Profile: W&T Offshore, Inc. (WTI)

W&T Offshore, Inc. (W&T) is an independent oil and natural gas producer engaged in the acquisition, exploitation, exploration and development of oil and natural gas properties in the Gulf of Mexico. The Company has acquired rights to develop and exploit new prospects, and has acquired existing oil and natural gas properties in both the deepwater and the deep shelf, while at the same time continuing its focus on the conventional shelf. As of December 31, 2008, it had four fields of major significance, which were Ship Shoal 349 field, Main Pass 108 field, Brazos A-133 field and East Cameron 321 field. As of December 31, 2008, the Company had interests in leases covering approximately 1.4 million gross acres (0.8 million net acres) spanning across the outer continental shelf off the coasts of Louisiana, Texas, Mississippi and Alabama.

On December 21, 2007, the Company entered into an agreement with Apache Corporation (Apache) to acquire its interest in Ship Shoal 349 field. This field is located off the coast of Louisiana and covers two federal offshore lease blocks, Ship Shoal blocks 349 and 359. The transaction closed on January 29, 2008. As of December 31, 2008, W&T’s proved reserves totaled 491.1 billions of cubic feet equivalent (Bcfe). As of December 31, 2008, approximately 68% of W&T’s reserves were classified as proved developed (of which 38% were classified as non-producing) and 32% were classified as proved undeveloped. Classified by product, 46% of its reserves were natural gas, and 54% were oil and natural gas liquids as of December 31, 2008.

Ship Shoal 349 Field

Ship Shoal 349 field is located off the coast of Louisiana, approximately 235 miles southeast of New Orleans, in 375 feet of water. The field area covers Ship Shoal blocks 349 and 359, with a single production platform on Ship Shoal block 349. The Company owns a 100% working interest in this field. During the year ended December 31, 2008, cumulative field production was approximately 162 Bcfe gross. This field is a sub-salt development with five productive horizons below salt at depths ranging to 17,000 feet. W&T is drilling a well targeting both development and exploration objectives. As of December 31, 2008, 21 wells were drilled, of which 12 were successful. Ship Shoal 349 is the Company’s largest field in terms of reserves. Total proved reserves associated with its interest in this field were 133 Bcfe at December 31, 2008. In December 2008, production from this field, net to the Company’s interest, averaged 3.6 million cubic feet (MMcf) of natural gas per day, and 1,826 barrels (Bbls) of oil per day, or 14.6 millions of cubic feet equivalent (MMcfe) per day.

Main Pass 108 Field

Main Pass 108 field contains six separate outer continental shelf (OCS) blocks, located off the coast of Louisiana approximately 50 miles east of Venice in 50 feet of water. This field includes Main Pass blocks 94, 102, 106, 107, 108 and 109. The Company acquired its working interests in these blocks, which range from 33% to 100%, in the Kerr-McGee Oil & Gas Corporation (Kerr-McGee) merger transaction. The field produces from a number of low relief, predominantly stratigraphically trapped sands. The productive interval ranges in age from Upper Miocene Big A through Middle Miocene Big Hum. As of December 31, 2008, 49 wells were drilled in this field, of which 35 were productive. In 2008, cumulative field production was approximately 313 Bcfe gross. In December 2008, production from this field, net to the Company’s interest, averaged 16.2 MMcf of natural gas per day and 357 Bbls of oil per day, or 18.4 MMcfe per day.

Brazos A-133 Field

Brazos A-133 field is located 85 miles east of Corpus Christi, Texas, in 200 feet of water. There are five active platforms, three of which are production platforms. In 2008, cumulative field production was approximately 821 Bcfe gross from the Middle Miocene Tex W and Big Hum sections. The bulk of the production is from the Big Hum CM-7 sand, which is a four-way closure downthrown to the Corsair Fault and bisected by antithetic faults. Since its discovery, 22 wells have been drilled with 17 being completed as producers. The Company owns a 25% working interest that was obtained through the Kerr-McGee merger transaction. In December 2008, production from this field, net to the Company’s interest, averaged 7.6 MMcf of natural gas per day and 15 Bbls of oil per day, or 7.7 MMcfe per day.

East Cameron 321 Field

East Cameron 321 field is located approximately 97 miles off the Louisiana coastline in 225 feet of water. Two production facilities, the A and B platforms, are located on the block. This field has multiple sands that are productive in faulted, structural traps. As of December 31, 2008, 75 wells were drilled, of which 57 were successful. During 2008, cumulative field production was approximately 538 Bcfe gross. W&T owns a 100% working interest in the field and is the operator of the field. In December 2008, net production averaged 5.2 MMcf of natural gas per day. Production from this field is restricted to dry gas only as a result of damage to a third-party oil pipeline system. During July 2008, production from this field, net to the Company’s interest, averaged 12.5 MMcf of natural gas per day and 2,701 Bbls of oil per day, or 28.7 MMcfe per day.

Green Canyon 19 Field

Green Canyon 19 field is located off the coast of Louisiana, approximately 150 miles southwest of New Orleans in 750 feet of water. This field covers Green Canyon block 18 and wells drilled from the A-platform located in Green Canyon 18 to Ewing Bank block 988. The Company has a 25% working interest in the field. As of December 31, 2008, 59 wells were drilled, of which 47 was successful. In 2008, cumulative field production was approximately 648 Bcfe gross. In December 2008, production from this field was shut-in. During July 2008, production from this field, net to the Company’s interest, averaged 0.6 MMcf of natural gas per day and 436 Bbls of oil per day, or 3.2 MMcfe per day. In 2009, the operator, ExxonMobil Corporation, restored oil production at a restricted rate.

High Island 24-L Field

The High Island Block 24-L field is located 50 miles southeast of Houston, Texas, in 42 feet of water. In 2008, cumulative field production was approximately 23 Bcfe from two wells in the Lower Miocene Lentic Jeff section. The Company owns a 25% working interest in this field. In December 2008, production from this field, net to its interest, averaged 9.1 MMcf of natural gas per day and 71 Bbls of oil per day, or 9.5 MMcfe per day.

Mobile 823 Field

Mobile 823 field is located off the coast of Alabama in approximately 60 feet of water. It is a natural gas field consisting of two OCS blocks, Mobile Blocks 822 and 823. It has 12.5% working interest in the field. ExxonMobil Corporation operates the majority of the field. The Company operates one well, a Miocene Luce sand discovery drilled during the year ended December 31, 2006. In 2008, cumulative field production was approximately 774 Bcfe gross from 11 productive wells. The field has one processing platform and three independent structures. In December 2008, production from this field, net to the Company’s interest, averaged 7.6 MMcf of natural gas per day.

Ship Shoal 299 Field

Ship Shoal 299 field is 60 miles south and west of Grand Isle, Louisiana, in water depths ranging from 250 feet to 300 feet. The field includes OCS blocks Ship Shoal 300, 314 and 315. Its working interests range from 75% to 100%. There are three active platforms in the field. Production is primarily from the Ang B and Cris S Sands. As of December 31, 2008, 27 wells were drilled, of which 19 were successful. In 2008, cumulative field production was approximately 140 Bcfe gross. In December 2008, production from this field was shut-in. In July 2008), production from this field, net to its interest, averaged 4.1 MMcf of natural gas per day and 2,403 Bbls of oil per day, or 18.5 MMcfe per day. The Company restored the majority of the field’s oil production in February 2009.

South Timbalier 228 Field

South Timbalier 228 field is located 50 miles off the coast of Louisiana in about 220 feet of water, and includes South Timbalier blocks 229 and 230. The Company is a 100% working interest owner in this field. The Company has drilled six wells since becoming operator, all of which were successful. All the producing sands are within the basal Nebraskan section. In 2008, cumulative production from this field was approximately 27 Bcfe gross. In December 2008, production from this field, net to its interest, averaged 1.7 MMcf of natural gas per day, and 1,183 Bbls of oil per day, or 8.8 MMcfe per day.

West Delta 30 Field

West Delta 30 field is located approximately six miles off the coast of Louisiana in 40 feet of water. Its interests in this field are in West Delta Block 29. Following a three-dimensional (3D) seismic analysis, the Company has drilled a total of 17 exploration and development wells, all but one of which have been successful. Its working interests in these wells range from 37.5% to 100%. In 2008, cumulative field production was approximately 698 Bcfe gross. In December 2008, production from this field, net to its interest, averaged 0.6 MMcf of natural gas per day, and 641 Bbls of oil per day, or 4.4 MMcfe per day.