(215) 405-2718 (fax)

Reports $8.9 million in Adjusted EBITDA and $7.1 million in Distributable Cash Flow for the partial first quarter 2011

Atlas Energy’s subsidiary, Atlas Pipeline, announces major capital expansion projects of approximately $400 million and additional expected EBITDA contribution of $150 million

Atlas Energy enters into a joint venture in the Marcellus Shale

Adjusted EBITDA, a non-GAAP measure, of $8.9 million;

Distributable cash flow of $7.1 million, a non-GAAP measure, or $0.14 per common unit⁽¹⁾;

On a GAAP basis, net income of $241.6 million for the first quarter 2011 compared with $24.9 million for the prior year comparable period. The increase over the prior year quarter was due primarily to a $255.9 million gain on asset sale recognized by Atlas Pipeline Partners, L.P. (“APL”) on its sale of its 49% equity ownership interest in the Laurel Mountain joint venture;

ATLS declared a cash distribution of $0.11 per limited partner unit based on the financial results for the first quarter 2011, compared to $0.07 per limited partner unit from the preceding quarter. This cash distribution reflects a distribution coverage ratio of approximately 1.3x. ATLS’ cash distribution for the first quarter 2011 included the financial results of the transferred assets for the 42 day period subsequent to the date of acquisition; and

Total net production of 37.0 million cubic feet equivalents per day (“mmcfed”).

Distributable cash flow per unit is based upon the average common units outstanding after ATLS’ acquisition of the transferred assets

Average net daily production for the first quarter 2011 for the Appalachia segment was 33.6 mmcfed.

Three horizontal Marcellus Shale wells were spud during the period within the partnership drilling programs, and ATLS is in the process of completing another eight Marcellus wells during the remainder of 2011. These eleven wells, along with an additional five previously completed Marcellus horizontal wells, are expected to be turned in-line during the fourth quarter of 2011 and the first quarter of 2012.

Average net daily production for the New Albany/Antrim segment in the first quarter 2011 was 3.2 mmcfed.

Average net daily production for the first quarter 2011 for the Niobrara segment was 185 thousand cubic feet equivalents per day (“mcfed”).

17 wells were drilled in the Niobrara formation during the period within the partnership drilling programs, and 18 wells were turned in-line during the period.

Partnership management margin⁽²⁾ contributed $1.9 million towards distributable cash flow for the first quarter 2011. Partnership management margin during the period was impacted primarily by the comparable year over year timing of funds raised for the direct investment programs.

At March 31, 2011, ATLS owned a 2.0% general partner interest, all of the incentive distribution rights, and an approximate 10.8% common limited partner interest in APL. ATLS’ financial results are presented on a consolidated basis with those of APL. Non-controlling interests in APL are reflected as income (expense) in ATLS’ consolidated combined statements of operations and as a component of partners’ capital on its consolidated combined balance sheets. A consolidating combined statement of operations and balance sheet has also been provided in the financial tables to this release for the comparable periods presented.

ATLS had $2.5 million of cash distributions received from APL during the first quarter 2011, which represented APL’s cash paid based on a $0.37 per unit distribution for the quarter ended December 31, 2010. On April 26, 2011, APL declared a cash distribution of $0.40 per unit on its outstanding common limited partner units, representing the cash distribution for the quarter ended March 31, 2011, a $0.03 per unit, or 8% increase from the preceding quarter. ATLS will receive cash distributions of $2.7 million from APL on May 13, 2011, the date of payment for the first quarter 2011 distribution.

Cash general and administrative expense, excluding amounts attributable to APL, was $0.5 million for the first quarter 2011 compared with $0.4 million for the prior year comparable quarter. The current period is presented net with $3.1 million of fees received from ATLS’ Transition Service Agreement with Chevron, through which ATLS provides accounting and other services. ATLS will recognize these fees for each of the services provided, which is expected to extend through the fourth quarter of 2011. Please refer to the consolidating statements of operations provided in the financial tables of this release.

Cash interest expense, excluding amounts attributable to APL, was $0.1 million for the first quarter 2011 compared with $0.6 million for the prior year comparable quarter. On March 22, 2011, ATLS entered into a new senior secured credit facility, which matures in March 2016 and has lender commitments of $300 million and an initial borrowing base of $125 million. As of March 31, 2011, ATLS had no amounts outstanding under its credit facility and had a cash position of $105.8 million.

Partnership management margin is comprised of Well Construction & Completion margin, Well Services margin and Administration & Oversight Fee revenues.

ATLS entered into derivative contracts during the first quarter 2011 for its natural gas and oil production. Atlas currently has approximately 24.3 billion cubic feet equivalents of its future production hedged through 2015. A summary of ATLS’ current derivative positions as of May 12, 2011 is as follows:

Production Period

Ended December 31,

   2011^(c)

2012

2013

2014

2015

Production Period

Ended December 31,

   2011^(c)

2012

2013

Production Period

Ended December 31,

   2011^(c)

2012

2013

“Mcf” represents thousand cubic feet; “bbl” represents barrel.

Includes an estimated positive basis differential and Btu (British thermal units) adjustment.

Reflects hedges covering the last nine months of 2011.

Revenues:

Gas and oil production

Well construction and completion

Gathering and processing

Administration and oversight

Well services

Gain (loss) on mark-to-market derivatives⁽²⁾

Other, net

Total revenues

Costs and expenses:

Gas and oil production

Well construction and completion

Gathering and processing

Well services

General and administrative⁽¹⁾

Depreciation, depletion and amortization

Total costs and expenses

Operating income

Gain (loss) on asset sales

Interest expense⁽¹⁾

Income from continuing operations

Income (loss) from discontinued operations

Net income

Income attributable to non-controlling interests

Net income after non-controlling interests

Income not attributable to common limited partners (results of operations of the Transferred Business as of and prior to February 17, 2011, the date of acquisition)⁽¹⁾

Net income (loss) attributable to common limited partners

Net income (loss) attributable to common limited partners per unit – basic:

Income (loss) from continuing operations attributable to common limited partners

Income from discontinued operations attributable to common limited partners

Net income (loss) attributable to common limited partners

Net income (loss) attributable to common limited partners per unit – diluted:

Income (loss) from continuing operations attributable to common limited partners

Income from discontinued operations attributable to common limited partners

Net income (loss) attributable to common limited partners

Weighted average common limited partner units outstanding:

Basic

Diluted

Net income (loss) attributable to common limited partners:

Income (loss) from continuing operations

Income (loss) from discontinued operations

Net income (loss) attributable to common limited partners

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011. However, since the results of operations of the Transferred Business prior to its acquisition date are not attributable to the common limited partners of ATLS, these amounts have been deducted to obtain net income (loss) attributable to common limited partners for the respective period. Also, the historical results of the Transferred Business prior to the acquisition date do not reflect general and administrative expenses and interest expense as ATLS was unable to identify and allocate such amounts to the Transferred Business for the respective periods.

Consists principally of hydrocarbon derivative gains / (losses) that relate to the operating activities of ATLS’ consolidated subsidiary, APL. The underlying hydrocarbon derivatives do not represent present or potential future obligations of ATLS.

Current assets:

Cash and cash equivalents

Accounts receivable

Current portion of derivative asset

Prepaid expenses and other

Total current assets

Property, plant and equipment, net

Intangible assets, net

Investment in joint venture

Goodwill, net

Long-term derivative asset

Cash in escrow (APL Senior Note redemption)

Other assets, net

Current liabilities:

Current portion of long-term debt

Accounts payable

Liabilities associated with drilling contracts

Accrued producer liabilities

Current portion of derivative liability

Current portion of derivative payable to Drilling Partnerships

Accrued interest

Accrued well drilling and completion costs

Advances from affiliates

Accrued liabilities

Total current liabilities

Long-term debt, less current portion

Long-term derivative liability

Long-term derivative payable to Drilling Partnerships

Other long-term liabilities

Commitments and contingencies

Partners’ Capital:

Common limited partners’ interests

Accumulated other comprehensive income (loss)

Non-controlling interests

Total partners’ capital

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011.

Net income (loss) attributable to common limited partners per unit - basic

Distributable cash flow per unit⁽²⁾⁽³⁾

Cash distributions paid per unit⁽⁴⁾

Production revenues (in thousands):

Natural gas

Oil⁽⁵⁾

Total production revenues⁽⁵⁾

Production volume:⁽⁶⁾⁽⁷⁾

Appalachia⁽⁸⁾:

Natural gas (Mcfd)

Oil (Bpd)⁽⁹⁾

Total (Mcfed)

New Albany/Antrim:

Natural gas (Mcfd)

Oil (Bpd)

Total (Mcfed)

Niobrara:

Natural gas (Mcfd)

Oil (Bpd)

Total (Mcfed)

Total:

Natural gas (Mcfd)

Oil (Bpd)⁽⁹⁾

Total (Mcfed)

Average sales prices:⁽⁷⁾

Natural gas (per Mcf) ⁽¹⁰⁾

Oil (per Bbl)⁽¹¹⁾

Production costs:^(7)(12)

Lease operating expenses per Mcfe

Production taxes per Mcfe

Total production costs per Mcfe

Depletion per Mcfe⁽⁷⁾

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011.

A reconciliation from net income to distributable cash flow is provided in the financial tables of this release.

Calculation consists of distributable cash flow divided by 51,224,000 common limited partner units, which is the weighted average units outstanding for the period subsequent to February 17, 2011, the date of acquisition for the Transferred Business, which includes the 23.4 million common limited partner units issued as partial consideration for the acquisition.

Represents the cash distributions paid by ATLS within 50 days after the end of each quarter, based upon the distributable cash flow generated during the respective quarter.

Includes NGL production revenue.

Production quantities consist of the sum of (i) ATLS’ proportionate share of production from wells in which it has a direct interest, based on ATLS’ proportionate net revenue interest in such wells, and (ii) ATLS’ proportionate share of production from wells owned by the investment partnerships in which ATLS has an interest, based on its equity interest in each such partnership and based on each partnership’s proportionate net revenue interest in these wells.

“Mcf” and “Mcfd” represent thousand cubic feet and thousand cubic feet per day; “Mcfe” and “Mcfed” represent thousand cubic feet equivalents and thousand cubic feet equivalents per day, and “Bbl” and “Bpd” represent barrels and barrels per day. Barrels are converted to Mcfe using the ratio of six Mcf’s to one barrel.

Appalachia consists of ATLS’ production located in Pennsylvania, Ohio, New York, West Virginia and Tennessee.

Includes NGL production volume.

ATLS’ average sales price for natural gas before the effects of financial hedging was $4.47 per Mcf and $5.97 per Mcf for the three months ended March 31, 2011 and 2010, respectively. These amounts exclude the impact of certain allocations of production revenues to investor partners within the investor partnerships. Including the effects of these allocations, average gas sales prices were $4.67 per Mcf ($3.68 per Mcf before the effects of financial hedging) and $6.21 per Mcf ($4.53 per Mcf before the effects of financial hedging) for the three months ended March 31, 2011 and 2010, respectively.

ATLS’ average sales price for oil before the effects of financial hedging was $87.39 per barrel and $67.90 per barrel for the three months ended March 31, 2011 and 2010, respectively.

Production costs include labor to operate the wells and related equipment, repairs and maintenance, materials and supplies, property taxes, severance taxes, insurance and production overhead. These amounts exclude the effects of ATLS’ proportionate share of lease operating expenses associated with certain allocations of production revenue to investor partners within ATLS’ investor partnerships. Including the effects of these costs, lease operating expenses per Mcfe were $0.59 per Mcfe ($0.65 per Mcfe for total production costs) and $0.45 per Mcfe ($0.49 per Mcfe for total production costs) for the three months ended March 31, 2011 and 2010, respectively.

Total debt

Less: Cash

Less: Cash in escrow⁽²⁾

Total net debt/(cash)

Partners’ capital

Total capitalization

Ratio of net debt to capitalization

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011.

APL placed $293.7 million in escrow ($7.0 million recorded within prepaid expenses and other and $286.7 million as a long-term asset on its consolidated balance sheet) as of March 31, 2011 to redeem all of its 8.125% Senior Notes.

Net of eliminated amounts.

Atlas Energy

Maintenance capital expenditures⁽²⁾

Expansion capital expenditures

Total

Atlas Pipeline

Maintenance capital expenditures

Expansion capital expenditures

Total

Consolidated Combined

Maintenance capital expenditures

Expansion capital expenditures

Total

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011. Also, the amounts for the first quarter 2010 were restated to reflect amounts reclassified to discontinued operations due to APL’s sale of assets in September 2010.

Prior to ATLS’ acquisition of the Transferred Business on February 17, 2011, ATLS had no maintenance capital requirements with regard to its oil and gas properties.

Atlas Energy Stand-Alone Adjusted EBITDA and Distributable Cash Flow Summary:

Gas and oil production margin

Well construction and completion margin

Administration and oversight margin

Well services margin

Gathering

Gross Margin

Cash general and administrative expenses⁽¹⁾

Atlas Pipeline Cash Distributions Received⁽²⁾

Other, net

Adjusted EBITDA⁽³⁾

Cash interest expense⁽⁴⁾

Maintenance capital expenditures

Distributable Cash Flow⁽³⁾

Distributions Paid⁽⁵⁾

per limited partner unit

per limited partner unit, extrapolated for full 1^st quarter⁽⁶⁾

Distribution coverage ratio

Reconciliation of non-GAAP measures to net income (loss) attributable to common limited
partners⁽³⁾:

Atlas Energy Stand-Alone Distributable Cash Flow

Distributable cash flow of Transferred Business as of and prior to February 17, 2011 (the date of acquisition)⁽⁷⁾

Atlas Pipeline net income attributable to common limited partners

Atlas Pipeline cash distributions received⁽²⁾

Non-recurring acquisition costs

Depreciation, depletion and amortization

Amortization of deferred finance costs

Non-cash stock compensation expense

Maintenance capital expenditures⁽⁸⁾

Non-cash net gain (loss) on asset sales

Other non-cash adjustments

Income not attributable to common limited partners (results of operations of the Transferred Business as of and prior to February 17, 2011, the date of acquisition)⁽⁷⁾

Net income (loss) attributable to common limited partners

Excludes non-cash stock-compensation expense and non-recurring costs incurred in connection with the acquisition of the Transferred Business.

Represents the cash distribution received from Atlas Pipeline during the respective period (paid from distributable cash flow generated during the preceding quarter).

Adjusted EBITDA and distributable cash flow are non-GAAP (generally accepted accounting principles) financial measures under the rules of the Securities and Exchange Commission. Management of ATLS believes that adjusted EBITDA and distributable cash flow provide additional information for evaluating ATLS’ performance, among other things. These measures are widely used by commercial banks, investment bankers, rating agencies and investors in evaluating performance relative to peers and established performance standards. Adjusted EBITDA is also a financial measurement that, with certain negotiated adjustments, is utilized within ATLS’ financial covenants under its credit facility. Adjusted EBITDA and distributable cash flow are not measures of financial performance under GAAP and, accordingly, should not be considered as a substitute for net income, operating income, or cash flows from operating activities in accordance with GAAP.

Excludes non-cash amortization of deferred financing costs.

Represents the cash distributions paid by ATLS within 50 days after the end of each quarter, based upon the distributable cash flow generated during the respective quarter. Calculation consists of an $0.11 per unit distribution multiplied by 51,224,000 common limited partner units.

This amount is the extrapolated effect of the actual 1^st quarter 2011 distribution declared for the full 90-day period. ATLS’ actual cash distribution for the 1^st quarter 2011 was based upon the distributable cash flow generated from the operating results of the Transferred Business for the 42 day period subsequent to February 17, 2011, the date of acquisition.

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011.

Prior to ATLS’ acquisition of the Transferred Business on February 17, 2011, ATLS had no maintenance capital requirements with regard to its oil and gas properties.

Revenues:

Gas and oil production

Well construction and completion

Gathering and processing

Administration and oversight

Well services

Gain (loss) on mark-to-market derivatives

Other, net

Total revenues

Costs and expenses:

Gas and oil production

Well construction and completion

Gathering and processing

Well services

General and administrative⁽¹⁾

Depreciation, depletion and amortization

Total costs and expenses

Operating income

Gain (loss) on asset sales

Interest expense⁽¹⁾

Income from continuing operations

Discontinued operations

Net income

Income attributable to non-controlling interests

Net income after non-controlling interests

Income not attributable to common limited partners (results of operations of the Transferred Business as of and prior to February 17, 2011, the date of acquisition)⁽¹⁾

Net income attributable to common limited partners

In accordance with prevailing accounting literature, ATLS has adjusted its historical financial statements to present them combined with the historical financial results of the Transferred Business for all periods prior to its acquisition date of February 17, 2011. However, since the results of operations of the Transferred Business prior to its acquisition date are not attributable to the common limited partners of ATLS, these amounts have been deducted to obtain net income (loss) attributable to common limited partners for the respective period. Also, the historical results of the Transferred Business prior to the acquisition date do not reflect general and administrative expenses and interest expense as ATLS was unable to identify and allocate such amounts to the Transferred Business for the respective periods.

Revenues:

Gas and oil production

Well construction and completion

Gathering and processing

Administration and oversight

Well services

Gain (loss) on mark-to-market derivatives

Other, net

Total revenues

Costs and expenses:

Gas and oil production

Well construction and completion

Gathering and processing

Well services

General and administrative