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PXP Provides Production and Gulf of Mexico Acquisition Financing Updates

HOUSTON, Oct. 2, 2012 /PRNewswire/ -- Plains Exploration & Production Company (NYSE:PXP) ("PXP" or the "Company") provides updates on 2012 third-quarter preliminary production estimates and on initial financing of the previously announced Gulf of Mexico acquisition.

PRODUCTION UPDATE

PXP's 2012 third-quarter preliminary daily sales volumes averaged approximately 105 thousand barrels of oil equivalent per day. Estimated third-quarter average daily oil/liquids sales volumes increased approximately 5% compared to second-quarter 2012 and represented approximately 60% of total quarterly sales volumes.

ACQUISITION FINANCING UPDATE

PXP has successfully syndicated $7.0 billion of committed financing to a group of banks and institutional lenders for the $6.11 billion proposed acquisition. The $7.0 billion of committed financing will be comprised of a $3.0 billion senior secured five-year revolving credit facility, a $750.0 million senior secured five-year term loan, a $1.25 billion senior secured seven-year term loan and a $2.0 billion senior unsecured bridge facility. The new senior secured credit facilities of $5.0 billion will be governed by a borrowing base initially set at $5.3 billion. The pricing and terms of the credit facilities are consistent with what was originally offered, with pricing on the seven-year term loan being flexed tighter as a result of strong demand.

The pricing on the revolving credit facility is the same as PXP's existing facility except there is a 0.25% increase while either the five-year or seven-year term loans are outstanding. The five-year term loans bear interest at a rate per year of Eurodollar Rate plus 3.00%. The seven-year term loans originally were to bear interest at a rate per year of Eurodollar Rate plus 3.25%-3.50%, which we expect to tighten given demand, with a minimum Eurodollar Rate of 1.00%. The financing is subject to the execution of satisfactory definitive documentation and other customary closing conditions.

Winston M. Talbert, Executive Vice President and Chief Financial Officer of PXP commented, "PXP is pleased with the overwhelming response to the Company's Gulf of Mexico acquisition financing plan. The plan is supported by the strong oil production profile from the Gulf of Mexico assets and underpinned by our growing onshore oil business. As previously reported we are well underway on our hedging program and have now completed the bank and term loan facilities syndication process to facilitate the closing of the Gulf of Mexico acquisition in the fourth quarter."

THIRD QUARTER RESULTS

PXP is scheduled to release 2012 third quarter results on Thursday, November 1, 2012, before the market opens and will host its quarterly conference call that same day, Thursday, November 1, 2012, at 8:00 a.m. Central time. Investors wishing to participate in the conference call may dial 1-800-567-9836 or 1-973-935-8460. The conference call and replay ID is: 36633286. The replay can be accessed by dialing 1-855-859-2056 or 1-404-537-3406. A live webcast of the conference call will be available in the Investor Information section of PXP's website at www.pxp.com.

PXP is an independent oil and gas company primarily engaged in the activities of acquiring, developing, exploring and producing oil and gas in California, Texas, Louisiana, and the Gulf of Mexico. PXP is headquartered in Houston, Texas.

ADDITIONAL INFORMATION & FORWARD-LOOKING STATEMENTS

This press release contains forward-looking information regarding PXP that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. All statements included in this press release that address activities, events or developments that PXP expects, believes or anticipates will or may occur in the future are forward-looking statements.

These include statements regarding:

* completion of the acquisition,
* completion of the acquisition financing,
* reserve and production estimates,
* oil and gas prices,
* the impact of derivative positions,
* cash flow estimates,
* future financial performance,
* capital and credit market conditions,
* planned capital expenditures, and
* other matters that are discussed in PXP's filings with the SEC.

These statements are based on our current expectations and projections about future events and involve known and unknown risks, uncertainties, and other factors that may cause our actual results and performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. Please refer to our filings with the SEC, including our Form 10-K, for a discussion of these risks.

All forward-looking statements in this press release are made as of the date hereof, and you should not place undue reliance on these statements without also considering the risks and uncertainties associated with these statements and our business that are discussed in this press release and our other filings with the SEC. Moreover, although we believe the expectations reflected in the forward-looking statements are based upon reasonable assumptions, we can give no assurance that we will attain these expectations or that any deviations will not be material. Except as required by law, we do not intend to update these forward-looking statements and information.

SOURCE Plains Exploration & Production Company