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CORRESP
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Atlas Pipeline Partners Corresp 5-9-2005

May 9,
2005

Securities
and Exchange Commission

Washington,
D.C. 20549-0405

Attn:
Michael Moran, Branch Chief

      Re:

      Atlas
      Pipeline Partners, L.P.

      Form
      10-K for the year ended December
2004

      Filed
      March 16, 2005

      File
      No. 1-14998

Dear Mr.
Moran:

This
letter responds to your comment letter dated May 2, 2005 concerning the
above-referenced filing (the “2004 10-K”). For your convenience, we first
restate your comment in italics and then provide our response.

FORM
10-K FOR THE YEAR ENDED DECEMBER 31, 2004

Item
6.  Selected Financial Data, page 21

      1.

      We
      note your response to prior comment 2. Please revise your characterization
      of EBITDA in future filings where you include adjustments and calculate
      the non-GAAP measure differently than earnings before interest, taxes,
      depreciation and amortization. Refer to Question 14 of Frequently Asked
      Questions Regarding the Use of Non-GAAP Financial Measures dated June 13,
      2003.

      The
      calculation of EBITDA set forth in this section is described in the first
      sentence of the paragraph immediately following the table of selected
      financial data. We believe that this calculation is a standard formulation
      for EBITDA. In our response to your prior comment 2, we stated that we
      would add language that pointed out that EBITDA as used in our credit
      facility differed from the standard method of calculating EBITDA set forth
      in this section because the EBITDA calculation in our credit facility
      required pro forma adjustments following material acquisitions. If, in the
      future, we include adjustments and calculate EBITDA, as used in this
      section, differently than the standard measure, we will revise our
      explanation of the calculation.

Securities
and Exchange Commission

May 9,
2005

Page
2

Item
8.  Financial Statements and Supplementary Data

      2.

      We
      note your response to prior comment 4. In future filings, please disclose
      on the face of your statements of cash flows the gross amounts that you
      received from the sale of your preferred interests to your related parties
      and the gross amounts that you expended to repurchase such shares. The
      amounts you expended to repurchase such shares should include the premium
      that you paid. In addition, reference is made to your response to our
      prior comment 14. Please revise to segregate the commitment fees paid to
      your related parties for the purchase of preferred units from the issuance
      of common units net of offering costs. Please revise this presentation, in
      future filings, to represent these two separate
      transactions.

In future
filings, we will disclose on the face of our consolidated statements of cash
flows the gross amounts we received from the sale of our preferred interests and
the gross amounts expended to repurchase such interests. The gross amounts
expended to repurchase the interests will include the premium we paid. We also
will segregate the commitment fees paid, and will show the sale and repurchase
as two separate transactions. The new line items will appear in “Cash Flows from
Financing Activities.”

Note
2.  Summary of Significant Accounting Policies

Revenue
Recognition, page 46

      3.

      We
      note your response to prior comment 12. Please include a description and
      the amounts of your unbilled revenues for all periods presented in your
      future filings.

      In
      future filings, we will include a description and the amount of our
      unbilled revenues in the section of the notes to our consolidated
      financial statements captioned “Summary of Significant Accounting Policies
      - Revenue Recognition.” In our Quarterly Report on Form 10-Q for the
      quarter ended March 31, 2005, the description is as
    follows:

Securities
and Exchange Commission

May 9,
2005

Page
3

“Because
there is a timing difference between the delivery of natural gas and the
Partnership’s receipt of a delivery statement, the Partnership has unbilled
revenues. These revenues are accrued based upon volumetric data from the
Partnership’s records and the Partnership’s estimates of the related
transportation and compression fees which are, in turn, based upon applicable
natural gas prices. The Partnership had unbilled trade receivables at March 31,
2005 and December 31, 2004, of $15.5 million and $13.4 million, respectively,
related to the Partnership’s Mid-Continent-Velma operations which are included
in its accounts receivable on its consolidated balance sheet. In addition, the
Partnership had unbilled trade receivables at March 31, 2004 and December 31,
2004, of $3.37 million and $1.9 million, respectively, related to its
Appalachian operations, which are included in its accounts receivable/accounts
payable - affiliates on its consolidated balance sheet.

Note
6.  Spectrum Acquisition, page 50

      4.

      We
      note your response to prior comment 14. It appears that the substance of
      this transaction is a bridge loan whereby Resource America and Atlas
      America, two of your related parties, had an expectation of being repaid
      with proceeds from your public offerings. Please help us better understand
      why you believe this transaction was in substance an equity investment by
      these related parties. In doing so, please indicate whether there was an
      agreement whereby Resource America and Atlas America would receive a
      pro-rata share of earnings or preferred dividends during this timeframe.
      Further, tell us and disclose the dates of the commitment agreements,
      purchase of preferred units and closing of the July offering. Please tell
      us if you considered alternate treatments with respect to the accounting
      for the commitment fees or premiums paid to repurchase the preferred
      interests and what consideration you gave to EITF Appendix
      D-53.

In
addition to the reasons set forth in our discussion in response to prior comment
14, we believe that the preferred units in our operating partnership were in
substance preferred equity and not debt for the following reasons:

      ·

      Unlike
      debt, the preferred units had equal voting rights with the other limited
      partners.

      ·

      The
      preferred units had no mandatory redemption date, no sinking fund and no
      right in any holder to require a repurchase. Thus, unlike debt, the
      preferred units had no contractual or other right to repayment. While the
      preferred units could be exchanged for our common units on or after
      January 1, 2005, it was only a substitution of one form of equity for
      another and not a repayment.

Securities
and Exchange Commission

May 9,
2005

Page
4

      ·

      While,
      as we previously stated, we intended to use the proceeds of a common unit
      offering to repurchase the preferred units, we were under no contractual
      obligation to do so. Moreover, the purchase commitments for the preferred
      units, which were executed on June 10, 2004, were not contingent on the
      initiation of the subsequent common unit offering, which closed July 20,
      2004.

      ·

      The
      preferred units had a stated distribution rate of 12% per year which was
      senior in right of payment to distributions on all other equity of the
      operating partnership, and subordinate to all
  indebtedness.

      ·

      The
      preferred units specified that, upon liquidation of the operating
      partnership, the liquidation proceeds were to be applied first to the
      secured credit facility, other creditors and the costs and expenses of
      liquidation, then to the preferred units and, thereafter, to the other
      equity interests.

In future
filings, we will revise our calculation of earnings per unit to reflect the
guidance of EITF Appendix D-53.

Note
9.  Related Party Transactions, page 55

      5.

      Reference
      is made to your proposed disclosure in response to our prior comment 17.
      Please ensure that the revised disclosure in the notes to the financial
      statements includes management’s assertion that the method used is
      reasonable.

We will
add the following sentence at the end of the disclosure proposed in our April
27, 2005 letter:

“The
General Partner believes that the allocation methods used are
reasonable.”

Note
16.  Operating Segment, Information and Major Customers, page
59

      6.

      We
      note your response to prior comment 19. You have indicated that you
      classify and report your revenues in either natural gas and liquids, or
      transportation and compression. If, as we believe, you have reported each
      separate product and service that you sell into groups of similar products
      and services, please tell us how you determined that such products and
      services are similar and indicate the specific factors you analyzed in
      reaching the conclusion that you did. We may have further
      comment.

Securities
and Exchange Commission

May 9,
2005

Page
5

Our
determination was made as the result of a two-part analysis. In the first part
of our analysis, we determined that our revenues from services (which come from
fees for transportation and compression) are not similar to our revenues from
products (which come from the sale of products derived from the processing and
treatment of raw natural gas), in that the former involves fees for service
while the latter involves the purchase, processing and resale of energy
commodities.

In the
second part of our analysis, we determined whether the services and products
within the respective categories were similar. With respect to transportation
and compression, we noted that compression was an integral part of our ability
to transport natural gas through our gathering systems, that the compressors
producing the compression were physically integrated into their respective
gathering systems and that we did not charge separately for compression.
Accordingly, we determined that transportation and compression were coordinate
parts of the same service.

With
respect to natural gas and natural gas liquids, our analysis noted numerous
linkages and similarities, as follows:

      ·

      Same
      source - The residue natural gas and natural gas liquids we sell are
      derived from the same source: the raw natural gas feedstock delivered by
      our producers. We do not have separate contracts with our producers for
      natural gas, on the one hand, and natural gas liquids, on the
      other.

      ·

      Same
      processing - The residue natural gas and natural gas liquids are produced
      at the same processing and treatment facilities using the same
      processes.

      ·

      Same
      economic category - The products are within the same category: energy
      commodities

We
further noted that paragraph 103 in Appendix A to SFAS 131 indicates that a
purpose of the requirement of paragraph 37 was to enable a comparison of a
company’s performance to industry statistics and information reported by
competitors. Our review of other companies similar to ours indicated that,
except for companies such as Duke Energy Field Services LLC which organize their
segments around specific products, the trend was to report in a manner similar
to ours. See, for example, MarkWest Energy Partners, L.P. and Crosstex Energy
LP.

Securities
and Exchange Commission

May 9,
2005

Page
6

In view
of the strong linkage between natural gas and natural gas liquids in our
operations, as well as the reporting practices in our industry, we concluded
that residue natural gas and natural gas liquids were part of a group of similar
products.

    Very
      truly yours,

      /s/
      Nancy
      McGurk

    Nancy McGurk

    Chief Accounting
Officer

cc:
Edward E.
Cohen

Michael
S. Yecies, Esq.

Noah
Newitz, Esq.

Emanuel
Faust, Esq.