Williams to Spin Off E&P Businesses by Year-End

Williams'  board of directors has approved a revised plan to separate the company's businesses into two stand-alone, publicly traded corporations. The revised plan calls for Williams to fully separate its exploration and production business via a tax-free spinoff to Williams shareholders by year-end 2011. The new independent exploration and production business will be known as WPX Energy, Inc.

The previously proposed plan was to conduct an initial public offering (IPO) of WPX Energy in 2011, followed by a spinoff of Williams' remaining WPX Energy shares in first-quarter 2012.

Following the spinoff, Williams shareholders will own common stock in Williams, a premier owner/operator of North American midstream and natural gas pipeline infrastructure assets; and common stock in WPX Energy, a large-scale, independent North American diversified exploration and production company with positions in key North American oil shale and gas basins along with additional holdings in South America. WPX Energy's stock will trade on the New York Stock Exchange under the symbol "WPX."

"The continued instability and weakness in equity markets, especially for new issuances, makes the IPO of WPX Energy appear unattractive in the near term," said Alan Armstrong, president and chief executive officer. "However, the strong growth in cash flows from our energy infrastructure businesses gives us the flexibility to revise our plans and prepare to separate WPX Energy by the end of this year.

"Despite the change, the outcome of the separation remains the same – we're creating two distinct and well-positioned companies, each of which will provide an opportunity for shareholders to realize greater value.

"Williams will be focused on meeting demand for large-scale energy infrastructure in North America and providing our shareholders significant value with our high-dividend, high-growth platform," Armstrong said.

Williams expects to maintain a capital structure that will support its investment-grade credit ratings. Williams also expects Williams Partners to maintain its investment-grade ratings.

WPX Energy to File Form 10

In preparation for the spinoff, WPX Energy, Inc., will file tomorrow its initial Form 10 with the U.S. Securities and Exchange Commission. The filing provides information about the spinoff and a detailed look at WPX Energy's business.

WPX Energy Senior Management

WPX Energy has named the members of its senior management team. The executive officers are as follows: Ralph A. Hill, chief executive officer; Rodney J. Sailor, senior vice president, chief financial officer and treasurer; James J. Bender, senior vice president, general counsel and corporate secretary; Bryan K. Guderian, senior vice president of operations; Neal A. Buck, senior vice president of business development and land; Marcia MacLeod, senior vice president of human resources and administration; Michael R. Fiser, senior vice president of marketing; Steven G. Natali, senior vice president of exploration; and J. Kevin Vann, chief accounting officer and controller.

Biographical information for the executive officers will be available in WPX Energy's Form 10 filing with the SEC.

Williams' preparations for a WPX Energy spinoff by the end of the year do not preclude the company from pursuing the alternative of a WPX Energy IPO followed by a spinoff of its remaining WPX Energy shares, as originally planned, in the event that market conditions become favorable.

Barclays Capital and Citi are acting as lead financial advisers to Williams. J.P. Morgan also serves as a financial adviser to the company. Williams' legal adviser is Gibson, Dunn & Crutcher LLP.


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