000		9.86		736

As a result of the sale of the limited-term overriding royalty interest and changes in forecasts of production, during the second quarter 2008 we determined that it was no longer probable that forecasted production would be sufficient to satisfy amounts designated under certain of our cash flow commodity-price hedges. Consequently, we have de-designated some of these instruments as hedges, which resulted in reclassification of $40.5 million of net unrealized losses ($21.2 million after tax) from accumulated other comprehensive income to derivatives expense in the consolidated statement of operations. Subsequent changes to the fair value of these instruments will be reflected as derivatives income (expense) in the consolidated statement of operations. For the quarter and nine months ended September 30, 2008, we recognized income of $41.0 million and a loss of $9.2 million, respectively in derivatives income (expense) for changes in fair value of derivatives, that are not designated as cash flow hedges. At the beginning of the third quarter, we entered into oil collar derivatives as price hedges of future-year production. However, at the end of the quarter, we elected to terminate these instruments and realized a gain of $20.0 million in derivatives income.

Settlements on all of our commodity derivative instruments are included in cash flows from operating activities in our consolidated statement of cash flows.

We also manage our exposure to oil and natural gas price risks by periodically entering into fixed-price physical forward sale contracts. These physical contracts qualified and have been designated for the normal purchase and sale exemption under SFAS No. 133, as amended, and therefore are not recorded.

12

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

At September 30, 2008, we had fixed-price physical contracts in place for the following natural gas and oil volumes:

Period	Volumes	Average Fixed Price (1)
		$/Unit
Natural gas (MMBtu)
Gulf of Mexico:
Remainder of 2008	2,745,000	$	8.48
2009	8,175,000		8.04
North Sea:
Remainder of 2008	3,680,000	$	7.64
2009	2,700,000		7.39
Oil (Bbl) – Gulf of Mexico:
Remainder of 2008	890,000	$	77.37
2009	2,736,750		76.01
2010	365,000		68.20
2011	273,000		68.20

(1) Includes the effect of basis differentials.

In January 2008, we entered into a cash flow hedge using an interest rate swap on, initially, $500.0 million of principal which locked the LIBOR portion of the interest rate on our then-outstanding first lien borrowings at 3.1% until February 15, 2010. As mentioned above, in the second quarter 2008, we refinanced the first lien borrowings and assumed different interest obligations. Accordingly, we have de-designated as a hedge the interest rate swap because we no longer expect it to be highly effective at offsetting the variability in the interest payments required under the new Term Loans. This resulted in reclassification of $49,000 of net unrealized losses ($32,000 after tax) from accumulated other comprehensive income to derivatives expense in the consolidated statement of earnings. During July 2008, we terminated the interest rate swap and received $50,000 cash consideration.

Note 10 — Commitments and Contingencies

We are a party to a multi-year (life of reserves) firm transportation agreement covering certain production in the North Sea that requires us to pay a pipeline tariff on our nominated contract quantity of natural gas during the contract period, whether or not the volumes are delivered to the pipeline. For any contract period where actual deliveries fall short of contract quantities, we can make up such amounts by delivering volumes over the subsequent four years free of tariff, within certain limitations. While we control our nominations, we are subject to the risk we may be required to prepay or ultimately pay transportation on undelivered volumes.

In the normal course of business we occasionally purchase oil and gas properties for little or no up-front costs and instead commit to pay consideration contingent upon the successful development and operation of the properties. The contingent consideration generally includes amounts to be paid upon achieving specified operational milestones, such as first commercial production and again upon achieving designated cumulative sales volumes. At September 30, 2008 the aggregate amount of such contingent commitments was $12.0 million.

We are, from time to time, a party to various legal proceedings in the ordinary course of business. Management does not believe that the outcome of these legal proceedings, individually, or in the aggregate, will have a material adverse effect on our financial condition, results of operations or cash flows.

13

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 11 — Segment Information

The Company’s operations are focused in the Gulf of Mexico and in the North Sea. Management reviews and evaluates separately the operations of its Gulf of Mexico segment and its North Sea segment. The operations of our segments include natural gas and liquid hydrocarbon production and sales. Segment activity for the three months and nine months ended September 30, 2008 and 2007 is as follows (in thousands):

For the Three Months Ended –	Gulf of Mexico			North Sea			Total
September 30, 2008:
Revenues	$	99,996		$	18,351		$	118,347
Depreciation, depletion and amortization		30,518			22,307			52,825
Income (loss) from operations		38,072			(11,491	)		26,581
Interest income		578			501			1,079
Interest expense, net		26,606			—			26,606
Income tax (expense) benefit		(16,729	)		11,195			(5,534	)
Additions to oil and gas properties		221,809			(25,512	)		196,297
September 30, 2007:
Revenues	$	99,212		$	17,526		$	116,738
Depreciation, depletion and amortization		39,531			14,086			53,617
Impairment of oil and gas properties		4,028			—			4,028
Income (loss) from operations		28,526			(1,548	)		26,978
Interest income		723			606			1,329
Interest expense, net		29,717			—			29,717
Income tax benefit		—			3,447			3,447
Additions to oil and gas properties		144,928			65,634			210,562
For the Nine months Ended –	Gulf of Mexico			North Sea			Total
September 30, 2008:
Revenues	$	445,924		$	91,166		$	537,090
Depreciation, depletion and amortization		136,567			85,530			222,097
Income (loss) from operations		217,805			(18,092	)		199,713
Interest income		1,337			1,614			2,951
Interest expense, net		78,904			65			78,969
Income tax (expense) benefit		(50,298	)		31,558			(18,740	)
Additions to oil and gas properties		594,071			17,795			611,866
Total assets		1,963,935			607,856			2,571,791

14

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

September 30, 2007:
Revenues	$	328,596	$	66,642	$	395,238
Depreciation, depletion and amortization		123,446		36,183		159,629
Impairment of oil and gas properties		9,798		—		9,798
Income from operations		106,784		13,003		119,787
Interest income		4,240		1,707		5,947
Interest expense, net		87,541		—		87,541
Income tax expense		—		2,597		2,597
Additions to oil and gas properties		504,302		188,097		692,399
Total assets		1,303,961		585,731		1,889,692

Note 12 — Fair Value Measurements

We adopted SFAS No. 157, “Fair Value Measurements,” effective January 1, 2008 for financial assets and liabilities measured on a recurring basis. SFAS No. 157 applies to all financial assets and financial liabilities that are being measured and reported on a fair value basis. In February 2008, the FASB issued FSP No. 157-2, which delayed the effective date of SFAS No. 157 by one year for nonfinancial assets and liabilities, except those measured on a recurring basis. We will adopt SFAS No. 157 with respect to asset retirement obligations and non-recurring impairments of oil and gas properties in the first quarter of 2009. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). SFAS No. 157 establishes a framework for measuring fair value and expands disclosure about fair value measurements. The statement requires fair value measurements be classified and disclosed in one of the following categories:

Level 1:	Measured based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
Level 2:	Measured based on quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability. This category includes those derivative instruments that we value using observable market data. Substantially all of these inputs are observable in the marketplace throughout the full term of the derivative instrument, can be derived from observable data, or supported by observable levels at which transactions are executed in the marketplace.
Level 3:	Measured based on prices or valuation models that require inputs that are both significant to the fair value measurement and less observable from objective sources (i.e., supported by little or no market activity). Our option pricing models are industry-standard and consider various inputs including forward commodity price estimates, volatility and time value of money.

Financial assets and liabilities are classified based on the lowest level input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and determines the valuation of the fair value of assets and liabilities and their placement within the fair value hierarchy levels. The following table summarizes, according to their inputs, financial assets and liabilities that are being measured on a fair value basis at September 30, 2008 (in thousands):

15

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Description	Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets (liabilities) – net:
Gas swap contracts – U.K.	$	—	$	(44,125	)
Oil and gas swap contracts – U.S.		16		—
Oil put contracts		—		1,105
Total	$	16	$	(43,020	)

The following table sets forth a reconciliation of changes in the fair value of financial assets (liabilities) valued using inputs classified as Level 3 at September 30, 2008 (in thousands):

	Gas Swap Contracts – U.K.			Oil Put Contracts		Total
Balance at beginning of year	$	(24,577	)	$	747	$	(23,830	)
Total loss included in other comprehensive income		(21,724	)		—		(21,724	)
Derivatives expense		(9,034	)		358		(8,676	)
Settlements		11,210			—		11,210
Balance at end of period	$	(44,125	)	$	1,105	$	(43,020	)
Changes in unrealized income (loss) included in earnings relating to derivatives still held at September 30, 2008	$	(7,159	)	$	372	$	(6,787	)

Note 13 — Subsequent Events

Sale of Interests in U.K. Properties

On October 23, 2008, we finalized a Sale and Purchase Agreement (the “S&P Agreement”) with EDF Production UK Limited (“EDF”) relating to the sale of 80% of our working interests in certain producing oil and gas properties, leasehold acreage and gathering infrastructures, all located in the U.K. sector of the North Sea at the Tors and Wenlock fields. The agreement provides for the acquisition to be effective as of July 1, 2008. The closing of the transaction is expected to occur by December 31, 2008, subject to customary closing conditions, including without limitation approval of the transaction by the U.K. Department of Energy and Climate Change. We currently own a 100% working interest in the Wenlock field and an 85% working interest in the Tors field.

The purchase price for these assets of £265.0 million (approximately $435.1 million as of October 23, 2008) was determined in arm’s-length negotiations and is subject to adjustment

16

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

based on each party’s share of production proceeds received and expenses paid for periods before and after July 1, 2008 and other factors. The S&P Agreement contains customary representations and warranties. Either party may terminate the agreement if the closing has not occurred by December 31, 2008.

The parties also entered into a Call Option Agreement dated October 23, 2008 pursuant to which we granted to EDF the option to acquire the remaining 20% of our working interests in the Wenlock and Tors fields. The option may be exercised at any time after the later of December 1, 2008 or the closing date of the transaction contemplated by the S&P Agreement (“the Initial Exercise Date”) and the 60th day following the Initial Exercise Date. The minimum purchase price payable by EDF to us under the Call Option Agreement is £72.4 million (approximately $118.9 million as of October 23, 2008), subject to being increased based on natural gas prices on the day before the option is exercised.

Share Repurchase Program

In October 2008, we announced a share repurchase program for up to 3,500,000 shares of common stock at any time through the end of 2011.

17

ATP OIL & GAS CORPORATION AND SUBSIDIARIES

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Executive Overview

General

ATP Oil & Gas Corporation is engaged in the acquisition, development and production of oil and natural gas properties in the Gulf of Mexico and the North Sea. We seek to acquire and develop properties with proved undeveloped reserves that are economically attractive to us but are not strategic to major or large exploration-oriented independent oil and gas companies. Occasionally we will acquire properties that are already producing or where previous drilling has encountered reservoirs that appear to contain commercially productive quantities of oil and gas even though the reservoirs do not meet the SEC definition of proved reserves. We may also acquire offshore lease blocks that surround our existing developments in order to expand our acreage position in the development. This expansion may add drilling opportunities, new reserves or production. We believe that our strategy of focusing on development with an occasional exposure to exploration opportunities near our existing developments provides assets for us without the risk, cost or time of traditional exploration.

We seek to create value and reduce operating risks through the acquisition and development of properties in areas that have:

• significant undeveloped reserves and reservoirs;

• close proximity to developed markets for oil and natural gas;

• existing infrastructure of common carrier oil and natural gas pipelines; and

• a relatively stable regulatory environment for offshore oil and natural gas development and production.

Our focus is on acquiring properties that are noncore or nonstrategic to their original owners for a variety of reasons. For example, larger oil companies from time to time adjust their capital spending or shift their focus to exploration prospects which they believe may offer greater reserve potential. Some projects may provide lower economic returns to a company due to changes in its cost structure or other constraints within that company. Also, timing, budget constraints or changes in a company’s ownership or management structure, may render a company unwilling or unable to develop a property before the expiration of the lease. Because of our cost structure, expertise in our areas of focus and ability to develop projects, the properties may be more financially attractive to us than the seller.

We focus on developing projects in the shortest time possible between initial major investment and first revenue generated in order to maximize our rate of return. Since we operate most of the properties in which we acquire a working interest, we are able to significantly influence the development concept and timing of a project’s development. We may initiate new development projects by simultaneously obtaining the various required components such as the pipeline and the production platform or subsea well completion equipment. We believe this strategy, combined with our strong technical abilities to evaluate and implement a project’s requirements, allows us to efficiently complete the development project and commence production. To enhance the economics of a project, we sometimes develop the project to a value creation point and either sell an interest or bring in partners on a promoted basis.

18

Third Quarter 2008 Highlights

Our financial and operating performance for the third quarter of 2008 included the following highlights:

• Net income of $36.5 million or $1.03 per share;

• Record nine-month production and revenues despite the impact of hurricanes Gustav and Ike;

• Executed an agreement to sell 80% of certain assets in the U.K. North Sea for approximately $430 million, which represents significant progress toward our previously announced monetization program;

• Continued progress on our 2008 development program.

Additional discussion of our expectations for 2008 can be found in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2007 Annual Report on Form 10-K.

Results of Operations

Three Months Ended September 30, 2008 Compared to Three Months Ended September 30, 2007

For the three months ended September 30, 2008 and 2007 we reported net income of $36.5 million and $2.3 million, or net income of $1.02 and $0.08 per diluted share, respectively.

Oil and Gas Production Revenues

Revenues presented in the table and the discussion below represent revenues from sales of oil and natural gas production volumes. Production sold under fixed-price delivery contracts which have been designated for the normal purchase and sale exemption under Statement of Financial Accounting Standards (“SFAS”) No. 133 are also included in these amounts as well as the effects of financial cash flow price hedges. Deliveries under the fixed-price contracts are approximately 100% and 45% of our oil production for the three months ended September 30, 2008 and 2007, respectively. Approximately 92% and 46% of our natural gas production was sold under these fixed-price delivery contracts for the comparable periods. The proportion of production sold under fixed-price delivery contracts in the current quarter is so great due to the temporary impacts of hurricanes Gustav and Ike. The realized prices below may differ from the market prices in effect during the periods depending on when the fixed-price delivery contract was executed. The table also reflects oil and gas production revenues from amortization of deferred revenue related to the second quarter 2008 sale of the limited-term overriding royalty interest. We do not reflect any production associated with those revenues.

	Three Months Ended September 30,				% Change in 2008 from
	2008		2007		2007
Production:
Natural gas (MMcf)		7,267		8,021	(9	)%
Oil and condensate (MBbl)		821		887	(7	)%
Total (MMcfe)		12,190		13,343	(9	)%
Revenues from production (in thousands):
Natural gas	$	53,429	$	58,276	(8	)%

19

Effects of cash flow hedges		(230	)		(118	)
Amortization of deferred revenue		2,434			—		—
Total	$	55,633		$	58,158		(4	)%
Oil and condensate	$	53,510		$	59,046		(9	)%
Effects of cash flow hedges		(957	)		(230	)
Amortization of deferred revenue		10,161			—		—
Total	$	62,714		$	58,816		7	%
Natural gas, oil and condensate	$	106,939		$	117,322		(9	)%
Effects of cash flow hedges		(1,187	)		(348	)
Amortization of deferred revenue		12,595			—		—
Total	$	118,347		$	116,974		1	%
Average realized sales price:
Natural gas (per Mcf)	$	7.35		$	7.27		1	%
Effects of cash flow hedges (per Mcf)		(0.03	)		(0.02	)
Average realized price (per Mcf)	$	7.32		$	7.25		1	%
Oil and condensate (per Bbl)	$	65.18		$	66.56		(2	)%
Effects of cash flow hedges (per Bbl)		(1.17	)		(0.26	)
Average realized price (per Bbl)	$	64.01		$	66.30		(3	)%
Natural gas, oil and condensate (per Mcfe)	$	8.77		$	8.79		—
Effects of cash flow hedges (per Mcfe)		(0.10	)		(0.02	)
Average realized price (per Mcfe)	$	8.67		$	8.77		(1	)%

Revenues from production increased 1% in the third quarter of 2008 compared to the third quarter of 2007. During the period production decreased 9% compared to the third quarter of 2007 primarily due to the Gulf of Mexico hurricanes Gustav and Ike, partially offset by increased production from the Wenlock property in the U.K., which was brought online in the fourth quarter of 2007. Also during the period, average sales prices decreased 1% primarily due to $8.9 million paid to purchasers related to shortfalls of deliveries under fixed-price forward contracts. These decreases were virtually offset by deferred revenue recognized.

Lease Operating

Lease operating expense for the third quarter of 2008 increased to $24.7 million ($2.03 per Mcfe) from $21.2 million ($1.59 per Mcfe) in the third quarter of 2007. The increase was primarily attributable to the increased cost of chemicals and fuel. The per unit cost increased primarily due to the effect on fixed costs of the storm-related decrease in production. In third quarter 2008, lease operating expense per Mcfe in the Gulf of Mexico and the North Sea was $2.20 and $1.61, respectively. In the third quarter 2007, lease operating expense per Mcfe in the Gulf of Mexico and North Sea was $1.69 and $1.17, respectively.

20

General and Administrative

General and administrative expense for the third quarter of 2008 increased to $9.2 million from $7.6 million in the third quarter of 2007. The increase is primarily attributable to higher stock-based compensation costs and legal fees.

Depreciation, Depletion and Amortization

Depreciation, Depletion and Amortization (“DD&A”) expense decreased during the third quarter of 2008 to $52.8 million from $53.6 million for the third quarter of 2007. The decrease was due to the decreased production caused by Gulf of Mexico hurricanes Gustav and Ike noted above partially offset by an increased depletion rate. The average depletion rate increased 8% to $4.33 per Mcfe in the third quarter of 2008 compared to $4.02 per Mcfe in the third quarter of 2007. This per unit increase is primarily a result of higher costs incurred on our new developments relative to some of our older properties. The third quarter of 2008 DD&A rates for the Gulf of Mexico and North Sea were $3.51 per Mcfe and $6.38 per Mcfe, respectively. The third quarter of 2007 DD&A rates for the Gulf of Mexico and North Sea were $3.71 per Mcfe and $5.25 per Mcfe, respectively.

Impairment of Oil and Gas Properties

There have been no impairments during the third quarter of 2008. In the third quarter of 2007, we recorded an impairment of oil and gas properties totaling $4.0 million due to unfavorable operating performance on one property in the Gulf of Mexico.

Accretion of Asset Retirement Obligation

Accretion expense increased to $4.2 million in the third quarter of 2008 compared to 3.0 million in third quarter 2007 primarily due to increased asset retirement obligations associated with increased oil and gas property development and overall vendor price increases.

Loss on Abandonment

During the third quarter of 2008, we recognized an aggregate loss on abandonment of $0.9 million compared to $0.3 million in the third quarter of 2007.

Interest Expense

Interest expense decreased to $26.6 million for the third quarter of 2008 compared to $29.7 million for the third quarter of 2007 primarily due to the effect of lower interest rates on our floating-rate borrowings and $12.5 million of capitalized 2008 interest related to the construction of a floating production system at the Telemark Hub.

Derivatives Income (Expense)

Derivatives income in the third quarter of 2008 was $41.0 million (Gulf of Mexico, $27.3 million and North Sea, $13.7 million). At the beginning of the third quarter, we entered into oil collar derivatives as price hedges of future-year production. However, at the end of the quarter, we elected to terminate these instruments and realized a gain of $20.0 million in derivatives income. The balance of the derivatives income is related primarily to changes in fair value of derivatives not designated as cash flow hedges.

Income Taxes

We recorded income tax expense of $5.5 million and income tax benefit of $3.4 million during the quarter ended September 30, 2008 and 2007, respectively. The provision for each quarter results from the application of the expected annual tax rate in each jurisdiction applied to the year-to-date pre-tax income by

21

jurisdiction, and takes into account permanent differences. Our estimated year-to-date effective tax rate for 2008 is 20.8% and for 2007 is 6.8%. In 2007 the provision was partially offset by the release of valuation allowance on the books related to our deferred tax assets in the United States jurisdiction.

Nine months Ended September 30, 2008 Compared to Nine months Ended September 30, 2007

For the nine months ended September 30, 2008 and 2007 we reported net income of $71.5 million and $35.9 million, or $1.99 and $1.17 per diluted share, respectively.

Oil and Gas Production Revenues

Revenues presented in the table and the discussion below represent revenues from sales of oil and natural gas production volumes. Production sold under fixed-price delivery contracts which have been designated for the normal purchase and sale exemption under SFAS No. 133 are also included in these amounts as well as the effects of financial cash flow price hedges. Deliveries under the fixed-price contracts are approximately 91% and 35% of our oil production for the nine months ended September 30, 2008 and 2007, respectively. Approximately 85%, and 48% of our natural gas production was sold under these fixed-price delivery contracts for the comparable periods. The proportion of production sold under fixed-price delivery contracts in the current year-to-date period is so great due to the temporary impacts of hurricanes Gustav and Ike. The realized prices below may differ from the market prices in effect during the periods depending on when the fixed-price delivery contract was executed. The table also reflects oil and gas production revenues from amortization of deferred revenue related to the second quarter 2008 sale of the limited-term overriding royalty interest. We do not reflect any production associated with those revenues.

	Nine months Ended September 30,						% Change in 2008 From
	2008			2007			2007
Production:
Natural gas (MMcf)		29,080			26,271		11	%
Oil and condensate (MBbl)		3,857			2,926		32	%
Total (MMcfe)		52,219			43,830		19	%
Revenues from production (in thousands):
Natural gas	$	247,050		$	216,628		14	%
Effects of cash flow hedges		(8,689	)		917
Amortization of deferred revenue		3,843			—		—
Total	$	242,204		$	217,545		11	%
Oil and condensate	$	280,775		$	177,341		58	%
Effects of cash flow hedges		(2,394	)		(1,320	)
Amortization of deferred revenue		15,608			—		—
Total	$	293,989		$	176,021		67	%
Natural gas, oil and condensate	$	527,825		$	393,969		34	%
Effects of cash flow hedges		(11,083	)		(403	)
Amortization of deferred revenue		19,451			—		—
Total	$	536,193		$	393,566		36	%

22

Average realized sales price:
Natural gas (per Mcf)	$	8.50		$	8.25		3	%
Effects of cash flow hedges (per Mcf)		(0.30	)		0.03
Average realized price (per Mcf)	$	8.20		$	8.28		(1	)%
Oil and condensate (per Bbl)	$	72.80		$	60.60		20	%
Effects of cash flow hedges (per Bbl)		(0.62	)		(0.45	)
Average realized price (per Bbl)	$	72.18		$	60.15		20	%
Natural gas, oil and condensate (per Mcfe)	$	10.11		$	8.99		12	%
Effects of cash flow hedges (per Mcfe)		(0.21	)		(0.01	)
Average realized price (per Mcfe)	$	9.90		$	8.98		10	%

Revenues from production increased 36% in the first nine months of 2008 compared to the first nine months of 2007. During the first nine months of 2008, our production increased 19% compared to the first nine months of 2007 primarily due to greater production in the Gulf of Mexico from the Gomez Hub and due to production from the Wenlock property in the U.K., which was brought online in the fourth quarter of 2007. The increased revenues were also attributable to a 10% increase in average realized sales price.

Lease Operating

Lease operating expense for the first nine months of 2008 increased to $73.1 million ($1.40 per Mcfe) from $62.3 million ($1.42 per Mcfe) in the first nine months of 2007. The increase was primarily attributable to the production increases noted above. The per unit cost has decreased primarily due to the effect of fixed costs. In the first nine months of 2008, lease operating expense per Mcfe in the Gulf of Mexico and the North Sea was $1.41 and $1.36, respectively. In the first nine months of 2007, lease operating expense per Mcfe in the Gulf of Mexico and North Sea was $1.39 and $1.57, respectively.

General and Administrative

General and administrative expense for the first nine months of 2008 increased to $27.3 million from $23.0 million in the first nine months of 2007. The increase is primarily attributable to higher stock-based compensation costs.

Depreciation, Depletion and Amortization

DD&A expense increased during the first nine months of 2008 to $222.1 million from $159.6 million for the first nine months of 2007. The increase was due to the increased production noted above and to an increased depletion rate. The average depletion rate increased 16% to $4.25 per Mcfe in the first nine months of 2008 compared to $3.64 per Mcfe in the first nine months of 2007. This per unit increase is primarily a result of higher costs incurred on our new developments relative to some of our older properties. During the first nine months of 2008, DD&A rates for the Gulf of Mexico and North Sea were $3.53 per Mcfe and $6.33 per Mcfe, respectively. The first nine months of 2007 DD&A rates for the Gulf of Mexico and North Sea were $3.44 per Mcfe and $4.57 per Mcfe, respectively.

23

Impairment of Oil and Gas Properties

There have been no impairments during the first nine months of 2008. In the first nine months of 2007, we recorded an impairment of oil and gas properties totaling $9.8 million due to unfavorable operating performance on one property in the Gulf of Mexico.

Accretion of Asset Retirement Obligation

Accretion expense increased to $12.8 million in the first nine months of 2008 compared to 9.0 million in the first nine months of 2007 primarily due to increased asset retirement obligations associated with increased oil and gas property development and overall vendor price increases.

Loss on Abandonment

During the first nine months of 2008, we recognized an aggregate loss on abandonment of $2.3 million compared to $0.4 million in 2007 due to unanticipated vendor price increases in the Gulf of Mexico.

Interest Expense

Interest expense decreased to $79.0 million for the first nine months of 2008 compared to $87.5 million for the first nine months of 2007 primarily due to $25.5 million of capitalized 2008 interest related to the construction of a floating production system at the Telemark Hub and lower overall interest rates and their effect on our floating-rate borrowings. This decrease was partially offset by interest related to the net $200.0 million increase in outstanding borrowings under our Term Loans beginning in the second quarter of 2007.

Derivatives Income (Expense)

Derivatives expense in the first nine months of 2008 was $9.2 million (Gulf of Mexico, $11.1 million gain and North Sea, $20.3 million loss). As a result of the limited-term overriding royalty interest and changes in forecasts of production, during the second quarter 2008 we determined that it was no longer probable that forecasted production would be sufficient to satisfy amounts designated under certain of our cash flow commodity-price hedges. Consequently, we have de-designated some of these instruments as hedges. Also, we have de-designated as a hedge the interest rate swap because we no longer expect it to be highly effective at offsetting the variability in the interest payments for the new Term Loans. The total expense related to de-designation of these cash flow hedges is $40.5 million. At the beginning of the third quarter, we entered into oil collar derivatives as price hedges of future-year production. However, at the end of the quarter, we elected to terminate these instruments and realized a gain of $20.0 million in derivatives income. The balance of the derivatives expense is related primarily to changes in fair value of derivatives no longer designated as cash flow hedges.

Loss on Debt Extinguishment

Loss on debt extinguishment in the first nine months of 2008 is $24.2 million. As discussed below, during the second quarter of 2008, we refinanced the Term Loans and Subordinated Notes and recorded losses for the remaining unamortized deferred financing costs, debt discount related to the retired debt and for repayment premiums associated with the Subordinated Notes.

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Income Taxes

We recorded income tax expense of $18.7 million and $2.6 million during the nine months ended September 30, 2008 and 2007, respectively. The provision for each period results from the application of the expected annual tax rate in each jurisdiction applied to the year-to-date pre-tax income by jurisdiction, and takes into account permanent differences. Our estimated year-to-date effective tax rate for 2008 is 20.8% and for 2007 is 6.8%. In 2007 the provision was partially offset by the release of valuation allowance on the books related to our deferred tax assets in the United States jurisdiction.

Liquidity and Capital Resources

Under the Term Loans (as defined below), we have a $50.0 million revolving credit facility (“Revolver”), of which $31.0 was available as of September 30, 2008. At that date, we had a working capital deficit of approximately $14.9 million, a decrease of approximately $111.8 million from December 31, 2007. Working capital was negatively impacted by hurricanes Gustav and Ike, which has caused the deferral of production during the third quarter of 2008. Our credit agreement covenants specify a minimum liquidity ratio under which we include the availability under the Revolver, and exclude current maturities of long-term debt, the current portion of assets and liabilities from derivatives and the current portion of asset retirement obligations. We were in compliance with all of our credit agreement covenants at September 30, 2008.

Historically, we have financed our acquisition and development activities through a combination of bank borrowings, proceeds from equity offerings, cash from operations and the sale of interests in selected properties. In the second quarter of 2008, we announced plans to offer for sale partial working interests in a number of our properties, both producing and under development. In October 2008, we announced the agreement to sell 80% of our working interests in two of our U.K. fields for £265.0 million (approximately $435.1 million as of October 23, 2008, the date of the Sale and Purchase Agreement). In addition, we granted the purchaser an option to purchase our remaining interests in these fields (see Note 13-Subsequent Events). We expect the sale to close by December 31, 2008. We intend to reduce our debt by up to $600.0 million with the expected proceeds from this and other such sales. We may also use discretionary cash flow to repurchase shares of common stock in accordance with our recently announced program.

We intend to continue to finance our near-term development projects utilizing cash on hand, asset sale proceeds net of debt repayments and the other potential sources of capital mentioned above. As operator of most of our projects under development, we have the ability to significantly control the timing of most of our capital expenditures. Coupled with that control, we believe our cash flows from operating activities and capital from other sources as noted above will enable us to meet our future capital requirements.

Cash Flows

	Nine months Ended
	September 30,
	2008			2007
Cash provided by (used in) (in thousands):
Operating activities	$	253,348		$	237,751
Investing activities		(447,797	)		(622,797	)
Financing activities		175,380			354,553

Cash provided by operating activities during the first nine months of 2008 and 2007 was $253.3 million and $237.8 million, respectively. Cash flow from operations increased primarily

25

due to higher oil and gas production revenues during 2008 compared to 2007. The increase in sales revenue was attributable to higher oil and gas production and higher oil and gas prices during 2008.

Cash used in investing activities was $447.8 million and $622.8 million during the first nine months of 2008 and 2007, respectively. Cash expended in the Gulf of Mexico and North Sea for additions to oil and gas properties was approximately $406.1 million and $138.1 million, respectively, in the first nine months of 2008. Cash expended in the Gulf of Mexico and North Sea for additions to oil and gas properties was approximately $166.2 million and $470.4 million, respectively, in the first nine months of 2007. During the second quarter of 2008, we completed the sale of 5.76 Bcfe of proved reserves in the form of a 15% limited-term overriding royalty interest for $82.0 million.

Cash provided by financing activities was $175.4 million and $354.6 million during first the nine months of 2008 and 2007, respectively. Payments of long-term debt for the first nine months of 2008 are primarily comprised of $1,202.2 million of repayment of borrowings under our former credit agreement and of $199.5 million related to our former subordinated notes. Proceeds from long-term debt are comprised of $1,593.4 million (net of issuance costs) of proceeds from the Term Loans. During the first nine months of 2007, financing cash flows were primarily due to the increase in our former term loans and former subordinated notes of $561.1 million (net of issuance costs), partially offset by the aggregate $208.5 million repayments of our former second lien term loans and other debt payments.

Long-term Debt

Long-term debt consisted of the following (in thousands):

	September 30,		December 31,
	2008		2007
Term Loans (includes unamortized discount of $38,483 as of September 30, 2008)	$	1,608,892	$	1,202,154
Subordinated Notes		—		201,857
Total		1,608,892		1,404,011
Less current maturities		10,500		12,165
Total long-term debt	$	1,598,392	$	1,391,846

We entered into a new senior secured term loan facility, effective June 27, 2008 (collectively, the “Term Loans”). Proceeds of the Term Loans were used to refinance the $1.2 billion senior secured term loan scheduled to mature in April 2010 and $210.0 million of unsecured subordinated notes scheduled to mature in September 2011, and for general corporate purposes. Key components of the Term Loans included a tranche of $1.05 billion, maturing July 2014, and a tranche of $600.0 million (the “Asset Sale Facility”), maturing January 2011. The Term Loans were issued with an original issue discount of 2.5% and bear interest at LIBOR plus 5.25% (with a LIBOR floor of 3.25%). The $1.05 billion tranche requires a $2.63 million principal repayment per calendar quarter until September 2013, and four quarterly repayments of $249.4 million thereafter. The Asset Sale Facility is due in full at maturity and allows for prepayment at any time at par. The Term Loans are secured by substantially all of our oil and gas assets in the Gulf of Mexico and a pledge of 65% of the common stock of our wholly owned subsidiaries, ATP Oil & Gas (UK) Limited and ATP Oil and Gas (Netherlands) B.V. We have a $50.0 million revolving credit facility (of which $31.0 million was available as of September 30, 2008).

The Term Loans carry the following restrictions and covenants, among others:

• Minimum Current Ratio of 1.0 to 1.0;

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• Ratio of Total Net Debt to Consolidated EBITDAX of not greater than 3.0 to 1.0 at the end of each quarter;

• Ratio of Consolidated EBITDAX to Consolidated Interest Expense of not less than 2.5 to 1.0 for any four consecutive fiscal quarters;

• Ratio of pre-tax PV-10 of our total Proved Developed Producing oil and gas reserves adjusted for current oil and gas price estimates, to Net Debt of at least 0.5 to 1.0 at June 30 and December 31 of any fiscal year;

• Ratio of pre-tax PV-10 of our Total Proved oil and gas reserves plus 50% of our pre-tax probable oil and gas reserves, both adjusted for current oil and gas price estimates, to Net Debt of at least 2.5 to 1.0 at June 30 or December 31 of any fiscal year;

• Commodity Hedging Agreements, based on forecasted production attributable to our proved producing reserves of (i) 60% of the projected PDP production from the Oil and Gas Properties of the Borrower and the Subsidiaries for the succeeding twelve calendar months on a rolling twelve calendar month basis and (ii) 40% of such projected PDP production on a rolling basis for the twelve calendar month period subsequent to the twelve calendar month period ;

• Permitted Business Investments during any fiscal year of no more than $150.0 million or 7.5% of PV-10 value of our total proved reserves;

• Requirement that at least 75% of net proceeds from all Asset Sales be applied to the Asset Sale Facility as long as any balance is outstanding on the Asset Sale Facility.

Capitalized terms in the foregoing restrictions and covenants have the meaning set forth in the credit agreement dated June 27, 2008, which is Exhibit 10.2 to this document. We were in compliance with our credit agreement covenants at September 30, 2008.

Contractual Obligations

The following table summarizes certain contractual obligations at September 30, 2008 (in thousands):

Contractual Obligations	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Long-term debt (1)	$	1,647,375	$	10,500	$	621,000	$	267,750	$	748,125
Interest on long-term debt (2)		586,215		139,692		242,707		171,137		32,679
Other trade commitments		280,370		121,620		158,750		—		—
Noncancelable operating leases		4,530		1,204		1,815		1,116		395
Total contractual obligations	$	2,518,490	$	273,016	$	1,024,272	$	440,003	$	781,199

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(1) Long-term debt in future periods includes amortization of discount.

(2) Interest is based on rates and principal repayments in effect at September 30, 2008.

Our liabilities also include asset retirement obligations (“ARO”) ($19.1 million current and $167.8 million long-term) that represent the amount at September 30, 2008 of our obligations with respect to the retirement/plugging and abandonment of our oil and gas properties. The ultimate settlement amounts and the timing of the settlements of such obligations are unknown because they are subject to, among other things, federal, state and local regulation, economic and operational factors. Consequently, ARO is not reflected in the table above.

Commitments and Contingencies

Management is periodically faced with uncertainties, the outcomes of which are not within its control and will not be known for a long time. We are involved in actions from time to time, which if determined adversely, could have a material negative impact on our financial position, results of operations and cash flows. Management, with the assistance of counsel makes estimates, if determinable, of ATP’s probable liabilities and records such amounts in the consolidated financial statements. Such estimates may be the minimum amount of a range of probable loss when no single best estimate is determinable. Disclosure is made, when determinable, of any additional possible amount of loss on these claims, or if such estimate cannot be made, that fact is disclosed. Along with our counsel, we monitor developments related to these legal matters and, when appropriate, we make adjustments to recorded liabilities to reflect current facts and circumstances. Although it is difficult to predict the ultimate outcome of these matters, management is not aware of any amounts that need to be recorded and believes that the recorded amounts, if any, are reasonable. See Note 10 to the consolidated financial statements for additional discussion of commitments and contingencies.

Accounting Pronouncements

See Note 2 to our Consolidated Financial Statements for a discussion of recently issued accounting pronouncements.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based on consolidated financial statements which have been prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts or assets, liabilities, revenues and expenses. We believe that certain accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements. Our 2007 Annual Report on Form 10-K includes a discussion of our critical accounting policies.

Item 3. Quantitative and Qualitative Disclosures about Market Risks

Interest Rate Risk

We are exposed to changes in interest rates on our Term Loans in Management’s Discussion and Analysis of Financial Condition and Results of Operations: Liquidity and Capital Resources, and on the earnings from cash and cash equivalents. See the discussion of our Term Loans in Note 6 to the consolidated financial statements.

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Foreign Currency Risk

The net assets, net earnings and cash flows from our wholly owned subsidiaries in the U.K. and the Netherlands are based on the U.S. dollar equivalent of such amounts measured in the applicable functional currency. These foreign operations have the potential to impact our financial position due to fluctuations in the local currency arising from the process of re-measuring the local currency in U.S. dollars.

Commodity Price Risk

Our revenues, profitability and future growth depend substantially on prevailing prices for oil and natural gas. Prices also affect the amount of cash flow available for capital expenditures and our ability to borrow and raise additional capital. Lower prices may also reduce the amount of oil and natural gas that we can economically produce. We currently sell a portion of our oil and natural gas production under market price contracts. We periodically use derivative instruments to hedge our commodity price risk. We hedge a portion of our projected oil and natural gas production through a variety of financial and physical arrangements intended to support oil and natural gas prices at targeted levels and to manage our exposure to price fluctuations. We may use futures contracts, swaps, put options and fixed-price physical contracts to hedge our commodity prices. See Derivative Instruments and Risk Management Activities in Note 9 to the consolidated financial statements.

We may enter into short-term hedging arrangements if (1) we are able to obtain commodity contracts at prices sufficient to secure an acceptable internal rate of return on a particular property or on a group of properties or (2) if deemed necessary by the terms of our existing credit agreements. We do not initially hold or issue derivative instruments for speculative purposes.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our principal executive officer and principal financial officer have reviewed and evaluated the effectiveness of our disclosure controls and procedures, as defined in Exchange Act Rules 13a-15(e) and 15d-15(e), as of September 30, 2008 (the “Evaluation Date”). Based on this evaluation, the principal executive officer and principal financial officer have concluded that ATP’s disclosure controls and procedures were effective as of the Evaluation Date to ensure that information that is required to be disclosed by ATP in the reports it files or submits under the Exchange Act is (i) recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms and (ii) accumulated and communicated to ATP’s management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Control Over Financial Reporting

During the three months ended September 30, 2008, we have made no change to our internal controls over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting.

Forward-Looking Statements and Associated Risks

This Quarterly Report contains projections and other forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. These projections and statements reflect the Company’s current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results could differ materially from those projected as a result of certain factors. A discussion of these factors is included in the Company’s 2007 Annual Report on Form 10-K.

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PART II. OTHER INFORMATION

Items 1, 2, 3, 4 and 5 are not applicable and have been omitted.

Item 1A.    Risk Factors

For additional information about the risk factors facing the Company, see Item 1A of Part I of the Company’s Annual Report on Form 10-K for the year ended December 31, 2007.

The global financial crisis may materially and adversely impact our financial condition and results of operations in amounts and ways that we currently cannot predict.

The continued credit crisis and related turmoil in the global financial system may have an impact on our industry, our business and our financial condition. This stress in the markets may cause us to face greater challenges if conditions in the financial markets do not improve. Our ability to access the capital markets or to consummate planned asset sales may be restricted at a time when we would like or need to raise financing, impairing our ability to react to changing economic and business conditions, or modifying or interrupting our business plans. The current economic situation could lead to reduced demand for oil and natural gas, or lower prices for oil and natural gas, or both, which could have a negative impact on our revenues, the value of our assets and our ability to meet our obligations. Further, the economic situation could also impact our lenders, customers and hedging counterparties and may cause them to fail to meet their obligations to us with little or no warning.

Item 6. Exhibits

Exhibits
3.1	Amended and Restated Articles of Incorporation, incorporated by reference to Exhibit 3.1 of Registration Statement No. 333-46034 on Form S-1 of ATP Oil & Gas Corporation (“ATP”).
3.2	Amended and Restated Bylaws of ATP, incorporated by reference to Exhibit 3.1 of ATP’s Report on Form 10-Q for the quarter ended September 30, 2006.
4.1	Warrant Shares Registration Rights Agreement dated as of March 29, 2004 between ATP and each of the Holders set forth on the execution pages thereof, incorporated by reference to Exhibit 4.5 of ATP’s Form 10-K for the year ended December 31, 2003.
4.2	Warrant Agreement dated as of March 29, 2004 by and among ATP and the Holders from time to time of the warrants issued hereunder, incorporated by reference to Exhibit 4.6 of ATP’s Form 10-K for the year ended December 31, 2003.
4.3	Rights Agreement dated October 11, 2005 between ATP and American Stock Transfer & Trust Company, as Rights Agent, specifying the terms of the Rights, which includes the form of Statement of Designations of Junior Participating Preferred Stock as Exhibit A, the form of Right Certificate as Exhibit B and the form of the Summary of Rights to Purchase Preferred Shares as Exhibit C, incorporated by reference to Exhibit 1 to the Company’s Registration Statement on Form 8-A filed with the Securities and Exchange Commission on October 14, 2005.
*10.1	Sale and Purchase Agreement between ATP Oil & Gas (UK) Limited and EDF Production UK Ltd, as amended and restated on October 23, 2008.
*10.2	Call Option Agreement between EDF Production UK Ltd and ATP Oil & Gas (UK) Limited, as amended and restated on October 23, 2008.
†10.3	ATP Oil & Gas Corporation 2000 Stock Plan, incorporated by reference to Exhibit 10.11 of ATP’s Form 10-K for the year ended December 31, 2000.
10.4	Credit Agreement, dated as of June 27, 2008, among ATP, the lenders named therein, and Credit Cuisse, as Administrative Agent and Collateral Agent, incorporated by reference to Exhibit 99.1 to ATP’s Form 8-K dated June 27, 2008.
†10.5	Employment Agreement between ATP and Pauline H. van der Sman-Archer, dated December 29, 2005, incorporated by reference to Exhibit 10.1 to ATP’s Form 8-K dated December 30, 2005.
†10.6	Employment Agreement between ATP and John E. Tschirhart, dated December 29, 2005, incorporated by reference to Exhibit 10.2 to ATP’s Form 8-K dated December 30, 2005.
†10.7	Employment Agreement between ATP and Leland E. Tate, dated December 29, 2005, incorporated by reference to Exhibit 10.3 to ATP’s Form 8-K dated December 30, 2005.
†10.8	Employment Agreement between ATP and Robert M. Shivers, III, dated December 29, 2005, incorporated by reference to Exhibit 10.4 to ATP’s Form 8-K dated December 30, 2005.
†10.9	Employment Agreement between ATP and Mickey W. Shaw, dated December 29, 2005, incorporated by reference to Exhibit 10.5 to ATP’s Form 8-K dated December 30, 2005.
†10.10	Employment Agreement between ATP and Albert L. Reese, Jr., dated December 29, 2005, incorporated by reference to Exhibit 10.7 to ATP’s Form 8-K dated December 30, 2005.

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†10.11	Employment Agreement between ATP and Isabel M. Plume, dated December 29, 2005, incorporated by reference to Exhibit 10.8 to ATP’s Form 8-K dated December 30, 2005.
†10.12	Employment Agreement between ATP and Scott D. Heflin, dated December 29, 2005, incorporated by reference to Exhibit 10.9 to ATP’s Form 8-K dated December 30, 2005.
†10.13	Employment Agreement between ATP and Keith R. Godwin, dated December 29, 2005, incorporated by reference to Exhibit 10.10 to ATP’s Form 8-K dated December 30, 2005.
†10.14	Employment Agreement between ATP and George Ross Frazer, dated December 29, 2005, incorporated by reference to Exhibit 10.11 to ATP’s Form 8-K dated December 30, 2005.
†10.15	Employment Agreement between ATP and T. Paul Bulmahn, dated December 29, 2005, incorporated by reference to Exhibit 10.12 to ATP’s Form 8-K dated December 30, 2005.
†10.16	Employment Agreement between ATP and George R. Morris, dated May 27, 2008, incorporated by reference to Exhibit 99.1 to ATP’s Form 8-K dated May 21, 2008.
21.1	Subsidiaries of ATP, incorporated by reference to Exhibit 21.1 of ATP’s Annual Report on Form 10-K for the year ended December 31, 2002.
*31.1	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, the “Act.”
*31.2	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) of the Act
*32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350
*32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350

† Management contract or compensatory plan or arrangement

* Filed herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned and thereunto duly authorized.

		ATP Oil & Gas Corporation
Date: November 7, 2008	By:	/s/ Albert L. Reese Jr.
		Albert L. Reese Jr.
		Chief Financial Officer

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EX-10.1

Exhibit 10.1

DATED 23^rd September 2008

As Amended and Restated on 23^rd October 2008

ATP OIL & GAS (UK) LIMITED

and

EDF PRODUCTION UK LTD

SALE AND PURCHASE AGREEMENT

in respect of certain interests under

United Kingdom Continental Shelf Petroleum Production Licence No. P.683 (Block 43/22a)

and

United Kingdom Continental Shelf Petroleum Production Licence No. P.1034 (Blocks 42/25a and 43/21a)

and

United Kingdom Continental Shelf Petroleum Production Licence No. P.033 (Block 49/12aN)

CONTENTS

Clause	Heading
1.	DEFINITIONS AND INTERPRETATION
2.	SALE AND PURCHASE OF THE INTERESTS
3.	CONSIDERATION
4.	INTERIM PERIOD
5.	COMPLETION
6.	INDEMNITIES
7.	REPRESENTATIONS AND WARRANTIES
8.	ONGOING OBLIGATIONS AND LIABILITIES
9.	ANNOUNCEMENTS AND CONFIDENTIALITY
10.	NOTICES
11.	COSTS AND EXPENSES
12.	TAXATION
13.	VARIATION
14.	ASSIGNMENT
15.	RIGHTS OF THIRD PARTIES
16.	GENERAL
17.	GOVERNING LAW AND ARBITRATION

SCHEDULE 1

Licence(s), related Licensed Interest Documents and other related information

SCHEDULE 2

Allocation of Consideration

SCHEDULE 3

Working Capital

SCHEDULE 4

Format for Interim Completion Statement and Final Completion Statement

SCHEDULE 5

AFEs

2

THIS AGREEMENT is made the 23^rd day of September 2008

and amended and restated on the              day of October 2008

BETWEEN

(1) ATP OIL & GAS (UK) LIMITED, a company incorporated in England and Wales (company number 3949599 whose registered office is at Victoria House, London Square, Cross Lanes, Guildford GU1 1UJ (the “Seller”); and

(2) EDF PRODUCTION UK LTD, a company incorporated in England and Wales (company number 6683599 whose registered office is at 1 Blake Mews, Kew Gardens, London TW9 3GA (the “Purchaser”).

WHEREAS

(A) The Seller wishes to sell and the Purchaser wishes to purchase the Interests; and

(B) The Parties wish to set out the terms and conditions upon which the aforesaid sale and purchase shall take place.

NOW THEREFORE IT IS HEREBY AGREED as follows:

1 Definitions and Interpretation

In this Agreement (including the recitals and the Schedules hereto):

1.1 The following expressions shall, except where the context otherwise requires, have the following respective meanings:

“Accruals Basis of Accounting” means that basis of accounting under which costs and benefits are regarded as applicable to the period in which the liability for the cost is incurred or the right to the benefit arises regardless of when calculated, discovered, invoiced, paid or received;

“Adjustments” means any or all (as the context may require) of the Working Capital Adjustment, the Cash Calls Adjustment, the Petroleum Sales Adjustment and the Interim Period Adjustment as calculated in accordance with Clause 3 and any payments made by the Purchaser to the Seller or by the Seller to the Purchaser pursuant to Clause 6 or Clause 12 or pursuant to a warranty claim under Clause 7 together with such amounts (if any) equivalent to interest payable in accordance with Clauses 3.15 and 3.16;

“Affiliate” means in relation to any Party, a subsidiary or a holding company of that Party and includes the ultimate holding company of that Party and any subsidiary of that holding company and for the purposes of this

3

definition “holding company” and “subsidiary” shall be construed in accordance with section 1159 of the Companies Act 2006;

“Agreed Rate” means for the London Interbank Offered Rate for one month for the currency in question as quoted in the British Bankers’ Association internet site (www.bba.org.uk/public/libor) for the first day of the relevant period in respect of which interest is to be calculated plus one percent (1%) provided that if the first day of the relevant period is not a Business Day then the rate to be used shall be that for the most recent Business Day preceding the first day of the relevant period;

“Agreement” means this Agreement including the recitals hereof and Schedules hereto, as the same may be amended or varied from time to time in accordance with its express terms;

“Assignment Documents” means the assignment and novation agreements in respect of the Licensed Interest Documents in the agreed form together with any other documents the Parties (acting reasonably) agree are necessary to effect the assignment and transfer of the Interests from the Seller to the Purchaser and release the Seller from contractual liability to third parties with respect to the Interests (including any parent company guarantees or letters of credit required of the Purchaser in support of the Purchaser’s obligations under any of the Licensed Interest Documents);

“ATP Corporation” means ATP Oil & Gas Corporation incorporated and registered in the State of Texas whose registered office is at 4600 Post Oak Place, Suite 200, Houston, Texas, 77027, Texas, USA;

“ATP Corporation Guarantee” means the guarantee in the agreed form to be provided by ATP Corporation and to be delivered to the Buyer pursuant to Clause 2.2.2;

“Benefits” has the meaning given in Clause 6.1;

“Block” means an offshore area located on the United Kingdom Continental Shelf (“UKCS”) forming part of a Licence and being separately designated and numbered as a block on the reference map showing all UKCS Licence blocks deposited at the principal office of the UK Department of Business, Enterprise and Regulatory Reform and “Blocks” means Block 43/22a, Block 42/25a and Block 43/21a, and Block 49/12aN.;

“Business Day” means a day (other than a Saturday, a Sunday or a legal bank or public holiday) on which banks are or, as the context may require, were generally open for business in England;

“Cash Calls Adjustment” is detailed in Clause 3.6;

“Completion” means the completion of the sale and purchase of the Interests in accordance with the provisions of this Agreement;

“Completion Date” means the date on which Completion takes place;

4

“Consequential Loss” has the meaning set out in Clause 7.17;

“Consideration” has the meaning set out in Clause 3.1;

“CT” means Corporation Tax as charged under the Income and Corporation Taxes Act 1988 (as amended) which for the avoidance of doubt includes the supplementary charge as levied by section 501A of the Income and Corporation Taxes Act 1988 (as amended);

“Data” means, in respect of the Blocks, all data in the possession, custody or control of the Seller directly and exclusively relating to the Interests in whatever form the same are maintained excluding any data which the Seller may not sell, transfer or otherwise dispose of as a result of confidentiality obligations by which it is bound or which cannot be provided to the Purchaser because such transfer is prohibited by the agreement under which it is acquired and excluding internal interpretations and documents created for the Seller’s (or its Affiliates’) own use;

“Data Room Documents” means the documents and data relating to the Interests made available for the Purchaser’s inspection in the data room located at the offices of Scotiawaterous, 33 Finsbury Square, London EC2A 1BB and/or sent to the Purchaser prior to the date hereof as such documents and data are listed in the index initialled by the Parties for the purposes of identification;

“Decommissioning Liabilities” means any and all claims, costs, charges, expenses, liabilities, duties and/or obligations arising from, under or in respect of the ownership or use of the Interests and/or the Blocks and relating to the decommissioning and/or removing and/or making safe of all of the property held in connection with the Interests whether such claims, costs, charges, expenses, liabilities, duties and/or obligations are incurred under or pursuant to any of the Licensed Interest Documents or under statutory law, common law or otherwise and including the reinstatement and/or making good of the area covered by the Licence(s) in accordance with good oil and gas field industry practice and applicable law at the time of such decommissioning and/or removal and any residual liability or obligation for anticipated and/or necessary continuing insurance, maintenance and monitoring costs regardless in each case of any acts, omissions, negligence or breach of duty (statutory or otherwise), conduct or statements of the Seller or the condition of the Interests;

“Dollars” or “$” means dollars of the United States of America;

“Economic Date” means 1^st  July 2008;

“EDF International” means EDF International of 20 place de la Défense, 92050 Paris la Défense, France;

“EDF International Guarantee” means the guarantee in the agreed form to be provided by EDF International and to be delivered to the Seller pursuant to Clause 2.2.2;

5

“Encumbrances” means all liens, charges (fixed or floating), security interests, pledges, options, net profit interests, rights of pre-emption, mortgages and other third party rights which encumber legal or beneficial ownership save in respect of the rights held by the Secretary under the Licences;

“Environment” means the natural and man-made environment including all or any part of the following media namely air, water, and land including subsurface strata lying beneath the surface of the ground or beneath a body of water, and any living organisms or systems supported by those media;

“Environmental Law” means all applicable national and local laws, regulations, directives and ministerial regulations and instructions, all judgments, orders, instructions or awards of any court or competent authority and all codes of practice, industry agreements and guidance notes which relate or apply to the Environment or matters affecting the Environment including pollution, contamination, emissions, hazardous substances or the creation of any adverse impact on the Environment;

“Environmental Liabilities” means any and all claims, costs, charges, expenses, liabilities, duties and/or obligations arising from, under or in respect of the ownership or use of the Interests in relation to any Environmental Law or in relation to cleaning up, decontamination of, removing and disposing of debris or any property from and for reinstating any area of land, foreshore or seabed, wherever situated, whether such claims, costs, charges, expenses, liabilities, duties and/or obligations are incurred under or pursuant to any of the Licensed Interest Documents or under statutory law, common law or otherwise and including any residual liability or obligation for anticipated and/or necessary continuing insurance, maintenance and monitoring costs regardless in each case of any acts, omissions, negligence or breach of duty (statutory or otherwise), conduct or statements of the Seller or the condition of the Interests;

“Final Completion Statement” has the meaning given in Clause 3.12;

“Forward Gas Sales Agreement” means forward Gas sales entered into prior to the Economic Date under the Beach 2000 Master Agreement dated 16^th March 2006 between Hess Energy Power and Gas Company (UK) Limited (1) and the Seller (2);

“Future Payment Liabilities” means the liability (ies) of the Seller to make future and/or contingent payments to sellers under the terms of the:

(A) the agreement dated 26^th January 2001 between (1) the Seller (2) Britoil Public Limited Company (3) and ATP Corporation, and

(B) the agreement dated 10^th March 2005 between (1) GDF Britain Limited (2) and the Seller;

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“Gas” or “Natural Gas” means any hydrocarbons or mixture of hydrocarbons and other gases consisting primarily of methane which at a temperature of fifteen (15) degrees Celsius and at atmospheric pressure are or is predominantly in the gaseous state;

“Heren” has the meaning set out in Clause 3.7;

“Interests” means:

(a) an undivided legal interest in the Licence(s); and

(b) an eighty percent (80%) interest in each of Block 49/12aNand a sixty-eight percent (68%) interest in each of Block 43/22a, Block 42/25a and Block 43/21a);

together, in each case, with all rights and obligations attaching thereto including for the avoidance of doubt a corresponding share of the Burdened Interest as defined in the Joint Operating Agreement and including (i) the right to take and receive a consequent share of all Petroleum produced from the Block(s) under the Licence(s) on and after the Economic Date and (subject to Clause 3.7 and Clause 12) to receive the gross proceeds from the sale or other disposition thereof; (ii) a consequent share of the Seller’s legal and beneficial right, title and interest in and to all property owned by the Seller pursuant to or under any of the Licensed Interest Documents; and (iii) all rights, liabilities and obligations associated with such interest under the Licensed Interest Documents;

“Interim Completion Statement” has the meaning given in Clause 3.10;

“Interim Period” means the period from and including the Economic Date up to and including the Completion Date;

“Interim Period Adjustment” is detailed in Clause 3.8;

“JDA” means the joint development agreement currently in force in respect of operations pursuant to Licence P.1034 (Blocks 42/25a and 43/21a) and P.683 (Block 43/22a) (as detailed in Schedule 1), as the context so admits, each as amended, supplemented and/or novated from time to time;

“Joint Operating Agreement” means the joint operating agreement currently in force in respect of operations pursuant to Licence P.033 (Block 49/12aN) (as detailed in Schedule 1) as amended, supplemented and/or novated from time to time;

“Licence(s)” means the licence(s) of which details are set out in Schedule 1 and, where the context so admits, any one or more of such licences and any licence issued to the Seller in full or partial substitution for any such licence;

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“Licensed Interest Documents” means those documents listed as such in Schedule 1 and, where the context so admits, any one or more of such documents in each case as the same may have been amended, supplemented and/or novated from time to time;

“Limited Overriding Royalty Interest” has the meaning set out in the Joint Operating Agreement and the Deed of Assignment dated 9^th August 2006 between ConocoPhillips (U.K.) Limited as assignor and ConocoPhillips (U.K.) Theta Limited as assignee;

“Losses and Expenses” means any and all actions, proceedings, losses, damages, liabilities, obligations claims, demands, costs and expenses including fines, penalties, clean-up costs, legal and other professional fees and any VAT payable but not recoverable in relation to any such matter, circumstances or item;

“New Works” means the coiled tubing work to be conducted on the Wenlock W1 Well, the Pilot Hole at the Wenlock W3 Well and the connection for W2 Well and W3 Well as more specifically described in the AFEs set out in Schedule 5;

“Obligations” has the meaning given in Clause 6.1;

“Operator” means the entity acting as operator under the Licence(s) as currently identified in Schedule 1;

“Party” means a party to this Agreement and “Parties” means both of the parties to this Agreement;

“Petroleum” has the meaning given in the Licence(s);

“Petroleum Sales Adjustment” is detailed in Clause 3.7;

“Pounds”, “£” or “Sterling” means pounds sterling of the United Kingdom;

“Purchase Price” has the meaning given in Clause 3.1;

“Purchaser’s Accounts” means such account(s) as the Purchaser may specify by notice in writing to the Seller not less than five (5) Business Days prior to the due date of any payment;

“Secretary” means the Secretary of State for Business, Enterprise and Regulatory Reform or any other person for the time being responsible for carrying out the functions at present carried out by the Secretary of State for Business, Enterprise and Regulatory Reform in relation to the Licence(s) or operations carried out thereunder;

“Secretary’s Consents” means all necessary consents of the Secretary to the transfer of the Interests from the Seller to the Purchaser;

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“Seller’s Account” means the following account with Barclays Bank plc, of P0 544, 54 Lombard Street, London EC3V 9EX Sort Code 20 - 06 -05, Account No. 50776785 or such other accounts as the Seller may specify by notice in writing not less than five (5) Business Days prior to the due date of any payment;

“Taxation” means all forms of taxation, duties, levies, imposts, charges, deductions and withholdings, direct or indirect, created or imposed by any taxing, fiscal or other appropriate authority of the United Kingdom and (without prejudice to the generality of the foregoing) includes:

(a) CT, VAT and any other forms of taxation, duties, levies, imposts, charges, deductions and withholdings similar to or supplementing or replaced by or replacing the foregoing or any of them; and

(b) all penalties, charges, interest, fines, costs and expenses, loss of relief, allowance or credit relating to any form of, or claim for, taxation or other imposition referred to in paragraph (a);

“VAT” means Value Added Tax as charged under the Value Added Tax Act 1994;

“Warranties means the representations and warranties given by the Seller to the Purchaser in Clause 7.1; and

“Working Capital Adjustment” is detailed in Clause 3.5.

1.2 All references to Clauses, recitals and Schedules are, unless otherwise expressly stated, references to clauses of and the recitals and schedules to this Agreement.

1.3 The headings are inserted for convenience only and shall be ignored in construing this Agreement. Unless the context otherwise requires, the singular shall include the plural and vice versa.

1.4 Unless the context otherwise requires, references to persons shall include natural persons, bodies corporate, unincorporated associations, partnerships, authorities, government and government bodies.

1.5 Reference to statutory provisions shall be construed as reference to those provisions as amended, consolidated, extended or re-enacted from time to time.

1.6 Any document expressed to be “in the agreed form” means a document in a form approved by the Parties (acting reasonably).

1.7 References to the words “include”, “including” and “other” shall be construed without limitation.

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2. Sale and Purchase of the Interests

2.1   2.1.1   Subject to the terms of this Agreement the Seller as legal and beneficial owner hereby agrees to sell and transfer the

Interests to the Purchaser free from all Encumbrances save for the Limited Overriding Royalty Interest pursuant to and as defined in the Joint Operating Agreement for the Consideration and the Purchaser hereby agrees to purchase and acquire the Interests from the Seller.

2.1.2 The transfer referred to in Clause 2.1.1 shall, as between the Parties, be deemed for all purposes to be made with effect on and from the Economic Date.

2.1.3 The Parties agree to co-operate in complying with the provisions of the Limited Overriding Royalty Interest and for such purpose they agree that the entitlement of ConocoPhillips (U.K.) Theta Limited (“Conoco”) to Natural Gas pursuant to the Limited Overriding Royalty Interest and the costs, charges, expenses, liabilities and obligations arising from such entitlement shall be borne as to 80% by the Purchaser and as to 20% by the Seller for so long as Conoco has the benefit of the Limited Overriding Royalty Interest.

2.2 The obligations of the Parties to complete the sale and purchase of the Interests under this Agreement is conditional on:

2.2.1 the receipt of all necessary written consents, approvals or waivers as the case may be in relation to the transfer by the Seller to the Purchaser of the Interests, including the Secretary’s Consents and any consents, approvals and/or waivers required under the Licence Interest Documents, in form and substance reasonably acceptable to the Seller and the Purchaser;

2.2.2 the approval of the Board of Directors of each of the Seller and the Purchaser and each of ATP Oil & Gas Corporation, EDF SA and EDF International to the transactions contemplated herein; and

2.2.3 execution of the Assignment Documents by the signatory parties thereto other than the Parties.

It is expressly acknowledged and agreed by the Purchaser that the obligations of the Parties to complete the sale and purchase of the Interests under this Agreement is not conditional on the Purchaser seeking or obtaining finance. The Parties shall notify each other promptly of the decision taken pursuant to Clause 2.2.2 by their respective Boards of Directors and the Boards of Directors of their Affiliates and in the event of and upon notification having been received that all such Boards have approved the sale and purchase of the Interests and accordingly that such condition has been satisfied:

(i) the Buyer shall request the execution and delivery of the EDF International Guarantee (and upon receipt of an executed copy) execute and deliver the ATP Corporation Guarantee; and

(ii) the Seller shall request the execution and delivery of the ATP Corporation Guarantee (and upon receipt of an executed copy) execute and deliver the EDF International Guarantee.

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so that the Buyer shall deliver to the Seller the EDF International Guarantee (duly executed by EDF International) and the Seller shall deliver to the Buyer the ATP Corporation Guarantee (duly executed by ATP Oil & Gas Corporation) within five (5) Business Days of satisfaction of such condition, and in the event of failure so to deliver the Party who has not received the relevant guarantee shall be entitled to terminate this Agreement which shall cease to have effect and the Parties shall be freed and discharged from all liability, save only for the continuing obligations under Clause 9.

2.3 The Parties shall each use reasonable endeavours to obtain fulfilment of the conditions set out:

(a) in Clause 2.2.2 by 31st October 2008 and

(b) in Clauses 2.2.1 and 2.2.3 by 31st December 2008 (or such later dates as the Parties may agree) provided that it shall be the primary responsibility of the Seller (a) to make the application to the Secretary to obtain the Secretary’s Consent and (b) to give the required notices in order to obtain the necessary consents, approvals and waivers (as the case may be) to the transfer and assignment of the Interests in order to obtain execution of the Assignment Documents in accordance with the Licensed Interest Documents.

2.4 In the event that the conditions set out in Clause 2.2.2 have not all been fulfilled and/or waived by the Parties by 31st October 2008, (or such later date as may be agreed as aforesaid), and/or in the event that the conditions set out in Clauses 2.2.1 and 2.2.3 have not all been fulfilled and/or waived by the Parties by 31^st December 2008 (or such later date as may be agreed as aforesaid), then in either of such events any Party shall be entitled, to terminate this Agreement within five (5) Business Days following the date upon which the relevant conditions should have been fulfilled and/or waived by the Parties as aforesaid by written notice to the other Party and upon receipt of any such notice this Agreement shall cease to have effect and the Parties shall be freed and discharged from all liability, save only for any prior breach of Clause 2.3 (b), any liability under Clause 2.5 and for the continuing obligations under Clause 9.

2.5 In consideration of the Seller entering into this Agreement, if Completion does not occur as a result of the Purchaser’s failure to meet its obligations under Clause 2.3 (b) or to carry out any of its obligations at Completion under this Agreement including payment of the Purchase Price to the Seller on the Completion Date then, in addition to any other obligation or liability pursuant to this Agreement, the Purchaser shall forthwith pay to the Seller the aggregate sum of five percent (5 %) of the Purchase Price, as compensation for any loss suffered by the Seller in entering into this Agreement and the risk undertaken by the Seller in so doing. The Parties acknowledge and agree that such sum is a genuine pre-estimate of loss and is not a penalty.

3. Consideration

3.1 The consideration for the sale and transfer by the Seller to the Purchaser of the Interests shall be the payment by the Purchaser to the Seller of the sum of two hundred and sixty five million Pounds (£265,000,000) (the “Purchase Price”) as adjusted pursuant to this Agreement (the “Consideration”).

3.2 Subject to Clause 12, the Consideration shall be allocated as set out in Schedule 2.

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Adjustments

3.3 The Purchase Price shall be adjusted by the Adjustments which shall operate by way of increases or decreases, as the case may be, to the Purchase Price provided that no item taken into account in calculating any one of the Adjustments shall be taken into account in calculating any one of the other Adjustments so as to result in a Party making or receiving payment twice in respect thereof.

3.4 No adjustment under this Clause 3 shall be made in respect of any matter to which Clause 6.6 applies.

3.5 The Working Capital Adjustment, which if positive shall increase the Purchase Price and if negative shall reduce the Purchase Price, shall be the aggregate of the working capital balances in relation to the Interests calculated in respect of each of the categories listed in Schedule 3 as at the Economic Date by reference to the statements provided by the Operator and otherwise in accordance with Schedule 3. Such working capital balances shall be prepared in accordance with proper accounting and operating procedures and otherwise in accordance with good oil and gas field practice.

3.6 The Cash Calls Adjustment, which shall increase the Purchase Price, shall be the sum of all cash calls or billing invoices paid in respect of the Interests by the Seller during and/or in respect of the Interim Period and which, using the Accruals Basis of Accounting, relate to periods beginning on or after the Economic Date pursuant to the Licensed Interest Documents.

3.7 The Petroleum Sales Adjustment, which shall decrease the Purchase Price, shall be the notional value of the Gas produced in respect of the Interests in each day of the Interim Period based on multiplying the volume of such Gas by the Market Price for such Gas and for this purpose the Market Price shall be calculated as follows:

Market Price = (0.25 x MP) + (0.75 x DP)

where:

“DP” means the applicable gas index price for Day D expressed in pence per therm based on the arithmetic average of the Day ahead NBP bid prices and the Day ahead NBP offer prices for Natural Gas (in pence per therm) published by Heren on the preceding Day (D-1).

In case of a following a weekend or a public holiday the arithmetic average of the Day ahead NBP bid prices and the Day ahead NBP offer prices published by Heren on the last Banking Day before the weekend or public holiday shall be used.

In the case of a weekend and a public holiday immediately preceding or following a weekend then the arithmetic average of the Heren weekend NBP bid prices and the weekend NBP offer prices on the preceding Banking Day for that weekend shall be used.

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In the case of a public holiday mid week the arithmetic average of the special NBP bid prices and special NBP offer prices for that period published by Heren on the preceding Banking Day shall be used, provided that if no such prices are published then the weekend NBP bid prices and weekend NBP offer prices for that period published by Heren on the preceding Banking Day shall be used.

“Heren” means Heren Energy in European Spot Gas Markets.

“MP” means the applicable gas index price for Month M (expressed in pence per therm) based on the arithmetic average of the month- ahead NBP bid prices and the Month ahead NBP offer prices for Natural Gas (in pence per therm) for Month M as published by Heren for each day of publication in Month M-1 which are then averaged over the number of days in which prices are published.

3.8 The Interim Period Adjustment, which shall increase the Purchase Price, shall be the sum of all expenditure incurred by the Seller, using the Accruals Basis of Accounting, in respect of the Interests during the Interim Period, including demurrage, brokers’ fees (other than fees of advisers engaged in relation to the matters referred to herein), insurance premia and deductibles, rent and licence fees and all other costs and expenses incurred by the Seller in respect of the Interests which are in respect of the period on and after the Economic Date and which have not been met by cash calls or other payments taken into account under the foregoing provisions of this Clause 3 or Clause 12 provided that any such expenditure relating to any period prior to the Economic Date which has not been taken into account in the Working Capital Adjustment shall be for the account of the Seller.

3.9 Where any sums payable by the Purchaser to the Seller or by the Seller to the Purchaser pursuant to Clauses 3, 6, 7 or 12 are expressed in Sterling, the same shall be paid in Sterling.

Interim Completion Statement and Final Completion Statement

3.10 The Seller shall provide the Purchaser with a written statement of the Consideration expected to be required as at the Completion Date (the “Interim Completion Statement”). The Interim Completion Statement shall be provided no later than ten (10) calendar days prior to the anticipated Completion Date and shall be in the form set out in Schedule 4. The Seller may update the same and the Parties shall endeavour to agree the Interim Completion Statement before Completion, failing which the matter shall be dealt with in accordance with Clauses 3.11 and 3.13.

3.11 If any of the amounts or portions thereof contained in the Interim Completion Statement have not been agreed prior to Completion, the disputed amounts or portions of the Adjustments shall be left out of account for the purposes of Clause 5.2.2.1. The undisputed amounts or portions of the Adjustments shall be added to the amount of the Purchase Price and such amount so adjusted shall be payable at Completion. Payment of disputed amounts or portions thereof shall be made within five (5) Business Days following agreement of the Parties or determination under Clause 3.13.

3.12 Within sixty (60) Business Days after Completion, and without prejudice to the provisions of Clauses 6, 7 and 12, the Seller shall provide the Purchaser with a written statement of all of the Adjustments to be made

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hereunder and giving the final amount of the Consideration (the “Final Completion Statement”), which statement shall be prepared in the form set out in Schedule 4. If the Parties fail to agree the Final Completion Statement within fifteen (15) Business Days of receipt by the Purchaser, the Final Completion Statement shall be referred for determination in accordance with the provisions of Clause 3.13. The agreed or determined amounts, to the extent not already paid or taken into account on Completion, shall be paid by the Purchaser. Payment of agreed or disputed amounts or portions thereof shall be made within ten (10) Business Days following either agreement of the Parties or determination under Clause 3.13 (as the case may be).

3.13 If the Parties cannot reach agreement on the contents of all or part of the statements referred to in Clauses 3.10 and/or 3.12 within the time limit provided in Clause 3.12, the disputed items may be referred by either the Seller or the Purchaser for determination by an independent chartered accountant nominated by the Parties or, in the absence of agreement between the Parties within ten (10) Business Days of a Party notifying the other that it proposes to refer the dispute to an independent chartered accountant, by the President of the Institute of Chartered Accountants in England and Wales on the application of such Party. The nominated chartered accountant shall be afforded such access to books, records, accounts and documents in the possession of the Parties as he may reasonably request, and he shall act as expert not as arbitrator. The said accountant’s determination shall, in the absence of fraud or manifest error or bias, be final and binding on the Parties, his fees and disbursements shall be borne by the Seller and the Purchaser in equal shares and the Parties shall bear their own costs in respect of such reference.

3.14 The Interim Completion Statement and the Final Completion Statement will be prepared on the information available at the time of their preparation and shall be without prejudice to any further claims arising under Clauses 6, 7 and/or 12 after the time of the preparation of such statements. The Seller and the Purchaser shall liaise on the compilation and agreement of the Interim Completion Statement and the Final Completion Statement and the Seller shall provide to the Purchaser, as soon as reasonably practicable, all the Seller’s calculations (and supporting documents) in the preparation of the Adjustments for verification purposes including such explanations and methodology as the Purchaser shall reasonably require. Without prejudice to the generality of the foregoing, subject to and to the extent of any confidentiality obligations by which it is bound, the Seller shall provide the Purchaser with copies of all Operators’ reports, billing statements and correspondence and any other relevant documentation in its possession necessary to support the Interim Completion Statement and the Final Completion Statement. Where the Seller is unable to provide the Purchaser with such information due to confidentiality obligations by which it is bound it shall provide the same to an independent chartered accountant for the purposes of certifying the accuracy of such information to the Purchaser.

Time -value adjustments

3.15 An amount equivalent to interest (calculated on a compounded basis on the accumulated daily balances) at the Agreed Rate shall be payable on the Purchase Price from the Economic Date up to the Completion Date (both dates inclusive).

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3.16 In respect of the Adjustments, an amount equivalent to interest (calculated on a compounded basis on the accumulated daily balances) at the Agreed Rate shall be payable (and in the case of clauses 3.16.3 and 3.16.4 below be taken into account in the calculation of the relevant Adjustment) on each of:

3.16.1 the Working Capital Adjustment from the Economic Date up to and including the Completion Date, and, in the case of final adjustments or disputed items, thereafter up to and including the date of settlement thereof;

3.16.2 the cash calls and billing invoices comprised in the Cash Calls Adjustment from the date on which such cash call or billing invoice is paid by the Seller up to and including the date of settlement of such element of the Cash Calls Adjustment;

3.16.3 the receipts comprised in the Petroleum Sales Adjustment from the date of such receipt by or credit to the Seller up to and including the date of settlement of such element of the Petroleum Sales Adjustment; and

3.16.4 the items of expenditure comprised in the Interim Period Adjustment from the date such item of expenditure is paid by the Seller up to and including the date of settlement of such element of the Interim Period Adjustment.

3.17 The Parties agree that the amounts set out in Clauses 3.15 and 3.16 are adjustments to the Purchase Price and not actual interest on any debt between the Seller and the Purchaser and the Parties agree to submit their CT returns on that basis.

4 Interim Period

4.1 During the Interim Period, (in so far as it falls after the date of this Agreement) the Seller shall:

4.1.1 continue to carry on its affairs in relation to the Interests in the ordinary course and in accordance with good oil and gas field practice;

4.1.2 (to the extent that it is able so to do having regard to the provisions of the Licensed Interest Documents) consult with the Purchaser with regard to the Interests where reasonably practicable and co-operate with the Purchaser so as to ensure an efficient handover of the Interests on Completion;

4.1.3 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed), encumber, sell, assign or otherwise dispose of the Interests or any part thereof, or purport to do any of the same;

4.1.4 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed) enter into or agree to enter into or become party to any new licences, operating agreements, farm-in or farm-out agreements, unitisation agreements, transportation agreements, long term gas sale or supply agreements or any other material agreement or undertaking (by whatever name called) relating to the Interests or permit any other person to enter into or agree to enter in any such agreement on behalf of the Seller;

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4.1.5 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed), enter into or agree to enter into any contract for the sale of gas and/or other Petroleum products relating to the Interests or permit any other person to enter into or agree to enter in any such contract on behalf of the Seller;

4.1.6 maintain insurance in relation to the Interests (on behalf of and for the benefit of the Purchaser) to such extent and at such levels as would be in accordance with good oil and gas field practice and otherwise in accordance with the JDA;

4.1.7 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed), undertake or agree to undertake any sole-risk or non-consent activities in relation to the Interests;

4.1.8 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed), amend, renew, terminate or agree to amend, renew or terminate any of the Licensed Interest Documents or waive or agree to waive any of its rights or remedies under the Licensed Interest Documents insofar as any such right or remedy is capable of relating to periods after the Economic Date or is in respect of Decommissioning and/or Environmental Liabilities;

4.1.9 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed) undertake any operations or commit to any work programmes on Block 49/12b and

4.1.10 not, without the Purchaser’s prior written approval (not to be unreasonably withheld or delayed):

(1) approve any expenditure or capital commitment relating to any Interest involving expenditure in excess of one hundred thousand Pounds (£100,000) in any case other than:

(a) any such expenditure in respect of which the Purchaser has given its prior consent as referenced in Clause 4.2 below; or

(b) any expenditure necessitated by any emergency for the safeguarding of lives or property or the prevention of pollution (in which case the Seller shall to the extent practicable in the circumstances consult with the Purchaser and in any event as soon as reasonably practicable inform the Purchaser).

(2) approve any work programme or budget which (i) differs materially from the 2008 Budget prepared for the purposes of the Interests (a copy of which in relation to the Tors Area has been provided to the Purchaser) or (ii) differs from the Budget approved in relation to the Wenlock Field as referenced in the AFEs in Schedule 5, in either case without the consent of the Purchaser and for this purpose an increase in such Budget of more than 5 % or increase in any expenditure or capital commitment as shown in such Budget of more than 10 % shall be deemed to be material.

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4.2 Without prejudice to Clause 4.1, the Seller shall (subject to any confidentiality obligations by which it is bound) between the date hereof and Completion generally keep the Purchaser informed, in a timely manner, of all material matters not of a routine or minor nature affecting the Interests including the approval of any work programme, budget, AFE expenditure or capital commitment relating to the Interests and make available for review by the Purchaser and any person authorised by the Purchaser all Data reasonably requested by the Purchaser. In this regard, the Purchaser acknowledges and accepts the AFEs in respect of Block 49/12aN as set out in Schedule 5 and agrees that its consent to the same is not required pursuant to Clause 4.1 save for the New Works.

4.3 Notwithstanding that title to the Interests will not pass to the Purchaser until Completion, the Purchaser shall assume all risk in the Interests with effect from the date of this Agreement and accordingly (save for and without prejudice to the Seller’s continuing obligations under Clause 4.1 (in particular under Clause 4.1.6)) the Purchaser shall be responsible for insuring the Interests and its rights and liabilities arising in relation thereto under the terms of this Agreement.

4.4 During the Interim Period the Parties shall use their reasonable endeavours to negotiate and agree in good faith a joint development agreement to apply in relation to Licence P033, Block 49/12aN, such agreement to be, mutatis mutandis, in similar terms to the JDA for Licence P.1034 (Blocks 42/25a and 43/21a) and P.683 (Block 43/22a) and in the event that such agreement is not entered into on Completion the Parties shall continue to act in good faith to complete the agreement thereon and until such time the provisions of the JDA for Licence P.1034 (Blocks 42/25a and 43/21a) and P.683 (Block 43/22a) shall be deemed to apply in so far as reasonably practicable.

5 Completion

5.1 Completion under this Agreement shall take place within ten (10) Business Days after all of the conditions referred to in Clause 2.2 have been satisfied, at such location and at such time as the Parties may agree.

5.2 On the Completion Date all, but not part only, of the following business shall be transacted:

5.2.1 The Seller shall deliver to the Purchaser (to the extent not already delivered prior to Completion and/or already in the possession of the Purchaser):

5.2.1.1 the Assignment Documents duly and validly executed by all the signatory parties thereto other than the Purchaser;

5.2.1.2 a copy of the Secretary’s Consents and all other relevant consents, approvals or waivers, if any, referred to in Clause 2.2 and obtained by or on behalf of the Seller;

5.2.1.3 a copy, certified as a true copy and in full force and effect by a director or the secretary of the Seller, of a resolution of the board of directors of the Seller authorising a person or persons to execute this Agreement and the Assignment Documents on behalf of the Seller; and

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5.2.1.4 written confirmation in terms satisfactory to the Purchaser that the Seller has notified to the relevant insurers the interest of the Purchaser in all property, assets and rights associated with the Interests and the Licensed Interest Documents.

5.2.2 The Purchaser shall:

5.2.2.1 pay to the Seller the sums specified in the Interim Completion Statement, subject to Clause 3.11, by means of telegraphic transfer in immediately available funds to the Seller’s Account for value in Sterlingon the Completion Date;

5.2.2.2 deliver to the Seller the Assignment Documents duly and validly executed by the Purchaser;

5.2.2.3 deliver to the Seller a copy of all relevant consents, approvals, or waivers, if any, referred to in Clause 2.2 and obtained by or on behalf of the Purchaser; and

5.2.2.4 deliver to the Seller a copy, certified as a true copy and in full force and effect by a director or the secretary of the Purchaser, of a resolution of the board of directors of the Purchaser authorising a person or persons to execute this Agreement and the Assignment Documents on behalf of the Purchaser;

and the Parties acknowledge and agree that all acts and transactions constituting Completion shall be regarded as a single transaction so that, at the option of the Party who is interested in the carrying out of the relevant act or transaction, no action or transaction shall be deemed to have taken place unless and until all other actions and transactions constituting Completion shall have taken place as provided in this Agreement. The Parties acknowledge the essential nature of this provision.

5.3 Each of the Parties shall and, if appropriate, shall ensure that its respective Affiliates shall execute such other documents and do all such other acts and things as may reasonably be required, in order to effect the transfer of the Interests to the Purchaser and to implement the transactions contemplated hereunder and otherwise to carry out the true intent of this Agreement.

5.4 Following Completion, the Seller shall ensure that (to the extent not delivered prior to Completion) copies of the Licensed Interest Documents and copies of Data in the possession or control of the Seller as requested and reasonably required by the Purchaser and which are not in the Purchaser’s possession are made available for collection by the Purchaser at its own expense and within normal business hours within thirty (30) Business Days after the Completion Date. The costs of reproducing the Licence Interest Documents and the Data shall be borne by the Purchaser. The Seller shall also following Completion use its reasonable endeavours to obtain such waivers and/or releases (at the cost of the Purchaser) which may be necessary so as to enable it to provide all data in the possession, custody or control of the Seller directly and exclusively relating to the Interests which may be the subject of confidentiality obligations by which it is bound or which cannot be provided to the Purchaser because such transfer is prohibited by the agreement under which it is acquired and upon obtaining such waivers and/or releases shall promptly provide the same to the Purchaser.

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5.5 Notwithstanding Completion:

5.5.1 each provision of this Agreement (and any other document referred to in it) not performed at or before Completion but which remains capable of performance;

5.5.2 the Warranties and the Purchaser’s warranties under Clause 7.2; and

5.5.3 all covenants, indemnities and other undertakings contained in or entered into pursuant to this Agreement,

will remain in full force and effect and (except as otherwise expressly provided) without limit in time.

6 Indemnities

6.1 The Seller shall be liable for all costs, charges, expenses, liabilities and obligations (including in respect of the Burdened Interest as defined in the JOA in respect of the Interests (together “Obligations”) which accrue in or relate to any period before the Economic Date and the Seller shall be entitled to all income, receipts, rebates, credits and other benefits in respect of the Interests (together “Benefits”) which accrue in or relate to any period before the Economic Date.

6.2 The Purchaser shall be liable for all Obligations and entitled to all Benefits which accrue in or relate to any period on or after the Economic Date.

6.3 Subject to Clauses 7 and 12 and save to the extent that the Consideration includes any adjustment under Clause 3 which already takes account of any of the following (with the intent that there shall be no-double – counting) :-

6.3.1 if any Obligations are incurred by the Seller in respect of any period on or after the Economic Date, the Purchaser shall reimburse and indemnify the Seller in respect thereof;

6.3.2 if any Obligations are incurred by the Purchaser in respect of any period prior to the Economic Date, the Seller shall reimburse and indemnify the Purchaser in respect thereof;

6.3.3 if any Benefits accrue to the Seller in respect of any period on or after the Economic Date, the Seller shall account to and reimburse the Purchaser in respect thereof; and

6.3.4 if any Benefits accrue to the Purchaser in respect of any period prior to the Economic Date, the Purchaser shall account to and reimburse the Seller in respect thereof

and any such reimbursements shall be treated as further adjustments to the Purchase Price.

6.4 Any amount to be paid or reimbursed in accordance with Clause 6.3 or any other provision of this Clause 6 shall be paid or reimbursed within ten (10) Business Days of receipt thereof (or, in the case of Obligations, within ten (10) Business Days of receipt of notification from the Party which has incurred such Obligations) to the relevant Seller Account or Purchaser Account (as the case may be) (unless otherwise intimated in writing).

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6.5 For the avoidance of doubt, and without prejudice to the provisions of Clauses 6.1, 6.2 and 6.3, any Benefits or Obligations accruing in respect of the Interests in the form of amounts receivable or payable resulting from any adjustment in relation to the operation of, and expenditure attributable to, the Interests in the period prior to the Economic Date shall accrue to the Seller.

6.6 Notwithstanding any other provision of this Agreement (but without prejudice to the Warranty in Clause 7.14), the Purchaser shall at its cost and expense perform and shall, to the extent of the Interests, be responsible for all Decommissioning Liabilities and all Environmental Liabilities whether arising before, on or after the Economic Date and shall indemnify and hold the Seller and its Affiliates harmless against all and any Losses and Expenses however arising out of or in connection with any and all Decommissioning Liabilities and any and all Environmental Liabilities, in each case to the extent of the Interests and regardless of whensoever such Decommissioning Liabilities or Environmental Liabilities may arise or may have arisen and whether before, on or after the Economic Date and regardless of whosoever is or was a licensee under the Licence(s) or owned or leased the relevant property.

6.7 The Purchaser shall promptly notify the Seller of any circumstances of which the Purchaser becomes aware and for which the Seller may have any benefit or liability under Clause 6.1 and/or Clause 6.3 and, if requested by notice in writing by the Seller, the Purchaser shall use its reasonable endeavours to defend or pursue any claim on behalf of the Seller and shall act in accordance with the Seller’s reasonable instructions in respect thereof. In such event, the Seller shall indemnify the Purchaser in respect of all costs, claims and damages suffered by the Purchaser in defending or pursuing such a claim on the Seller’s behalf and acting in accordance with the Seller’s reasonable instructions.

6.8 The rights and obligations in this Clause 6 shall not come into effect unless and until Completion takes place and for the avoidance of doubt any payments arising under this Clause 6 shall be made after the Completion Date. All adjustments and reimbursements made and the ascertainment of all Obligations and Benefits under this Clause 6 shall be calculated using the Accruals Basis of Accounting.

6.9 Notwithstanding any other provision of this Agreement, the Seller shall at its cost and expense perform and shall, be responsible for all Future Payment Liabilities whether arising before, on or after the Economic Date and shall indemnify and hold the Purchaser and its Affiliates (including for this purpose Edison S.p.A and its Affiliates) harmless against all and any Losses and Expenses however arising out of or in connection with any and all Future Payment Liabilities regardless of whensoever such Future Payment Liabilities may arise or may have arisen and whether before, on or after the Economic Date and regardless of whosoever is or was a licensee under the Licence(s) or owned or leased the relevant property. Furthermore the Seller shall indemnify and hold the Purchaser harmless against any breach of the Warranty contained in Clause 7.1.19.

6.10 The Seller shall ensure that there are no obligations outstanding at Completion to sell gas or any other Petroleum products relating to the Interests to any person and that (without limitation to the generality thereof) all commitments under the Forward Gas Sales Agreement which may relate to the Interests have been terminated. Furthermore the Seller shall indemnify and hold the Buyer harmless against any Losses and Expenses however arising out of or in connection with any breach of the Warranty contained in Clause 7.1.18.

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7 Representations and Warranties

7.1 Subject to the provisions of this Clause 7, the Seller hereby represents and warrants to the Purchaser that save in respect of matters fairly disclosed (with sufficient details to identify the nature and scope of the matters disclosed) in the Data Room Documents, the Licence Interest Documents or this Agreement, the following Warranties are true and accurate:

7.1.1 the Seller is a licensee of the Licence(s) and the legal and beneficial owner of the Interests and all property rights and interests attributable thereto under the Licensed Interest Documents;

7.1.2 save for the Limited Overriding Royalty Interest, no mortgage, charge (whether fixed or floating), pledge, lien, encumbrance or other security or net profit or royalty interest is in existence and in force over the Interests other than arising under the Licence(s) nor, subject as aforesaid, has the Seller entered into any agreement or commitment to create the same; nor, so far as the Seller is aware, are there any other matters which restrict the Seller’s ability freely to dispose of the Interests save for the terms of the Licence(s) and the Licence Interest Documents;

7.1.3 the Seller has not committed any breach of the Licence(s) or any of the Licensed Interest Documents nor received notice that any of the parties to any of the above-mentioned documents has committed any breach of the Licence Interest Documents, which breach, at the date of making this statement, is in either case of a material nature and is subsisting and would have a material adverse effect upon the Seller’s ownership of the Interests;

7.1.4 the Licence(s) and all rights and interests of the Seller thereunder or deriving therefrom are in full force and effect and the Seller has not committed any act or omission nor, so far as the Seller is aware, has any other licensee of the Licence(s) committed any act or omission which would entitle the Secretary to revoke the Licence(s) and no notice has been given to the Seller or, so far as the Seller is aware, to any other licensee of the Licence(s), by the Secretary of any intention to revoke the Licence(s);

7.1.5 the Licence(s) is not in the course of being surrendered in whole or in part;

7.1.6 none of the current licensees of the Licence(s) or the current parties to the JDA have given any notice of withdrawal from the Licence(s) or the JDA;

7.1.7 the Seller is not a party to any litigation or arbitration or administrative proceedings relating to the Interests in respect of which a writ or summons or other formal pleading has been served or judgment issued, nor has the Seller been notified of any claim (not formulated within a formal pleading as aforesaid) or dispute in relation to, and which is likely materially to prejudice or endanger in any material manner, the Interests, and the Seller is not aware that any such litigation, arbitration or administrative proceedings are threatened or pending, either by or against the Seller, and there are no facts known to the Seller which are likely to give rise to any claim or dispute which is likely so materially to prejudice or endanger in any material manner the Interests, and, so far as the Seller is aware, none of the other licensees of the Licence

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or the parties to the Licensed Interest Documents is a party to any litigation, arbitration or administrative proceedings or any claim or dispute or judgment in relation to, and which is likely materially to prejudice or endanger in any material manner, the Interests;

7.1.8 the Seller is duly incorporated with limited liability and validly existing under the laws of England;

7.1.9 the documents which contain or establish the Seller’s constitution incorporate provisions which authorise, and all necessary corporate action has been taken to authorise, the Seller to execute and deliver this Agreement and perform the transaction contemplated by this Agreement;

7.1.10 subject to fulfilment of the conditions set out in Clause 2.2, the signing and delivery of this Agreement and the performance of any of the transactions contemplated by this Agreement will not contravene or constitute a material default under any provision contained in any agreement, instrument, law, judgment, order, licence, permit or consent by which the Seller or any of its Affiliates or their respective assets is bound or affected and

7.1.11 the Licensed Interest Documents are the only material documents which govern or relate to the creation, existence or validity of the Interests, and to which the Seller is a party and the Seller is not under any contractual obligation to enter into any further material agreement in relation to the Interests other than for operational purposes;

7.1.12 all accrued obligations and liabilities imposed by the Licence(s), including the work obligations arising from the Licence(s), have been duly fulfilled and discharged and there is no outstanding work obligation to be fulfilled under the Licence(s);

7.1.13 the Seller is not a party to any farm-in or farm-out agreement under which it will become obliged to transfer the Interests or any part of them;

7.1.14 In relation to the following:

7.1.14.1 the Seller has not received any orders or directives under any Environmental Laws in force at the date hereof which require any material work, repairs, construction or capital expenditures with respect to the Interests which have not been fully complied with in all material respects;

7.1.14.2 the Seller has not received any demand or notice under any Environmental Law in force at the date hereof with respect to a material breach thereof related to the Interests;

7.1.14.3 the Seller has not received any complaint from any UK government, agency or group regarding any actual or alleged material environment damage or material injury related to the Interests;

7.1.14.4 so far as the Seller is aware the Seller has complied in all material respects with Environmental Law in force at the date hereof in relation to the Interests;

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7.1.15 the Seller is not for statutory purposes deemed to be unable to pay its debts and is able to pay its debts as they fall due and no steps have been taken to propose any scheme of arrangement involving the Seller and its creditors generally, obtain an administration order or appoint any administration or other receiver or equivalent officer in relation to the Seller or any of its property or to wind up or dissolve the Seller. No order has been made, petition presented or meeting convened for the purpose of considering a resolution for the winding up of the Seller or for the appointment of any provisional liquidator; and so far as the Seller is aware, no petition has been presented for an administration order to be made in relation to the Seller;

7.1.16 the Seller is not party to, and nor is the Seller aware of, any proposal by any other party to the Licensed Interest Documents to conduct any sole risk or non-consent operations under the Licence(s) so as to impose upon the Seller an obligation to pay any penalty or premium as a condition of participating in any future operation under the Licensed Interest Document in question;

7.1.17 the Seller (and/or the Operator on behalf of the Seller) has in place all insurances required by law and by the JDA and the Joint Operating Agreement in relation to the Interests;

7.1.18 all reserves of Petroleum arising from the Interests may following Completion be freely lifted and disposed of by the Purchaser and are not contracted for sale or otherwise committed to any person or entity;

7.1.19 details of expenditures on which capital allowances have been claimed or would have been claimed in the Seller’s corporation tax returns have been provided to the Purchaser and to the extent that any part of the Consideration is allocated to assets qualifying for capital allowances under Part 2 and Part 5 of the Capital Allowances Act 2001, such capital allowances are available;

7.1.20 there are no outstanding obligations of the Seller (whether or not attaching to the Interests) to make future and/or contingent payments to any person from whom the Seller acquired all or part of the Interests (other than the Future Payment Liabilities);

Provided that the Warranties given in Clauses 7.1.4 to 7.1.6 (inclusive) and Clause 7.1.12 are, to the extent that the Seller does not have an interest in a Block in such Licence, given so far as the Seller is aware and for the avoidance of doubt provided further that no matters are disclosed pursuant to Clause 7.1 and 7.3 in relation to the Warranty in Clause 7.1.19.

7.2 Subject to the provisions of this Clause 7 the Purchaser hereby represents and warrants to the Seller as follows:

7.2.1 the Purchaser is duly incorporated with limited liability and validly existing under the laws of England;

7.2.2 the documents which contain or establish the Purchaser’s constitution incorporate provisions which authorise, and all necessary corporate action has been taken to authorise, the Purchaser to execute and deliver this Agreement and perform the transactions contemplated hereby;

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7.2.3 subject to fulfilment of the conditions set out in Clause 2.2, the signing and delivery of this Agreement and the performance of the transactions contemplated by this Agreement, will not contravene or constitute a default under any provision contained in any agreement, instrument, law, judgment, order, licence, permit or consent by which the Purchaser or any of its Affiliates or any of their respective assets is bound or affected and which would result in the Purchaser being unable to perform its obligations under this Agreement;

7.2.4 no litigation, arbitration, administrative proceeding, dispute or judgement against the Purchaser (or its Affiliates) or to which the Purchaser (or its Affiliates) is a party which might by itself or together with any other such proceedings have a material adverse effect on the Purchaser’s business, assets or condition and which would materially and adversely affect its ability to observe or perform its obligations under this Agreement and the transactions contemplated hereby, is subsisting or, so far as the Purchaser is aware, threatened or pending against the Purchaser or any of its assets or against its Affiliates;

7.2.5 there are no facts within the actual knowledge of the Purchaser or its Affiliates at the date hereof which will entitle the Purchaser to make any claim against the Seller and, insofar as there are any such facts, the Purchaser shall not be entitled to make any claim in respect thereof; and

7.2.6 the Purchaser is not for statutory purposes deemed to be unable to pay its debts and is able to pay its debts as they fall due and no steps have been taken to propose any scheme of arrangement involving the Purchaser and its creditors generally, obtain an administration order or appoint any administration or other receiver or equivalent officer in relation to the Purchaser or any of its property or to wind up or dissolve the Purchaser. No order has been made, petition presented or meeting convened for the purpose of considering a resolution for the winding up of the Purchaser or for the appointment of any provisional liquidator; and so far as the Purchaser is aware, no petition has been presented for an administration order to be made in relation to the Purchaser.

7.3 The Warranties are given as at the date of this Agreement and shall be repeated as at the Completion Date subject to matters fairly disclosed (with sufficient details to identify the nature and scope of the matters disclosed) in the Data Room Documents, the Licence Interest Documents or this Agreement. Accordingly, the Purchaser shall not be entitled to claim that any fact or matter constitutes a breach of or inconsistency with the Warranties and the Seller shall not be liable to the Purchaser for any claim to the extent that such fact or matter has been so disclosed.

7.4 Subject to Clause 7.3 and without prejudice to Clause 7.2.5, the Purchaser’s remedy for breach of any of the Warranties or any other provision of this Agreement shall be limited to a claim for damages and/or indemnity and the Purchaser shall not be entitled to any other form of remedy in relation thereto including rescission of this Agreement. Any payment by the Seller to the Purchaser for damages pursuant to a breach of any of the Warranties shall be treated as a reduction in the Purchase Price to the extent of such payment.

7.5 Save in the case of fraud or wilful concealment of material facts, the Seller shall not be liable for any claim for breach of any of the Warranties unless it shall have received from the Purchaser, as soon as practicable after the Purchaser becomes aware of the

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same, written notice containing reasonable details of the relevant claim including the Purchaser’s bona fide provisional estimate of the amount of the claim provided always that such notice is received on or before the expiry of eighteen(18) months from the Completion Date in the case of the Warranties other than the warranty contained in Clause 7.1.19 and in the case of such warranty before 31 ^st March 2014. Any claim made shall be deemed to have been withdrawn or satisfied unless arbitration proceedings in respect thereof have been both issued and served on the Seller within six (6) months of the giving of such notice.

7.6 Except as set out in Clause 7.1, neither the Seller nor any of its Affiliates nor any officer, shareholder, director, employee, agent, adviser, consultant or representative of the Seller or any of its Affiliates (including their auditors) makes any representation, warranty, statement, opinion, information or advice (including any representation, warranty, statement, opinion, information or advice (a) communicated (orally or in writing) to the Purchaser or any Affiliate of the Purchaser or (b) made in any data, information or document communicated to the Purchaser or any Affiliate of the Purchaser or made by any officer, shareholder, director, employee, agent, adviser, consultant or representative of the Seller or any Affiliate of the Seller) and the Purchaser acknowledges, affirms and warrants that (except as aforesaid) it has not relied, and will not rely, upon any such representation, warranty, statement, opinion, information or advice of any person in entering into this Agreement or carrying out the transactions contemplated by this Agreement. Without limiting the generality of the foregoing, the Seller makes no representation or warranty as to: (i) the amounts, quality or deliverability of reserves of oil, gas or other hydrocarbons attributable to the Interests, (ii) any geological, geophysical, technical, engineering, economic or other interpretations, forecasts or evaluations, (iii) any forecast of expenditures, budgets or financial projections, (iv) any geological formation, drilling prospect or hydrocarbon reserve, or (v) the physical state or condition of any of the assets associated with the Interests and the Purchaser acknowledges that all such assets are to be acquired by the Purchaser on an “as is, where is” basis.

7.7 Save in the case of fraud or wilful concealment of material facts, the Purchaser shall not be liable for any claim in relation to any breach of the provisions of Clause 7.2 unless it shall have received from the Seller, as soon as practicable after the Seller becomes aware of the same, written notice containing reasonable details of the relevant claim including the Seller’s bona fide provisional estimate of the amount of the claim and in any event such notice is received on or before the expiry of twelve (12) months from the Completion Date. Any claim made shall be deemed to have been withdrawn or satisfied unless judicial proceedings in respect thereof have been both issued and served on the Purchaser within six (6) months of the giving of such notice.

7.8 Save in the case of fraud or wilful concealment of material facts or breach of the Warranty contained in Clause 7.1.19, the liability of the Seller in respect of any claim for breach of the Warranties shall be limited as follows:

7.8.1 the Seller shall have no such liability unless the total loss or damage claimed to have been suffered by the Purchaser (acting in good faith) in respect thereof when aggregated with other such claims amounts to two million Dollars ($2,000,000) or more, whereupon the whole of such liability and not merely the excess shall be recoverable; and

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7.8.2 individual claims with a value of less than two hundred and fifty thousand Dollars ($250,000) shall be disregarded for all purposes including for the calculation of the aggregate value of claims for the purposes of Clause 7.8.1; and

7.8.3 the maximum aggregate liability of the Seller in respect of all such claims (including interest and expenses) shall not exceed an amount equal to the Purchase Price.

7.9 If:

7.9.1 the Purchaser becomes aware of any circumstance which may result in the Purchaser having a claim against the Seller under this Clause 7 as a result of or in connection with a liability or alleged liability to a third party, or

7.9.2 the Purchaser is or may be entitled by law to recover from some other person any sum in respect of which the Purchaser may have a claim against the Seller under this Clause 7,

the Purchaser shall promptly notify the Seller thereof in writing and the Purchaser shall make no admission of liability, agreement, settlement or compromise with any third party in relation to any such liability or alleged liability without the prior written consent of the Seller and the Seller shall at its expense be entitled to take and/or require the Purchaser to take any action the Seller might reasonably request to prevent a claim arising or to resist such liability or enforce such recovery (as the case may be) and to have conduct of any appeal, dispute, compromise or defence and of any incidental negotiations for the aforesaid purposes, subject to indemnifying the Purchaser in terms reasonably acceptable to the Purchaser against any Losses and Expenses the Purchaser may incur, and the Purchaser will give the Seller all practicable co-operation, access, assistance and information for the purposes of preventing such a claim, resisting such liability or enforcing such recovery as aforesaid.

7.10 Where the Purchaser is or may be entitled to recover from some other person any sum in respect of any liability, loss or damage the subject of a claim by the Purchaser against the Seller in respect of any breach of the Warranties or for which such a claim could be made, the Purchaser shall, before seeking to recover any amount from the Seller under this Agreement, take all reasonable steps as the Seller may reasonably require to enforce such recovery and shall keep the Seller informed of the progress of any action taken and any claim against the Seller shall be limited (in addition to the limitations on the liability of the Seller referred to in this Clause 7) to the amount by which the loss or damage suffered by the Purchaser as a result of such breach shall exceed the amount so recovered. If the Seller pays to the Purchaser an amount pursuant to a claim in respect of any breach of the Warranties and the Purchaser is entitled to recover from some other person any sum to which it would not have been or become entitled but for the circumstances giving rise to such a claim, the Purchaser shall promptly undertake all appropriate steps to enforce such recovery and shall forthwith repay to the Seller the amount recovered from the third party or, if less, the amount paid by the Seller, less any costs and expenses reasonably incurred by the Purchaser in recovering that amount from the third party.

7.11 The Seller shall not be liable for any breach of any provision of this Clause 7 nor shall the Purchaser have any rights in respect of any inconsistency therewith arising after the date hereof, to the extent that such breach or inconsistency is occasioned by the Seller doing or omitting to do any act or thing at the written request of the Purchaser.

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7.12 A breach of warranties under Clause 7.1 or Clause 7.2 which is capable of remedy shall not entitle a Party to make a claim unless the warrantor is given notice of such breach and the warrantor has failed to commence remedial action within thirty (30) days after the date on which such notice is served on the warrantor. Without prejudice to the foregoing, if any claim shall arise by reason of some liability which at the time that the claim is notified to a Party is contingent only, such Party shall not be under any obligation to make any payment in respect of such claim until such time as the contingent liability ceases to be so contingent.

7.13 Where a representation or warranty is qualified by the words “so far as the Seller is aware”, or any similar expression, such representation or warranty is given only to the extent that any of the officers or directors of the Seller or ATP Oil & Gas Corporation or senior managers of the Seller have actual knowledge of the matters to which it refers as at the date the representation or warranty is given after due and careful inquiry only of those of the Seller’s senior employees directly engaged in the management of the Interests and who could reasonably be expected to have knowledge of the subject matter of the relevant representation or warranty (and no other persons).

7.14 Nothing in this Agreement shall relieve a Party of any duty, whether at common law or otherwise, to mitigate any loss or damage incurred by it in respect of any breach by the other Party of the representations, warranties, indemnities or any other term of this Agreement or in respect of its subject matter.

7.15 A Party shall not be entitled to recover from the other Party the same sum or loss more than once in respect of any claims for any breach of any provision of this Agreement or in respect of its subject matter.

7.16 Notwithstanding any other provisions of this Agreement, neither Party shall be liable to the other Party under, arising out of or in any way connected to this Agreement or the Assignment Documents, for any Consequential Loss, whether arising in contract or in tort (including negligence, breach of statutory duty or otherwise). For these purposes “Consequential Loss” means loss of revenue, production or profits; or inability to produce Petroleum; or losses associated with business interruption; or loss of bargain, contract (other than this Agreement), expectation or opportunity; or any loss, claim or expense which arises out of the delay, postponement, interruption to or inability to produce, deliver or process production from the Interests; or any increase in operating or other costs; or all indirect or consequential losses or damages howsoever caused or arising.

8 Ongoing obligations and liabilities

8.1 The Parties shall co-operate with each other and shall execute such documents and take such actions as may reasonably be requested from time to time in order to give full effect to the intent of this Agreement.

8.2 Each Party undertakes to provide written advice to the other Party of any event giving rise to an adjustment under Clause 6, Clause 7 or Clause 12.7 or Clause 12.9.2, including such documentary evidence as is reasonably deemed to be necessary by the other Party to verify the adjustment, within thirty (30) days of becoming aware of such an event.

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9 Announcements and Confidentiality

9.1 No Party shall, and each Party shall procure that none of its Affiliates shall, issue or make any public announcement or statement regarding this Agreement or any transactions contemplated hereby without the prior written consent of the other Party, such consent not to be unreasonably withheld or delayed, except to the extent that it is necessary for a Party or its Affiliate to make such public announcement or statement in order to comply with a statutory obligation, an obligation to include information in published or audited accounts, or with the requirement of a competent government agency or other regulatory body, the London Stock Exchange plc, the Securities and Exchange Commission of the United States of America or a recognised stock exchange on which that Party or such Affiliate has its shares or oil production or royalty stock listed, in which event the Party proposing to make such an announcement or statement shall, as soon as practicable and, if possible prior to its release, issue a copy thereof to the other Party. In all circumstances the Parties shall consult in relation to the form of the announcement.

9.2 The terms and conditions of this Agreement shall be held confidential by the Parties and all information furnished or disclosed to a Party in connection with the transactions contemplated by this Agreement (“Confidential Information”) whether before or after the date hereof shall be held confidential by such Party and neither the terms of this Agreement nor any Confidential Information shall, subject to Clause 9.1, be divulged in any way to any third party by one Party without the prior written approval of the other Party; provided that such Party may, without such approval, disclose the same to:-

9.2.1 any of its Affiliates provided such Party remains liable for any breach of confidentiality by such Affiliate(s); or

9.2.2 any outside professional consultants or other professional advisers consulted in connection with this Agreement (including an expert and/or accountant appointed hereunder) provided such Party obtains a similar undertaking of confidentiality (but excluding this proviso) from such consultants and advisers; or

9.2.3 any bank or financial institution from whom such Party is seeking or obtaining finance, provided such Party obtains a similar undertaking of confidentiality (but excluding this proviso) from such bank or institution; or

9.2.4 the extent required by any applicable laws, the Licence(s), or the requirements of any recognised stock exchange or the Securities and Exchange Commission of the United States of America in compliance with its rules and regulations; or

9.2.5 the extent required by any Government agency or authority lawfully requesting the same; or

9.2.6 any Court of competent jurisdiction acting in pursuance of its powers; or

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9.2.7 the extent that the terms of this Agreement or any Confidential Information become public knowledge or for any other reason cease to be confidential otherwise than through breach of this undertaking.

9.3 Notwithstanding the termination of this Agreement the provisions of this Clause 9 shall continue to apply for a period of three (3) years from the date hereof.

10 Notices

10.1 Except as otherwise provided in this Agreement any notice or other document to be given under this Agreement shall be in writing and shall be deemed to be duly given if it (or the envelope containing it) identifies the Party to whom it is intended to be given as the addressee and:

10.1.1 it is delivered personally; or

10.1.2 it is sent by (i) pre-paid first class post or airmail or express or other fast postal service or (ii) the recorded delivery service or (iii) facsimile transmission,

to the appropriate address or facsimile number and marked for the attention of the appropriate person shown in Clause 10.3 or to such other addresses and/or facsimile numbers and/or marked for the attention of such other persons as may be given by a Party for the purposes of this Agreement by notice to the other Party.

10.2 Any notice duly given within the meaning of Clause 10.1 shall be deemed to have been both given and received:

10.2.1 if it is delivered in accordance with Clause 10.1.1, on such delivery;

10.2.2 if it is duly posted or transmitted in accordance with Clause 10.1.2 by any of the methods therein specified, on the second (or, when sent by airmail, the fifth) Business Day after the day of posting or (in the case of a notice transmitted by facsimile) on the first Business Day after the day of transmission and receipt by the sender of a successful transmission report indicating full and complete transmission.

10.3 The respective addresses for service are:

Seller ATP Oil & Gas (UK) Limited

Victoria House,

London Square,

Cross Lanes,

Guildford GU1 1UJ

Facsimile: 01483 307222

Email: jgill@atpog.com

Attention: John Gill

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copied to:

ATP Oil & Gas Corporation

4600 Post Oak Place,

Suite 200,

Houston,

Texas 11027-9726

Facsimile: + 1 713 622 0289

Email: jtschirhart@atpog.com

Attention: John Tschirhart

Purchaser EDF Production UK Ltd

c/o 1 Blake Mews.

Kew Gardens,

London, TW9 3GA

Facsimile: +44 208 439 9868

Emails: amj@lawxl.com

Emails: philippe.antoine@edf.fr

Attention: Philippe M Antoine

copied to:

Facsimile: +33 1 5665 0837

Attention: Charles-Henri Prou

Emails: charles-henri.prou@edf.fr

10.4 For the purposes of this Clause 10 “notice” shall include any request, demand, instructions or other document.

11 Costs and Expenses

11.1 Save as otherwise stated in this Agreement, each Party shall pay its and its Affiliates’ own costs, expenses, duties and, except as otherwise expressly agreed in writing, Taxation in relation to the preparation and execution of this Agreement, the documents contemplated hereby or executed pursuant hereto and any transactions contemplated by this Agreement.

11.2 Without prejudice to any other rights or remedies available to a Party hereunder or at law, if any amount payable hereunder is not paid when due, the defaulting Party shall pay interest on such amount from the due date of payment (after as well as before judgment) at a rate equal to two percent (2%) above the Agreed Rate calculated on a compounded basis on the accumulated daily balances.

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11.3 The Purchaser shall be responsible for payment in a timely fashion of any and all stamp duty land tax, stamp duties, transfer taxes, registration fees and other charges payable on or in respect of this Agreement, the Assignment Documents and/or any related agreements and in respect of its or their subject matter and any similar taxes, duties, fees and charges wheresoever arising in relation to the transfer of the Interests to the Purchaser.

12 Taxation

12.1 The Seller confirms that it is registered and the Purchaser confirms that it has applied for registration and will use its reasonable endeavours to obtain registration before Completion, as taxable persons for the purposes of VAT and that no election has been made and no election will be made prior to the Completion Date under paragraph 2 of Schedule 10 to the Value Added Tax Act 1994 in relation to the Interests.

12.2 The Purchaser undertakes that it will use the Interests as part of its business of searching for, boring for and getting petroleum as a going concern for a sufficient period to comply with the requirements of Article 5 of the Value Added Tax (Special Provisions) Order 1995 so that the assignment of the Interests is treated as neither a supply of goods nor a supply of services for VAT purposes.

12.3 The Purchase Price is stated net of any applicable VAT. The Parties believe that the sale and transfer hereunder is a transaction which is outside the scope of VAT by virtue of Article 5 of the Value Added Tax (Special Provisions) Order 1995 and/or that the transfer contemplated hereby is of a right over land situated outside the United Kingdom and as such will be treated as outside the scope of Value Added Tax by virtue of Article 5 of the Value Added Tax (Place of Supply of Services) Order 1995. However, in the event that a Party is advised in writing by HM Revenue and Customs that the transaction hereunder is subject to VAT, the Purchaser undertakes to pay to the Seller, on delivery of a valid VAT invoice, any amounts due in respect of VAT within thirty (30) days of demand.

12.4 Reimbursement pursuant to Clause 6.3 shall be exclusive of VAT which the Party receiving the reimbursement may be required to charge and, if called upon to do so by the such Party, the Party making the reimbursement undertakes to pay such Party, on presentation of a valid VAT invoice, any amounts properly due in respect of VAT set out in such invoice within thirty (30) days of demand.

12.5 Subject to Clause 12.3, any Adjustments pursuant to Clause 3 or payments or reimbursements pursuant to Clause 6.3 or Clause 7 in respect of any payment or receipt being an amount in respect of which VAT has been paid or received shall be made on a basis disregarding the VAT element where the VAT paid is fully deductible or is required to be accounted for in full to HM Revenue and Customs, but otherwise shall be made on a basis which leaves the Seller and the Purchaser in no better and no worse a position (after taking account of VAT, and subject to the application of the other provisions of this Clause 12) than had the payment or receipt not been made or received.

12.6 The Seller shall make an application to HM Revenue and Customs under Section 49(1) (b) of the Value Added Tax Act 1994 for a direction that the records relating to the Interests which under paragraph 6 of Schedule 11 to the Value Added Tax Act 1994 have been maintained by the Seller or its Affiliates should be preserved by the Seller or its Affiliates, as the case may be,

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notwithstanding the provisions of the said section. The Seller shall, as soon as reasonably practicable following receipt thereof, provide the Purchaser with a copy of any such direction and the Purchaser shall retain access at all reasonable times during business hours to all books and records retained by the Seller or its Affiliates in relation to VAT matters concerning the Interests and the Seller covenants to retain such records as required by paragraph 6 of Schedule 11 to the Value Added Tax Act 1994.

12.7 CT Adjustments

12.7.1 The Purchase Price shall be increased by the Purchaser paying to the Seller an amount equal to any CT paid by the Seller on any receipts taken into account, using the Accruals Basis of Accounting, for the purposes of Clause 3.7, the Petroleum Sales Adjustment.

12.7.2 The Purchase Price shall be decreased by the Seller paying to the Purchaser an amount equal to any CT relief received by the Seller on any cash calls paid and any expenditure taken into account, using the Accruals Basis of Accounting, for the purposes of Clause 3.6, the Cash Calls Adjustment and Clause 3.8, the Interim Period Adjustment.

12.7.3 The Parties recognise that adjustments under this Clause 12.7 are notional adjustments, as opposed to actual payments of, reliefs from or reductions in CT liabilities. For the purpose of calculating these notional adjustments it shall be assumed that both the Seller and the Purchaser are single companies with no brought forward losses who are paying CT at the standard rate applicable for the period concerned. Such notional adjustments shall be effected by deducting from each relevant payment a notional CT charge. In calculating the notional CT charge, the CT rate to be used will be the rate which applies at the end of the month in which the receipt or payment arises, or if the rate of CT changes during a month the arithmetic mean of the rates applicable for that month shall be used.

12.7.4 If the Parties cannot reach agreement on all or part of the adjustments referred to in this Clause 12.7 within thirty (30) Business Days of receipt by the Purchaser from the Seller of the Seller’s estimate of such adjustments, the adjustments in dispute may be referred by either the Seller or the Purchaser for determination by an independent expert nominated by the Parties or, in the absence of agreement between the Parties within five (5) Business Days of a Party notifying the other that it proposes to refer the dispute to an expert, by the President of the Institute of Chartered Accountants in England and Wales on the application of either the Seller or the Purchaser. Within twenty (20) Business Days after the appointment of such expert, each Party may submit to the expert a statement of the nature of the dispute, a description of the submitting Party’s claims with respect thereto, and any other supporting documentation or materials with respect thereto that the submitting Party desires the expert to consider. The Party submitting such statement shall provide a copy thereof to the other Party, who shall have ten (10) Business Days from receipt thereof to submit a responding statement to the expert. The nominated expert shall be afforded such access to books, records, accounts and documents in the possession of the Parties as he may reasonably request, and he shall act as expert not as arbitrator. The said expert’s determination shall, in the absence of fraud or manifest error or bias, be final and binding on the Parties, his fees and disbursements shall be borne by the Seller and the Purchaser in equal shares and the Parties shall bear their own costs in respect of such reference.

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12.8 The Seller shall be liable for any liabilities arising under Schedule 15 to the Finance Act 1973 in respect of the Interests or the Licence(s)for periods ending up to the Economic Date and the Purchaser shall be liable for all periods thereafter.

12.9.1 The Seller and the Purchaser agree that the allocation of Consideration set out in Schedule 2 is a just and reasonable apportionment of the Consideration and both agree to submit their CT returns for all relevant years on the basis of said allocation. Further, the Seller and the Purchaser agree consistently to allocate the Consideration attributable to amounts eligible for capital allowances between plant and machinery allowances and mineral extraction allowances on their respective CT returns. Where HM Revenue and Customs does not agree with the claim for capital allowances by the Purchaser, the allocation set out in Schedule 2 shall be adjusted to take into account the just and reasonable apportionment agreed by HM Revenue and Customs and to reflect any revised disposal proceeds taken into account in the Seller’s revised CT returns.

12.9.2 If any part of the Consideration allocated as set out in Schedule 2 to assets qualifying for capital allowances under Part 2 and/or Part 5 of the Capital Allowances Act 2001 is not agreed by HM Revenue and Customs and the total of the capital allowances claim of the Purchaser is reduced, the Seller shall pay to the Purchaser, by way of adjustment to the Purchase Price, an amount equal to fifty percent (50%) of the amount by which the total of the Purchaser’s claim for capital allowances is reduced by HM Revenue and Customs provided always that, save in the case of fraud or wilful concealment of material facts, the Seller shall not be liable for any payment to the Purchaser pursuant to this Clause 12.9.2 unless it shall have received from the Purchaser, as soon as practicable after the Purchaser becomes aware of the amount of capital allowances not being so agreed, written notice containing reasonable details of the relevant claim including the Purchaser’s bona fide provisional estimate of the amount of the claim and in any event such notice is received on or before 31^st March 2014. Any payment under this clause shall not be due for payment until the earlier of 1^st January 2012 and the date on which the increased Taxation that results from the adjustments to the allocation of consideration falls due for payment to HM Revenue and Customs.

13 Variation

The terms and conditions of this Agreement shall only be varied by an agreement in writing signed by each of the Parties and specifically referring to this Agreement.

14 Assignment

No Party shall assign or transfer its rights or its obligations under this Agreement without the prior written consent of the other Party save that (a) prior to Completion the Purchaser may assign its rights under this Agreement (in whole or in part) with the consent of the Seller (such consent not to be unreasonable withheld or delayed) and (b) after Completion the Purchaser may assign its rights under this Agreement (in whole or in part), in either case to an Affiliate(s) and/or to an Affiliate(s) of Edison S.p.A.

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15 Rights of Third Parties

With the exception of the rights of the Seller’s Affiliates to enforce the terms of Clause 6.6, nothing in this Agreement is intended to confer on any person any right to enforce any term of this Agreement which that person would not have had but for the Contracts (Rights of Third Parties) Act 1999. Notwithstanding the foregoing, the Parties may by agreement rescind or vary any term of this Agreement without the consent of any of the Seller’s Affiliates.

16 General

16.1 If there is any conflict between the provisions of this Agreement and the provisions of the Assignment Documents, the provisions of this Agreement shall prevail. The provisions of the main body of this Agreement shall prevail over the provisions of the Schedules in the event of any conflict.

16.2 Without prejudice to the provisions of Clauses 7.5 and 7.7, this Agreement shall remain in full force and effect notwithstanding Completion.

16.3 No waiver by any Party of any breach of a provision of this Agreement shall be binding unless made expressly and in writing and any such waiver shall relate only to the matter to which it expressly relates and shall not apply to any subsequent or other matter.

16.4 This Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns of the Parties.

16.5 This Agreement may be executed in any number of counterparts but shall not be effective until each Party has executed at least one counterpart. Each of the executed counterparts shall be deemed to be an original of this Agreement, but taken together, all the counterparts shall constitute one and the same instrument.

16.6 This Agreement is not intended to constitute or create nor shall it be construed so as to constitute or create any partnership, association, joint venture or trust. Notwithstanding the foregoing if, for the income tax purposes of the United States of America, this Agreement and the transactions under this Agreement are regarded as a partnership, each Party which is affected thereby elects to be excluded from the application of all of the provisions of Subchapter “K” of Chapter 1 of Subtitle “A” of the Internal Revenue Code of 1986 as amended of the United States of America (the “Code”), as permitted and authorised by Section 761 of the Code and the Treasury Regulations promulgated under the Code, and any future income tax laws of the United States containing similar provisions. No affected Party shall give any notices or take any other action inconsistent with the election made hereby. In making the foregoing election, each affected Party states that the income derived by it from the transactions under this Agreement can be adequately determined without a computation of partnership taxable income. A Party that is not subject to the income tax laws of the United States of America in respect of this Agreement and the transactions under this Agreement shall not be required to do any act or execute any instrument which might subject it to the taxation jurisdiction of the United States of America.

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16.7 Each provision of this Agreement is severable and distinct from the others and if any such provision shall in whole or in part be held to any extent to be illegal or unenforceable under any enactment or rule of law that provision or part shall to that extent be deemed not to form part of this Agreement and the validity and enforceability of the remainder of this Agreement shall not be affected.

16.8 This Agreement, and the confidentiality agreement between the Parties dated 30^th May 2008 contain the entire agreement between the Parties and supersedes the Offer Letter dated 28 August 2008 from the Purchaser, the Letter Agreements dated September 5, 2008 and September 11, 2008 between the Parties, all prior negotiations, proposals, statements of intent, understandings and agreements relating to the subject matter hereof. Each of the Parties agrees that it will have no remedy in respect of any untrue representations or statements made by the other Party or its advisers, unless made fraudulently, and upon which it relied in entering this Agreement.

17 Governing Law and Arbitration

17.1 The construction validity and performance of this Agreement and all agreements executed pursuant hereto shall be governed by English law (other than choice of law rules).

17.2 Subject to Clause 3.13 and Clause 12.7.4, all disputes arising out of or in connection with this Agreement shall be finally settled under the Rules of Arbitration of the LCIA by three (3) arbitrators appointed in accordance with those rules. London shall be the seat of arbitration and the language of the arbitration shall be English and all documents submitted to the arbitration shall be submitted to the arbitration in their original form together with an English translation.

17.5 Each Party agrees that without preventing any other mode of service, any document in any dispute referred to arbitration hereunder may be served on any Party by being delivered to or left for that Party at its address for service of notices under Clause 10 and each Party undertakes to maintain such an address at all times in accordance with Clause 10 and to notify the other Party in advance of any change from time to time of the details of such address in accordance with the manner prescribed for service of notices under Clause 10.

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IN WITNESS whereof this Agreement has been signed by the duly authorised representatives of the Parties on the day and year first above written.

SIGNED for and on behalf of

ATP OIL & GAS (UK) LIMITED

/s/ John Gill

Director

SIGNED for and on behalf of

EDF PRODUCTION UK LTD

/s/ Dominique Venet

Director

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Schedule 1

Licence(s), related Licensed Interest Documents and other related information

Tors Field – Kilmar Interest under UK Petroleum Production Licence No. P.683 dated 12^th September 1989 and Garrow Interest under UK Petroleum Production Licence No. P.1034 dated 6 ^th February 2002

(A) Blocks

Licence P.683 – Block 43/22a (including the Kilmar Field)

Licence P.1034 – Blocks 42/25a and 43/21a (including the Garrow Field)

(B) Licensees & Percentage Interests

ATP Oil & Gas (UK) Limited	85	%
Sojitz Energy Project Limited	15	%

(C) JDA

Agreement for the Joint Development of and Production from the Tors Fields United Kingdom Petroleum Production Licences P.683 (Block 43/22a) and P.1034 (Blocks 42/25a and 43/21a) (to be known as the “Tors Development Agreement”) dated 21^st December 2005.

(D) Operator

ATP Oil & Gas (UK) Limited

(E) Licensed Interest Documents

Licence P.683 dated 12 September 1989.

DTI letter dated 1 October 1991.

Joint operating agreement (JOA) relating to licence P.683 dated 7 October 1991.

Deed of licence assignment dated 20 November 1991.

Novation and amendment agreement in respect of JOA dated 20 November 1991.

Deed of licence assignment dated 6 November 1992.

Novation agreement in respect of JOA dated 6 November 1992.

37

Deed of licence assignment dated 1 January 1993.

Novation agreement in respect of JOA dated 1 January 1993.

Deed of licence assignment dated 25 January 1994.

Novation agreement in respect of JOA dated 25 January 1994.

Area of Mutual Interest Agreement dated 22 February 1994.

DTI letter and attached schedule of retained area dated 12 July 1995.

Deed of licence assignment dated 1 August 1995.

Deed of assignment of interest dated 1 August 1995.

Novation agreement in respect of JOA dated 1 August 1995.

Deed of licence assignment dated 21 December 1995.

Deed of assignment of interest dated 21 December 1995.

Novation agreement in respect of JOA dated 21 December 1995.

JOA relating to licences P.683 and P.891 dated 22 August 1996.

Seismic trade agreement dated 13 June 1997.

Deed of licence assignment dated 2 October 1998.

Deed of assignment of interest dated 2 October 1998.

Novation agreement in respect of JOA dated 2 October 1998.

Deed of rectification dated 2 October 1998.

Deed of licence assignment dated 1 May 2000.

Novation of Joint Operating Agreement dated 1 May 2000.

Sales and Purchase Agreement between ATP (UK), Arco and ATP Corp dated 7 May 2001.

Stamp Duty Agreement 7 May 2001.

Deed of Assignment 20 June 2001.

Novation of JOA 20 June 2001.

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Assignment of Percentage Interest 20 June 2001.

Licence P.1034 dated 6 February 2002, Blocks 42/25a and 43/21a dated 06 February 2002.

Deed of Licence Agreement 19 February 2003.

Deed of Adherence to Agreement for Provision of Claims Validation 6 May 2003.

Sale and Purchase Agreement – GDF and ATP – dated 10 March 2005

Heads of Terms for Offshore and Compression Services 21 March 2005.

Heads of Terms for Transportation 21 March 2005.

Heads of Terms for Processing Services 21 March 2005.

Extracts from Minutes of Board Meeting 25 May 2005.

Percentage of Interest Assignment 27 May 2005.

Deed of Licence Assignment 27 May 2005.

SEAL Pipeline Crossing Agreement 7 July 2005 Signature Page.

DTI Approval for dev of Kilmar Field 20 July 2005.

Construction & Tie-in Agreement (with P.683) 11 August 2005.

Letter of Agreement re ARCO (with P.683) 17 November 2005.

Joint Development Agreement (with P.683) 21 December 2005.

Letter Agreement re Decommissioning Security (with P.683) 21 December 2005

Deed of Licence Assignment (with P.683) 21 December 2005.

Novation of Construction & Tie-In (with P.683) 21 December 2005.

Side Letter To CTIA 14 February 2006.

Deed of Adherence to ABAAA 24 March 2006.

Deed of Adherence to ABUFA 24 March 2006.

Tors Field POSA 24 March 2006.

Side Letter to POSA 24 March 2006.

39

EAGLES Tors Transportation Agreement 24 March 2006.

EAGLES Area Sub Allocation Agreement 24 March 2006.

Tors Bacton Processing Agreement 24 March 2006.

40

The Wenlock Field Interests under UK Petroleum Production Licence No. P.033 dated 17^th September 1964

(A) Blocks

Licence P.033 – Block 49/12aN (including the Wenlock Field).

(B) Licensees & Percentage Interests

ATP Oil & Gas (UK) Limited 100 %    

(C) JOA

P.033 Joint Operating Agreement Block 49/12a North dated 14^th December 2005.

(D) Operator

ATP Oil & Gas (UK) Limited.

(E) Licensed Interest Documents

UKCS Petroleum Production Licence P.033 dated 17/9/64.

Agreement between National Coal Board (Exploration) Limited and Continental Oil dated 14/2/67 (and letter dated 10/3/67).

Deed of Assignment dated 7/3/67 (and Ministry of Power letter dated 6/3/67).

Supplemental Deed to Licence dated 17/8/70.

Schedule of Retained Area dated 18/9/70.

Letter agreement concerning UKCS Licences P.025 and P.033 dated 9/3/71.

Joint Operating Agreement dated 18/6/71 and letter dated 18/6/71 (and supplementary agreement dated 18/6/71).

Sub-Licence relating to Block 49/17 dated 25/3/74.

Agreement for the transfer of certain of the assets and undertakings of BNOC Exploration Limited dated 20/12/78.

Dept. Energy consent dated 17/8/79.

Deed of licence assignment dated 20/11/79.

Novation of JOA dated 20/11/79.

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Letter approving Conoco (UK) Limited as operator of Licence P.033 dated 15/8/80.

Dept. Energy letter approving Conoco resignation dated 24/10/80.

Novation agreement relating to JOA dated 24/11/80.

Letter from DoE – Development and Production Works consent dated 31/12/80.

DoE letter re assignment of sub-licence dated 19/10/81.

Scheme re Britoil dated 1/8/82 and DoE letter dated 9/11/82.

Dept. Energy consent dated 8/10/85.

JOA Amendment Agreement dated 14/10/85.

Dept. Energy consent dated 19/11/86.

Dept. Energy consent dated 8/12/86.

JOA Amendment Agreement dated 7/7/88.

Letter from Conoco re Conoco Development Limited dated 8/7/88.

Letter from Conoco re letter agreement dated 8/7/88.

Letters from Britoil plc relating to JOA dated 19/1/89.

Deed or licence assignment dated 1/2/89.

Letter Agreement re notice of assignment dated 1/12/89.

Deed of licence assignment dated 24/2/93.

Trust Deed dated 24/2/93.

JOA Novation and Amendment Agreement dated 24/2/93.

JOA Novation and Amendment Agreement dated 30/6/93.

DTI letter of approval dated 13/6/94.

Letter to DTI attaching licence assignment form re Britoil transfer dated 18/11/94.

JOA Novation and Amendment Agreement dated 9/12/94.

Letters to/from DTE re Britoil transfers dated 15/12/94.

Letters to DTI re Licence Assignment dated 9/3/95 and 17/5/95.

Fax to DTI re Licence dated 22/6/95.

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Letters from DTI dated 21/6/95 and 23/6/95.

JOA Amendment Agreement (undated).

JOA Amendment Agreement dated 29/12/94.

Deed of licence assignment dated 29/6/95.

Trust Deed (Block 49/16 Ganymede Extension Area) dated 29/6/95.

JOA Amendment Agreement dated 30/9/95.

JOA Novation Agreement dated 3/11/95.

Letters to DTI re Licence dated 18/11/96, 20/12/96 and 18/2/97.

Letter of consent from DTI dated 20/12/96 and letter dated 13/3/97.

DTI letter of consent dated 24/7/97.

Supplemental Deed to Trust Deed (49/16) dated 30/11/97.

DTI letter of consent dated 23/12/97.

Deed of licence assignment dated 9/2/98.

Consent to assignment of sub-licence dated 9/2/98.

Supplemental Deed to Trust Deed (49/16) dated 9/2/98.

JOA Novation Agreement dated 26/3/98.

DTI letter of consent dated 30/7/98.

Deed of licence assignment dated 25/11/98.

JOA Novation and Amendment Agreement dated 25/11/98.

Supplemental Deed to Trust Deed (49/16) dated 25/11/98.

Deed of licence assignment dated 25/11/98.

JOA Novation Agreement dated 27/11/98.

DTI consent dated 9/8/99.

Deed of licence assignment dated 19/4/00.

Deed of licence assignment dated 11/5/00.

Supplemental Deed to Trust Deed (49/16) dated 11/05/00.

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DTI consent dated 25/7/00.

JOA Novation and Amendment Agreement dated 30/10/00.

Deed of licence assignment dated 30/10/00.

Agreement for the sale and purchase of assets in relation to UKCS Block 49/12a North dated 26/1/01.

Stamp Duty Agreement relating to U.K. Petroleum Production Licence P.033 – Block 49/12a North dated 26/1/01.

Novation and Amendment to the Southern North Sea Joint Operating Agreement relating to Licences P.033 and P.130 (Amendment Number 20) dated 30/3/01.

Deed of Novation of Trust Deed U.K. Petroleum Production Licence P.033 (Block 49/16 – Ganymede Extension Area) dated 30/3/01.

Deed of Assignment in respect of U.K. Petroleum Production Licence P.033 dated 30/3/01.

Assignment of Percentage Interest relating to Block 49/12a North dated 30/3/01.

Novation and Amendment to the Operating Agreement relating to Exploration and Production Operations under UK Production Licences Nos. P.033 and P.130 Amendment No. 21 dated 21/12/01.

Supplemental Deed to Trust Deed in relation to Sub-Licence P.033 (Block 49/17) dated 26/4/02.

Novation and Amendment of the Operating Agreement relating to Exploration and Production Operations in certain parts of the Southern North Sea under U.K. Petroleum Production Licences Nos. P.033 and P.130 – Amendment No.22 dated 15/5/02.

Novation and Amendment of the Operating Agreement relating to Exploration and Production Operations in certain parts of the Southern North Sea under U.K. Petroleum Production Licences Nos. P.033 and P.130 – Amendment No.23 dated 12/11/02.

Deed of Novation and Amendment to Trust Deed relating to U.K. Petroleum Production Licence No. P.033 (Block 49/16 – Ganymede Extension Area) dated 12/11/02.

Letter from ConocoPhillips (U.K.) Limited re merger dated 10/12/02.

Letter from BP Exploration Operating Company Ltd re transfer of assets under P.033 dated 23/5/03.

Deed of Assignment in respect of UK Petroleum Production Licence P.033 dated 19/5/03.

Deed of Novation of and Amendment to Trust Deed relating to U.K. Petroleum Production Licence No. P.033 (Block 49/16 – Ganymede Extension Area) dated 19/5/03.

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Novation and Amendment of the Operating Agreement relating to Exploration and Production Operations in certain parts of the Southern North Sea under U.K. Petroleum Production Licences Nos. P.033 and P.130 –Amendment No.24 dated 19/05/03.

Novation and Amendment of the Operating Agreement relating to Exploration and Production Operations in certain parts of the Southern North Sea under UK Petroleum Production Licences Nos. P.033 and P.130 –Amendment No.25 dated 4/6/03.

Execution Deed re transfer of interests in Southern Waters Production JOA dated 31/10/03.

Novation and Amendment of the Operating Agreement relating to Exploration and Production Operations in certain parts of the Southern North Sea under UK Petroleum Production Licences Nos. P.033 and P.130 –Amendment No 27 dated 22/12/03.

Amendment of the Operating Agreement relating to Exploration and Production Operations in certain parts of the Southern North Sea under UK Petroleum Production Licences Nos. P.033 and P.130 – Amendment No.29 dated 14/9/05.

Sale and Purchase Agreement in relation to P.033, Block 49/12a North – (including Venture Discovery area) dated 14/12/05.

Letter Agreement re acquisition of ConocoPhillips interest in P.033 dated 14/12/05.

Joint Operating Agreement Block 49/12a North dated 14/12/05.

Trust Deed in respect of United Kingdom Petroleum Production Licence P.033 Block 49/12A North (Area K) dated 14/12/05.

Deed of Amendment No.30 to Operating Agreement relating to Exploration and Production Operations in Certain Parts of the Southern North Sea under UK Petroleum Production Licences P.033 and P.130 dated 14/12/05.

Trust Deed in respect of United Kingdom Petroleum Production Licence P.033 Block 49/12a North (Area K) and part Block 49/16 (Viper Area) dated 23/12/05.

Grant of Permission to enter 500m zone for the purpose of ROV inspection dated 28/5/06.

Letter of Credit re Wenlock dated 8/8/06.

Novation and Amendment Agreement in respect of Joint Operating Agreement Block 49/12A (North) dated 9/8/06.

Deed of Assignment of Limited Overriding Royalty Interest 9/8/06.

DTI letter re Wenlock Field Development dated 18/8/06.

DTI letter re Development and Production Works dated 18/8/06.

Agreement relating to Preparatory work for the possible tie-in of the Wenlock Facilities to Inde Platform 49/23AC dated 29/8/06.

Construction and Tie-in Agreement relating to the tie-in of the Wenlock Facilities to Inde Platform 49/23 AC dated 11/9/06.

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Cable Crossing Agreement in respect of the Wenlock/Inde 23AC Pipelines and the Norsea Communications Cable dated 12/9/06.

ATP Power of Attorney dated 19/12/06.

Decommissioning Security Agreement relating to Wenlock Field dated 21/12/06.

Novation of Joint Operating Agreement relating to Block 49/12a North dated 21/12/06.

Letter of undertaking re Decommissioning Security Agreement dated 21/12/06.

Letter Agreement relating to Sale and Purchase Agreement in relation to P.033, Block 49/12a (North) dated 21/12/06.

Trust Deed in respect of Licence P.033 dated 14/6/07.

Letter from ConocoPhillips re Licence P.033 Rationalisation dated 21/6/07.

Execution Deed in respect of UK Petroleum Production Licence P.025, Part of Block 53/1a Camelot Fields and Associated Infrastructure and Non-Producing Acreage dated 25/6/07.

Deed of Rectification in relation to the Amoco Bacton Allocation and Attribution Agreement and the Amoco Bacton User Fields Agreements dated 28/6/07.

Schedule 3 to Deed of Rectification dated 28/6/07.

Execution Deed relating to transfer of Victor/Jupiter/Bell P.025/P.033 Interests (Licences and Trust Deeds) dated 28/6/07.

Amoco Bacton User Fields Agreement New User Group Notice for Wenlock Field dated 27/7/07.

Amoco Bacton Allocation and Attribution Agreement New User Notice for Wenlock Field dated 1/8/07.

Deed of Adherence to the Amoco Bacton Allocation and Attribution Agreement dated 4/10/07.

Deed of Adherence to the Amoco Bacton User Fields Agreement dated 4/10/07.

Amending Agreement to the Amoco Bacton Allocation and Attribution Agreement dated 16/10/07.

Agreement for Transportation of Natural Gas from the Wenlock Field via the Inde Facilities and Provision of Offshore Services dated 16/11/07.

Agreement for Reception, Processing and Redelivery of Natural Gas from the Wenlock Field at the Perenco Bacton Terminal dated 16/11/07.

Wenlock Backgassing Agreement dated 20/11/07.

Supplemental Agreement to Joint Operating Agreement Block 49/12A (North) dated 20/11/07.

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Execution Deed in respect of UK Petroleum Production Licences P.033 (Block 49/17) and P.025 (Block 49/22a) (Victor) dated 30/11/07.

Deed of Novation and Amendment of Trust Deed in respect of Licence P.033 dated 19/12/07.

Deed of Assignment in respect of United Kingdom Petroleum Production Licence No. P.033 dated 19/12/07.

Amoco Bacton Allocation and Attribution Agreement New User Group Notice dated 23/1/08.

Amoco Bacton User Fields Agreement New User Group Notice dated 23/1/08.

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Schedule 2

Summary of the Consideration allocated to assets qualifying for Capital Allowances

Field/Area	Plant & Machinery (£s)	Mineral exploration & access – (£s)	£s
Wenlock	99,471,975	462,434	101,280,000
Tors	134,179,135	572,290	163,720,000
			£265,000,000

Any balance of the respective considerations will be allocated to the Licences

48

Schedule 3

Working Capital

1. Pursuant to Clause 3.5, the working capital balance shall be determined in relation to the Interests in accordance with the provisions of this Schedule 3, by adding together the amounts of the Cash Balances, VAT Receivable, Other Assets, Inventory (net of provisions) and Prepayments (the “Positive Balance”) for the Interests and adding together the amounts of any overdraft balance, VAT Payable, Accruals and Other Liabilities (the “Negative Balance”) for the Interests and deducting the Negative Balance from the Positive Balance, and adding together the net balances.

2. Elements

The elements of working capital shall comprise those items set out in the Exhibit to this Schedule 3, which items shall relate solely to the Interests and have the following meanings:

“Accruals”	means the amounts accrued by the Joint Account but unpaid as at the Economic Date;
“Cash Balances”	means cash balances held by the Joint Account at the Economic Date;
“Inventory”	means the value of equipment held at the Economic Date;
“Joint Account”	means any joint account held by the Operator in accordance with the JOA;
“Other Assets”	means other assets due to the Joint Account but unpaid at the Economic Date;
“Other Liabilities”	means the other liabilities accrued by the Joint Account but unpaid as at the Economic Date;
“Prepayments”	means amounts prepaid by the Seller or the Operator on account of expenditure incurred on an accruals basis of accounting after the Economic Date;
“VAT Receivable/Payable”	means VAT due to/from the Joint Account but not recovered/paid at the Economic Date.

3. Valuation of certain elements

For all elements of working capital, the figures shall be derived from the statements provided by the Operator.

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Exhibit to Schedule 3

Working Capital Statement

INTEREST	100%   JOINT VENTURE   £	INTEREST %	INTEREST SHARE £
AS PER OPERATOR STATEMENTS
CASH BALANCES
PREPAYMENTS
VAT RECEIVABLE/PAYABLE
OTHER ASSETS
INVENTORY
ACCRUALS
OTHER LIABILITIES
TOTAL WORKING CAPITAL

50

Schedule 4

Format for Interim Completion Statement and Final Completion Statement

STATEMENT OF CONSIDERATION
Description	Clause/Schedule	Amount £	Amount £
Purchase Price	Clause 3.1
Interest thereon	Clause 3.15
Adjustments
Working Capital Adjustment	Clause 3.5, Schedule 3	+/-
Interest thereon	Clause 3.16	+/-	+/-
Cash Calls Adjustment	Clause 3.6	+
Interest thereon	Clause 3.16	+	+
Petroleum Sales Adjustment	Clause 3.7	-
Interest thereon	Clause 3.16	-	-
Interim Period Adjustment	Clause 3.8	+
Interest thereon	Clause 3.16	+	+
Total consideration (incl Adjustments)

51

Schedule 5

AFEs referenced in Clause 4.2

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EX-10.2

Exhibit 10.2

DATED 23RD SEPTEMBER 2008

AS AMENDED AND RESTATED ON 23RD OCTOBER 2008

CALL OPTION AGREEMENT

Between

EDF PRODUCTION UK LTD

And

ATP OIL & GAS (UK) LIMITED

THIS AGREEMENT is dated 23rd September 2008

and amended and restated on the day of October 2008

PARTIES

(1) EDF PRODUCTION UK LTD, a company incorporated in England and Wales (company number 6683599 whose registered office is at 1 Blake Mews, Kew Gardens, London TW9 3GA (Buyer).

(2) ATP OIL & GAS (UK) LIMITED, a company incorporated in England and Wales (company number 3949599) whose registered office is at Victoria House, London Square, Cross Lanes, Guildford GU1 1UJ (Seller).

BACKGROUND

(A) The Buyer has agreed to purchase the Interests on the terms and conditions of the Sale and Purchase Agreement entered into between the Buyer and Seller on 23^rd September 2008 as amended and restated today (the Amended and Restated Sale and Purchase Agreement);

(B) The Seller is the legal and beneficial owner of the Option Interests and has agreed to enter into a call option in favour of the Buyer upon the terms of this Agreement; and

(C) The Parties wish to set out the terms and conditions upon which the aforesaid sale and purchase of the Option Interests shall take place in the event of exercise of such option.

AGREED TERMS

1. INTERPRETATION

1.1 Unless otherwise stated in this Agreement, the definitions and rules of interpretation set out in the SPA Terms shall apply in this Agreement. For the purposes of this Agreement the following shall have the meanings set out below:

Completion: the completion of the exercise of the Option as described in the SPA Terms.

Exercise Notice: the written notice given by the Buyer in accordance with clause 4.1 and in the form set out in Schedule 1.

First Exercise Date: has the meaning set out in clause 3.1 (a).

Interests: has the meaning set out in the Amended and Restated Sale and Purchase Agreement.

Lapse: the lapse of the Option in accordance with clause 3.1(b).

Option: the option granted in favour of the Buyer by clause 2.

Option Period: the time during which the Buyer may exercise the Option, as set out in clause 3.

Option Interests: has the meaning set out in the SPA Terms.

SPA Terms: the terms and conditions of the sale and purchase under which the Buyer shall buy the Option Interests as set out in Schedule 2 of this Agreement.

Tunnel: has the meaning set out in the SPA Terms.

1.2 Clause, schedule and paragraph headings shall not affect the interpretation of this agreement.

1.3 A person includes a natural person, corporate or unincorporated body (whether or not having separate legal personality).

1.4 The schedules form part of this agreement and shall have effect as if set out in full in the body of this agreement and any reference to this agreement includes the schedules.

1.5 References to clauses and schedules are to the clauses and schedules of this agreement; references to paragraphs are to paragraphs of the relevant schedule.

1.6 A reference to one gender shall include a reference to the other genders.

1.7 Words in the singular shall include the plural and vice versa.

1.8 A reference to a statute or statutory provision is a reference to it as it is in force for the time being, taking account of any amendment, extension or re-enactment and includes any subordinate legislation for the time being in force made under it.

1.9 Writing or written includes faxes but not e-mail.

1.10 Where the words include(s), including or in particular are used in this agreement, they are deemed to have the words “without limitation” following them. The words other and otherwise are illustrative and shall not limit the sense of the words preceding them.

1.11 Any obligation in this agreement on a person not to do something includes an obligation not to agree or allow that thing to be done.

2. GRANT OF THE OPTION

2.1 In consideration of the payment of £1 by the Buyer to the Seller (receipt of which is hereby acknowledged by the Seller), the Seller grants to the Buyer an option to purchase the Option Interests on the terms set out in this Agreement (including in the SPA Terms).

2.2 The Option Interests shall be sold pursuant to the SPA Terms.

3. OPTION PERIOD

3.1 The Option may only be exercised:

(a) after the later of 1^st December 2008 and the Completion Date (as defined in the Amended and Restated Sale and Purchase Agreement) such date being the First Exercise Date; and

(b) before the later of 5pm (Paris time) on a date which is sixty days after the First Exercise Date (or such later date as the Parties may agree),

and if the Option is not exercised on or before such date, it shall lapse.

For the purposes of this clause 3.1, the date of exercise of the Option is the date on which the Buyer serves the Exercise Notice on the Seller and not the date on which the Seller is deemed to receive the Exercise Notice in accordance with clause 15.3.

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4. EXERCISE

4.1 The Option shall be exercised by the Buyer giving the Seller an Exercise Notice in the form set out in Schedule 1 containing:

(a) the date on which the Exercise Notice is given;

(b) a statement to the effect that the Buyer is exercising the Option; and

(c) a signature by or on behalf of the Buyer

and the Buyer making a payment of six million one hundred and forty thousand Pounds (£6,140,000) into the Seller’s Account within 5 Business Days of serving such notice by way of an advance of part of the Purchase Price.

4.2 The Option may be exercised only in respect of all of the Option Interests.

4.3 Once given, an Exercise Notice may not be revoked without the written consent of the Seller.

5. SPA TERMS

5.1 The Parties hereby agree that immediately upon the giving of an Exercise Notice the SPA Terms shall apply to the sale and purchase of the Option Interests and the Parties shall be bound by the same as if such terms and conditions had been incorporated into the main body of this Agreement and/or as if a new agreement containing such terms and conditions shall have been entered into at the time of such Exercise Notice.

5.2 Without prejudice to the generality of Clause 5.1, Completion of the sale and purchase shall be conditional upon satisfaction of the Conditions set out in Clause 2.2 of the SPA Terms.

5.3 The consideration for the sale and transfer by the Seller to the Buyer of the Option Interests shall be the payment by the Buyer of a sum calculated using the following formula:

if X > 69.1p/therm, then the Purchase Price = £6,140,000 + [(X/69.1) x £66,250,000]

if X < 69.1p/therm, then the Purchase Price = £72,390,000

Where:

X = price in p/therm of gas as determined by the Tunnel as of the day before the day on which the Option is exercised

69.1 p/therm = price per therm of gas as determined by the Tunnel as of October 22, 2008

(the “Purchase Price”) as adjusted pursuant to the SPA Terms.

6. COMPLETION

6.1 Completion shall take place at the address of ATP Oil & Gas Corporation’s offices in Houston, USA (or such other place as the Parties may agree).

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6.2 At Completion, the Buyer shall pay or procure the payment of the Purchase Price to the Seller in accordance with the SPA Terms.

6.3 The Seller and the Buyer shall meet their obligations at Completion as provided in Clause 5 of the SPA Terms.

7. WARRANTIES

The Seller represents and warrants to the Buyer that:

(a) it has full power and authority to grant the Option on the terms and conditions of this Agreement (including the SPA Terms);

(b) it is, and will remain during the Option Period, the legal and beneficial owner of the Option Interests, subject only to the Option; and

(c) the Option Interests whilst taken together with the Interests represent the entire legal and beneficial interests of the Seller in the Licensed Interest Documents.

8. BUYER’S PROTECTION

8.1 Until Completion or until the Lapse of the Option (whichever is earlier), the Seller shall meet its obligations under Clause 4 of the SPA Terms (Interim Period) as if the Option had been exercised and such covenants are immediately in full force and effect.

8.2 The Seller shall notify and keep the Buyer informed between the date hereof and Completion or the Lapse of the Option (whichever is earlier) in a timely manner, of all material matters not of a routine or minor nature affecting the Interests and/or any breaches of the Warranties contained in the SPA Terms and make available for review by the Buyer and any person authorised by the Buyer all Data reasonably requested by the Buyer.

8.3 The Seller shall until Completion or until the Lapse of the Option (whichever is the earlier) continue as Operator and shall in good faith support all and any requests of the Buyer in relation to any change of operator it shall require for the Interests and the Option Interests after Completion. The Buyer agrees that it will not commence a discussion with the Secretary regarding a change of operatorship to the Buyer (or an Affiliate including for this purpose Edison S.p.A.) in relation to the Interests and/or the Option Interests until after issue of the Exercise Notice or until Lapse of the Option.

9. CONFIDENTIALITY AND ANNOUNCEMENTS

The provisions of Clause 9 of the SPA Terms shall apply.

10. FURTHER ASSURANCE

At all times after the date of this Agreement the parties shall, at their own expense, execute all such documents and do all such acts and things as may reasonably be required for the purpose of giving full effect to this agreement.

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11. ASSIGNMENT

No Party shall assign or transfer its rights or its obligations under this Agreement without the prior written consent of the other Party save that the Buyer may prior to issue of the Exercise Notice assign its rights under this Agreement (in whole or in part) to an Affiliate(s) and/or to an Affiliate(s) of Edison S.p.A. and thereafter may assign its rights to such person with the consent of the Seller (such consent not to be unreasonably withheld or delayed).provided that if such assignment is to an Affiliate of Edison S.p.A (other than Edison International S.p.A) the Seller may require a parent company guarantee to be provided in the same form as that provided by the Buyer and which shall replace the Buyer’s guarantee.

12. WHOLE AGREEMENT

12.1 This Agreement and the SPA Terms and any documents referred to in it, constitute the whole agreement between the parties and supersede any previous arrangement, understanding or agreement between them relating to the subject matter they cover.

12.2 Nothing in this clause 12 operates to limit or exclude any liability for fraud.

13. VARIATION AND WAIVER

13.1 A variation of this agreement shall be in writing and signed by or on behalf of each party.

13.2 Any waiver of any right under this agreement is only effective if it is in writing and signed by the waiving or consenting party and it applies only in the circumstances for which it is given, and shall not prevent the party who has given the waiver from subsequently relying on the provision it has waived.

13.3 Except as expressly stated, no failure to exercise or delay in exercising any right or remedy provided under this agreement or by law constitutes a waiver of such right or remedy or shall prevent any future exercise in whole or in part thereof.

13.4 No single or partial exercise of any right or remedy under this agreement shall preclude or restrict the further exercise of any such right or remedy.

13.5 Unless specifically provided otherwise, rights arising under this agreement are cumulative and do not exclude rights provided by law.

14. COSTS

Each party shall bear its own legal, accountancy and other costs, charges and expenses connected with the negotiation, preparation and implementation of this agreement and any other agreement incidental to or referred to in this agreement.

15. NOTICE

15.1 A notice given under this agreement:

(a) shall be in writing in the English language (or be accompanied by a properly prepared translation into English);

6

(b) shall be sent for the attention of the person, and to the address or fax number, given in this clause 15 (or such other address, fax number or person as the relevant party may notify to the other party); and

(c) shall be:

(i) delivered personally; or

(ii) sent by fax; or

(iii) sent by pre-paid first-class post or recorded delivery; or

(iv) (if the notice is to be served by post outside the country from which it is sent) sent by airmail.

15.2 The addresses for service of notice are:

(a) SELLER

Address: ATP Oil & Gas (UK) Limited

Victoria House,

London Square,

Cross Lanes,

Guildford GU1 1UJ

For the attention of: John Gill

Facsimile: 01483 307222

Email: jgill@atpog.com

copied to:

ATP Oil & Gas Corporation

4600 Post Oak Place,

Suite 200,

Houston,

Texas 11027-9726

Facsimile: + 1 713 622 0289

Email: jtschirhart@atpog.com

For the attention of: John Tschirhart

(b) BUYER

EDF Production UK Ltd

c/o 1 Blake Mews.

Kew Gardens,

London, TW9 3GA

7

Facsimile: +44 208 439 9868

Emails: amj@lawxl.com

Emails: philippe.antoine@edf.fr

For the attention of: Philippe M Antoine

copied to:

Facsimile: +33 1 5665 0837

Attention: Charles-Henri Prou

Emails: charles-henri.prou@edf.fr

15.3 A notice is deemed to have been received:

(a) if delivered personally, at the time of delivery; or

(b) in the case of fax, on the first Business Day after the day of transmission and receipt by the sender of a successful transmission report indicating full and complete transmission; or

(c) in the case of pre-paid first class post or recorded delivery, 48 hours from the date of posting; or

(d) in the case of airmail, five days from the date of posting; or

(e) if deemed receipt under the previous paragraphs of this clause 15.3 is not within business hours (meaning 9.00 am to 5.30 pm Monday to Friday on a day that is not a Business Day), when business next starts in the place of receipt.

15.4 To prove service, it is sufficient to prove that the notice was transmitted by fax to the fax number of the party or, in the case of post, that the envelope containing the notice was properly addressed and posted.

16. SEVERANCE

16.1 If any provision of this Agreement (or part of a provision) is found by any court or administrative body of competent jurisdiction to be invalid, unenforceable or illegal, the other provisions shall remain in force.

16.2 If any invalid, unenforceable or illegal provision would be valid, enforceable or legal if some part of it were deleted, the provision shall apply with whatever modification is necessary to give effect to the commercial intention of the parties.

17. THIRD PARTY RIGHTS

No term of this agreement shall be enforceable by a third party (being any person other than the parties and their permitted successors and assignees).

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18. COUNTERPARTS

This agreement may be executed in any number of counterparts, each of which is an original and which together have the same effect as if each party had signed the same document.

19. LANGUAGE

If this agreement is translated into any language other than English, the English language text shall prevail.

20. GOVERNING LAW AND ARBITRATION

20.1 This Agreement and any disputes or claims arising out of or in connection with its subject matter are governed by and construed in accordance with the law of England.

20.2 The provisions of Clause 17 of the SPA Terms shall apply to any dispute arising hereunder.

9

IN WITNESS whereof this Agreement has been signed by the duly authorised representatives of the Parties on the day and year first above written.

SIGNED for and on behalf of

EDF PRODUCTION UK LTD

/s/ Dominique Venet

Director

SIGNED for and on behalf of

ATP Oil & Gas (UK) Limited

/s/ John Gill

Director

10

Schedule 1

Form of Exercise Notice

ATP Oil & Gas (UK) Limited

Victoria House,

London Square,

Cross Lanes,

Guildford GU1 1UJ

For the attention of: John Gill

[Date]

Dear Sirs,

Call Option Agreement dated 23^rd September 2008 and as amended and restated on      October 2008

We hereby give notice that [we/the assignee] today exercise the Option set out in the above agreement pursuant to Clause 4.1 and that this letter serves as the Exercise Notice in accordance therewith.

Yours faithfully,

For and by or on behalf of the Buyer

11

Schedule 2

SPA Terms

ATP OIL & GAS (UK) LIMITED

and

EDF PRODUCTION UK LTD

SALE AND PURCHASE TERMS

In respect of certain interests under

United Kingdom Continental Shelf Petroleum Production Licence No. P.683 (Block 43/22a)

and

United Kingdom Continental Shelf Petroleum Production Licence No. P.1034 (Blocks 42/25a and 43/21a)

and

United Kingdom Continental Shelf Petroleum Production Licence No. P.033 (Block 49/12aN)

12

CONTENTS

Clause	Heading	Page
1.	DEFINITIONS AND INTERPRETATION	14
2.	SALE AND PURCHASE OF THE OPTION INTERESTS	20
3.	CONSIDERATION	22
4.	INTERIM PERIOD	26
5.	COMPLETION	28
6.	INDEMNITIES	29
7.	REPRESENTATIONS AND WARRANTIES	31
8.	ONGOING OBLIGATIONS AND LIABILITIES	38
9.	ANNOUNCEMENTS AND CONFIDENTIALITY	38
10.	NOTICES	39
11.	COSTS AND EXPENSES	41
12.	TAXATION	41
13.	VARIATION	44
14.	ASSIGNMENT	44
15.	RIGHTS OF THIRD PARTIES	44
16.	GENERAL	44
17.	GOVERNING LAW AND ARBITRATION	45
SCHEDULE 1
Licence(s), related Licensed Interest Documents and other related information
SCHEDULE 2
Allocation of Consideration
SCHEDULE 3
Working Capital
SCHEDULE 4
Format for Interim Completion Statement and Final Completion Statement
SCHEDULE 5
AFEs

13

THESE TERMS should be read together with the Call Option Agreement dated 23^rd September 2008 and as amended and restated on      October 2008 and entered into between (1) ATP Oil & Gas (UK) Limited and (2) EDF Production UK Ltd (“the Call Option Agreement”) and apply immediately upon the serving of an Exercise Notice pursuant to such agreement.

WHEREAS

(A) Upon the service of an Exercise Notice, the Seller wishes to sell and the Buyer wishes to purchase the Option Interests; and

(B) The Parties wish to set out the terms and conditions upon which the aforesaid sale and purchase shall take place.

NOW THEREFORE IT IS HEREBY AGREED as follows:

1 Definitions and Interpretation

In the SPA Terms (including the recitals and the Schedules hereto):

1.1 The following expressions shall, except where the context otherwise requires, have the following respective meanings:

“Accruals Basis of Accounting” means that basis of accounting under which costs and benefits are regarded as applicable to the period in which the liability for the cost is incurred or the right to the benefit arises regardless of when calculated, discovered, invoiced, paid or received;

“Adjustments” means any or all (as the context may require) of the Working Capital Adjustment, the Cash Calls Adjustment, the Petroleum Sales Adjustment and the Interim Period Adjustment as calculated in accordance with Clause 3 and any payments made by the Buyer to the Seller or by the Seller to the Buyer pursuant to Clause 6 or Clause 12 or pursuant to a warranty claim under Clause 7 together with such amounts (if any) equivalent to interest payable in accordance with Clauses 3.15 and 3.16;

“Advance” has the meaning set out in Clause 3.1;

“Affiliate” means in relation to any Party, a subsidiary or a holding company of that Party and includes the ultimate holding company of that Party and any subsidiary of that holding company and for the purposes of this definition “holding company” and “subsidiary” shall be construed in accordance with section 1159 of the Companies Act 2006;

14

“Agreed Rate” means for the London Interbank Offered Rate for one month for the currency in question as quoted in the British Bankers’ Association internet site (www.bba.org.uk/public/libor) for the first day of the relevant period in respect of which interest is to be calculated plus one percent (1%) provided that if the first day of the relevant period is not a Business Day then the rate to be used shall be that for the most recent Business Day preceding the first day of the relevant period;

“Agreement” means the agreement comprised in these SPA Terms including the recitals hereof and Schedules hereto, as the same may be amended or varied from time to time in accordance with its express terms;

“Assignment Documents” means the assignment and novation agreements in respect of the Licensed Interest Documents in the agreed form together with any other documents the Parties (acting reasonably) agree are necessary to effect the assignment and transfer of the Option Interests from the Seller to the Buyer and release the Seller from contractual liability to third parties with respect to the Option Interests (including any parent company guarantees or letters of credit required of the Buyer in support of the Buyer’s obligations under any of the Licensed Interest Documents);

“ATP Corporation” means ATP Oil & Gas Corporation incorporated and registered in the State of Texas whose registered office is at 4600 Post Oak Place, Suite 200, Houston, Texas, 77027, Texas, USA

“ATP Corporation Guarantee” means the guarantee in the agreed form to be provided by ATP Corporation and to be delivered to the Buyer pursuant to Clause 2.2.2

“Benefits” has the meaning given in Clause 6.1;

“Block” means an offshore area located on the United Kingdom Continental Shelf (“UKCS”) forming part of a Licence and being separately designated and numbered as a block on the reference map showing all UKCS Licence blocks deposited at the principal office of the UK Department of Business, Enterprise and Regulatory Reform and “Blocks” means Block 43/22a, Block 42/25a and Block 43/21a, Block 49/12aN,and Block 49/12b;

“Business Day” means a day (other than a Saturday, a Sunday or a legal bank or public holiday) on which banks are or, as the context may require, were generally open for business in England;

“Cash Calls Adjustment” is detailed in Clause 3.6;

“Completion” means the completion of the sale and purchase of the Option Interests in accordance with the provisions of this Agreement;

“Completion Date” means the date on which Completion takes place;

“Consequential Loss” has the meaning set out in Clause 7.17;

“Consideration” has the meaning set out in Clause 3.1;

15

“CT” means Corporation Tax as charged under the Income and Corporation Taxes Act 1988 (as amended) which for the avoidance of doubt includes the supplementary charge as levied by section 501A of the Income and Corporation Taxes Act 1988 (as amended);

“Data” means, in respect of the Blocks, all data in the possession, custody or control of the Seller directly and exclusively relating to the Option Interests in whatever form the same are maintained excluding any data which the Seller may not sell, transfer or otherwise dispose of as a result of confidentiality obligations by which it is bound or which cannot be provided to the Buyer because such transfer is prohibited by the agreement under which it is acquired and excluding internal interpretations and documents created for the Seller’s (or its Affiliates’) own use;

“Data Room Documents” means the documents and data relating to the Option Interests made available for the Buyer’s inspection in the data room located at the offices of Scotiawaterous, 33 Finsbury Square, London EC2A 1BB and/or sent to the Buyer prior to the date hereof as such documents and data are listed in the index initialled by the Parties for the purposes of identification;

“Decommissioning Liabilities” means any and all claims, costs, charges, expenses, liabilities, duties and/or obligations arising from, under or in respect of the ownership or use of the Option Interests and/or the Blocks and relating to the decommissioning and/or removing and/or making safe of all of the property held in connection with the Option Interests whether such claims, costs, charges, expenses, liabilities, duties and/or obligations are incurred under or pursuant to any of the Licensed Interest Documents or under statutory law, common law or otherwise and including the reinstatement and/or making good of the area covered by the Licence(s) in accordance with good oil and gas field industry practice and applicable law at the time of such decommissioning and/or removal and any residual liability or obligation for anticipated and/or necessary continuing insurance, maintenance and monitoring costs regardless in each case of any acts, omissions, negligence or breach of duty (statutory or otherwise), conduct or statements of the Seller or the condition of the Option Interests;

“Dollars” or “$” means dollars of the United States of America;

“Economic Date” means 1^st  July 2008;

“Encumbrances” means all liens, charges (fixed or floating), security interests, pledges, options, net profit interests, rights of pre-emption, mortgages and other third party rights which encumber legal or beneficial ownership save in respect of the rights held by the Secretary under the Licences;

“Environment” means the natural and man-made environment including all or any part of the following media namely air, water, and land including subsurface strata lying beneath the surface of the ground or beneath a body of water, and any living organisms or systems supported by those media;

16

“Environmental Law” means all applicable national and local laws, regulations, directives and ministerial regulations and instructions, all judgments, orders, instructions or awards of any court or competent authority and all codes of practice, industry agreements and guidance notes which relate or apply to the Environment or matters affecting the Environment including pollution, contamination, emissions, hazardous substances or the creation of any adverse impact on the Environment;

“Environmental Liabilities” means any and all claims, costs, charges, expenses, liabilities, duties and/or obligations arising from, under or in respect of the ownership or use of the Option Interests in relation to any Environmental Law or in relation to cleaning up, decontamination of, removing and disposing of debris or any property from and for reinstating any area of land, foreshore or seabed, wherever situated, whether such claims, costs, charges, expenses, liabilities, duties and/or obligations are incurred under or pursuant to any of the Licensed Interest Documents or under statutory law, common law or otherwise and including any residual liability or obligation for anticipated and/or necessary continuing insurance, maintenance and monitoring costs regardless in each case of any acts, omissions, negligence or breach of duty (statutory or otherwise), conduct or statements of the Seller or the condition of the Option Interests;

“Final Completion Statement” has the meaning given in Clause 3.12;

“Forward Gas Sales Agreement” means forward Gas sales entered into prior to the Economic Date under the Beach 2000 Master Agreement dated 16^th March 2006 between Hess Energy Power and Gas Company (UK) Limited (1) and the Seller (2);

“Future Payment Liabilities” means the liability (ies) of the Seller to make future and/or contingent payments to sellers under the terms of the:

(A) the agreement dated 26^th January 2001 between (1) the Seller (2) Britoil Public Limited Company (3) and ATP Corporation, and

(B) the agreement dated 10^th March 2005 between (1) GDF Britain Limited (2) and the Seller;

“Gas” or “Natural Gas” means any hydrocarbons or mixture of hydrocarbons and other gases consisting primarily of methane which at a temperature of fifteen (15) degrees Celsius and at atmospheric pressure are or is predominantly in the gaseous state;

“Interests” has the meaning set out in the Sale and Purchase Agreement dated 23^rd September 2008 between the Seller and the Buyer;

“Interim Completion Statement” has the meaning given in Clause 3.10;

“Interim Period” means the period from and including the Economic Date up to and including the Completion Date;

17

“Interim Period Adjustment” is detailed in Clause 3.8;

“JDA” means the joint development agreement currently in force in respect of operations pursuant to Licence P.1034 (Blocks 42/25a and 43/21a) and P.683 (Block 43/22a) (as detailed in Schedule 1), as the context so admits, each as amended, supplemented and/or novated from time to time;

“Joint Operating Agreement” means the joint operating agreement currently in force in respect of operations pursuant to Licence P.033 (Block 49/12aN) (as detailed in Schedule 1) as amended, supplemented and/or novated from time to time;

“Licence(s)” means the licence(s) of which details are set out in Schedule 1 and, where the context so admits, any one or more of such licences and any licence issued to the Seller in full or partial substitution for any such licence;

“Licensed Interest Documents” means those documents listed as such in Schedule 1 and, where the context so admits, any one or more of such documents in each case as the same may have been amended, supplemented and/or novated from time to time;

“Limited Overriding Royalty Interest” has the meaning set out in the Joint Operating Agreement and the Deed of Assignment dated 9^th August 2006 between ConocoPhillips (U.K.) Limited as assignor and ConocoPhillips (U.K.) Theta Limited as assignee;

“Losses and Expenses” means any and all actions, proceedings, losses, damages, liabilities, obligations claims, demands, costs and expenses including fines, penalties, clean-up costs, legal and other professional fees and any VAT payable but not recoverable in relation to any such matter, circumstances or item;

“New Operator” means the person nominated by the Buyer to act as operator in relation to the Licences relating to the Interests and the Option Interests;

“New Works” means the coiled tubing work to be conducted on the Wenlock W1 Well, the Pilot Hole at the Wenlock W3 Well and the connection for W2 Well and W3 Well as more specifically described in the AFEs set out in Schedule 5

“Obligations” has the meaning given in Clause 6.1;

“Operator” means the entity acting as operator under the Licence(s) as currently identified in Schedule 1;

“Option” has the meaning defined in the Call Option Agreement;

“Option Interests” means:

(a) an undivided legal interest in the Licence(s); and

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(b) a twenty percent (20%) interest in each of Block 49/12aN and a seventeen percent (17%) interest in each of Block 43/22a, Block 42/25a and Block 43/21a);

together, in each case, with all rights and obligations attaching thereto including for the avoidance of doubt a corresponding share of the Burdened Interest as defined in the Joint Operating Agreement and including (i) the right to take and receive a consequent share of all Petroleum produced from the Block(s) under the Licence(s) on and after the Economic Date and (subject to Clause 3.7 and Clause 12) to receive the gross proceeds from the sale or other disposition thereof; (ii) a consequent share of the Seller’s legal and beneficial right, title and interest in and to all property owned by the Seller pursuant to or under any of the Licensed Interest Documents; and (iii) all rights, liabilities and obligations associated with such interest under the Licensed Interest Documents;

“Party” means a party to this Agreement and “Parties” means both of the parties to this Agreement;

“Petroleum” has the meaning given in the Licence(s);

“Petroleum Sales Adjustment” is detailed in Clause 3.7;

“Pounds”, “£” or “Sterling” means pounds sterling of the United Kingdom;

“Purchase Price” has the meaning given in Clause 3.1;

“Purchaser’s Accounts” means such account(s) as the Buyer may specify by notice in writing to the Seller not less than five (5) Business Days prior to the due date of any payment;

“Secretary” means the Secretary of State for Business, Enterprise and Regulatory Reform or any other person for the time being responsible for carrying out the functions at present carried out by the Secretary of State for Business, Enterprise and Regulatory Reform in relation to the Licence(s) or operations carried out thereunder;

“Secretary’s Consents” means all necessary consents of the Secretary to the transfer of the Option Interests from the Seller to the Buyer and the change of the Operator to the New Operator;

“Seller’s Account” means the following account with Barclays Bank plc, of P0 544, 54 Lombard Street, London EC3V 9EXSort Code 20 - 06 - 05, Account No. 50776785 or such other accounts as the Seller may specify by notice in writing not less than five (5) Business Days prior to the due date of any payment;

“Taxation” means all forms of taxation, duties, levies, imposts, charges, deductions and withholdings, direct or indirect, created or imposed by any taxing, fiscal or other appropriate authority of the United Kingdom and (without prejudice to the generality of the foregoing) includes:

(a) CT, VAT and any other forms of taxation, duties, levies, imposts, charges, deductions and withholdings similar to or supplementing or replaced by or replacing the foregoing or any of them; and

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(b) all penalties, charges, interest, fines, costs and expenses, loss of relief, allowance or credit relating to any form of, or claim for, taxation or other imposition referred to in paragraph (a);

“Tunnel” means the tunnel set forth as Appendix 1 to the Offer Letter dated 28^th August 2008 from the Buyer to the Seller;

“VAT” means Value Added Tax as charged under the Value Added Tax Act 1994;

“Warranties means the representations and warranties given by the Seller to the Buyer in Clause 7.1; and

“Working Capital Adjustment” is detailed in Clause 3.5.

1.2 All references to Clauses, recitals and Schedules are, unless otherwise expressly stated, references to clauses of and the recitals and schedules to these SPA Terms.

1.3 The headings are inserted for convenience only and shall be ignored in construing this Agreement. Unless the context otherwise requires, the singular shall include the plural and vice versa.

1.4 Unless the context otherwise requires, references to persons shall include natural persons, bodies corporate, unincorporated associations, partnerships, authorities, government and government bodies.

1.5 Reference to statutory provisions shall be construed as reference to those provisions as amended, consolidated, extended or re-enacted from time to time.

1.6 Any document expressed to be “in the agreed form” means a document in a form approved by the Parties (acting reasonably).

1.7 References to the words “include”, “including” and “other” shall be construed without limitation.

2. Sale and Purchase of the Option Interests

2.1     2.1.1 Subject to the terms of this Agreement the Seller as legal and beneficial owner hereby agrees to sell and transfer the Option Interests to the Buyer free from all Encumbrances save for the Limited Overriding Royalty Interest pursuant to and as defined in the Joint Operating Agreement for the Consideration and the Buyer hereby agrees to purchase and acquire the Option Interests from the Seller.

2.1.2 The transfer referred to in Clause 2.1.1 shall, as between the Parties, be deemed for all purposes to be made with effect on and from the Economic Date.

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2.2 The obligations of the Parties to complete the sale and purchase of the Option Interests under this Agreement is conditional on:

2.2.1 the receipt of all necessary written consents, approvals or waivers as the case may be in relation to (A) the transfer by the Seller to the Buyer of the Option Interests and (B) the change of the Operator to the New Operator for the Licences the subject of the Interests and the Option Interests; including in both cases the Secretary’s Consents and any consents, approvals and/or waivers required under the Licence Interest Documents, in form and substance reasonably acceptable to the Seller and the Buyer;

2.2.2 execution of the Assignment Documents by the signatory parties thereto other than the Parties.

It is expressly acknowledged and agreed by the Buyer that the obligations of the Parties to complete the sale and purchase of the Option Interests under this Agreement is not conditional on the Buyer seeking or obtaining finance.

2.3 The Parties shall each use reasonable endeavours to obtain fulfilment of the conditions set out in Clauses 2.2.1 and 2.2.2 by a date which is seventy-five (75) calendar days following the date of this Agreement (or such later dates as the Parties may agree) provided that it shall be the primary responsibility of the Seller (a) to make the applications to the Secretary to obtain the Secretary’s Consent and (b) to give the required notices in order to obtain the necessary consents, approvals and waivers (as the case may be) to the transfer and assignment of the Option Interests in order to obtain execution of the Assignment Documents in accordance with the Licensed Interest Documents. For the avoidance of doubt, the Seller shall vote its interest in relation to the change of the Operator to the New Operator in favour of such change.

2.4 In the event that the conditions set out in Clauses 2.2.1 and 2.2.2 have not all been fulfilled and/or waived by the Parties by the date which is seventy-five (75) calendar days following the date of service of the Exercise Notice, (or such later date as may be agreed as aforesaid), then in either of such events any Party shall be entitled, to terminate this Agreement within five (5) Business Days following the date upon which the relevant conditions should have been fulfilled and/or waived by the Parties as aforesaid by written notice to the other Party and upon receipt of any such notice this Agreement shall cease to have effect and the Parties shall be freed and discharged from all liability, save only for any prior breach of Clause 2.3, any liability under Clause 2.5 and for the continuing obligations under Clause 9.

2.5 In consideration of the Seller entering into this Agreement, if Completion does not occur as a result of the Buyer’s failure to meet its obligations at Completion, the Seller having complied with its obligations and the Conditions having been satisfied, then the Seller shall be entitled to retain the amount of the Advance. In all other circumstances if Completion does not occur the Seller shall repay the Advance to the Buyer with interest calculated over the period at the Agreed Rate.

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3. Consideration

3.1 The consideration for the sale and transfer by the Seller to the Buyer of the Option Interests shall be the payment by the Buyer to the Seller of a sum calculated using the following formula:

if X > 69.1p/therm, then the Purchase Price = £6,140,000 + [(X/69.1) x £66,250,000]

if X < 69.1p/therm, then the Purchase Price = £72,390,000

Where:

X = price in p/therm of gas as determined by the Tunnel as of the day before the day on which the Option is exercised

69.1 p/therm = price per therm of gas as determined by the Tunnel as of October 22, 2008

(the “Purchase Price”) (of which six million one hundred and forty thousand Pounds (£6,140,000) shall have been paid by the Buyer to the Seller upon exercise of the Option (the “Advance”) as adjusted pursuant to this Agreement (the “Consideration”).

3.2 Subject to Clause 12, the Consideration shall be allocated as set out in Schedule 2.

Adjustments

3.3 The Purchase Price shall be adjusted by the Adjustments which shall operate by way of increases or decreases, as the case may be, to the Purchase Price provided that no item taken into account in calculating any one of the Adjustments shall be taken into account in calculating any one of the other Adjustments so as to result in a Party making or receiving payment twice in respect thereof.

3.4 No adjustment under this Clause 3 shall be made in respect of any matter to which Clause 6.6 applies.

3.5 The Working Capital Adjustment, which if positive shall increase the Purchase Price and if negative shall reduce the Purchase Price, shall be the aggregate of the working capital balances in relation to the Option Interests calculated in respect of each of the categories listed in Schedule 3 as at the Economic Date by reference to the statements provided by the Operator and otherwise in accordance with Schedule 3. Such working capital balances shall be prepared in accordance with proper accounting and operating procedures and otherwise in accordance with good oil and gas field practice.

3.6 The Cash Calls Adjustment, which shall increase the Purchase Price, shall be the sum of all cash calls or billing invoices paid in respect of the Option Interests by the Seller during and/or in respect of the Interim Period and which, using the Accruals Basis of Accounting, relate to periods beginning on or after the Economic Date pursuant to the Licensed Interest Documents.

3.7 The Petroleum Sales Adjustment, which shall decrease the Purchase Price, shall be the notional value of the Gas produced in respect of the Option Interests in each day of the Interim Period based on multiplying the volume of such Gas by the Market Price for such Gas and for this purpose the Market Price shall be calculated as follows:

Market Price = (0.25 x MP) + (0.75 x DP)

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where:

“DP” means the applicable gas index price for Day D expressed in pence per therm based on the arithmetic average of the Day ahead NBP bid prices and the Day ahead NBP offer prices for Natural Gas (in pence per therm) published by Heren on the preceding Day (D-1).

In case of a Banking Day following a weekend or a public holiday the arithmetic average of the Day ahead NBP bid prices and the Day ahead NBP offer prices published by Heren on the last Banking Day before the weekend or public holiday shall be used.

In the case of a weekend and a public holiday immediately preceding or following a weekend then the arithmetic average of the Heren weekend NBP bid prices and the weekend NBP offer prices on the preceding Banking Day for that weekend shall be used.

In the case of a public holiday mid week the arithmetic average of the special NBP bid prices and special NBP offer prices for that period published by Heren on the preceding Banking Day shall be used, provided that if no such prices are published then the weekend NBP bid prices and weekend NBP offer prices for that period published by Heren on the preceding Banking Day shall be used.

“Heren” means Heren Energy in European Spot Gas Markets.

“MP” means the applicable gas index price for Month M (expressed in pence per therm) based on the arithmetic average of the month- ahead NBP bid prices and the Month ahead NBP offer prices for Natural Gas (in pence per therm) for Month M as published by Heren for each day of publication in Month M-1 which are then averaged over the number of days in which prices are published.

3.8 The Interim Period Adjustment, which shall increase the Purchase Price, shall be the sum of all expenditure incurred by the Seller, using the Accruals Basis of Accounting, in respect of the Option Interests during the Interim Period, including demurrage, brokers’ fees (other than fees of advisers engaged in relation to the matters referred to herein), insurance premia and deductibles, rent and licence fees and all other costs and expenses incurred by the Seller in respect of the Option Interests which are in respect of the period on and after the Economic Date and which have not been met by cash calls or other payments taken into account under the foregoing provisions of this Clause 3 or Clause 12 provided that any such expenditure relating to any period prior to the Economic Date which has not been taken into account in the Working Capital Adjustment shall be for the account of the Seller.

3.9 Where any sums payable by the Buyer to the Seller or by the Seller to the Buyer pursuant to Clauses 3, 6, 7 or 12 are expressed in Sterling, the same shall be paid in Sterling.

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Interim Completion Statement and Final Completion Statement

3.10 The Seller shall provide the Buyer with a written statement of the Consideration expected to be required as at the Completion Date (the “Interim Completion Statement”). The Interim Completion Statement shall be provided no later than ten (10) calendar days prior to the anticipated Completion Date and shall be in the form set out in Schedule 4. The Seller may update the same and the Parties shall endeavour to agree the Interim Completion Statement before Completion, failing which the matter shall be dealt with in accordance with Clauses 3.11 and 3.13.

3.11 If any of the amounts or portions thereof contained in the Interim Completion Statement have not been agreed prior to Completion, the disputed amounts or portions of the Adjustments shall be left out of account for the purposes of Clause 5.2.2.1. The undisputed amounts or portions of the Adjustments shall be added to the amount of the Purchase Price and such amount so adjusted shall be payable at Completion. Payment of disputed amounts or portions thereof shall be made within five (5) Business Days following agreement of the Parties or determination under Clause 3.13.

3.12 Within sixty (60) Business Days after Completion, and without prejudice to the provisions of Clauses 6, 7 and 12, the Seller shall provide the Buyer with a written statement of all of the Adjustments to be made hereunder and giving the final amount of the Consideration (the “Final Completion Statement”), which statement shall be prepared in the form set out in Schedule 4. If the Parties fail to agree the Final Completion Statement within fifteen (15) Business Days of receipt by the Buyer, the Final Completion Statement shall be referred for determination in accordance with the provisions of Clause 3.13. The agreed or determined amounts, to the extent not already paid or taken into account on Completion, shall be paid by the Buyer. Payment of agreed or disputed amounts or portions thereof shall be made within ten (10) Business Days following either agreement of the Parties or determination under Clause 3.13 (as the case may be).

3.13 If the Parties cannot reach agreement on the contents of all or part of the statements referred to in Clauses 3.10 and/or 3.12 within the time limit provided in Clause 3.12, the disputed items may be referred by either the Seller or the Buyer for determination by an independent chartered accountant nominated by the Parties or, in the absence of agreement between the Parties within ten (10) Business Days of a Party notifying the other that it proposes to refer the dispute to an independent chartered accountant, by the President of the Institute of Chartered Accountants in England and Wales on the application of such Party. The nominated chartered accountant shall be afforded such access to books, records, accounts and documents in the possession of the Parties as he may reasonably request, and he shall act as expert not as arbitrator. The said accountant’s determination shall, in the absence of fraud or manifest error or bias, be final and binding on the Parties, his fees and disbursements shall be borne by the Seller and the Buyer in equal shares and the Parties shall bear their own costs in respect of such reference.

3.14 The Interim Completion Statement and the Final Completion Statement will be prepared on the information available at the time of their preparation and shall be without prejudice to any further claims arising under Clauses 6, 7 and/or 12 after the time of the preparation of such statements. The Seller and the Buyer shall liaise on the compilation and agreement of the Interim Completion Statement and the Final Completion

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Statement and the Seller shall provide to the Buyer, as soon as reasonably practicable, all the Seller’s calculations (and supporting documents) in the preparation of the Adjustments for verification purposes including such explanations and methodology as the Buyer shall reasonably require. Without prejudice to the generality of the foregoing, subject to and to the extent of any confidentiality obligations by which it is bound, the Seller shall provide the Buyer with copies of all Operators’ reports, billing statements and correspondence and any other relevant documentation in its possession necessary to support the Interim Completion Statement and the Final Completion Statement. Where the Seller is unable to provide the Buyer with such information due to confidentiality obligations by which it is bound it shall provide the same to an independent chartered accountant for the purposes of certifying the accuracy of such information to the Buyer.

Time-value adjustments

3.15 An amount equivalent to interest (calculated on a compounded basis on the accumulated daily balances) at the Agreed Rate shall be payable on the Purchase Price from the Economic Date up to the Completion Date (both dates inclusive).

3.16 In respect of the Adjustments, an amount equivalent to interest (calculated on a compounded basis on the accumulated daily balances) at the Agreed Rate shall be payable (and in the case of clauses 3.16.3 and 3.16.4 below be taken into account in the calculation of the relevant Adjustment) on each of:

3.16.1 the Working Capital Adjustment from the Economic Date up to and including the Completion Date, and, in the case of final adjustments or disputed items, thereafter up to and including the date of settlement thereof;

3.16.2 the cash calls and billing invoices comprised in the Cash Calls Adjustment from the date on which such cash call or billing invoice is paid by the Seller up to and including the date of settlement of such element of the Cash Calls Adjustment;

3.16.3 the receipts comprised in the Petroleum Sales Adjustment from the date of such receipt by or credit to the Seller up to and including the date of settlement of such element of the Petroleum Sales Adjustment; and

3.16.4 the items of expenditure comprised in the Interim Period Adjustment from the date such item of expenditure is paid by the Seller up to and including the date of settlement of such element of the Interim Period Adjustment.

3.17 The Parties agree that the amounts set out in Clauses 3.15 and 3.16 are adjustments to the Purchase Price and not actual interest on any debt between the Seller and the Buyer and the Parties agree to submit their CT returns on that basis.

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4 Interim Period

4.1 During the Interim Period, (in so far as it falls after the date of this Agreement) the Seller shall:

4.1.1 continue to carry on its affairs in relation to the Option Interests in the ordinary course and in accordance with good oil and gas field practice;

4.1.2 (to the extent that it is able so to do having regard to the provisions of the Licensed Interest Documents) consult with the Buyer with regard to the Option Interests where reasonably practicable and co-operate with the Buyer so as to ensure an efficient handover of the Option Interests on Completion;

4.1.3 not, without the Buyer’s prior written approval (not to be unreasonably withheld or delayed), encumber, sell, assign or otherwise dispose of the Option Interests or any part thereof, or purport to do any of the same;

4.1.4 not, without the Buyer’s prior written approval (not to be unreasonably withheld or delayed) enter into or agree to enter into or become party to any new licences, operating agreements, farm-in or farm-out agreements, unitisation agreements, transportation agreements, long term gas sale or supply agreements or any other material agreement or undertaking (by whatever name called) relating to the Option Interests or permit any other person to enter into or agree to enter in any such agreement on behalf of the Seller;

4.1.5 not, without the Buyer’s prior written approval (not to be unreasonably withheld or delayed), enter into or agree to enter into any contract for the sale of gas and/or other Petroleum products relating to the Option Interests or permit any other person to enter into or agree to enter in any such contract on behalf of the Seller;

4.1.6 maintain insurance in relation to the Option Interests (on behalf of and for the benefit of the Buyer) to such extent and at such levels as would be in accordance with good oil and gas field practice and otherwise in accordance with the JDA;

4.1.7 not, without the Buyer’s prior written approval (not to be unreasonably withheld or delayed), undertake or agree to undertake any sole-risk or non-consent activities in relation to the Option Interests;

4.1.8 not, without the Buyer’s prior written approval (not to be unreasonably withheld or delayed), amend, renew, terminate or agree to amend, renew or terminate any of the Licensed Interest Documents or waive or agree to waive any of its rights or remedies under the Licensed Interest Documents insofar as any such right or remedy is capable of relating to periods after the Economic Date or is in respect of Decommissioning and/or Environmental Liabilities; and

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4.1.9 not, without the Buyer’s prior written approval (not to be unreasonably withheld or delayed):

(1) approve any ,expenditure or capital commitment relating to any Interest involving expenditure in excess of one hundred thousand Pounds (£100,000) in any case other than:

(a) any such expenditure in respect of which the Buyer has given its prior consent as referenced in Clause 4.2 below; or

(b) any expenditure necessitated by any emergency for the safeguarding of lives or property or the prevention of pollution (in which case the Seller shall to the extent practicable in the circumstances consult with the Buyer and in any event as soon as reasonably practicable inform the Buyer).

(2) approve any work programme or budget which (i) differs materially from the 2008 Budget prepared for the purposes of the Option Interests (a copy of which in relation to the Tors Area has been provided to the Buyer) or (ii) differs from the Budget approved in relation to the Wenlock Field as referenced in the AFEs in Schedule 5, in either case without the consent of the Buyer and for this purpose an increase in such Budget of more than 5 % or increase in any expenditure or capital commitment as shown in such Budget of more than 10 % shall be deemed to be material.

4.2 Without prejudice to Clause 4.1, the Seller shall (subject to any confidentiality obligations by which it is bound) between the date hereof and Completion generally keep the Buyer informed, in a timely manner, of all material matters not of a routine or minor nature affecting the Option Interests including the approval of any work programme, budget, AFE expenditure or capital commitment relating to the Option Interests and make available for review by the Buyer and any person authorised by the Buyer all Data reasonably requested by the Buyer. In this regard, the Buyer acknowledges and accepts the AFEs in respect of Block 49/12aN as set out in Schedule 5 and agrees that its consent to the same is not required pursuant to Clause 4.1 save for the New Works.

4.3 Notwithstanding that title to the Option Interests will not pass to the Buyer until Completion, the Buyer shall assume all risk in the Option Interests with effect from the date of this Agreement and accordingly (save for and without prejudice to the Seller’s continuing obligations under Clause 4.1 (in particular under Clause 4.1.6)) the Buyer shall be responsible for insuring the Option Interests and its rights and liabilities arising in relation thereto under the terms of this Agreement.

4.4 During the Interim Period the Parties shall use their reasonable endeavours to negotiate and agree in good faith a joint development agreement to apply in relation to Licence P033, Block 49/12aN, such agreement to be, mutatis mutandis, in similar terms to the JDA for Licence P.1034 (Blocks 42/25a and 43/21a) and P.683 (Block 43/22a) and in the event that such agreement is not entered into on Completion the Parties shall continue to act in good faith to complete the agreement thereon and until such time the provisions of the JDA for Licence P.1034 (Blocks 42/25a and 43/21a) and P.683 (Block 43/22a) shall be deemed to apply in so far as reasonably practicable.

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5 Completion

5.1 Completion under this Agreement shall take place within ten (10) Business Days after all of the conditions referred to in Clause 2.2 have been satisfied, at such location and at such time as the Parties may agree.

5.2 On the Completion Date all, but not part only, of the following business shall be transacted:

5.2.1 The Seller shall deliver to the Buyer (to the extent not already delivered prior to Completion and/or already in the possession of the Buyer):

5.2.1.1 the Assignment Documents duly and validly executed by all the signatory parties thereto other than the Buyer;

5.2.1.2 a copy of the Secretary’s Consents and all other relevant consents, approvals or waivers, if any, referred to in Clause 2.2 and obtained by or on behalf of the Seller;

5.2.1.3 a copy, certified as a true copy and in full force and effect by a director or the secretary of the Seller, of a resolution of the board of directors of the Seller authorising a person or persons to execute this Agreement and the Assignment Documents on behalf of the Seller; and

5.2.1.4 written confirmation in terms satisfactory to the Buyer that the Seller has notified to the relevant insurers the interest of the Buyer in all property, assets and rights associated with the Option Interests and the Licensed Interest Documents.

5.2.2 The Buyer shall:

5.2.2.1 pay to the Seller the sums specified in the Interim Completion Statement, subject to Clause 3.11, by means of telegraphic transfer in immediately available funds to the Seller’s Account for value in Sterling on the Completion Date;

5.2.2.2 deliver to the Seller the Assignment Documents duly and validly executed by the Buyer;

5.2.2.3 deliver to the Seller a copy of all relevant consents, approvals, or waivers, if any, referred to in Clause 2.2 and obtained by or on behalf of the Buyer; and

5.2.2.4 deliver to the Seller a copy, certified as a true copy and in full force and effect by a director or the secretary of the Buyer, of a resolution of the board of directors of the Buyer authorising a person or persons to execute this Agreement and the Assignment Documents on behalf of the Buyer;

and the Parties acknowledge and agree that all acts and transactions constituting Completion shall be regarded as a single transaction so that, at the option of the Party who is interested in the carrying out of the relevant act or transaction, no action or transaction shall be deemed to have taken place unless and until all other actions and transactions constituting Completion shall have taken place as provided in this Agreement. The Parties acknowledge the essential nature of this provision.

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5.3 Each of the Parties shall and, if appropriate, shall ensure that its respective Affiliates shall execute such other documents and do all such other acts and things as may reasonably be required, in order to effect the transfer of the Option Interests to the Buyer and to implement the transactions contemplated hereunder and otherwise to carry out the true intent of this Agreement.

5.4 Following Completion, the Seller shall ensure that (to the extent not delivered prior to Completion) copies of the Licensed Interest Documents and copies of Data in the possession or control of the Seller as requested and reasonably required by the Buyer and which are not in the Buyer’s possession are made available for collection by the Buyer at its own expense and within normal business hours within thirty (30) Business Days after the Completion Date. The costs of reproducing the Licence Interest Documents and the Data shall be borne by the Buyer. The Seller shall also following Completion use its reasonable endeavours to obtain such waivers and/or releases (at the cost of the Buyer) which may be necessary so as to enable it to provide all data in the possession, custody or control of the Seller directly and exclusively relating to the Option Interests which may be the subject of confidentiality obligations by which it is bound or which cannot be provided to the Buyer because such transfer is prohibited by the agreement under which it is acquired and upon obtaining such waivers and/or releases shall promptly provide the same to the Buyer.

5.5 Notwithstanding Completion:

5.5.1 each provision of this Agreement (and any other document referred to in it) not performed at or before Completion but which remains capable of performance;

5.5.2 the Warranties and the Buyer’s warranties under Clause 7.2; and

5.5.3 all covenants, indemnities and other undertakings contained in or entered into pursuant to this Agreement,

will remain in full force and effect and (except as otherwise expressly provided) without limit in time.

6 Indemnities

6.1 The Seller shall be liable for all costs, charges, expenses, liabilities and obligations (including in respect of the Burdened Interest as defined in the JOA in respect of the Option Interests (together “Obligations”) which accrue in or relate to any period before the Economic Date and the Seller shall be entitled to all income, receipts, rebates, credits and other benefits in respect of the Option Interests (together “Benefits”) which accrue in or relate to any period before the Economic Date.

6.2 The Buyer shall be liable for all Obligations and entitled to all Benefits which accrue in or relate to any period on or after the Economic Date.

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6.3 Subject to Clauses 7 and 12 and save to the extent that the Consideration includes any adjustment under Clause 3 which already takes account of any of the following (with the intent that there shall be no-double – counting) :-

6.3.1 if any Obligations are incurred by the Seller in respect of any period on or after the Economic Date, the Buyer shall reimburse and indemnify the Seller in respect thereof;

6.3.2 if any Obligations are incurred by the Buyer in respect of any period prior to the Economic Date, the Seller shall reimburse and indemnify the Buyer in respect thereof;

6.3.3 if any Benefits accrue to the Seller in respect of any period on or after the Economic Date, the Seller shall account to and reimburse the Buyer in respect thereof; and

6.3.4 if any Benefits accrue to the Buyer in respect of any period prior to the Economic Date, the Buyer shall account to and reimburse the Seller in respect thereof

and any such reimbursements shall be treated as further adjustments to the Purchase Price.

6.4 Any amount to be paid or reimbursed in accordance with Clause 6.3 or any other provision of this Clause 6 shall be paid or reimbursed within ten (10) Business Days of receipt thereof (or, in the case of Obligations, within ten (10) Business Days of receipt of notification from the Party which has incurred such Obligations) to the relevant Seller Account or Purchaser Account (as the case may be) (unless otherwise intimated in writing).

6.5 For the avoidance of doubt, and without prejudice to the provisions of Clauses 6.1, 6.2 and 6.3, any Benefits or Obligations accruing in respect of the Option Interests in the form of amounts receivable or payable resulting from any adjustment in relation to the operation of, and expenditure attributable to, the Option Interests in the period prior to the Economic Date shall accrue to the Seller.

6.6 Notwithstanding any other provision of this Agreement (but without prejudice to the Warranty in Clause 7.14), the Buyer shall at its cost and expense perform and shall, to the extent of the Option Interests, be responsible for all Decommissioning Liabilities and all Environmental Liabilities whether arising before, on or after the Economic Date and shall indemnify and hold the Seller and its Affiliates harmless against all and any Losses and Expenses however arising out of or in connection with any and all Decommissioning Liabilities and any and all Environmental Liabilities, in each case to the extent of the Option Interests and regardless of whensoever such Decommissioning Liabilities or Environmental Liabilities may arise or may have arisen and whether before, on or after the Economic Date and regardless of whosoever is or was a licensee under the Licence(s) or owned or leased the relevant property.

6.7 The Buyer shall promptly notify the Seller of any circumstances of which the Buyer becomes aware and for which the Seller may have any benefit or liability under Clause 6.1 and/or Clause 6.3 and, if requested by notice in writing by the Seller, the Buyer shall use its reasonable endeavours to defend or pursue any claim on behalf of the Seller and shall act in accordance with the Seller’s reasonable instructions in respect thereof. In such event, the Seller shall indemnify the Buyer in respect of all costs, claims and damages suffered by the Buyer in defending or pursuing such a claim on the Seller’s behalf and acting in accordance with the Seller’s reasonable instructions.

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6.8 The rights and obligations in this Clause 6 shall not come into effect unless and until Completion takes place and for the avoidance of doubt any payments arising under this Clause 6 shall be made after the Completion Date. All adjustments and reimbursements made and the ascertainment of all Obligations and Benefits under this Clause 6 shall be calculated using the Accruals Basis of Accounting.

6.9 Notwithstanding any other provision of this Agreement, the Seller shall at its cost and expense perform and shall, be responsible for all Future Payment Liabilities whether arising before, on or after the Economic Date and shall indemnify and hold the Buyer and its Affiliates (including for this purpose Edison S.p.A and its Affiliates) harmless against all and any Losses and Expenses however arising out of or in connection with any and all Future Payment Liabilities regardless of whensoever such Future Payment Liabilities may arise or may have arisen and whether before, on or after the Economic Date and regardless of whosoever is or was a licensee under the Licence(s) or owned or leased the relevant property. Furthermore the Seller shall indemnify and hold the Buyer harmless against any breach of the Warranty contained in Clause 7.1.19.

6.10 The Seller shall ensure that there are no obligations outstanding at Completion to sell gas or any other Petroleum products relating to the Option Interests to any person and that (without limitation to the generality thereof) all commitments under the Forward Gas Sales Agreement which may relate to the Option Interests have been terminated. Furthermore the Seller shall indemnify and hold the Buyer harmless against any Losses and Expenses however arising out of or in connection with any breach of the Warranty contained in Clause 7.1.18.

7 Representations and Warranties

7.1 Subject to the provisions of this Clause 7, the Seller hereby represents and warrants to the Buyer that save in respect of matters fairly disclosed (with sufficient details to identify the nature and scope of the matters disclosed) in the Data Room Documents, the Licence Interest Documents or this Agreement, the following Warranties are true and accurate:

7.1.1 the Seller is a licensee of the Licence(s) and the legal and beneficial owner of the Option Interests and all property rights and interests attributable thereto under the Licensed Interest Documents;

7.1.2 save for the Limited Overriding Royalty Interest, no mortgage, charge (whether fixed or floating), pledge, lien, encumbrance or other security or net profit or royalty interest is in existence and in force over the Option Interests other than arising under the Licence(s) nor, subject as aforesaid, has the Seller entered into any agreement or commitment to create the same; nor, so far as the Seller is aware, are there any other matters which restrict the Seller’s ability freely to dispose of the Option Interests save for the terms of the Licence(s) and the Licence Interest Documents;

7.1.3 the Seller has not committed any breach of the Licence(s) or any of the Licensed Interest Documents nor received notice that any of the parties to any of the above-mentioned documents has committed any breach of the Licence Interest Documents, which breach, at the date of making this statement, is in either case of a material nature and is subsisting and would have a material adverse effect upon the Seller’s ownership of the Option Interests;

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7.1.4 the Licence(s) and all rights and interests of the Seller thereunder or deriving therefrom are in full force and effect and the Seller has not committed any act or omission nor, so far as the Seller is aware, has any other licensee of the Licence(s) committed any act or omission which would entitle the Secretary to revoke the Licence(s) and no notice has been given to the Seller or, so far as the Seller is aware, to any other licensee of the Licence(s), by the Secretary of any intention to revoke the Licence(s);

7.1.5 the Licence(s) is not in the course of being surrendered in whole or in part;

7.1.6 none of the current licensees of the Licence(s) or the current parties to the JDA have given any notice of withdrawal from the Licence(s) or the JDA;

7.1.7 the Seller is not a party to any litigation or arbitration or administrative proceedings relating to the Option Interests in respect of which a writ or summons or other formal pleading has been served or judgment issued, nor has the Seller been notified of any claim (not formulated within a formal pleading as aforesaid) or dispute in relation to, and which is likely materially to prejudice or endanger in any material manner, the Option Interests, and the Seller is not aware that any such litigation, arbitration or administrative proceedings are threatened or pending, either by or against the Seller, and there are no facts known to the Seller which are likely to give rise to any claim or dispute which is likely so materially to prejudice or endanger in any material manner the Option Interests, and, so far as the Seller is aware, none of the other licensees of the Licence or the parties to the Licensed Interest Documents is a party to any litigation, arbitration or administrative proceedings or any claim or dispute or judgment in relation to, and which is likely materially to prejudice or endanger in any material manner, the Option Interests;

7.1.8 the Seller is duly incorporated with limited liability and validly existing under the laws of England;

7.1.9 the documents which contain or establish the Seller’s constitution incorporate provisions which authorise, and all necessary corporate action has been taken to authorise, the Seller to execute and deliver this Agreement and perform the transaction contemplated by this Agreement;

7.1.10 subject to fulfilment of the conditions set out in Clause 2.2, the signing and delivery of this Agreement and the performance of any of the transactions contemplated by this Agreement will not contravene or constitute a material default under any provision contained in any agreement, instrument, law, judgment, order, licence, permit or consent by which the Seller or any of its Affiliates or their respective assets is bound or affected and which would result in the Seller being unable to perform its obligations under this Agreement;

7.1.11 the Licensed Interest Documents are the only material documents which govern or relate to the creation, existence or validity of the Option Interests, and to which the Seller is a party and the Seller is not under any contractual obligation to enter into any further material agreement in relation to the Option Interests other than for operational purposes;

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7.1.12 all accrued obligations and liabilities imposed by the Licence(s), including the work obligations arising from the Licence(s), have been duly fulfilled and discharged and there is no outstanding work obligation to be fulfilled under the Licence(s);

7.1.13 the Seller is not a party to any farm-in or farm-out agreement under which it will become obliged to transfer the Option Interests or any part of them;

7.1.14 In relation to the following:

7.1.14.1 the Seller has not received any orders or directives under any Environmental Laws in force at the date hereof which require any material work, repairs, construction or capital expenditures with respect to the Option Interests which have not been fully complied with in all material respects;

7.1.14.2 the Seller has not received any demand or notice under any Environmental Law in force at the date hereof with respect to a material breach thereof related to the Option Interests;

7.1.14.3 the Seller has not received any complaint from any UK government, agency or group regarding any actual or alleged material environment damage or material injury related to the Option Interests;

7.1.14.4 so far as the Seller is aware the Seller has complied in all material respects with Environmental Law in force at the date hereof in relation to the Option Interests;

7.1.15 the Seller is not for statutory purposes deemed to be unable to pay its debts and is able to pay its debts as they fall due and no steps have been taken to propose any scheme of arrangement involving the Seller and its creditors generally, obtain an administration order or appoint any administration or other receiver or equivalent officer in relation to the Seller or any of its property or to wind up or dissolve the Seller. No order has been made, petition presented or meeting convened for the purpose of considering a resolution for the winding up of the Seller or for the appointment of any provisional liquidator; and so far as the Seller is aware, no petition has been presented for an administration order to be made in relation to the Seller;

7.1.16 the Seller is not party to, and nor is the Seller aware of, any proposal by any other party to the Licensed Interest Documents to conduct any sole risk or non-consent operations under the Licence(s) so as to impose upon the Seller an obligation to pay any penalty or premium as a condition of participating in any future operation under the Licensed Interest Document in question;

7.1.17 the Seller (and/or the Operator on behalf of the Seller) has in place all insurances required by law and by the JDA and the Joint Operating Agreement in relation to the Option Interests;

7.1.18 all reserves of Petroleum arising from the Option Interests may following Completion be freely lifted and disposed of by the Buyer and are not contracted for sale or otherwise committed to any person or entity;

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7.1.19 details of expenditures on which capital allowances have been claimed or would have been claimed in the Seller’s corporation tax returns have been provided to the Buyer and to the extent that any part of the Consideration is allocated to assets qualifying for capital allowances under Part 2 and Part 5 of the Capital Allowances Act 2001, such capital allowances are available;

7.1.20 there are no outstanding obligations of the Seller (whether or not attaching to the Option Interests) to make future and/or contingent payments to any person from whom the Seller acquired all or part of the Option Interests (other than the Future Payment Liabilities)

Provided that the Warranties given in Clauses 7.1.4 to 7.1.6 (inclusive) and Clause 7.1.12 are, to the extent that the Seller does not have an interest in a Block in such Licence, given so far as the Seller is aware and for the avoidance of doubt provided further that no matters are disclosed pursuant to Clause 7.1 and 7.3 in relation to the Warranty in Clause 7.1.19.

7.2 Subject to the provisions of this Clause 7 the Buyer hereby represents and warrants to the Seller as follows:

7.2.1 the Buyer is duly incorporated with limited liability and validly existing under the laws of England;

7.2.2 the documents which contain or establish the Buyer’s constitution incorporate provisions which authorise, and all necessary corporate action has been taken to authorise, the Buyer to execute and deliver this Agreement and perform the transactions contemplated hereby;

7.2.3 subject to fulfilment of the conditions set out in Clause 2.2, the signing and delivery of this Agreement and the performance of the transactions contemplated by this Agreement, will not contravene or constitute a default under any provision contained in any agreement, instrument, law, judgment, order, licence, permit or consent by which the Buyer or any of its Affiliates or any of their respective assets is bound or affected and which would result in the Buyer being unable to perform its obligations under this Agreement;

7.2.4 no litigation, arbitration, administrative proceeding, dispute or judgement against the Buyer (or its Affiliates) or to which the Buyer (or its Affiliates) is a party which might by itself or together with any other such proceedings have a material adverse effect on the Buyer’s business, assets or condition and which would materially and adversely affect its ability to observe or perform its obligations under this Agreement and the transactions contemplated hereby, is subsisting or, so far as the Buyer is aware, threatened or pending against the Buyer or any of its assets or against its Affiliates;

7.2.5 there are no facts within the actual knowledge of the Buyer or its Affiliates at the date hereof which will entitle the Buyer to make any claim against the Seller and, insofar as there are any such facts, the Buyer shall not be entitled to make any claim in respect thereof; and

7.2.6 the Buyer is not for statutory purposes deemed to be unable to pay its debts and is able to pay its debts as they fall due and no steps have been taken to propose any scheme of arrangement involving the Buyer and its creditors generally, obtain an administration order or appoint any administration or other receiver

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or equivalent officer in relation to the Buyer or any of its property or to wind up or dissolve the Buyer. No order has been made, petition presented or meeting convened for the purpose of considering a resolution for the winding up of the Buyer or for the appointment of any provisional liquidator; and so far as the Buyer is aware, no petition has been presented for an administration order to be made in relation to the Buyer.

7.3 The Warranties are given as at the date of this Agreement and shall be repeated as at the Completion Date subject to matters fairly disclosed (with sufficient details to identify the nature and scope of the matters disclosed) in the Data Room Documents, the Licence Interest Documents or this Agreement. Accordingly, the Buyer shall not be entitled to claim that any fact or matter constitutes a breach of or inconsistency with the Warranties and the Seller shall not be liable to the Buyer for any claim to the extent that such fact or matter has been so disclosed.

7.4 Subject to Clause 7.3 and without prejudice to Clause 7.2.5, the Buyer’s remedy for breach of any of the Warranties or any other provision of this Agreement shall be limited to a claim for damages and/or indemnity and the Buyer shall not be entitled to any other form of remedy in relation thereto including rescission of this Agreement. Any payment by the Seller to the Buyer for damages pursuant to a breach of any of the Warranties shall be treated as a reduction in the Purchase Price to the extent of such payment.

7.5 Save in the case of fraud or wilful concealment of material facts, the Seller shall not be liable for any claim for breach of any of the Warranties unless it shall have received from the Buyer, as soon as practicable after the Buyer becomes aware of the same, written notice containing reasonable details of the relevant claim including the Buyer’s bona fide provisional estimate of the amount of the claim provided always that such notice is received on or before the expiry of eighteen(18) months from the Completion Date in the case of the Warranties other than the warranty contained in Clause 7.1.19 and in the case of such warranty before 31^st March 2014. Any claim made shall be deemed to have been withdrawn or satisfied unless arbitration proceedings in respect thereof have been both issued and served on the Seller within six (6) months of the giving of such notice.

7.6 Except as set out in Clause 7.1, neither the Seller nor any of its Affiliates nor any officer, shareholder, director, employee, agent, adviser, consultant or representative of the Seller or any of its Affiliates (including their auditors) makes any representation, warranty, statement, opinion, information or advice (including any representation, warranty, statement, opinion, information or advice (a) communicated (orally or in writing) to the Buyer or any Affiliate of the Buyer or (b) made in any data, information or document communicated to the Buyer or any Affiliate of the Buyer or made by any officer, shareholder, director, employee, agent, adviser, consultant or representative of the Seller or any Affiliate of the Seller) and the Buyer acknowledges, affirms and warrants that (except as aforesaid) it has not relied, and will not rely, upon any such representation, warranty, statement, opinion, information or advice of any person in entering into this Agreement or carrying out the transactions contemplated by this Agreement. Without limiting the generality of the foregoing, the Seller makes no representation or warranty as to: (i) the amounts, quality or deliverability of reserves of oil, gas or other hydrocarbons attributable to the Option Interests, (ii) any geological, geophysical, technical, engineering, economic or other interpretations, forecasts or evaluations, (iii) any forecast of expenditures, budgets or financial projections, (iv) any geological formation, drilling prospect or hydrocarbon reserve, or (v) the physical state or condition of any of the assets associated with the Option Interests and the Buyer acknowledges that all such assets are to be acquired by the Buyer on an “as is, where is” basis.

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7.7 Save in the case of fraud or wilful concealment of material facts, the Buyer shall not be liable for any claim in relation to any breach of the provisions of Clause 7.2 unless it shall have received from the Seller, as soon as practicable after the Seller becomes aware of the same, written notice containing reasonable details of the relevant claim including the Seller’s bona fide provisional estimate of the amount of the claim and in any event such notice is received on or before the expiry of twelve (12) months from the Completion Date. Any claim made shall be deemed to have been withdrawn or satisfied unless judicial proceedings in respect thereof have been both issued and served on the Buyer within six (6) months of the giving of such notice.

7.8 Save in the case of fraud or wilful concealment of material facts or breach of the Warranty contained in Clause 7.1.19, the liability of the Seller in respect of any claim for breach of the Warranties shall be limited as follows:

7.8.1 the Seller shall have no such liability unless the total loss or damage claimed to have been suffered by the Buyer (acting in good faith) in respect thereof when aggregated with other such claims amounts to two million Dollars ($2,000,000) or more, whereupon the whole of such liability and not merely the excess shall be recoverable; and

7.8.2 individual claims with a value of less than two hundred and fifty thousand Dollars ($250,000) shall be disregarded for all purposes including for the calculation of the aggregate value of claims for the purposes of Clause 7.8.1; and

7.8.3 the maximum aggregate liability of the Seller in respect of all such claims (including interest and expenses) shall not exceed an amount equal to the Purchase Price.

7.9 If:

7.9.1 the Buyer becomes aware of any circumstance which may result in the Buyer having a claim against the Seller under this Clause 7 as a result of or in connection with a liability or alleged liability to a third party, or

7.9.2 the Buyer is or may be entitled by law to recover from some other person any sum in respect of which the Buyer may have a claim against the Seller under this Clause 7,

the Buyer shall promptly notify the Seller thereof in writing and the Buyer shall make no admission of liability, agreement, settlement or compromise with any third party in relation to any such liability or alleged liability without the prior written consent of the Seller and the Seller shall at its expense be entitled to take and/or require the Buyer to take any action the Seller might reasonably request to prevent a claim arising or to resist such liability or enforce such recovery (as the case may be) and to have conduct of any appeal, dispute, compromise or defence and of any incidental negotiations for the aforesaid purposes, subject to indemnifying the Buyer in terms reasonably acceptable to the Buyer against any Losses and Expenses the Buyer may incur, and the Buyer will give the Seller all practicable co-operation, access, assistance and information for the purposes of preventing such a claim, resisting such liability or enforcing such recovery as aforesaid.

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7.10 Where the Buyer is or may be entitled to recover from some other person any sum in respect of any liability, loss or damage the subject of a claim by the Buyer against the Seller in respect of any breach of the Warranties or for which such a claim could be made, the Buyer shall, before seeking to recover any amount from the Seller under this Agreement, take all reasonable steps as the Seller may reasonably require to enforce such recovery and shall keep the Seller informed of the progress of any action taken and any claim against the Seller shall be limited (in addition to the limitations on the liability of the Seller referred to in this Clause 7) to the amount by which the loss or damage suffered by the Buyer as a result of such breach shall exceed the amount so recovered. If the Seller pays to the Buyer an amount pursuant to a claim in respect of any breach of the Warranties and the Buyer is entitled to recover from some other person any sum to which it would not have been or become entitled but for the circumstances giving rise to such a claim, the Buyer shall promptly undertake all appropriate steps to enforce such recovery and shall forthwith repay to the Seller the amount recovered from the third party or, if less, the amount paid by the Seller, less any costs and expenses reasonably incurred by the Buyer in recovering that amount from the third party.

7.11 The Seller shall not be liable for any breach of any provision of this Clause 7 nor shall the Buyer have any rights in respect of any inconsistency therewith arising after the date hereof, to the extent that such breach or inconsistency is occasioned by the Seller doing or omitting to do any act or thing at the written request of the Buyer.

7.12 A breach of warranties under Clause 7.1 or Clause 7.2 which is capable of remedy shall not entitle a Party to make a claim unless the warrantor is given notice of such breach and the warrantor has failed to commence remedial action within thirty (30) days after the date on which such notice is served on the warrantor. Without prejudice to the foregoing, if any claim shall arise by reason of some liability which at the time that the claim is notified to a Party is contingent only, such Party shall not be under any obligation to make any payment in respect of such claim until such time as the contingent liability ceases to be so contingent.

7.13 Where a representation or warranty is qualified by the words “so far as the Seller is aware”, or any similar expression, such representation or warranty is given only to the extent that any of the officers or directors of the Seller or ATP Oil & Gas Corporation or senior managers of the Seller have actual knowledge of the matters to which it refers as at the date the representation or warranty is given after due and careful inquiry only of those of the Seller’s senior employees directly engaged in the management of the Option Interests and who could reasonably be expected to have knowledge of the subject matter of the relevant representation or warranty (and no other persons).

7.14 Nothing in this Agreement shall relieve a Party of any duty, whether at common law or otherwise, to mitigate any loss or damage incurred by it in respect of any breach by the other Party of the representations, warranties, indemnities or any other term of this Agreement or in respect of its subject matter.

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7.15 A Party shall not be entitled to recover from the other Party the same sum or loss more than once in respect of any claims for any breach of any provision of this Agreement or in respect of its subject matter.

7.16 Notwithstanding any other provisions of this Agreement, neither Party shall be liable to the other Party under, arising out of or in any way connected to this Agreement or the Assignment Documents, for any Consequential Loss, whether arising in contract or in tort (including negligence, breach of statutory duty or otherwise). For these purposes “Consequential Loss” means loss of revenue, production or profits; or inability to produce Petroleum; or losses associated with business interruption; or loss of bargain, contract (other than this Agreement), expectation or opportunity; or any loss, claim or expense which arises out of the delay, postponement, interruption to or inability to produce, deliver or process production from the Option Interests; or any increase in operating or other costs; or all indirect or consequential losses or damages howsoever caused or arising.

8 Ongoing obligations and liabilities

8.1 The Parties shall co-operate with each other and shall execute such documents and take such actions as may reasonably be requested from time to time in order to give full effect to the intent of this Agreement.

8.2 Each Party undertakes to provide written advice to the other Party of any event giving rise to an adjustment under Clause 6, Clause 7 or Clause 12.7 or Clause 12.9.2, including such documentary evidence as is reasonably deemed to be necessary by the other Party to verify the adjustment, within thirty (30) days of becoming aware of such an event.

9 Announcements and Confidentiality

9.1 No Party shall, and each Party shall procure that none of its Affiliates shall, issue or make any public announcement or statement regarding this Agreement or any transactions contemplated hereby without the prior written consent of the other Party, such consent not to be unreasonably withheld or delayed, except to the extent that it is necessary for a Party or its Affiliate to make such public announcement or statement in order to comply with a statutory obligation, an obligation to include information in published or audited accounts, or with the requirement of a competent government agency or other regulatory body, the London Stock Exchange plc, the Securities and Exchange Commission of the United States of America or a recognised stock exchange on which that Party or such Affiliate has its shares or oil production or royalty stock listed, in which event the Party proposing to make such an announcement or statement shall, as soon as practicable and, if possible prior to its release, issue a copy thereof to the other Party. . In all circumstances the Parties shall consult in relation to the form of the announcement.

9.2 The terms and conditions of this Agreement shall be held confidential by the Parties and all information furnished or disclosed to a Party in connection with the transactions contemplated by this Agreement (“Confidential Information”) whether before or after the date hereof shall be held confidential by such Party and neither the terms of this Agreement nor any Confidential Information shall, subject to Clause 9.1, be divulged in any way to any third party by one Party without the prior written approval of the other Party; provided that such Party may, without such approval, disclose the same to:-

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9.2.1 any if its Affiliates provided such Party remains liable for any breach of confidentiality by such Affiliate(s); or

9.2.2 any outside professional consultants or other professional advisers consulted in connection with this Agreement (including an expert and/or accountant appointed hereunder) provided such Party obtains a similar undertaking of confidentiality (but excluding this proviso) from such consultants and advisers; or

9.2.3 any bank or financial institution from whom such Party is seeking or obtaining finance, provided such Party obtains a similar undertaking of confidentiality (but excluding this proviso) from such bank or institution; or

9.2.4 the extent required by any applicable laws, the Licence(s), or the requirements of any recognised stock exchange or the Securities and Exchange Commission of the United States of America in compliance with its rules and regulations; or

9.2.5 the extent required by any Government agency or authority lawfully requesting the same; or

9.2.6 any Court of competent jurisdiction acting in pursuance of its powers; or

9.2.7 the extent that the terms of this Agreement or any Confidential Information become public knowledge or for any other reason cease to be confidential otherwise than through breach of this undertaking.

9.3 Notwithstanding the termination of this Agreement the provisions of this Clause 9 shall continue to apply for a period of three (3) years from the date hereof.

10 Notices

10.1 Except as otherwise provided in this Agreement any notice or other document to be given under this Agreement shall be in writing and shall be deemed to be duly given if it (or the envelope containing it) identifies the Party to whom it is intended to be given as the addressee and:

10.1.1 it is delivered personally; or

10.1.2 it is sent by (i) pre-paid first class post or airmail or express or other fast postal service or (ii) the recorded delivery service or (iii) facsimile transmission,

to the appropriate address or facsimile number and marked for the attention of the appropriate person shown in Clause 10.3 or to such other addresses and/or facsimile numbers and/or marked for the attention of such other persons as may be given by a Party for the purposes of this Agreement by notice to the other Party.

10.2 Any notice duly given within the meaning of Clause 10.1 shall be deemed to have been both given and received:

10.2.1 if it is delivered in accordance with Clause 10.1.1, on such delivery;

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10.2.2 if it is duly posted or transmitted in accordance with Clause 10.1.2 by any of the methods therein specified, on the second (or, when sent by airmail, the fifth) Business Day after the day of posting or (in the case of a notice transmitted by facsimile) on the first Business Day after the day of transmission and receipt by the sender of a successful transmission report indicating full and complete transmission.

10.3 The respective addresses for service are:

Seller	ATP Oil & Gas (UK) Limited
	Victoria House, London Square, Cross Lanes, Guildford GU1 1UJ
	Facsimile: 01483 307222
	Email: jgill@atpog.com
	Attention: John Gill
	copied to:
	ATP Oil & Gas Corporation
	4600 Post Oak Place, Suite 200, Houston, Texas 11027-9726
	Facsimile: + 1 713 622 0289
	Email: jtschirhart@atpog.com
	Attention: John Tschirhart
Buyer	EDF Production UK Ltd
	c/o 1 Blake Mews. Kew Gardens, London, TW9 3GA
	Facsimile: +44 208 439 9868
	Emails: amj@lawxl.com
	Emails: philippe.antoine@edf.fr
	Attention: Philippe M Antoine
	copied to:
	Facsimile: +33 1 5665 0837
	Attention: Charles-Henri Prou
	Emails: charles-henri.prou@edf.fr

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10.4 For the purposes of this Clause 10 “notice” shall include any request, demand, instructions or other document.

11 Costs and Expenses

11.1 Save as otherwise stated in this Agreement, each Party shall pay its and its Affiliates’ own costs, expenses, duties and, except as otherwise expressly agreed in writing, Taxation in relation to the preparation and execution of this Agreement, the documents contemplated hereby or executed pursuant hereto and any transactions contemplated by this Agreement.

11.2 Without prejudice to any other rights or remedies available to a Party hereunder or at law, if any amount payable hereunder is not paid when due, the defaulting Party shall pay interest on such amount from the due date of payment (after as well as before judgment) at a rate equal to two percent (2%) above the Agreed Rate calculated on a compounded basis on the accumulated daily balances.

11.3 The Buyer shall be responsible for payment in a timely fashion of any and all stamp duty land tax, stamp duties, transfer taxes, registration fees and other charges payable on or in respect of this Agreement, the Assignment Documents and/or any related agreements and in respect of its or their subject matter and any similar taxes, duties, fees and charges wheresoever arising in relation to the transfer of the Option Interests to the Buyer.

12 Taxation

12.1 The Seller confirms that it is registered and the Buyer confirms that it has applied for registration and will use its reasonable endeavours to obtain registration before Completion, as taxable persons for the purposes of VAT and that no election has been made and no election will be made prior to the Completion Date under paragraph 2 of Schedule 10 to the Value Added Tax Act 1994 in relation to the Option Interests.

12.2 The Buyer undertakes that it will use the Option Interests as part of its business of searching for, boring for and getting petroleum as a going concern for a sufficient period to comply with the requirements of Article 5 of the Value Added Tax (Special Provisions) Order 1995 so that the assignment of the Option Interests is treated as neither a supply of goods nor a supply of services for VAT purposes.

12.3 The Purchase Price is stated net of any applicable VAT. The Parties believe that the sale and transfer hereunder is a transaction which is outside the scope of VAT by virtue of Article 5 of the Value Added Tax (Special Provisions) Order 1995 and/or that the transfer contemplated hereby is of a right over land situated outside the United Kingdom and as such will be treated as outside the scope of Value Added Tax by virtue of Article 5 of the Value Added Tax (Place of Supply of Services) Order 1995. However, in the event that a Party is advised in writing by HM Revenue and Customs that the transaction hereunder is subject to VAT, the Buyer undertakes to pay to the Seller, on delivery of a valid VAT invoice, any amounts due in respect of VAT within thirty (30) days of demand.

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12.4 Reimbursement pursuant to Clause 6.3 shall be exclusive of VAT which the Party receiving the reimbursement may be required to charge and, if called upon to do so by the such Party, the Party making the reimbursement undertakes to pay such Party, on presentation of a valid VAT invoice, any amounts properly due in respect of VAT set out in such invoice within thirty (30) days of demand.

12.5 Subject to Clause 12.3, any Adjustments pursuant to Clause 3 or payments or reimbursements pursuant to Clause 6.3 or Clause 7 in respect of any payment or receipt being an amount in respect of which VAT has been paid or received shall be made on a basis disregarding the VAT element where the VAT paid is fully deductible or is required to be accounted for in full to HM Revenue and Customs, but otherwise shall be made on a basis which leaves the Seller and the Buyer in no better and no worse a position (after taking account of VAT, and subject to the application of the other provisions of this Clause 12) than had the payment or receipt not been made or received.

12.6 The Seller shall make an application to HM Revenue and Customs under Section 49(1) (b) of the Value Added Tax Act 1994 for a direction that the records relating to the Option Interests which under paragraph 6 of Schedule 11 to the Value Added Tax Act 1994 have been maintained by the Seller or its Affiliates should be preserved by the Seller or its Affiliates, as the case may be, notwithstanding the provisions of the said section. The Seller shall, as soon as reasonably practicable following receipt thereof, provide the Buyer with a copy of any such direction and the Buyer shall retain access at all reasonable times during business hours to all books and records retained by the Seller or its Affiliates in relation to VAT matters concerning the Option Interests and the Seller covenants to retain such records as required by paragraph 6 of Schedule 11 to the Value Added Tax Act 1994.

12.7 CT Adjustments

12.7.1 The Purchase Price shall be increased by the Buyer paying to the Seller an amount equal to any CT paid by the Seller on any receipts taken into account, using the Accruals Basis of Accounting, for the purposes of Clause 3.7, the Petroleum Sales Adjustment.

12.7.2 The Purchase Price shall be decreased by the Seller paying to the Buyer an amount equal to any CT relief received by the Seller on any cash calls paid and any expenditure taken into account, using the Accruals Basis of Accounting, for the purposes of Clause 3.6, the Cash Calls Adjustment and Clause 3.8, the Interim Period Adjustment.

12.7.3 The Parties recognise that adjustments under this Clause 12.7 are notional adjustments, as opposed to actual payments of, reliefs from or reductions in CT liabilities. For the purpose of calculating these notional adjustments it shall be assumed that both the Seller and the Buyer are single companies with no brought forward losses who are paying CT at the standard rate applicable for the period concerned. Such notional adjustments shall be effected by deducting from each relevant payment a notional CT charge. In calculating the notional CT charge, the CT rate to be used will be the rate which applies at the end of the month in which the receipt or payment arises, or if the rate of CT changes during a month the arithmetic mean of the rates applicable for that month shall be used.

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12.7.4 If the Parties cannot reach agreement on all or part of the adjustments referred to in this Clause 12.7 within thirty (30) Business Days of receipt by the Buyer from the Seller of the Seller’s estimate of such adjustments, the adjustments in dispute may be referred by either the Seller or the Buyer for determination by an independent expert nominated by the Parties or, in the absence of agreement between the Parties within five (5) Business Days of a Party notifying the other that it proposes to refer the dispute to an expert, by the President of the Institute of Chartered Accountants in England and Wales on the application of either the Seller or the Buyer. Within twenty (20) Business Days after the appointment of such expert, each Party may submit to the expert a statement of the nature of the dispute, a description of the submitting Party’s claims with respect thereto, and any other supporting documentation or materials with respect thereto that the submitting Party desires the expert to consider. The Party submitting such statement shall provide a copy thereof to the other Party, who shall have ten (10) Business Days from receipt thereof to submit a responding statement to the expert. The nominated expert shall be afforded such access to books, records, accounts and documents in the possession of the Parties as he may reasonably request, and he shall act as expert not as arbitrator. The said expert’s determination shall, in the absence of fraud or manifest error or bias, be final and binding on the Parties, his fees and disbursements shall be borne by the Seller and the Buyer in equal shares and the Parties shall bear their own costs in respect of such reference.

12.8 The Seller shall be liable for any liabilities arising under Schedule 15 to the Finance Act 1973 in respect of the Option Interests or the Licence(s) for periods ending up to the Economic Date and the Buyer shall be liable for all periods thereafter.

12.9.1 The Seller and the Buyer agree that the allocation of Consideration set out in Schedule 2 is a just and reasonable apportionment of the Consideration and both agree to submit their CT returns for all relevant years on the basis of said allocation. Further, the Seller and the Buyer agree consistently to allocate the Consideration attributable to amounts eligible for capital allowances between plant and machinery allowances and mineral extraction allowances on their respective CT returns. Where HM Revenue and Customs does not agree with the claim for capital allowances by the Buyer, the allocation set out in Schedule 2 shall be adjusted to take into account the just and reasonable apportionment agreed by HM Revenue and Customs and to reflect any revised disposal proceeds taken into account in the Seller’s revised CT returns.

12.9.2 If any part of the Consideration allocated as set out in Schedule 2 to assets qualifying for capital allowances under Part 2 and/or Part 5 of the Capital Allowances Act 2001 is not agreed by HM Revenue and Customs and the total of the capital allowances claim of the Buyer is reduced, the Seller shall pay to the Buyer, by way of adjustment to the Purchase Price, an amount equal to fifty percent (50%) of the amount by which the total of the Buyer’s claim for capital allowances is reduced by HM Revenue and Customs provided always that, save in the case of fraud or wilful concealment of material facts, the Seller shall not be liable for any payment to the Buyer pursuant to this Clause 12.9.2 unless it shall have received from the Buyer, as soon as practicable after the Buyer becomes aware of the amount of capital allowances not being so agreed, written notice containing reasonable details of the relevant claim including the Buyer’s bona fide provisional estimate of the amount of the claim and in any event such notice is received on or before 31^st March 2014. Any payment under this clause shall not be due for payment until the earlier of 1^st January 2012 and the date on which the increased Taxation that results from the adjustments to the allocation of consideration falls due for payment to HM Revenue and Customs.

43

13 Variation

The terms and conditions of this Agreement shall only be varied by an agreement in writing signed by each of the Parties and specifically referring to this Agreement.

14 Assignment

No Party shall assign or transfer its rights or its obligations under this Agreement without the prior written consent of the other Party save that (a) prior to Completion the Buyer may assign its rights under this Agreement (in whole or in part) with the consent of the Seller (such consent not to be unreasonable withheld or delayed) and (b) after Completion the Buyer may assign its rights under this Agreement (in whole or in part), in either case to an Affiliate(s) and/or to an Affiliate(s) of Edison S.p.A.

15 Rights of Third Parties

With the exception of the rights of the Seller’s Affiliates to enforce the terms of Clause 6.6, nothing in this Agreement is intended to confer on any person any right to enforce any term of this Agreement which that person would not have had but for the Contracts (Rights of Third Parties) Act 1999. Notwithstanding the foregoing, the Parties may by agreement rescind or vary any term of this Agreement without the consent of any of the Seller’s Affiliates.

16 General

16.1 If there is any conflict between the provisions of this Agreement and the provisions of the Assignment Documents, the provisions of this Agreement shall prevail. The provisions of the main body of this Agreement shall prevail over the provisions of the Schedules in the event of any conflict.

16.2 Without prejudice to the provisions of Clauses 7.5 and 7.7, this Agreement shall remain in full force and effect notwithstanding Completion.

16.3 No waiver by any Party of any breach of a provision of this Agreement shall be binding unless made expressly and in writing and any such waiver shall relate only to the matter to which it expressly relates and shall not apply to any subsequent or other matter.

16.4 This Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns of the Parties.

16.5 This Agreement may be executed in any number of counterparts but shall not be effective until each Party has executed at least one counterpart. Each of the executed counterparts shall be deemed to be an original of this Agreement, but taken together, all the counterparts shall constitute one and the same instrument.

44

16.6 This Agreement is not intended to constitute or create nor shall it be construed so as to constitute or create any partnership, association, joint venture or trust. Notwithstanding the foregoing if, for the income tax purposes of the United States of America, this Agreement and the transactions under this Agreement are regarded as a partnership, each Party which is affected thereby elects to be excluded from the application of all of the provisions of Subchapter “K” of Chapter 1 of Subtitle “A” of the Internal Revenue Code of 1986 as amended of the United States of America (the “Code”), as permitted and authorised by Section 761 of the Code and the Treasury Regulations promulgated under the Code, and any future income tax laws of the United States containing similar provisions. No affected Party shall give any notices or take any other action inconsistent with the election made hereby. In making the foregoing election, each affected Party states that the income derived by it from the transactions under this Agreement can be adequately determined without a computation of partnership taxable income. A Party that is not subject to the income tax laws of the United States of America in respect of this Agreement and the transactions under this Agreement shall not be required to do any act or execute any instrument which might subject it to the taxation jurisdiction of the United States of America.

16.7 Each provision of this Agreement is severable and distinct from the others and if any such provision shall in whole or in part be held to any extent to be illegal or unenforceable under any enactment or rule of law that provision or part shall to that extent be deemed not to form part of this Agreement and the validity and enforceability of the remainder of this Agreement shall not be affected.

16.8 This Agreement, and the confidentiality agreement between the Parties dated 30^th May 2008 contain the entire agreement between the Parties and supersedes the Offer Letter dated 28 August 2008 from the Buyer, the Letter Agreements dated September 5, 2008 and September 11, 2008 between the Parties, all prior negotiations, proposals, statements of intent, understandings and agreements relating to the subject matter hereof. Each of the Parties agrees that it will have no remedy in respect of any untrue representations or statements made by the other Party or its advisers, unless made fraudulently, and upon which it relied in entering this Agreement.

17 Governing Law and Arbitration

17.1 The construction validity and performance of this Agreement and all agreements executed pursuant hereto shall be governed by English law (other than choice of law rules).

17.2 Subject to Clause 3.13 and Clause 12.7.4, all disputes arising out of or in connection with this Agreement shall be finally settled under the Rules of the LCIA by three (3) arbitrators appointed in accordance with those rules. London shall be the seat of arbitration and the language of the arbitration shall be English and all documents submitted to the arbitration shall be submitted to the arbitration in their original form together with an English translation.

17.5 Each Party agrees that without preventing any other mode of service, any document in any dispute referred to arbitration hereunder may be served on any Party by being delivered to or left for that Party at its address for service of notices under Clause 10 and each Party undertakes to maintain such an address at all times in accordance with Clause 10 and to notify the other Party in advance of any change from time to time of the details of such address in accordance with the manner prescribed for service of notices under Clause 10.

45

Schedule 1 (to SPA Terms)

Licence(s), related Licensed Interest Documents and other related information

As per Schedule 1 of the Sale and Purchase Agreement between the Seller and the Buyer dated 23^rd

September 2008 and amended and restated on      October 2008

46

Schedule 2 (to SPA Terms)

Summary of the Consideration allocated to assets qualifying for Capital Allowances

.

Field/Area	Plant & Machinery (£s)	Mineral exploration & access – (£s)	£s
Wenlock	24,867,993	115,609		27,480,000
Tors	33,544,784	143,072		44,910,000
			£	72,390,000 (as may be increased per Clause 3.1)

Any balance of the respective considerations will be allocated to the Licences

The Sterling column includes the £6,140,000 Advance

1

Schedule 3 (to SPA Terms)

Working Capital

1. Pursuant to Clause 3.5, the working capital balance shall be determined in relation to the Option Interests in accordance with the provisions of this Schedule 3, by adding together the amounts of the Cash Balances, VAT Receivable, Other Assets, Inventory (net of provisions) and Prepayments (the “Positive Balance”) for the Option Interests and adding together the amounts of any overdraft balance, VAT Payable, Accruals and Other Liabilities (the “Negative Balance”) for the Option Interests and deducting the Negative Balance from the Positive Balance, and adding together the net balances.

2. Elements

The elements of working capital shall comprise those items set out in the Exhibit to this Schedule 3, which items shall relate solely to the Option Interests and have the following meanings:

“Accruals”	means the amounts accrued by the Joint Account but unpaid as at the Economic Date;
“Cash Balances”	means cash balances held by the Joint Account at the Economic Date;
“Inventory”	means the value of equipment held at the Economic Date;
“Joint Account”	means any joint account held by the Operator in accordance with the JOA;
“Other Assets”	means other assets due to the Joint Account but unpaid at the Economic Date;
“Other Liabilities”	means the other liabilities accrued by the Joint Account but unpaid as at the Economic Date;
“Prepayments”	means amounts prepaid by the Seller or the Operator on account of expenditure incurred on an accruals basis of accounting after the Economic Date;
“VAT Receivable/Payable”	means VAT due to/from the Joint Account but not recovered/paid at the Economic Date.

2

3. Valuation of certain elements

For all elements of working capital, the figures shall be derived from the statements provided by the Operator.

3

Exhibit to Schedule 3

WORKING CAPITAL SCHEDULE

INTEREST	100%     JOINT VENTURE     £	INTEREST %	INTEREST         SHARE £
AS PER OPERATOR STATEMENTS
CASH BALANCES
PREPAYMENTS
VAT RECEIVABLE/PAYABLE
OTHER ASSETS
INVENTORY
ACCRUALS
OTHER LIABILITIES
TOTAL WORKING CAPITAL

4

Schedule 4 (to SPA Terms)

Format for Interim Completion Statement and Final Completion Statement

STATEMENT OF CONSIDERATION

Description	Clause/Schedule	Amount £	Amount £
Purchase Price	Clause 3.1
Interest thereon	Clause 3.15
Adjustments
Working Capital Adjustment	Clause 3.5, Schedule 3	+/-
Interest thereon	Clause 3.16	+/-	+/-
Cash Calls Adjustment	Clause 3.6	+
Interest thereon	Clause 3.16	+	+
Petroleum Sales Adjustment	Clause 3.7	-
Interest thereon	Clause 3.16	-	-
Interim Period Adjustment	Clause 3.8	+
Interest thereon	Clause 3.16	+	+
Total consideration (incl Adjustments)

5

SCHEDULE 5

AFEs

6

EX-31.1

EXHIBIT 31.1

ATP OIL & GAS CORPORATION

Section 302 Certification of Principal Executive Officer

I, T. Paul Bulmahn, certify that:

1. I have reviewed this quarterly report on Form 10-Q for the nine month period ended September 30, 2008 of ATP Oil & Gas Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2008	/s/ T. Paul Bulmahn
	T. Paul Bulmahn
	Chairman, Chief Executive Officer

EX-31.2

EXHIBIT 31.2

ATP OIL & GAS CORPORATION

Section 302 Certification of Principal Financial Officer

I, Albert L. Reese Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q for the nine month period ended September 30, 2008 of ATP Oil & Gas Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2008	/s/ Albert L. Reese Jr.
	Albert L. Reese Jr. Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ATP Oil & Gas Corporation (the “Company”) on Form 10-Q for the nine month period ending September 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, in his capacity as an officer of the Company, that:

(1) the Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and the results of operations of the Company.

Date: November 7, 2008	By:	/s/ T. Paul Bulmahn
		T. Paul Bulmahn Chairman, Chief Executive Officer

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ATP Oil & Gas Corporation (the “Company”) on Form 10-Q for the nine month period ending September 30, 2008 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned hereby certifies, pursuant to 18 U.S.C. Sec. 1350, as adopted pursuant to Sec. 906 of the Sarbanes-Oxley Act of 2002, in his capacity as an officer of the Company, that:

(1) the Report fully complies with the requirements of section 13 (a) or 15 (d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and the results of operations of the Company.

Date: November 7, 2008	By:	/s/ Albert L. Reese Jr.
		Albert L. Reese Jr. Chief Financial Officer