Ladies and gentlemen, thank you for standing by, and welcome to the W&T Offshore fourth quarter earnings conference call. (Operator Instructions) I would now like to turn the conference over to Manny Mondragon, VP of Finance. Please go ahead, sir.

Thank you, operator and good morning to everyone. We appreciate you joining us for W&T Offshore’s conference call to review the fourth quarter and full year 2007 results. Before I turn the call over, I have a few items to go over. If you would like to be on the company’s email distribution list to receive future news releases or you experienced a technical problem and didn’t receive yours, please call DRG&E’s office at 713-529-6600 and someone will be glad to help you there. If you wish to listen to today’s replay call, it will be available in a few hours via webcast by going to investor relations section of the company’s website at www.WTOffshore.com or via a recorded replay until March 6, 2008. To use the replay feature call 303-590-3000 and dial the passcode 11109032. Information recorded on this call speaks only as of today, February 28, 2008 and therefore time-sensitive information may no longer be accurate as of the date of any replay. Today management is going to discuss certain topics that contain forward-looking information which is based on management’s beliefs as well as assumptions made by and information currently available to management. Forward-looking information includes statements regarding expected production and expenses for full year 2008. Although management believes that the expectations reflected in such forward-looking statements are reasonable, they can give no assurance that such expectations will prove to be correct. Such statements are subject to certain risks, uncertainties and assumptions including, among other things, market conditions; oil and gas price volatility; uncertainties inherent in oil and gas production operations and estimated reserves; unexpected future capital expenditures; competition; the success of risk management activities; governmental regulations; and other factors described in the company’s most recent annual report on Form 10-K and subsequent filings with the Securities and Exchange Commission. Should one or more of these risks materialize or should underlying assumptions prove incorrect, actual results may vary materially from those expected. Please also note that this conference call contains references to non-GAAP financial measures. You can find a reconciliation of those non-GAAP financial measures to GAAP financial measures in the Form 8-K filed by the company earlier today as well as in this morning’s press release. Now, I’d like to turn over the call to Mr. Tracy Krohn.

Thanks Manny, and good morning, everyone. Thanks again for joining us for our fourth quarter and full year 2007 conference call. This morning, I’d like to review key events that took place in the fourth quarter and for the full year 2007 and expand on what’s going to happen in 2008. With me today is Danny Gibbons, our CFO. Danny is going to review financial results for the fourth quarter and 2007. Steve Schroeder, our Chief Operating Officer, is going to talk about our 2007 operations and discuss our plans for 2008. Cliff Williams, our VP of Reservoir Engineering, will review reserves and production guidance. Jeff Durrant, Senior VP of Exploration and Geoscience, is going to update you on our 2007 drilling successes and preview our 2008 drilling program. Following our formal presentation, we will also have a Q&A session. I will talk a little about earnings per share and cash flow per share versus consensus. As you saw in this morning’s press release, we had earnings per share of $0.65 per share for the fourth quarter of 2007 and $1.90 per share for the full year 2007. Our adjusted earnings per share were $0.80 per diluted share for the fourth quarter and $2.26 for the full year 2007. The reason for the large difference reported between earnings per share and adjusted earnings per share is the unrealized loss of $37.8 million for our commodity and interest rate derivatives, which we outlined in the tables in press release. The Wall Street consensus earning per share was for $0.67 per share for the fourth quarter and $2.04 for the full year. We continue to feel the best way to judge our performance is on cash flow per share. We define cash flow as net income plus DD&A, accretion, capitalized interest, deferred…

Thank you, Tracy. As Tracy mentioned, we had record revenues in 2007. Revenue increased $313 million to $1.1 billion. For the fourth quarter of 2007, our average realized price was $7.28 per Mcfe for natural gas and $84.62 per barrel for crude oil and natural gas liquids. This resulted in an all-in realized price of $9.88 per Mcfe compared to an average realize price of $7.38 per Mcfe in the fourth quarter last year. For the full year of 2007, our average realized price for natural gas was $7.20 per Mcfe and crude oil and natural gas liquids averaged $67.58 per barrel resulting in an all-in average realized price of $8.80 per Mcfe. This compares to an average realized price of $8.07 per Mcfe for the year 2006. Moving on to net income, net income for the fourth quarter of 2007 was $49 million or $0.65 per diluted share on revenue of $349 million. This compares to net income of $38 million or $0.50 per share on revenue of $264 million for the fourth quarter of 2006. Net income for the year 2007 was $144 million or $1.90 per share on revenue of $1.1 billion compared to net income of $199 million or $2.84 per share on revenue of $800 million for 2006. Net income was affected in the fourth quarter and full year 2007 with overall higher operating expenses, increased DD&A expense and the large unrealized loss on our commodity derivative position. Included in the fourth quarter and full year 2007 results are unrealized commodity derivative losses of $14 million and $34 million respectively. We also incurred an unrealized loss of $3.5 million related to our open interest rates swap that was de-designated as a cash flow hedge. In 2006 we had an unrealized derivative gain of $13.5 million…

Thanks, Danny. As Tracy discussed earlier, 2008 is projected to be a busy year with 50 wells plans. With such a large drilling plan, you can expect the number of rigs running at any certain time to fluctuate; some months may be as high as six to eight rigs while other months will be three to four. We currently have five active rigs. In our Ship Shoal 300 area program, we have two rigs running; a platform rig and an independent leg jack-up. At Highland 38, we have a mat cantilever rig drilling a deep test and an independent leg jack-up rig is drilling deep targets at Ship Shoal 224. In the main pass area a platform rig is being mobilized to begin a program of between three and five wells. Last week we completed our work on the Cypress well and release the semi-submersible rig we had under contract. In addition to the aforementioned, we anticipate mobilizing three to five additional operated rigs to the Central and Eastern Gulf of Mexico within the next month or two. We also project to have an operated rig or two in the Western Gulf. Finally, we have approved three wells by outsides operators and expect to have a couple more rigs working shortly. As you can tell, we have a lot of irons in the fire or in this case, bits in the ground, but I believe our team is up to the challenge. With respect to rig availability with our drilling program focused on the conventional shelf and deep shelf, we are not experiencing issues with respect to obtaining rigs. In fact, with our high activity level we are beginning to have discounts offered by contracting multiple rigs with a single vendor. With respect to our recent activity, we have completed…

Thanks, Steve. First, I’d like to report on 2007 production. Our fourth quarter production of 34.3 Bcfe and full year 2007 production of 126.5 Bcfe both approach the upper limit of our most recent guidance. The breakdown of annual 2007 production was about 40% oil and NGL and 60% natural gas. Next I’d like to discuss production guidance for the first quarter and full year of 2008. For the first quarter 2008 the company anticipates production to be between 2 and 2.1 million barrels of oil and 17.5 and 18.4 billion cubic feet of natural gas for a total of between 29.2 and 30.7 billion cubic feet of gas equivalent. For the entire year, we anticipate production to be between 7.4 and 9.4 million barrels of oil and 65.9 and 83.8 billion cubic feet of natural gas or a total of between 110 and 140 billion cubic feet of gas equivalent. In the absence of additional acquisitions, we expect production to decline through the first half of the year then ramp up in the second half as we realize build-up from our active exploration program. As Tracy stated earlier, we are gearing up to drill 50 wells in 2008 and have a rig schedule that includes all these wells. Production contributed by the exploration program will have a cumulative effect and so will increase as the year progresses, with the largest contribution being in the fourth quarter of ‘08 and into 2009. Some of the wells drilled in 2008 will not contribute to this year’s production simply because they will be completed late in the year or because more extensive facility construction is required to bring them on line. Moving on to reserves, at December 31, 2007 the company’s proved reserves were 638.8 Bcfe compared to 735.2 Bcfe at December…

Thanks Cliff and good morning, everyone. As you’ve already heard the ‘07 drilling program activity was lower than W&T’s historical drilling wells. However, our success rate was very much in line with our prior year success rate at 89% for the overall program. For the year, we successfully drilled six of seven exploratory wells and both of our development wells. In the total 2007 program then we were eight of nine with successes in all three areas including one deepwater discovery in Healey, a deep shelf success at South Timbalier 41 and then we drilled five of six successful wells on the conventional shelf including our substantial discovery in High Island 24. Additionally, we’ve successfully deepened the Healey Number 3 early in the year. This was not included in the ‘07 well count, due to prior year successes in the shallower oil and gas and we counted this well in 2006. Specifically in the fourth quarter, we drilled two successful horizontal wells, the A1 Sidetrack and A3 Sidetrack in Ship Shoal 300. The 76% W&T working interest wells each founded objectives their at about 2,300 feet through vertical depth and lay out from 500 to 700 feet of horizontal section. Both wells are now online and producing at a combined gross rate of about 3.8 million cubic feet of gas per day, which is about 2.4 Mcfe per day, net to W&T. As you’ll see, these wells are only the beginning of a substantial Ship Shoal area drilling plan that we have scheduled for 2008. Our other fourth quarter drilling success was in the deepwater at out Healy project in Green Canyon 82. Going in you might recall the no. 4 well had four independent amplitude based exploration targets. The first two shallower objectives were non-commercial, finding low gas saturation…

While we are looking forward to 2008, we managed this company for the long term. We put a plan in place after the Kerr-McGee transaction to evaluate in 2007 in preparation for a substantial 2008 and beyond. We felt this would be the most efficient way to create several multiple well drilling programs in several areas instead of drilling single wells immediately. This plan should help us achieve the best returns from the Kerr-McGee and W&T heritage properties and help us reach our goals of production result growth, as well as cost management. That concludes our prepared remarks and we’re ready to take your questions. Operator, would you please open the phones for Q&A.

Our first question comes from Gary Nuschler - Jefferies & Company. Gary Nuschler - Jefferies & Company: Can you give us an update on the development plan at [Daniel Boon]?

We’re still working on that development. I expect that we’ll have some announcements here fairly quickly about full development but we’re proceeding full steam ahead. Gary Nuschler - Jefferies & Company: And will that be a ‘08 startup or more likely an ‘09?

More likely ‘09. Gary Nuschler - Jefferies & Company: Could you elaborate a little bit on what your exploration plans are in the deep water?

Well, we don’t have any other wells right now that we’ve got booked for the deep water. Currently we are working at Green Canyon 82 to further evaluate the field seismic but we don’t have any plans for drilling other wells at Healey this year. Gary Nuschler - Jefferies & Company: I thought you have one exploratory well outlined for 2008.

Earlier in the year we put that on there as a contingency well for us. Currently, with rigs schedules we’re not going to drill that well.

Your next question comes from Jason Winkler – Wells Fargo. Please go ahead. Jason Winkler – Wells Fargo : Just curious on LOE, it looks like it’s kind of reduced a little bit. Is that just basically, Kerr-McGee assets are pretty much accounted for for workovers or is there anything else that relates to that?

I think there are several things. We are getting a better handle on the properties but cost of goods and services have came down somewhat as a function of the market; how long that hangs there will be a function also of commodity prices. Jason Winkler – Wells Fargo : Obviously, Tracy you are staying offshore the whole time, but is there a situation which you would look onshore or is it just basically staying out there with the cash flow you guys are receiving?

We’ve looked not only onshore but all over the world. The conclusion I keep coming back to is that Gulf of Mexico is a pretty good place to be if you want to make a bunch of cash. That don’t prevents us from going onshore and we certainly look onshore at areas around the Gulf of Mexico, and I consider anywhere from South Texas over to Alabama to be Gulf Coast onshore; that’s pretty similar to what we already do. That’s certainly a possibility. It’s not necessary a focus.

Your next question comes from Richard Tullis - Capital One Southcoast.

A couple of questions. Going back to the Healy discovery, what are we looking at in terms of at least early thoughts on reserve bookings for this year? Any ideas of a range yet?

The reality is that we didn’t book a whole lot of proved reserves there. What we did was we firmed up our probable and possible. We will be releasing that pretty soon. I’ll go ahead and tell you the 3P reserves there are now about 270 Bcf equivalent.

What about the no. 4, what are your thoughts on that thus far?

It’s going well. The good news is that it’s going to generate a whole bunch of cash. There was one sand up the hole that we though might have a little more gas in it, but it was wet. So that was a little bit of the disappointment, but the other side of it was we found another oil sand that we hadn’t anticipated. It does show up quite nicely on what we’re looking for. We though it was another sand, but it turns out to be a different oil sand that sets up some other prospects in the field. That’s our deepest sands. So that was quite a nice surprise for us and a very pleasant discovery. We’re moving forward with what we think will be a reasonable way to produce this field and quite frankly I’m leaning at this point without enough information to make a definitive statement, but I’m kind of leaning towards a float in production system.

When do you think you would have it on initial production?

That’s going to be a function of what kind of production system we put into it, so I’m not quite prepared to give you that estimate. But I don’t think it’s going to be one of these things that will be out there for years and years. I think it will be relatively quick.

What are your reserves associated with the three successful wells in 4Q and the four wells in 1Q of this year?

I don’t have that answer.

Your next question comes from Brian Kuzma - JP Morgan.

When you look at your production guidance for the full year what type of exploration success is baked into those numbers? Its just kind of back end loaded so I guess it wouldn’t required too much?

I am not sure I can give you an answer of production of absolute success there. I think, it’s a collage based on existing production and performance and also development well drilling and then exploration success as well. So I don’t necessarily have a number for you about exploration success. I think we’ve had pretty good success and we’ve given you a pretty good range from 110 to 140. I would be reticent to give you a number on that.

I just wanted to compliment you guys on your reserve disclosure, it’s actually one of the best that I’ve seen. If you can talk a little bit about the negative performance provision, just elaborate on what your guys saw?

Sure. In fact, we thought we might get that question so I am going to turn that over to Cliff Williams to address that.

I’ll address that. The negative revision you see is the minus 18.7 Bcfe but that’s a result of also a positive revision due to pricing. So really, the revision we are talking about is 38.5 Bcfe, the majority of it being performance related. There are several individual completions that contributed to this. Actually we had some positive ones as well, but some of the key ones, for example, would be our Cyprus completion late in the year unexpectedly and that’s the well that Steve also talked to you about. Currently we’ve completely that re-complete and its producing the 1,750 barrels a day growth right now. We also had another completion at Eugene Island 205 that watered out unexpectedly. Then there was a series of other completions similar to that. We also had some positive revision at East Camp 321, that was new completions that we put online last year and there was some positive revisions in that field.

Your next question comes from Phil McPherson - Global Hunter Securities.

I was wondering if I could just talk a little bit more about the Healey, even if you don’t have any intention of drilling anything out in the deep, does that preclude you from booking reserves out there at the end of this year?

If we don’t drill anything else does that preclude us from booking reserves? We haven’t booked the reserves, but we didn’t book reserves for 2007. We booked some reserves in 2008 – not a whole bunch -- on the proved side. What we did do is we firmed up the probable and possible reserves of about 270 Bs. Proved reserves are around 60 Bs now.

That is included in your year end number that you published?

It is. No, I’m sorry no -- not for 2007. No.

So then that 60 Bs will be posted in next year’s reserve report?

No, no. We had about 50 Bs or so for 2007, is that right? 60, around 60. We included the deepening so those reserves are not booked, the additional reserves are not booked for 2007.

I was under the assumption that the year end reserve didn’t have anything in it for – so it did have at least 50 to 60 Bs in it?

That’s about right. At 12/31/07 we had roughly 60 Bs equivalent.

At what point will you guys gives us little more color on as I guess it’s an ‘09 event as far as developing it or bringing up another well there?

As soon I have more color on that I will give it to you. I really don’t have that yet, we’ve still got some more valuations to do on the PBT side of it as well and how we think is the most efficient way to produce it. As I said earlier, I’m leaning toward some sort of floating production system on top of the reservoir because I think intuitively we’ll get more reserves that way. I don’t have all those answers yet and again I’m not sitting here warranting that that’s exactly the way we’re going to do it. It could be a combination of an FPS and sub sea completion. We’ll just have to run some numbers and figure out what is the most efficient way to do that. But we’re working on it hard.

Your next question comes from Richard Tullis with Capital One Southcoast.

Could you talk about any additional hedges you’ve layered on for oil and/or gas?

No. We didn’t talk about any additional hedges because we don’t have any. We haven’t laid any on at this point in time.

But are you looking at with the high commodity prices?

Not necessarily. The concern with hedges is again the basic philosophy is we hedge to assist us in some sort of financing situation, maybe an acquisition or something like that. I would hedge to protect the budget. I see no reason to protect the budget; we are operating within cash flow on the budget. So unless there was a precipitous drop in the price of oil then I wouldn’t really be concerned. If I thought that we’d see something that would threaten that budget than we would consider that.

Any plans for the March lease sale?

We’ll probably have some things to look at in March, you bet.

Thanks.

Management as there are no further questions, I’ll turn it back to you for closing comments.

I thank all of you for joining us today. I think this is an excellent quarter for us. I am looking forward to 2008 and beyond. This project Kerr-McGee has taken on all the characteristics that we hoped for originally and we are looking forward to drilling that and drilling the rest of our properties for this year and beyond. Thanks so much.