Good morning, ladies and gentlemen. Welcome to the W&T Offshore First Quarter Earnings Call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions. (Operator Instructions) This conference call is being recorded today, Tuesday, May 6, 2008. I would now like to turn the conference over to Mr. 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 first quarter 2008 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 e-mail distribution list to receive future news releases or you are experiencing technical problems and didn't receive yours, please call DRG&E's office at 713-529-6600, and someone will be glad to help you. If you wish to listen to a replay of today's call it will be available in a few hours via webcast by going to the Investor Relations section of the company's website at www.wtoffshore.com or via recorded replay until May 13, 2008. To use the replay feature, call 303-590-3000, and dial the passcode 11112873. Information recorded on this call speaks only as of today, May 6, 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 expenses for first quarter 2008 and beyond. 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 and 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 reconciliations 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 first quarter 2008 conference call. Again, I’m Tracy Krohn, and this morning I’ll review the key events that took place in the first quarter of 2008 and we’ll expand upon our expectations to remainder of the year. With me today is Danny Gibbons, our Chief Financial Officer, who will review financial results for the first quarter 2008; Steve Schroeder, our Chief Operating Officer, he is going to talk about our 2008 operations; and Jeff Durrant, our Senior VP of Exploration/Geoscience will update you on our 2008 drilling successes and preview our next quarter's drilling plans. Following our formal presentation, we will also have a Q&A session. I’ll talk about earnings per share versus consensus. As you saw in this morning's press release, we had earnings per share EPS of a $1.05 to the first quarter 2008. Adjusted earnings per share were a $1.10 for the first quarter 2008 which is our highest single quarter's earnings per share. Additionally, we beat the Wall Street consensus earnings per share of $0.90 for the first quarter. We've realized a higher price of $11.57 per Mcfe and that's significantly higher than the Street price tags. I realized some of the differences, high realized price, but exceeding the high side of production guidance also helps. Production was 5.1 million barrels of oil equivalent or 30.8 Bcf equivalent. Part of the reason we produced more than we expected and it was due to the success we've had with our exploration re-completes and work-over programs. We are very pleased with initial results from these programs and expect good results throughout the year. We also like to point out that because of these programs and the work performed at Ship Shoal 349, the Mahogany field,…

Thanks, Tracy. Revenue for the first quarter was $356 million. That's a $110 million increase over the same period of 2007. Our average realized price was $8.70 per Mcfe for natural gas and $92.52 per barrel for crude oil and natural gas liquids. This resulted in an all-in realized price of $11.57 per Mcfe. That is almost a $4 improvement over the $7.67 per Mcfe that we realized in the first quarter of 2007. Moving on to a discussion of expenses, let me start with lease operating expense or LOE. LOE for the first quarter of 2008 was $49.8 million compare to $63.6 million in the first quarter of 2007. Lease operating expense per Mcfe in the first quarter was a $1.62 compared to $1.98 in the first quarter of 2007. Lease operating expense decreased this year due to lower work-over and facility expenses, a reduction in insurance premiums, and the completion of all hurricane remediation efforts by the end of 2007. Depreciation, depletion, amortization, and accretion, which we refer to as DD&A was $145.5 million or $4.72 per Mcfe in the first quarter of 2008. That’s an increase of $21.3 million over the comparable 2007 period. Factors leading to the DD&A increase were capital expenditures, an increase in future development costs, and increase in our estimated asset retirement obligations. This was partially offset by the addition of reserves as a result to be acquisition of Apache's interest in Ship Shoal 349 Mahogany, effective January 1, 2008. Moving on to general and administrative expenses; for the first quarter of 2008, G&A expenses were $12.6 million compared to $11.9 million in the first quarter of 2007. On a per Mcfe basis, G&A was $0.41 in 2008 compared to $0.37 in 2007. G&A increased primarily due to an increase in the number…

Thanks, Danny. As noted in our operations update and consistent with our budget, we have dramatically increased our drilling activity. We currently have 11 active rigs. As far as operated, we have three mat cantilever, three independent leg jack-ups and two platform rigs. Most of these rig lines have multiple wells scheduled to be drilled especially the platform rigs which are projected at three or more wells. Relative to non-operated rig activity, three rigs are running one mat cantilever and two independent leg jack-ups. One question we get asked while talking with investors is how our activity level will change during the hurricane season. As stated in the past, we plan to stay active during the hurricane season, and let me explain why. Relative to downtime caused by weather, more downtime caused by weather occurs in winters than during the summer and fall. One significant factor is sea conditions. Based on historical information there is typically half a day in the month of July with greater than 10 foot waves compared to approximately six days in the month of January. If we have to shut down our drilling for four days in the event of a hurricane we are statistically better to conduct drilling operations during the hurricane season. Also given the longer days there are more operations occurring during daylight hours which we believe increases efficiency. To elaborate on our drilling program, Jeff mentioned in our previous conference call of the high quality oil sand we were drilling in the Ship Shoal 314 A-4 sidetrack. The well was priced online in early April and is currently producing at a growth rate of 2200 barrels of oil per day and 1.7 million cubic feet per day. The Ship Shoal 300 A-2 and Ship Shoal 224-E18 wells are currently being completed…

Thanks, Steve. As Tracy and Steve just discussed, we are off to a great start with the bid in 2008. All four of our first quarter exploration wells were successful and three of these wells are currently producing with the fourth well schedule to come online shortly. These three wells are pulling at a combined growth rate of 2500 barrel per day and 18.8 million cubic feet gas per day or 20.8 million cubic feet equivalent per day net to WNC. All four of these conventional shelf wells were drilled from existing infrastructure, as ours are the large majority of our planned 2008 drilling program. In our previous conference call, I outlined our successes including the 50% working interest South Timbalier 217 A-3 and 100% working interest Ship Shoal 315 A-3 sidetrack. Both of these wells are still producing at or above our expectations. Two other wells, the 100% working interest Ship Shoal 300 A-2 and 100% working interest Ship Shoal 314 A-4 sidetrack were in progress at that time and we have not completed the drilling on each of them. The A-2 sidetrack sidetrack and the Ship Shoal 300 had found about 100 feet of oil in two shallower sands. We went deep in the well and found an additional 60 feet of oil sands in the crisped out section. The well is currently being completed and we hope to have this thing on line very shortly. The fourth well and the Ship Shoal 314 A-4 sidetrack continue drilling deeper and we found 92 feet of very high quality oil sand, about double what we had reported earlier. This well which has results at the high-end of our expectations is now being completed and is currently producing on a gross rate of 2200 barrels of oil per day, 1.7…

Thanks, Jeff. We spent a $129 million the first quarter from our budget of $800 million. We also spent an additional $116 million for the acquisition of Mahogany and as we've mentioned in the past, we don't budget for acquisitions, but we get our fair share of acquisition opportunities. We are also -- we were awarded a lease at Grand Isle 108 for which we were the higher bidder in last March OCS lease sale by the MMS. We are actually high bidder on four leases. Services for the first one has been awarded to us so, we are pleased with that. Late last year, we announced our plan to drill 44 exploration and six development wells and I am pleased with the progress made where we stand today with 11 active rigs. We are happy to see that we beat our production guidance. The team is not only doing a great job identifying wells on the former Kerr-McGee properties, but we are also finding these extra reserves and production, which is added value, especially with these commodity prices. We continue to be focused on the fundamentals of finding oil and gas reserves on the conventional shelf. A high success rate is what allows us to continue to generate industry beating cash flows. I know that some folks in the investment community remain skeptical about our opportunities in the Gulf of Mexico. I've heard the same mantra for the last 25 years. We keep on doing what we are doing, we keep finding reserves. We believe that Gulf of Mexico still offers huge opportunities for us to grow our company, increase cash grow and build shareholder value. And in 2008, we are really putting our money where our mouth is. But we don’t see it as high risk rather we see it as managed risk. A drilling success rate is a demonstration by our ability to develop quality prospects. Remember from 2000 through 2007, we had an overall success rate of 82% with the drill bit and of course, we are exceeding that now. With an interest in over 155 fields in the Gulf of Mexico we believe we can continue to develop quality prospects in the future. Couple that with the continuing acquisitions program and lease sale participation, I think the future is really bright for WTI. That concludes our remarks today and we are ready to take your questions. Operator, if would, please open the phone lines for Q&A.

Thank you. Ladies and gentlemen at this time we’ll begin the question-and-answer session. (Operator Instructions). The first question comes from Jason Wangler with Dahlman Rose. Please go ahead.

Good morning guys, great quarter.

Hi, Jason

Just kind of, when you guys set that cash flow budget, obviously the 800 million in CapEx, commodity prices where they are at right now. Is there kind of any idea what to do with that extra money is going to be coming, obviously it might be kind of tough to ramp any further with the aggressive drilling program? But is there any kind of thought so far, what to do with that?

That’s kind of a quality problem in it.

Yes, definitely.

I mean, there are opportunities, I mean, all it does in the long run, of course and in the short run for that matter is still a war chest for other acquisition opportunities and potential consolidation. So that’s one of the things that we see. I mean, we’ve always got the opportunity to pay down some of our term B debt, which is pretty lower interest rate, so that’s kind of further down the list if other things come along that make sense. We did a special dividend last year, we really haven’t made that decision because I think that the acquisitions market hitting up pretty well and we certainly positioned the balance sheet to participate in the future with all of our actions last year. The market beat us up pretty bad for some of the decisions that we made last year to cut back on drilling and position our balance sheet to take care of some of what we thought were future activities. But so far this year it has proven that those were the right decisions. And so that’s kind of the future that I see, an immediate future and I hope to have this discussion many times with our staff and worry about quality problem like having too much money.

Sure. And then just kind of jumping around on you. But for the rigs that are going to be coming on with 18 done kind of after this quarter or at least drilling, are those all contracted for all 50 wells? Are they all set in stone pretty much at the windows and everything? Or are there still going to need some time to have to possibly move around and get the rigs going at the right time?

Let me tell you how that usually works. We don’t normally do long-term contracts for rigs. So that we have flexibility as we see things in our program that are more enticing or less enticing, sometimes schedule slip, sometimes things have to be moved around that target is continuing to move around a little bit, but in general the answer is yes. There are still plenty of availability in the rig sites that we need to complete our program. Certainly we didn’t necessarily expect commodity prices -- well we didn’t expect commodity prices to be where they are now, but so far it hasn’t really affected our ability to contract rigs, so we are still in very good shape with that.

Thanks guys.

Thank you.

Thank you. Our next question comes from Richard Tullis with Capital One Southcoast. Please go ahead.

Hey, good morning, nice quarter. I guess, first question, what kind of cost trend do you see in for rigs now these days, Tracy?

Yeah, in the deepwater, it’s a totally different market than what we're really faced with here with majority of our projects on the conventional shelf. It appears that things kind of leveled out seasonally normally in spring and summer. You will see more activities so you expect maybe you will get some increase maybe not, part of the issue appears to be that lot of people spend a lot of their budget when things were really high last year, we will fortunate that we didn’t follow that trend rather we positioned ourselves for a little bit further on and now we are reaping the benefits of that. But, in general, I’m seeing a kind of a bottom on rig prices right now.

Okay. What were the rest reserves associated with the eight successful wells drilled so far this year?

Not sure if I can tell you exactly on those eight wells, I don’t have an answer on that. I'm sorry.

That’s fine. Any update on Healy?

Yeah. We’ll continue to do a full analysis there. We’ve got some things that we need to look at in the way of how we want to hard pipe this thing, whether we want to send it to another platform, whether we want to do an FPS or an FPSO. We’re still working on those details and a lot of that will come out of the full analysis that we’re doing on that. I expect we will have that by probably in July or so, something like that.

Okay. Thank you. I’ll jump back in the queue. I appreciate it.

Sure. Thank you.

Thanks. Our next question comes from the line of Scott Hanold with RBC Capital Markets, please go ahead.

Thanks, good morning.

Good morning, Scott.

I guess I am really king of hit on sort of your drilling just to clarify, you’re going to have 18 wells drilled in the first half of the year and then there is a total of 50 for the full year, so that would imply 32 wells in the back half of the year. Is that correct?

Right now that’s the plan. We will be drilled or drilling on those first 18 wells by the end of the second half.

Okay. And kind of going back --

-- second quarter.

Okay and then going back to sort of our prior question on whether or not you are looking to potentially ramp up activity in more because of the strong commodity pricing obviously, the good performance you have all had; what is sort of the internal capacity to do something like that?

I think it’s a function of everything else that we have going on. I don’t know quite how to answer that. I mean if we were to do a fairly sizeable transaction or something that could affect that our commodity price is going to continue to be the same, is the cost of goods and services going to stay about the same or is it going to stay about the same or is it going to ramp up, I mean I don't really have a firm answer for that. But certainly we are always trying to maximize whatever our activity levels are going to be. I think that if we needed to continue to ramp up we are looking at a position where we'd have to get some folks to help us probably outside recourses.

Okay and then when you look in to sort of '09, could you sort of looking at your second half '08 type of run rate did you run at that similar type of rate into '09, through most of '09?

Well that’s kind of the current plan. I mean we are contingent to drill wells, we've got a lot of things to do and although I don't have really anything turned up to '09, I mean I expect that we'll have very high activity rates going forward.

Okay and one last question, can you give us your thoughts on deep water activity and whether you will be able to get a little bit more active there at some point?

It's an opportunity driven thing with deepwater. We do have some deep water operations certainly, we got everything on our pipe that we need to have right now. But we certainly can operate in deep water, we can certainly buy properties in the deep water as well. It's just a matter of what's driving the rate of return for the dollar that we want to put in the ground.

Okay, thank you.

Thank you.

Thank you. (Operator Instructions) Our next question comes from David Adams with Jefferies & Company. Please go ahead. David Adams - Jefferies & Company: Hi guys, great quarter. Real quickly, I mean you had excellent success in the first quarter from an exploration stand point. Can you kind of give us a sense of the risk profile for the remainder of the year in terms of the exploration portfolio in terms of working interest as-well-as the percentage of high potential prospects, you are going to drill?

Yes, I can. We have a pretty nice mix of things that we were looking at. We have got some singles and doubles to look at, We have got some triples and home runs. But I’d tell you as-far-as what we think is feasible and where we are going to go with it this year, I don’t like to set up profiles where we have people looking at single wells as impact wells we certainly have that. I don’t particularly care to announce that because I like to look at it as an entire portfolio. So that’s something I consciously try to minimize. There is people that do it a little bit differently from what we do. Certainly if it’s significant impact and something that I need to tell the market about, I will. But as a normal activity we don’t try to identify these single projects as hyping the stocks or anything like that. That’s not what I seek to do with it. I seek to do it as a planned activity over a long period of time. I have been doing this for a while; I just think its better to look at your entire portfolio. David Adams - Jefferies & Company: Right, and your average working interest going forward on a per well basis?

Yes, I’m sorry, I forgot that part of the question. Normally we try to generate about 50% or greater working interest. We prefer to have operations, but we certainly have laid off some and expect that we’ll have between 50% and a 100% working interest on most of the wells that we do. David Adams - Jefferies & Company: Okay, great. Thanks.

Sure.

Thank you. Our next question comes from Noel Pawlak with Ladenburg Thalmann. Please go ahead.

Good morning.

Good morning, Noel, thanks.

I apologize if this came up already; I had to drop off from it earlier in the call. Did you talk about what your thoughts are on deeper test on the mines at Mahogany?

Can you say that again?

I was wondering if you had talked about doing a deeper test to the mines you had at Mahogany. I know that was something that had been on your mind for a while. I was just wondering if that was something we might see at the end of this year or some time next year.

Yeah, I’ll be happy to talk about it. Mahogany of course was the first really commercially successful sub-salt play in the Gulf. We are very excited about the potential deeper prospects there. We have not drilled to the (inaudible) that is one of our goals. We are studying potential well plans right now. We have certainly looked at some of the seismic re-process, seismic that gives us great encouragement. So, I would like to drill a deeper well out there that would explore the (inaudible) and that’s going to be fairly deep. Exactly how deep, I don’t really know at this point in time. But certainly something probably well in excess of 20,000 feet.

Alright. Do you think that would be like a first half ‘09 type event?

Yeah, probably, it could be a little bit sooner than that just depending upon what type of rig we figure we want to drill and what that economic line it gives us.

That’s it. That’s all I have.

Thank you. (Operator Instructions) And I am showing there are no further questions. So I'll turn the call back over to Mr. Krohn for closing comments. Please go ahead sir.

Thank you, operator. Again thank you all for listening this morning. It's been a very good quarter and my congratulations to the staff at W&T, they all work really hard, they work long hours and it shows up in the results. We've made some decisions last year that have proven to be the correct ones and we tend to continue on this quest to find more reserves and more production in our managing our F&D cost. So, thank you very much and we'll talk to you in about three months.

Thank you. Ladies and gentlemen that will conclude today's teleconference. If you will like to listen to a replay of today's conference please dial into 303-590-3000 and enter the access code of 11112873 followed by the # sign. Once again that number is 303-590-3000 and access code 11112873 followed by the # sign. We thank you again for your participation in today's conference and at this time you may disconnect.