|        |
|--------|
|        |  |  |  |  |
|   |   |   |   |   |

|        |
|--------|
|        |  |
| x      | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|   | For the quarterly period ended March 31, 2011 |

|        |
|--------|
|        |  |
| o      | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|   | For the transition period from ___ to ___ |

|                                          |
|------------------------------------------|
|                                          |  |
| Delaware                                 | 74-3169953 |
| (State or other jurisdiction of          | (I.R.S. Employer |
| incorporation or organization)           | Identification Number) |
|                                     |   |
| 515 South Flower Street, Suite 4800      |   |
| Los Angeles, California                  | 90071 |
| (Address of principal executive offices) | (Zip Code) |

|                                                                            |
|----------------------------------------------------------------------------|
|                                                                            |  |
| Large accelerated filer o                                             | Accelerated filer x   |
| Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o |

|        |
|--------|
|        |  |  |  |  |
|   |   |   |   |   |

----

|            |
|------------|
|            |  |  |
|       |   | Page No. |
|       | Cautionary Statement Regarding Forward-Looking Information | 1 |
|       |   |   |
|       | PART I |   |
|       | FINANCIAL INFORMATION |   |
|       |   |   |
| Item 1.    | Financial Statements |   |
|       | – Unaudited Consolidated Balance Sheets at March 31, 2011 and December 31, 2010 | 2 |
|       | – Unaudited Consolidated Statements of Operations for the Three Months Ended March 31, 2011 and 2010 | 3 |
|       | – Unaudited Consolidated Statements of Cash Flows for Three Months Ended March 31, 2011 and 2010 | 4 |
|       | – Notes to Consolidated Financial Statements | 5 |
|       |   |   |
| Item 2.    | Management's Discussion and Analysis of Financial Condition and Results of Operations | 23 |
| Item 3.    | Quantitative and Qualitative Disclosures About Market Risk | 30 |
| Item 4.    | Controls and Procedures | 30 |
|       |   |   |
|       | PART II |   |
|       | OTHER INFORMATION |   |
|       |   |   |
| Item 1.    | Legal Proceedings | 31 |
| Item 1A.   | Risk Factors | 31 |
| Item 2.    | Unregistered Sales of Equity Securities and Use of Proceeds | 31 |
| Item 3.    | Defaults Upon Senior Securities | 31 |
| Item 4.    | (Removed and Reserved) | 31 |
| Item 5.    | Other Information | 31 |
| Item 6.    | Exhibits | 32 |
|       |   |   |
| Signatures |   | 33 |

----

INDEX

----

INDEX

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |
| Thousands                              |   | March 31, 2011 |   | December 31, 2010 |
| ASSETS                                 |   |   |   |   |
| Current assets                         |   |   |   |   |
| Cash                                   |   | $ | 6,177 |   |   | $ | 3,630 |   |
| Accounts and other receivables, net    |   | 51,587 |   |   | 53,520 |   |
| Derivative instruments (note 3)        |   | 42,006 |   |   | 54,752 |   |
| Related party receivables (note 4)     |   | 2,556 |   |   | 4,345 |   |
| Inventory (note 5)                     |   | 4,875 |   |   | 7,321 |   |
| Prepaid expenses                       |   | 5,899 |   |   | 6,449 |   |
| Total current assets                   |   | 113,100 |   |   | 130,017 |   |
| Equity investments                     |   | 7,803 |   |   | 7,700 |   |
| Property, plant and equipment          |   |   |   |   |   |   |
| Oil and gas properties                 |   | 2,142,636 |   |   | 2,133,099 |   |
| Other assets                           |   | 11,163 |   |   | 10,832 |   |
|                                   |   | 2,153,799 |   |   | 2,143,931 |   |
| Accumulated depletion and depreciation |   | (445,446 | ) |   | (421,636 | ) |
| Net property, plant and equipment      |   | 1,708,353 |   |   | 1,722,295 |   |
| Other long-term assets                 |   |   |   |   |
| Derivative instruments (note 3)        |   | 25,016 |   |   | 50,652 |   |
| Other long-term assets                 |   | 16,380 |   |   | 19,503 |   |
|                                   |   |   |   |   |   |   |
| Total assets                           |   | $ | 1,870,652 |   |   | $ | 1,930,167 |   |
|                                   |   |   |   |   |
| LIABILITIES AND EQUITY                 |   |   |   |   |   |   |
| Current liabilities                    |   |   |   |   |   |   |
| Accounts payable                       |   | $ | 28,029 |   |   | $ | 26,808 |   |
| Derivative instruments (note 3)        |   | 58,219 |   |   | 37,071 |   |
| Revenue and royalties payable          |   | 17,059 |   |   | 16,427 |   |
| Salaries and wages payable             |   | 3,938 |   |   | 12,594 |   |
| Accrued liabilities                    |   | 13,712 |   |   | 8,417 |   |
| Total current liabilities              |   | 120,957 |   |   | 101,317 |   |
|                                   |   |   |   |   |
| Credit facility (note 6)               |   | 113,000 |   |   | 228,000 |   |
| Senior notes, net (note 6)             |   | 300,240 |   |   | 300,116 |   |
| Deferred income taxes (note 8)         |   | 1,057 |   |   | 2,089 |   |
| Asset retirement obligation (note 9)   |   | 46,734 |   |   | 47,429 |   |
| Derivative instruments (note 3)        |   | 91,447 |   |   | 39,722 |   |
| Other long-term liabilities            |   | 2,066 |   |   | 2,237 |   |
| Total liabilities                      |   | 675,501 |   |   | 720,910 |   |
| Equity                                 |   |   |   |   |   |   |
| Partners' equity (note 10)             |   | 1,194,702 |   |   | 1,208,803 |   |
| Noncontrolling interest (note 11)      |   | 449 |   |   | 454 |   |
| Total equity                           |   | 1,195,151 |   |   | 1,209,257 |   |
|                                   |   |   |   |   |
| Total liabilities and equity           |   | $ | 1,870,652 |   |   | $ | 1,930,167 |   |
|                                   |   |   |   |   |
| Common units outstanding               |   | 59,040 |   |   | 53,957 |   |

----

INDEX

|                                                               |
|---------------------------------------------------------------|
|                                                               |  |  |  |  |  |  |  |  |
|                                                          |   | Three Months Ended |
|                                                          |   | March 31, |
| Thousands of dollars, except per unit amounts                 |   | 2011 |   | 2010 |
| Revenues and other income items                               |   |   |   |   |
| Oil, natural gas and natural gas liquid sales                 |   | $ | 92,575 |   |   | $ | 80,469 |   |
| Gain (loss) on commodity derivative instruments, net (note 3) |   | (106,177 | ) |   | 52,065 |   |
| Other revenue, net                                            |   | 898 |   |   | 632 |   |
| Total revenues and other income items                         |   | (12,704 | ) |   | 133,166 |   |
| Operating costs and expenses                                  |   |   |   |   |   |   |
| Operating costs                                               |   | 36,811 |   |   | 35,851 |   |
| Depletion, depreciation and amortization                      |   | 24,641 |   |   | 22,054 |   |
| General and administrative expenses                           |   | 12,471 |   |   | 11,257 |   |
| Loss on sale of assets                                        |   | 14 |   |   | 115 |   |
| Total operating costs and expenses                            |   | 73,937 |   |   | 69,277 |   |
|                                                          |   |   |   |   |
| Operating income (loss)                                       |   | (86,641 | ) |   | 63,889 |   |
|                                                          |   |   |   |   |
| Interest expense, net of capitalized interest                 |   | 9,420 |   |   | 3,617 |   |
| (Gain) loss on interest rate swaps (note 3)                   |   | (343 | ) |   | 2,243 |   |
| Other income, net                                             |   | (3 | ) |   | (25 | ) |
|                                                          |   |   |   |   |
| Income (loss) before taxes                                    |   | (95,715 | ) |   | 58,054 |   |
|                                                          |   |   |   |   |
| Income tax expense (benefit) (note 8)                         |   | (1,002 | ) |   | 144 |   |
|                                                          |   |   |   |   |
| Net income (loss)                                             |   | (94,713 | ) |   | 57,910 |   |
|                                                          |   |   |   |   |
| Less: Net income attributable to noncontrolling interest      |   | (34 | ) |   | (71 | ) |
|                                                          |   |   |   |   |
| Net income (loss) attributable to the partnership             |   | $ | (94,747 | ) |   | $ | 57,839 |   |
|                                                          |   |   |   |   |
| Basic net income (loss) per unit (note 10)                    |   | $ | (1.67 | ) |   | $ | 1.02 |   |
| Diluted net income (loss) per unit (note 10)                  |   | $ | (1.67 | ) |   | $ | 1.02 |   |

----

INDEX

|                                                                  |
|------------------------------------------------------------------|
|                                                                  |  |  |  |  |  |  |  |  |
|                                                             |   | Three Months Ended |
|                                                             |   | March 31, |
| Thousands of dollars                                             |   | 2011 |   | 2010 |
| Cash flows from operating activities                             |   |   |   |   |
| Net income (loss)                                                |   | $ | (94,713 | ) |   | $ | 57,910 |   |
| Adjustments to reconcile to cash flow from operating activities: |   |   |   |   |
| Depletion, depreciation and amortization                         |   | 24,641 |   |   | 22,054 |   |
| Unit-based compensation expense                                  |   | 5,437 |   |   | 4,883 |   |
| Unrealized (gain) loss on derivative instruments                 |   | 111,254 |   |   | (40,610 | ) |
| Income from equity affiliates, net                               |   | (103 | ) |   | 158 |   |
| Deferred income taxes                                            |   | (1,032 | ) |   | 27 |   |
| Amortization of intangibles                                      |   |                   – |   |   | 124 |   |
| Loss on sale of assets                                           |   | 14 |   |   | 115 |   |
| Other                                                            |   | 257 |   |   | 824 |   |
| Changes in net assets and liabilities                            |   |   |   |   |
| Accounts receivable and other assets                             |   | 4,462 |   |   | 7,884 |   |
| Inventory                                                        |   | 2,446 |   |   | (1,261 | ) |
| Net change in related party receivables and payables             |   | 1,789 |   |   | (513 | ) |
| Accounts payable and other liabilities                           |   | (53 | ) |   | (6,960 | ) |
| Net cash provided by operating activities                        |   | 54,399 |   |   | 44,635 |   |
| Cash flows from investing activities                             |   |   |   |   |   |   |
| Capital expenditures                                             |   | (12,735 | ) |   | (9,954 | ) |
| Net cash used in investing activities                            |   | (12,735 | ) |   | (9,954 | ) |
| Cash flows from financing activities                             |   |   |   |   |   |   |
| Issuance of common units                                         |   | 100,482 |   |   | — |   |
| Distributions                                                    |   | (23,559 | ) |   | — |   |
| Proceeds from issuance of long-term debt                         |   | 60,500 |   |   | 22,000 |   |
| Repayments of long-term debt                                     |   | (175,500 | ) |   | (58,000 | ) |
| Change in book overdraft                                         |   | (1,003 | ) |   | 878 |   |
| Long-term debt issuance costs                                    |   | (37 | ) |   | — |   |
| Net cash used in financing activities                            |   | (39,117 | ) |   | (35,122 | ) |
| Increase (decrease) in cash                                      |   | 2,547 |   |   | (441 | ) |
| Cash beginning of period                                         |   | 3,630 |   |   | 5,766 |   |
| Cash end of period                                               |   | $ | 6,177 |   |   | $ | 5,325 |   |

----

INDEX

----

INDEX

|                                             |
|---------------------------------------------|
|                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                        | Year |
|                                        | 2011 |   | 2012 |   | 2013 |   | 2014 |   | 2015 |
| Oil Positions:                              |   |   |   |   |   |   |   |   |   |
| Fixed Price Swaps:                          |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (Bbl/d)           | 5,151 |   |   | 5,039 |   |   | 6,480 |   |   | 5,000 |   |   | 2,000 |   |
|   Average Price ($/Bbl)           | $ | 76.56 |   |   | $ | 77.15 |   |   | $ | 81.37 |   |   | $ | 88.59 |   |   | $ | 99.00 |   |
| Participating Swaps: (a)                    |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (Bbl/d)           | 1,377 |   |   | — |   |   | — |   |   | — |   |   | — |   |
|   Average Price ($/Bbl)           | $ | 60.00 |   |   | — |   |   | — |   |   | — |   |   | — |   |
|   Average Participation %         | 53.1 | % |   | — |   |   | — |   |   | — |   |   | — |   |
| Collars:                                    |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (Bbl/d)           | 2,231 |   |   | 2,477 |   |   | 500 |   |   | 1,000 |   |   | 1,000 |   |
|   Average Floor Price ($/Bbl)     | $ | 103.79 |   |   | $ | 110.00 |   |   | $ | 77.00 |   |   | $ | 90.00 |   |   | $ | 90.00 |   |
|   Average Ceiling Price ($/Bbl)   | $ | 153.06 |   |   | $ | 145.39 |   |   | $ | 103.10 |   |   | $ | 112.00 |   |   | $ | 113.50 |   |
| Floors:                                     |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (Bbl/d)           | — |   |   | — |   |   | — |   |   | — |   |   | — |   |
|   Average Floor Price ($/Bbl)     | — |   |   | — |   |   | — |   |   | — |   |   | — |   |
| Total:                                      |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (Bbl/d)           | 8,759 |   |   | 7,516 |   |   | 6,980 |   |   | 6,000 |   |   | 3,000 |   |
|   Average Price ($/Bbl)           | $ | 80.89 |   |   | $ | 87.97 |   |   | $ | 81.06 |   |   | $ | 88.83 |   |   | $ | 96.00 |   |
|                                        |   |   |   |   |   |   |   |   |   |
| Gas Positions:                              |   |   |   |   |   |   |   |   |   |
| Fixed Price Swaps:                          |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (MMBtu/d)         | 20,282 |   |   | 19,128 |   |   | 37,000 |   |   | 7,500 |   |   | 5,000 |   |
|   Average Price ($/MMBtu)         | $ | 6.78 |   |   | $ | 7.10 |   |   | $ | 6.50 |   |   | $ | 6.00 |   |   | $ | 6.00 |   |
| Collars:                                    |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (MMBtu/d)         | 20,282 |   |   | 19,129 |   |   | — |   |   | — |   |   | — |   |
|   Average Floor Price ($/MMBtu)   | $ | 9.00 |   |   | $ | 9.00 |   |   | — |   |   | — |   |   | — |   |
|   Average Ceiling Price ($/MMBtu) | $ | 11.13 |   |   | $ | 11.89 |   |   | — |   |   | — |   |   | — |   |
| Total:                                      |   |   |   |   |   |   |   |   |   |
|   Hedged Volume (MMBtu/d)         | 40,564 |   |   | 38,257 |   |   | 37,000 |   |   | 7,500 |   |   | 5,000 |   |
|   Average Price ($/MMBtu)         | $ | 7.89 |   |   | $ | 8.05 |   |   | $ | 6.50 |   |   | $ | 6.00 |   |   | $ | 6.00 |   |

|                                          |
|------------------------------------------|
|                                          |  |  |  |  |  |  |
| Notional amounts in thousands of dollars |   | Notional Amount |   | Fixed Rate |
| Period Covered                           |   |   |   |   |
| April 1, 2011 to October 20, 2011        |   | 100,000 |   |   | 1.6200 | % |
| April 1, 2011 to October 20, 2011        |   | 100,000 |   |   | 2.9900 | % |
| November 21, 2011 to December 20, 2012   |   | 100,000 |   |   | 1.1550 | % |
| January 20, 2012 to January 20, 2014     |   | 100,000 |   |   | 2.4800 | % |

----

INDEX

|                                                 |
|-------------------------------------------------|
|                                                 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Balance sheet location, thousands of dollars    |   | Oil Commodity Derivatives |   | Natural GasCommodity Derivatives |   | Interest RateDerivatives |   | Commodity Derivatives Netting (a) |   | Total Financial Instruments |
|                                            |   |   |   |   |   |   |   |   |   |   |
| As of March 31, 2011                            |   |   |   |   |   |   |   |   |   |   |
| Assets                                          |   |   |   |   |   |   |   |   |   |   |
| Current assets - derivative instruments         |   | $ | 3,289 |   |   | $ | 45,882 |   |   | $ | — |   |   | $ | (7,165 | ) |   | $ | 42,006 |   |
| Other long-term assets - derivative instruments |   | 4,078 |   |   | 43,039 |   |   | 83 |   |   | (22,184 | ) |   | 25,016 |   |
| Total assets                                    |   | 7,367 |   |   | 88,921 |   |   | 83 |   |   | (29,349 | ) |   | 67,022 |   |
|                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current liabilities - derivative instruments    |   | (62,700 | ) |   | — |   |   | (2,684 | ) |   | 7,165 |   |   | (58,219 | ) |
| Long-term liabilities - derivative instruments  |   | (112,356 | ) |   | (394 | ) |   | (881 | ) |   | 22,184 |   |   | (91,447 | ) |
| Total liabilities                               |   | (175,056 | ) |   | (394 | ) |   | (3,565 | ) |   | 29,349 |   |   | (149,666 | ) |
|                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net assets (liabilities)                        |   | $ | (167,689 | ) |   | $ | 88,527 |   |   | $ | (3,482 | ) |   | $ | — |   |   | $ | (82,644 | ) |
|                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| As of December 31, 2010                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Assets                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current assets - derivative instruments         |   | $ | 9,438 |   |   | $ | 48,972 |   |   | $ | — |   |   | $ | (3,658 | ) |   | $ | 54,752 |   |
| Other long-term assets - derivative instruments |   | 15,785 |   |   | 55,806 |   |   | — |   |   | (20,939 | ) |   | 50,652 |   |
| Total assets                                    |   | 25,223 |   |   | 104,778 |   |   | — |   |   | (24,597 | ) |   | 105,404 |   |
|                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Liabilities                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current liabilities - derivative instruments    |   | (37,610 | ) |   | — |   |   | (3,119 | ) |   | 3,658 |   |   | (37,071 | ) |
| Long-term liabilities - derivative instruments  |   | (58,766 | ) |   | (166 | ) |   | (1,729 | ) |   | 20,939 |   |   | (39,722 | ) |
| Total liabilities                               |   | (96,376 | ) |   | (166 | ) |   | (4,848 | ) |   | 24,597 |   |   | (76,793 | ) |
|                                            |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net assets (liabilities)                        |   | $ | (71,153 | ) |   | $ | 104,612 |   |   | $ | (4,848 | ) |   | $ | — |   |   | $ | 28,611 |   |
|                                            |   |   |   |   |   |   |   |   |   |   |

----

INDEX

|                                                                                                                    |
|--------------------------------------------------------------------------------------------------------------------|
|                                                                                                                    |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Thousands of dollars                                                                                               |   | Oil CommodityDerivatives (a) |   | Natural GasCommodity Derivatives (a) |   | Interest RateDerivatives (b) |   | Total Financial Instruments |
| Three Months Ended March 31, 2011                                                                                  |   |   |   |   |   |   |   |   |
| Realized gain (loss)                                                                                               |   | $ | (8,623 | ) |   | $ | 15,066 |   |   | $ | (1,023 | ) |   | $ | 5,420 |   |
| Unrealized gain (loss)                                                                                             |   | (96,536 | ) |   | (16,084 | ) |   | 1,366 |   |   | (111,254 | ) |
| Net gain (loss)                                                                                                    |   | $ | (105,159 | ) |   | $ | (1,018 | ) |   | $ | 343 |   |   | $ | (105,834 | ) |
|                                                                                                               |   |   |   |   |   |   |   |   |
| Three Months Ended March 31, 2010                                                                                  |   |   |   |   |   |   |   |   |
| Realized gain (loss)                                                                                               |   | $ | 308 |   |   | $ | 11,838 |   |   | $ | (2,934 | ) |   | $ | 9,212 |   |
| Unrealized gain (loss)                                                                                             |   | (2,511 | ) |   | 42,430 |   |   | 691 |   |   | 40,610 |   |
| Net gain (loss)                                                                                                    |   | $ | (2,203 | ) |   | $ | 54,268 |   |   | $ | (2,243 | ) |   | $ | 49,822 |   |
|                                                                                                               |   |   |   |   |   |   |   |   |
| (a) Included in gain (loss) on commodity derivative instruments, net on the consolidated statements of operations. |
| (b) Included in (gain) loss on interest rate swaps on the consolidated statements of operations.                   |

----

INDEX

|                                                     |
|-----------------------------------------------------|
|                                                     |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Thousands of dollars                                |   | Level 1 |   | Level 2 |   | Level 3 |   | Total |
|                                                |   |   |   |   |   |   |   |   |
| As of March 31, 2011                                |   |   |   |   |   |   |   |   |
| Assets (liabilities):                               |   |   |   |   |   |   |   |   |
| Commodity derivatives (swaps, put and call options) |   | $ | — |   |   | $ | (148,233 | ) |   | $ | 69,071 |   |   | $ | (79,162 | ) |
| Other derivatives (interest rate swaps)             |   | — |   |   | (3,482 | ) |   | — |   |   | (3,482 | ) |
| Total                                               |   | $ | — |   |   | $ | (151,715 | ) |   | $ | 69,071 |   |   | $ | (82,644 | ) |
|                                                |   |   |   |   |   |   |   |   |
| As of December 31, 2010                             |   |   |   |   |   |   |   |   |   |   |   |   |
| Assets (liabilities):                               |   |   |   |   |   |   |   |   |   |   |   |   |
| Commodity derivatives (swaps, put and call options) |   | $ | — |   |   | $ | (52,794 | ) |   | $ | 86,253 |   |   | $ | 33,459 |   |
| Other derivatives (interest rate swaps)             |   | — |   |   | (4,848 | ) |   | — |   |   | (4,848 | ) |
| Total                                               |   | $ | — |   |   | $ | (57,642 | ) |   | $ | 86,253 |   |   | $ | 28,611 |   |

|                                                                                                                    |
|--------------------------------------------------------------------------------------------------------------------|
|                                                                                                                    |  |  |  |  |  |  |  |  |
|                                                                                                               |   | Three Months Ended |
|                                                                                                               |   | March 31, |
| Thousands of dollars                                                                                               |   | 2011 |   | 2010 |
| Assets:                                                                                                            |   |   |   |   |
| Beginning balance                                                                                                  |   | $ | 86,253 |   |   | $ | 102,475 |   |
| Realized gain (a)                                                                                                  |   | 4,725 |   |   | 4,975 |   |
| Unrealized gain (loss) (a)                                                                                         |   | (21,907 | ) |   | 1,266 |   |
| Ending balance                                                                                                     |   | $ | 69,071 |   |   | $ | 108,716 |   |
|                                                                                                               |   |   |   |   |
| (a) Included in gain (loss) on commodity derivative instruments, net on the consolidated statements of operations. |

----

INDEX

----

INDEX

----

INDEX

|                                                      |
|------------------------------------------------------|
|                                                      |  |  |  |  |  |  |  |  |
|                                                 |   | Three Months Ended |
|                                                 |   | March 31, |
| Thousands of dollars                                 |   | 2011 |   | 2010 |
| Credit agreement (including commitment fees)         |   | $ | 1,690 |   |   | $ | 2,793 |   |
| Senior notes                                         |   | 6,503 |   |   | — |   |
| Amortization of discount and deferred issuance costs |   | 1,304 |   |   | 824 |   |
| Capitalized interest                                 |   | (77 | ) |   | — |   |
| Total                                                |   | $ | 9,420 |   |   | $ | 3,617 |   |

----

INDEX

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                   |   | As of March 31, 2011 |
| Thousands of dollars                   |   | Parent/Co-Issuer |   | Combined Guarantor Subsidiaries |   | Combined Non-Guarantor Subsidiaries |   | Eliminations |   | Consolidated |
| ASSETS                                 |   |   |   |   |   |   |   |   |   |   |
| Current assets                         |   |   |   |   |   |   |   |   |   |   |
| Cash                                   |   | $ | 61 |   |   | $ | 3,851 |   |   | $ | 2,265 |   |   | $ | — |   |   | $ | 6,177 |   |
| Accounts and other receivables, net    |   | 10,000 |   |   | 39,416 |   |   | 2,171 |   |   | — |   |   | 51,587 |   |
| Derivative instruments                 |   | — |   |   | 42,006 |   |   | — |   |   | — |   |   | 42,006 |   |
| Related party receivables              |   | — |   |   | 2,556 |   |   | — |   |   | — |   |   | 2,556 |   |
| Inventory                              |   | — |   |   | 4,875 |   |   | — |   |   | — |   |   | 4,875 |   |
| Prepaid expenses                       |   | 879 |   |   | 5,020 |   |   | — |   |   | — |   |   | 5,899 |   |
| Total current assets                   |   | 10,940 |   |   | 97,724 |   |   | 4,436 |   |   | — |   |   | 113,100 |   |
| Investments in subsidiaries            |   | 1,156,132 |   |   | 31,662 |   |   | — |   |   | (1,187,794 | ) |   | — |   |
| Intercompany receivables (payables)    |   | 326,233 |   |   | (323,470 | ) |   | (2,763 | ) |   | — |   |   | — |   |
| Equity investments                     |   | — |   |   | 7,803 |   |   | — |   |   | — |   |   | 7,803 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Property, plant and equipment          |   |   |   |   |   |   |   |   |   |   |
| Oil and gas properties                 |   | 8,467 |   |   | 2,084,839 |   |   | 49,330 |   |   | — |   |   | 2,142,636 |   |
| Other assets                           |   | — |   |   | 11,163 |   |   | — |   |   | — |   |   | 11,163 |   |
|                                   |   | 8,467 |   |   | 2,096,002 |   |   | 49,330 |   |   | — |   |   | 2,153,799 |   |
| Accumulated depletion and depreciation |   | (1,119 | ) |   | (431,972 | ) |   | (12,355 | ) |   | — |   |   | (445,446 | ) |
| Net property, plant and equipment      |   | 7,348 |   |   | 1,664,030 |   |   | 36,975 |   |   | — |   |   | 1,708,353 |   |
| Other long-term assets                 |   |   |   |   |   |   |   |   |   |   |
| Derivative instruments                 |   | — |   |   | 25,016 |   |   | — |   |   | — |   |   | 25,016 |   |
| Other long-term assets                 |   | 7,542 |   |   | 8,762 |   |   | 76 |   |   | — |   |   | 16,380 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Total assets                           |   | $ | 1,508,195 |   |   | $ | 1,511,527 |   |   | $ | 38,724 |   |   | $ | (1,187,794 | ) |   | $ | 1,870,652 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND EQUITY                 |   |   |   |   |   |   |   |   |   |   |
| Current liabilities                    |   |   |   |   |   |   |   |   |   |   |
| Accounts payable                       |   | $ | 13,103 |   |   | $ | 13,594 |   |   | $ | 1,332 |   |   | $ | — |   |   | $ | 28,029 |   |
| Derivative instruments                 |   | — |   |   | 58,219 |   |   | — |   |   | — |   |   | 58,219 |   |
| Revenue and royalties payable          |   | — |   |   | 15,457 |   |   | 1,602 |   |   | — |   |   | 17,059 |   |
| Salaries and wages payable             |   | — |   |   | 3,938 |   |   | — |   |   | — |   |   | 3,938 |   |
| Accrued liabilities                    |   | — |   |   | 12,994 |   |   | 718 |   |   | — |   |   | 13,712 |   |
| Total current liabilities              |   | 13,103 |   |   | 104,202 |   |   | 3,652 |   |   | — |   |   | 120,957 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Credit facility                        |   | — |   |   | 113,000 |   |   | — |   |   | — |   |   | 113,000 |   |
| Senior notes, net                      |   | 300,240 |   |   | — |   |   | — |   |   | — |   |   | 300,240 |   |
| Deferred income taxes                  |   | — |   |   | 1,057 |   |   | — |   |   | — |   |   | 1,057 |   |
| Asset retirement obligation            |   | — |   |   | 43,623 |   |   | 3,111 |   |   | — |   |   | 46,734 |   |
| Derivative instruments                 |   | — |   |   | 91,447 |   |   | — |   |   | — |   |   | 91,447 |   |
| Other long-term liabilities            |   | — |   |   | 2,066 |   |   | — |   |   | — |   |   | 2,066 |   |
| Total liabilities                      |   | 313,343 |   |   | 355,395 |   |   | 6,763 |   |   | — |   |   | 675,501 |   |
| Equity                                 |   |   |   |   |   |   |   |   |   |   |
| Partners' equity                       |   | 1,194,852 |   |   | 1,156,132 |   |   | 31,961 |   |   | (1,188,243 | ) |   | 1,194,702 |   |
| Noncontrolling interest                |   | — |   |   | — |   |   | — |   |   | 449 |   |   | 449 |   |
| Total equity                           |   | 1,194,852 |   |   | 1,156,132 |   |   | 31,961 |   |   | (1,187,794 | ) |   | 1,195,151 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Total liabilities and equity           |   | $ | 1,508,195 |   |   | $ | 1,511,527 |   |   | $ | 38,724 |   |   | $ | (1,187,794 | ) |   | $ | 1,870,652 |   |

----

INDEX

|                                        |
|----------------------------------------|
|                                        |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                   |   | As of December 31, 2010 |
| Thousands of dollars                   |   | Parent/Co-Issuer |   | Combined Guarantor Subsidiaries |   | Combined Non-Guarantor Subsidiaries |   | Eliminations |   | Consolidated |
|                                   |   |   |   |   |   |   |   |   |   |   |
| ASSETS                                 |   |   |   |   |   |   |   |   |   |   |
| Current assets:                        |   |   |   |   |   |   |   |   |   |   |
| Cash                                   |   | $ | 70 |   |   | $ | 1,836 |   |   | $ | 1,724 |   |   | $ | — |   |   | $ | 3,630 |   |
| Accounts and other receivables, net    |   | 10,000 |   |   | 41,945 |   |   | 1,575 |   |   | — |   |   | 53,520 |   |
| Derivative instruments                 |   | — |   |   | 54,752 |   |   | — |   |   | — |   |   | 54,752 |   |
| Related party receivables              |   | — |   |   | 4,345 |   |   | — |   |   | — |   |   | 4,345 |   |
| Inventory                              |   | — |   |   | 7,321 |   |   | — |   |   | — |   |   | 7,321 |   |
| Prepaid expenses                       |   | 877 |   |   | 5,572 |   |   | — |   |   | — |   |   | 6,449 |   |
| Total current assets                   |   | 10,947 |   |   | 115,771 |   |   | 3,299 |   |   | — |   |   | 130,017 |   |
| Investments in subsidiaries            |   | 1,243,910 |   |   | 30,647 |   |   | — |   |   | (1,274,557 | ) |   | — |   |
| Intercompany receivables (payables)    |   | 245,323 |   |   | (242,011 | ) |   | (3,312 | ) |   | — |   |   | — |   |
| Equity investments                     |   | — |   |   | 7,700 |   |   | — |   |   | — |   |   | 7,700 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Property, plant and equipment          |   |   |   |   |   |   |   |   |   |   |
| Oil and gas properties                 |   | 8,467 |   |   | 2,076,074 |   |   | 48,558 |   |   | — |   |   | 2,133,099 |   |
| Other assets                           |   | — |   |   | 10,832 |   |   | — |   |   | — |   |   | 10,832 |   |
|                                   |   | 8,467 |   |   | 2,086,906 |   |   | 48,558 |   |   | — |   |   | 2,143,931 |   |
| Accumulated depletion and depreciation |   | (1,014 | ) |   | (408,850 | ) |   | (11,772 | ) |   | — |   |   | (421,636 | ) |
| Net property, plant and equipment      |   | 7,453 |   |   | 1,678,056 |   |   | 36,786 |   |   | — |   |   | 1,722,295 |   |
| Other long-term assets                 |   |   |   |   |   |   |   |   |   |   |
| Derivative instruments                 |   | — |   |   | 50,652 |   |   | — |   |   | — |   |   | 50,652 |   |
| Other long-term assets                 |   | 7,746 |   |   | 11,681 |   |   | 76 |   |   | — |   |   | 19,503 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Total assets                           |   | $ | 1,515,379 |   |   | $ | 1,652,496 |   |   | $ | 36,849 |   |   | $ | (1,274,557 | ) |   | $ | 1,930,167 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND EQUITY                 |   |   |   |   |   |   |   |   |   |   |
| Current liabilities:                   |   |   |   |   |   |   |   |   |   |   |
| Accounts payable                       |   | $ | 6,300 |   |   | $ | 19,566 |   |   | $ | 942 |   |   | $ | — |   |   | $ | 26,808 |   |
| Derivative instruments                 |   | — |   |   | 37,071 |   |   | — |   |   | — |   |   | 37,071 |   |
| Revenue and royalties payable          |   | — |   |   | 15,016 |   |   | 1,411 |   |   | — |   |   | 16,427 |   |
| Salaries and wages payable             |   | — |   |   | 12,594 |   |   | — |   |   | — |   |   | 12,594 |   |
| Accrued liabilities                    |   | — |   |   | 7,912 |   |   | 505 |   |   | — |   |   | 8,417 |   |
| Total current liabilities              |   | 6,300 |   |   | 92,159 |   |   | 2,858 |   |   | — |   |   | 101,317 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Credit facility                        |   | — |   |   | 228,000 |   |   | — |   |   | — |   |   | 228,000 |   |
| Senior notes, net                      |   | 300,116 |   |   | — |   |   | — |   |   | — |   |   | 300,116 |   |
| Deferred income taxes                  |   | — |   |   | 2,089 |   |   | — |   |   | — |   |   | 2,089 |   |
| Asset retirement obligation            |   | — |   |   | 44,379 |   |   | 3,050 |   |   | — |   |   | 47,429 |   |
| Derivative instruments                 |   | — |   |   | 39,722 |   |   | — |   |   | — |   |   | 39,722 |   |
| Other long-term liabilities            |   | — |   |   | 2,237 |   |   | — |   |   | — |   |   | 2,237 |   |
| Total liabilities                      |   | 306,416 |   |   | 408,586 |   |   | 5,908 |   |   | — |   |   | 720,910 |   |
| Equity:                                |   |   |   |   |   |   |   |   |   |   |
| Partners' equity                       |   | 1,208,963 |   |   | 1,243,910 |   |   | 30,941 |   |   | (1,275,011 | ) |   | 1,208,803 |   |
| Noncontrolling interest                |   | — |   |   | — |   |   | — |   |   | 454 |   |   | 454 |   |
| Total equity                           |   | 1,208,963 |   |   | 1,243,910 |   |   | 30,941 |   |   | (1,274,557 | ) |   | 1,209,257 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |
| Total liabilities and equity           |   | $ | 1,515,379 |   |   | $ | 1,652,496 |   |   | $ | 36,849 |   |   | $ | (1,274,557 | ) |   | $ | 1,930,167 |   |
|                                   |   |   |   |   |   |   |   |   |   |   |

----

INDEX

|                                                          |
|----------------------------------------------------------|
|                                                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                     |   | Three Months Ended March 31, 2011 |
| Thousands of dollars                                     |   | Parent/Co-Issuer |   | Combined Guarantor Subsidiaries |   | Combined Non-Guarantor Subsidiaries |   | Eliminations |   | Consolidated |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Revenues and other income items:                         |   |   |   |   |   |   |   |   |   |   |
| Oil, natural gas and natural gas liquid sales            |   | $ | — |   |   | $ | 85,056 |   |   | $ | 7,519 |   |   | $ | — |   |   | $ | 92,575 |   |
| Loss on commodity derivative instruments, net            |   | — |   |   | (106,177 | ) |   | — |   |   | — |   |   | (106,177 | ) |
| Other revenue, net                                       |   | — |   |   | 898 |   |   | — |   |   | — |   |   | 898 |   |
| Total revenues and other income items                    |   | — |   |   | (20,223 | ) |   | 7,519 |   |   | — |   |   | (12,704 | ) |
| Operating costs and expenses:                            |   |   |   |   |   |   |   |   |   |   |
| Operating costs                                          |   | — |   |   | 34,385 |   |   | 2,426 |   |   | — |   |   | 36,811 |   |
| Depletion, depreciation and amortization                 |   | 105 |   |   | 23,892 |   |   | 644 |   |   | — |   |   | 24,641 |   |
| General and administrative expenses                      |   | 36 |   |   | 12,433 |   |   | 2 |   |   | — |   |   | 12,471 |   |
| Loss on sale of assets                                   |   | — |   |   | 14 |   |   | — |   |   | — |   |   | 14 |   |
| Total operating costs and expenses                       |   | 141 |   |   | 70,724 |   |   | 3,072 |   |   | — |   |   | 73,937 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Operating income (loss)                                  |   | (141 | ) |   | (90,947 | ) |   | 4,447 |   |   | — |   |   | (86,641 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Interest expense, net of capitalized interest            |   | 6,848 |   |   | 2,572 |   |   | — |   |   | — |   |   | 9,420 |   |
| Gain on interest rate swaps                              |   | — |   |   | (343 | ) |   | — |   |   | — |   |   | (343 | ) |
| Other income, net                                        |   | — |   |   | (2 | ) |   | (1 | ) |   | — |   |   | (3 | ) |
| Income (loss) before taxes                               |   | (6,989 | ) |   | (93,174 | ) |   | 4,448 |   |   | — |   |   | (95,715 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Income tax expense (benefit)                             |   | (9 | ) |   | (995 | ) |   | 2 |   |   | — |   |   | (1,002 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) before equity earnings                 |   | (6,980 | ) |   | (92,179 | ) |   | 4,446 |   |   | — |   |   | (94,713 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Equity in earnings (losses) of subsidiaries              |   | (87,779 | ) |   | 4,400 |   |   | — |   |   | 83,379 |   |   | — |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                        |   | (94,759 | ) |   | (87,779 | ) |   | 4,446 |   |   | 83,379 |   |   | (94,713 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Less: Net income attributable to noncontrolling interest |   | — |   |   | — |   |   | — |   |   | (34 | ) |   | (34 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) attributable to the partnership        |   | $ | (94,759 | ) |   | $ | (87,779 | ) |   | $ | 4,446 |   |   | $ | 83,345 |   |   | $ | (94,747 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |

----

INDEX

|                                                          |
|----------------------------------------------------------|
|                                                          |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                     |   | Three Months Ended March 31, 2010 |
| Thousands of dollars                                     |   | Parent/Co-Issuer |   | Combined Guarantor Subsidiaries |   | Non-Guarantor Subsidiary |   | Eliminations |   | Consolidated |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Revenues and other income items:                         |   |   |   |   |   |   |   |   |   |   |
| Oil, natural gas and natural gas liquid sales            |   | $ | — |   |   | $ | 74,499 |   |   | $ | 5,970 |   |   | $ | — |   |   | $ | 80,469 |   |
| Gain on commodity derivative instruments, net            |   | — |   |   | 52,065 |   |   | — |   |   | — |   |   | 52,065 |   |
| Other revenue, net                                       |   | — |   |   | 632 |   |   | — |   |   | — |   |   | 632 |   |
| Total revenues and other income items                    |   | — |   |   | 127,196 |   |   | 5,970 |   |   | — |   |   | 133,166 |   |
| Operating costs and expenses:                            |   |   |   |   |   |   |   |   |   |   |
| Operating costs                                          |   | 47 |   |   | 33,052 |   |   | 2,752 |   |   | — |   |   | 35,851 |   |
| Depletion, depreciation and amortization                 |   | 52 |   |   | 21,453 |   |   | 549 |   |   | — |   |   | 22,054 |   |
| General and administrative expenses                      |   | 142 |   |   | 11,103 |   |   | 12 |   |   | — |   |   | 11,257 |   |
| Loss on sale of assets                                   |   | — |   |   | 115 |   |   | — |   |   | — |   |   | 115 |   |
| Total operating costs and expenses                       |   | 241 |   |   | 65,723 |   |   | 3,313 |   |   | — |   |   | 69,277 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Operating income (loss)                                  |   | (241 | ) |   | 61,473 |   |   | 2,657 |   |   | — |   |   | 63,889 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Interest expense, net                                    |   | — |   |   | 3,617 |   |   | — |   |   | — |   |   | 3,617 |   |
| Loss on interest rate swaps                              |   | — |   |   | 2,243 |   |   | — |   |   | — |   |   | 2,243 |   |
| Other income, net                                        |   | — |   |   | (24 | ) |   | (1 | ) |   | — |   |   | (25 | ) |
| Income (loss) before taxes                               |   | (241 | ) |   | 55,637 |   |   | 2,658 |   |   | — |   |   | 58,054 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Income tax expense (benefit)                             |   | (40 | ) |   | 183 |   |   | 1 |   |   | — |   |   | 144 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Net income (loss) before equity earnings                 |   | (201 | ) |   | 55,454 |   |   | 2,657 |   |   | — |   |   | 57,910 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Equity in earnings of subsidiaries                       |   | 58,084 |   |   | 2,630 |   |   | — |   |   | (60,714 | ) |   | — |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Net income                                               |   | 57,883 |   |   | 58,084 |   |   | 2,657 |   |   | (60,714 | ) |   | 57,910 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Less: Net income attributable to noncontrolling interest |   | — |   |   | — |   |   | — |   |   | (71 | ) |   | (71 | ) |
|                                                     |   |   |   |   |   |   |   |   |   |   |
| Net income attributable to the partnership               |   | $ | 57,883 |   |   | $ | 58,084 |   |   | $ | 2,657 |   |   | $ | (60,785 | ) |   | $ | 57,839 |   |
|                                                     |   |   |   |   |   |   |   |   |   |   |

----

INDEX

|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                        |   | Three Months Ended March 31, 2011 |
| Thousands of dollars                                                        |   | Parent/Co-Issuer |   | Combined Guarantor Subsidiaries |   | Combined Non-Guarantor Subsidiaries |   | Eliminations |   | Consolidated |
|                                                                        |   |   |   |   |   |   |   |   |   |   |
| Cash flows from operating activities                                        |   |   |   |   |   |   |   |   |   |   |
| Net income (loss)                                                           |   | $ | (94,759 | ) |   | $ | (87,779 | ) |   | $ | 4,446 |   |   | $ | 83,379 |   |   | $ | (94,713 | ) |
| Adjustments to reconcile net income to cash flow from operating activities: |   |   |   |   |   |   |   |   |   |   |
| Depletion, depreciation and amortization                                    |   | 105 |   |   | 23,892 |   |   | 644 |   |   | — |   |   | 24,641 |   |
| Unit-based compensation expense                                             |   | — |   |   | 5,437 |   |   | — |   |   | — |   |   | 5,437 |   |
| Unrealized loss on derivative instruments                                   |   | — |   |   | 111,254 |   |   | — |   |   | — |   |   | 111,254 |   |
| Income from equity affiliates, net                                          |   | — |   |   | (103 | ) |   | — |   |   | — |   |   | (103 | ) |
| Equity in earnings of subsidiaries                                          |   | 87,779 |   |   | (4,400 | ) |   | — |   |   | (83,379 | ) |   | — |   |
| Deferred income taxes                                                       |   | — |   |   | (1,032 | ) |   | — |   |   | — |   |   | (1,032 | ) |
| Loss on sale of assets                                                      |   | — |   |   | 14 |   |   | — |   |   | — |   |   | 14 |   |
| Other                                                                       |   | 344 |   |   | (87 | ) |   | — |   |   | — |   |   | 257 |   |
| Changes in net assets and liabilities:                                      |   |   |   |   |   |   |   |   |   |   |   |
| Accounts receivable and other assets                                        |   | — |   |   | 5,058 |   |   | (596 | ) |   | — |   |   | 4,462 |   |
| Inventory                                                                   |   | — |   |   | 2,446 |   |   | — |   |   | — |   |   | 2,446 |   |
| Net change in related party receivables and payables                        |   | — |   |   | 1,789 |   |   | — |   |   | — |   |   | 1,789 |   |
| Accounts payable and other liabilities                                      |   | 6,490 |   |   | (6,918 | ) |   | 375 |   |   | — |   |   | (53 | ) |
| Net cash provided by (used in) operating activities                         |   | (41 | ) |   | 49,571 |   |   | 4,869 |   |   | — |   |   | 54,399 |   |
| Cash flows from investing activities                                        |   |   |   |   |   |   |   |   |   |   |
| Capital expenditures                                                        |   | — |   |   | (12,379 | ) |   | (356 | ) |   | — |   |   | (12,735 | ) |
| Net cash used in investing activities                                       |   | — |   |   | (12,379 | ) |   | (356 | ) |   | — |   |   | (12,735 | ) |
| Cash flows from financing activities                                        |   |   |   |   |   |   |   |   |   |   |
| Issuance of common units                                                    |   | 100,482 |   |   | — |   |   | — |   |   | — |   |   | 100,482 |   |
| Distributions                                                               |   | (23,559 | ) |   | — |   |   | — |   |   | — |   |   | (23,559 | ) |
| Proceeds from the issuance of long-term debt                                |   | — |   |   | 60,500 |   |   | — |   |   | — |   |   | 60,500 |   |
| Repayments of long-term debt                                                |   | — |   |   | (175,500 | ) |   | — |   |   | — |   |   | (175,500 | ) |
| Change in book overdraft                                                    |   | — |   |   | (1,003 | ) |   | — |   |   | — |   |   | (1,003 | ) |
| Long-term debt issuance costs                                               |   | (18 | ) |   | (19 | ) |   | — |   |   | — |   |   | (37 | ) |
| Intercompany activity                                                       |   | (76,873 | ) |   | 80,845 |   |   | (3,972 | ) |   | — |   |   | — |   |
| Net cash provided by (used in) financing activities                         |   | 32 |   |   | (35,177 | ) |   | (3,972 | ) |   | — |   |   | (39,117 | ) |
|                                                                        |   |   |   |   |   |   |   |   |   |   |
| Increase (decrease) in cash                                                 |   | (9 | ) |   | 2,015 |   |   | 541 |   |   | — |   |   | 2,547 |   |
| Cash beginning of period                                                    |   | 70 |   |   | 1,836 |   |   | 1,724 |   |   | — |   |   | 3,630 |   |
| Cash end of period                                                          |   | $ | 61 |   |   | $ | 3,851 |   |   | $ | 2,265 |   |   | $ | — |   |   | $ | 6,177 |   |
|                                                                        |   |   |   |   |   |   |   |   |   |   |

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INDEX

|                                                                             |
|-----------------------------------------------------------------------------|
|                                                                             |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                        |   | Three Months Ended March 31, 2010 |
| Thousands of dollars                                                        |   | Parent/Co-Issuer |   | Combined Guarantor Subsidiaries |   | Non-Guarantor Subsidiary |   | Eliminations |   | Consolidated |
|                                                                        |   |   |   |   |   |   |   |   |   |   |
| Cash flows from operating activities                                        |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                  |   | $ | 57,883 |   |   | $ | 58,084 |   |   | $ | 2,657 |   |   | $ | (60,714 | ) |   | $ | 57,910 |   |
| Adjustments to reconcile net income to cash flow from operating activities: |   |   |   |   |   |   |   |   |   |   |
| Depletion, depreciation and amortization                                    |   | 52 |   |   | 21,453 |   |   | 549 |   |   | — |   |   | 22,054 |   |
| Unit-based compensation expense                                             |   | — |   |   | 4,883 |   |   | — |   |   | — |   |   | 4,883 |   |
| Unrealized gain on derivative instruments                                   |   | — |   |   | (40,610 | ) |   | — |   |   | — |   |   | (40,610 | ) |
| Income from equity affiliates, net                                          |   | — |   |   | 158 |   |   | — |   |   | — |   |   | 158 |   |
| Equity in earnings of subsidiaries                                          |   | (58,084 | ) |   | (2,630 | ) |   | — |   |   | 60,714 |   |   | — |   |
| Deferred income taxes                                                       |   | — |   |   | 27 |   |   | — |   |   | — |   |   | 27 |   |
| Amortization of intangibles                                                 |   | — |   |   | 124 |   |   | — |   |   | — |   |   | 124 |   |
| Loss on sale of assets                                                      |   | — |   |   | 115 |   |   | — |   |   | — |   |   | 115 |   |
| Other                                                                       |   | — |   |   | 824 |   |   | — |   |   | — |   |   | 824 |   |
| Changes in net assets and liabilities:                                      |   |   |   |   |   |   |   |   |   |   |   |
| Accounts receivable and other assets                                        |   | — |   |   | 7,734 |   |   | 150 |   |   | — |   |   | 7,884 |   |
| Inventory                                                                   |   | — |   |   | (1,261 | ) |   | — |   |   | — |   |   | (1,261 | ) |
| Net change in related party receivables and payables                        |   | — |   |   | (513 | ) |   | — |   |   | — |   |   | (513 | ) |
| Accounts payable and other liabilities                                      |   | — |   |   | (7,179 | ) |   | 219 |   |   | — |   |   | (6,960 | ) |
| Net cash provided by (used in) operating activities                         |   | (149 | ) |   | 41,209 |   |   | 3,575 |   |   | — |   |   | 44,635 |   |
| Cash flows from investing activities                                        |   |   |   |   |   |   |   |   |   |   |
| Capital expenditures                                                        |   | — |   |   | (9,953 | ) |   | (1 | ) |   | — |   |   | (9,954 | ) |
| Net cash used in investing activities                                       |   | — |   |   | (9,953 | ) |   | (1 | ) |   | — |   |   | (9,954 | ) |
| Cash flows from financing activities                                        |   |   |   |   |   |   |   |   |   |   |
| Proceeds from the issuance of long-term debt                                |   | — |   |   | 22,000 |   |   | — |   |   | — |   |   | 22,000 |   |
| Repayments of long-term debt                                                |   | — |   |   | (58,000 | ) |   | — |   |   | — |   |   | (58,000 | ) |
| Change in book overdraft                                                    |   | — |   |   | 878 |   |   | — |   |   | — |   |   | 878 |   |
| Intercompany activity                                                       |   | 43 |   |   | 3,416 |   |   | (3,459 | ) |   | — |   |   | — |   |
| Net cash provided by (used in) financing activities                         |   | 43 |   |   | (31,706 | ) |   | (3,459 | ) |   | — |   |   | (35,122 | ) |
|                                                                        |   |   |   |   |   |   |   |   |   |   |
| Increase (decrease) in cash                                                 |   | (106 | ) |   | (450 | ) |   | 115 |   |   | — |   |   | (441 | ) |
| Cash beginning of period                                                    |   | 149 |   |   | 4,917 |   |   | 700 |   |   | — |   |   | 5,766 |   |
| Cash end of period                                                          |   | $ | 43 |   |   | $ | 4,467 |   |   | $ | 815 |   |   | $ | — |   |   | $ | 5,325 |   |
|                                                                        |   |   |   |   |   |   |   |   |   |   |

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|                                                                                                                                            |
|--------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                            |  |  |  |  |  |  |  |  |
|                                                                                                                                       |   | Three Months Ended |
|                                                                                                                                       |   | March 31, |
| Thousands of dollars                                                                                                                       |   | 2011 |   | 2010 |
| Federal current tax expense                                                                                                                |   | $ | 28 |   |   | $ | 129 |   |
| Deferred federal tax expense (benefit) (a)                                                                                                 |   | (1,032 | ) |   | 27 |   |
| State income tax expense (benefit) (b)                                                                                                     |   | 2 |   |   | (12 | ) |
| Total income tax expense (benefit)                                                                                                         |   | $ | (1,002 | ) |   | $ | 144 |   |
|                                                                                                                                       |   |   |   |   |
| (a) Related to Phoenix Production Company, a tax-paying corporation and our wholly-owned subsidiary.                                       |
| (b) Related to various forms of state taxes imposed on gross receipts, profit margin or net income in the states where we have operations. |

|                                                              |
|--------------------------------------------------------------|
|                                                              |  |  |  |  |  |  |  |  |
|                                                         |   | Three Months Ended |   | Year Ended |
| Thousands of dollars                                         |   | March 31, 2011 |   | December 31, 2010 |
| Carrying amount, beginning of period                         |   | $ | 47,429 |   |   | $ | 36,635 |   |
| Additions                                                    |   | — |   |   | 509 |   |
| Liabilities settled in the current period                    |   | (1,525 | ) |   | (1,952 | ) |
| Revisions (a)                                                |   | — |   |   | 9,611 |   |
| Accretion expense                                            |   | 830 |   |   | 2,626 |   |
| Carrying amount, end of period                               |   | $ | 46,734 |   |   | $ | 47,429 |   |
|                                                         |   |   |   |   |
| (a) Changes to cost estimates and revisions to reserve life. |   |   |   |

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|                                                                                                                                                                                                                                                                                                                                                                       |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                       |  |  |  |  |  |  |  |  |
|                                                                                                                                                                                                                                                                                                                                                                  |   | Three Months Ended |
|                                                                                                                                                                                                                                                                                                                                                                  |   | March 31, |
| Thousands, except per unit amounts                                                                                                                                                                                                                                                                                                                                    |   | 2011 |   | 2010 |
|                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |
| Net income (loss) attributable to the partnership                                                                                                                                                                                                                                                                                                                     |   | $ | (94,747 | ) |   | $ | 57,839 |   |
| Distributions on participating units not expected to vest                                                                                                                                                                                                                                                                                                             |   | — |   |   | — |   |
| Net income (loss) attributable to common unitholders and participating securities                                                                                                                                                                                                                                                                                     |   | $ | (94,747 | ) |   | $ | 57,839 |   |
|                                                                                                                                                                                                                                                                                                                                                                  |   |   |   |   |
| Weighted average number of units used to calculate basic and diluted earnings per unit:                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |
| Common Units                                                                                                                                                                                                                                                                                                                                                          |   | 56,787 |   |   | 53,294 |   |
| Participating securities                                                                                                                                                                                                                                                                                                                                              |   | — |   |   | 3,291 |   |
| Denominator for basic earnings per common unit (a)                                                                                                                                                                                                                                                                                                                    |   | 56,787 |   |   | 56,585 |   |
| Dilutive units (b)                                                                                                                                                                                                                                                                                                                                                    |   | — |   |   | 118 |   |
| Denominator for diluted earnings per common unit                                                                                                                                                                                                                                                                                                                      |   | 56,787 |   |   | 56,703 |   |
| Net income (loss) per common unit                                                                                                                                                                                                                                                                                                                                     |   |   |   |   |   |   |
| Basic                                                                                                                                                                                                                                                                                                                                                                 |   | $ | (1.67 | ) |   | $ | 1.02 |   |
| Diluted                                                                                                                                                                                                                                                                                                                                                               |   | $ | (1.67 | ) |   | $ | 1.02 |   |
| (a) Basic earnings per unit is based on the weighted average number of Common Units outstanding plus the weighted average number of unvested RPUs, CPUs and 2011 Directors' Units.  The three months ended March 31, 2011 excludes 2,888 unvested weighted average RPUs, CPUs and 2011 Directors' Units from participating securities, as we were in a loss position. |
| (b)  The three months ended March 31, 2010 includes unvested dilutive units issued to directors under compensation plans.  The three months ended March 31, 2011 excludes 131 of weighted average anti-dilutive units from the calculation of the denominator for diluted earnings per common unit.                                                                   |

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|         |                                                                                     |
|---------|-------------------------------------------------------------------------------------|
| • | Acquire long-lived assets with low-risk exploitation and development opportunities; |

|         |                                                                                                                                                          |
|---------|----------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | Use our technical expertise and state-of-the-art technologies to identify and implement successful exploitation techniques to optimize reserve recovery; |

|         |                                                                                        |
|---------|----------------------------------------------------------------------------------------|
| • | Reduce cash flow volatility through commodity price and interest rate derivatives; and |

|         |                                                                                         |
|---------|-----------------------------------------------------------------------------------------|
| • | Maximize asset value and cash flow stability through operating and technical expertise. |

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|                                                                                                                            |
|----------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|                                                                                                                       |   | Three Months Ended March 31, |   | Increase / |   |   |
| Thousands of dollars, except as indicated                                                                                  |   | 2011 |   | 2010 |   | Decrease |   | % |   |
| Total production (MBoe)                                                                                                    |   | 1,629 |   |   | 1,595 |   |   | 34 |   |   | 2 |  % |
| Oil and NGL (MBoe)                                                                                                         |   | 773 |   |   | 727 |   |   | 46 |   |   | 6 |  % |
| Natural gas (MMcf)                                                                                                         |   | 5,138 |   |   | 5,207 |   |   | (69 | ) |   | (1 | )% |
| Average daily production (Boe/d)                                                                                           |   | 18,098 |   |   | 17,725 |   |   | 373 |   |   | 2 |  % |
| Sales volumes (MBoe)                                                                                                       |   | 1,682 |   |   | 1,594 |   |   | 88 |   |   | 6 |  % |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Average realized sales price (per Boe) (a) (b)                                                                             |   | $ | 58.78 |   |   | $ | 58.15 |   |   | $ | 0.63 |   |   | 1 |  % |
| Oil and NGL (per Boe) (a) (b)                                                                                              |   | 73.81 |   |   | 72.79 |   |   | 1.02 |   |   | 1 |  % |
| Natural gas (per Mcf) (a)                                                                                                  |   | 7.38 |   |   | 7.65 |   |   | (0.27 | ) |   | (4 | )% |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Oil, natural gas and NGL sales (c)                                                                                         |   | $ | 92,575 |   |   | $ | 80,469 |   |   | $ | 12,106 |   |   | 15 |  % |
| Realized gain on commodity derivative instruments                                                                          |   | 6,443 |   |   | 12,146 |   |   | (5,703 | ) |   | (47 | )% |
| Unrealized gain (loss) on commodity derivative instruments                                                                 |   | (112,620 | ) |   | 39,919 |   |   | (152,539 | ) |   | n/a |   |
| Other revenues, net                                                                                                        |   | 898 |   |   | 632 |   |   | 266 |   |   | 42 |  % |
| Total revenues                                                                                                             |   | (12,704 | ) |   | 133,166 |   |   | (145,870 | ) |   | (110 | )% |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Lease operating expenses and processing fees                                                                               |   | 27,485 |   |   | 30,491 |   |   | (3,006 | ) |   | (10 | )% |
| Production and property taxes (d)                                                                                          |   | 5,769 |   |   | 5,579 |   |   | 190 |   |   | 3 |  % |
| Total lease operating expenses                                                                                             |   | 33,254 |   |   | 36,070 |   |   | (2,816 | ) |   | (8 | )% |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Transportation expenses                                                                                                    |   | 1,423 |   |   | 847 |   |   | 576 |   |   | 68 |  % |
| Purchases                                                                                                                  |   | 154 |   |   | 52 |   |   | 102 |   |   | 196 |  % |
| Change in inventory                                                                                                        |   | 1,980 |   |   | (1,118 | ) |   | 3,098 |   |   | n/a |   |
| Total operating costs                                                                                                      |   | $ | 36,811 |   |   | $ | 35,851 |   |   | $ | 960 |   |   | 3 |  % |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Lease operating expenses pre taxes per Boe (e)                                                                             |   | $ | 16.87 |   |   | $ | 19.12 |   |   | $ | (2.25 | ) |   | (12 | )% |
| Production and property taxes per Boe                                                                                      |   | 3.54 |   |   | 3.50 |   |   | 0.04 |   |   | 1 |  % |
| Total lease operating expenses per Boe                                                                                     |   | 20.41 |   |   | 22.62 |   |   | (2.21 | ) |   | (10 | )% |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Depletion, depreciation and amortization (DD&A)                                                                        |   | $ | 24,641 |   |   | $ | 22,054 |   |   | $ | 2,587 |   |   | 12 |  % |
| DD&A per Boe                                                                                                           |   | 15.13 |   |   | 13.83 |   |   | 1.30 |   |   | 9 |  % |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| (a) Includes realized gains on commodity derivative instruments.                                                           |
| (b) Includes crude oil purchases.  2010 excludes amortization of an intangible asset related to crude oil sales contracts. |
| (c) 2010 includes $124 of amortization of an intangible asset related to crude oil sales contracts.                        |
| (d) Includes ad valorem and severance taxes.                                                                               |
| (e) Includes lease operating expenses, district expenses and processing fees.                                              |

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|        |
|--------|
|        |  |  |
| NUMBER |    | DOCUMENT |
| 3.1    |   | First Amended and Restated Agreement of Limited Partnership of BreitBurn Energy Partners L.P. (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-33055) filed on October 16, 2006). |
| 3.2    |   | Amendment No. 1 to the First Amended and Restated Agreement of Limited Partnership of BreitBurn Energy Partners L.P. (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-33055) filed on June 23, 2008). |
| 3.3    |   | Amendment No. 2 to the First Amended and Restated Agreement of Limited Partnership of BreitBurn Energy Partners L.P. (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-33055) filed on April 9, 2009). |
| 3.4    |   | Amendment No. 3 to the First Amended and Restated Agreement of Limited Partnership of BreitBurn Energy Partners L.P. (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-33055) filed on September 1, 2009). |
| 3.5    |   | Amendment No.4 to the First Amended and Restated Agreement of Limited Partnership of BreitBurn Energy Partners L.P. (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-33055) filed on April 9, 2010). |
| 3.6    |   | Fourth Amended and Restated Limited Liability Company Agreement of BreitBurn GP, LLC (incorporated herein by reference to Exhibit 3.2 to the Current Report on Form 8-K (File No. 001-33055) filed on April 9, 2010). |
| 3.7    |   | Amendment No. 1 to the Fourth Amended and Restated Limited Liability Company Agreement of BreitBurn GP, LLC dated as of December 30, 2010 (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K (File No. 001-33055) filed on January 6, 2011). |
| 4.1    |   | Registration Rights Agreement, dated as of November 1, 2007, by and among BreitBurn Energy Partners L.P. and Quicksilver Resources Inc. (incorporated herein by reference to Exhibit 4.2 to the Current Report on Form 8-K (File No. 001-33055) filed on November 6, 2007). |
| 4.2    |   | First Amendment to Registration Rights Agreement between BreitBurn Energy Partners L.P. and Quicksilver Resources Inc. (incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K (File No. 001-33055) filed on April 9, 2010). |
| 4.3    |   | Indenture, dated as of October 6, 2010, by and among BreitBurn Energy Partners L.P., BreitBurn Finance Corporation, the Guarantors and U.S. National Bank Association as trustee, in connection with the private placement of the Notes.  (incorporated herein by reference to Exhibit 4.1 to the Current Report on Form 8-K (File No. 001-33055) filed on October 7, 2010). |
| 10.1*  |   | Second Amendment to the Second Amended and Restated Credit Agreement dated May 9, 2011. |
| 31.1*  |   | Certification of Registrant’s Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of 2002. |
| 31.2*  |   | Certification of Registrant’s Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 and Section 302 of the Sarbanes-Oxley Act of 2002. |
| 32.1** |   | Certification of Registrant’s Chief Executive Officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. |
| 32.2** |   | Certification of Registrant’s Chief Financial Officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002. |

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|        |
|--------|
|        |  |  |  |
|   |   | BREITBURN ENERGY PARTNERS L.P. |
|   |   |   |   |
|   |   | By: | BREITBURN GP, LLC, |
|   |   |   | its General Partner   |
|   |   |   |   |
| Dated: | May 10, 2011 | By: | /s/ Halbert S. Washburn |
|   |   |   | Halbert S. Washburn |
|   |   |   | Chief Executive Officer   |
|   |   |   |   |
| Dated: | May 10, 2011 | By: | /s/ James G. Jackson |
|   |   |   | James G. Jackson |
|   |   |   | Chief Financial Officer |