Laredo Forms New Mid-Continent Oil and Gas Company

Laredo Petroleum says that Warburg Pincus, the global private equity firm, and company management have agreed to a line-of- equity financing for up to $300 million. Funding from this line-of-equity, which may be increased to $500 million subject to the agreement of the investors, will be provided over time as needed by the company to pursue the acquisition, exploration and development of oil and gas properties in the Mid- Continent region of the United States. Laredo Petroleum will then seek to add value to these properties by deploying its significant operating experience and exploration skills to expand reserves and production through new drilling programs. Shortly following its formation, Laredo Petroleum completed its first such investment, a $75 million acquisition of assets from Austin-based Jones Energy Ltd. In addition to the equity funding provided by Warburg Pincus, Laredo has arranged a $300 million revolving credit facility with commercial banks.

Randy Foutch, a highly successful entrepreneur who previously created three notable Mid-Continent-focused exploration and production companies, each of increasing scale, leads Laredo Petroleum. Mr. Foutch is joined by experienced senior industry executive Jerry Schuyler, who brings more than 30 years of experience at ARCO Oil & Gas, Dominion Exploration and Production and St. Mary Land & Exploration, as well as by Pat Curth, Oran Hall, Mark Womble and several other of Mr. Foutch's former colleagues from previous Warburg Pincus portfolio companies Lariat Petroleum and Latigo Petroleum. Lariat was founded in 1997 and sold in 2001 to Newfield Exploration Company for approximately $333 million, and Latigo was formed in 2002 and sold in 2006 to Pogo Producing Company for approximately $750 million.

"I am pleased to have the opportunity to once again launch a company with the support of Warburg Pincus," said Mr. Foutch. "In the current market environment, there is no shortage of capital available for investment in upstream oil and gas properties. However, Warburg Pincus distinguishes itself as one of the largest, most experienced and most sophisticated private equity investors in the E&P sector, and I believe that Laredo is best positioned for long-term success through this partnership. I am also honored that Jerry Schuyler and many of my former colleagues who were so instrumental in the success of Lariat Petroleum and Latigo Petroleum have chosen to join Laredo Petroleum as well."

Jeffrey A. Harris, a Warburg Pincus Managing director, said: "Our previous investments in Lariat and Latigo were very successful, primarily due to the talents of Randy Foutch and his team. We welcome the addition of Jerry Schuyler to the team and are thrilled to have another opportunity to work with such a talented group of entrepreneurs." Peter R. Kagan, also a Warburg Pincus Managing Director, added: "We are excited by the opportunity to assist in building Laredo Petroleum into a durable business of considerable scale. We are optimistic that the company can become an important player in the oil and gas industry in the Mid-Continent region."

Laredo Petroleum's first completed transaction, the acquisition of 130 producing properties located primarily in Hansford County, Texas, has an effective date of March 1, 2007. In addition to exploiting the existing production, Laredo Petroleum will implement new drilling programs to target undeveloped opportunities. Commenting on this first acquisition, COO Jerry Schuyler stated: "This set of producing properties is in an area with which our team is extremely familiar, and is a good fit for our overall strategy. We believe that this transaction will provide a strong platform from which to pursue additional opportunities throughout the Texas and Oklahoma Panhandle area."

Laredo Petroleum, LLC is a newly formed independent oil and gas company with headquarters in Tulsa, Oklahoma. Laredo's business strategy is focused on the acquisition, exploration and development of oil and gas properties in the Mid-Continent region of the United States. Formed with financial support from Warburg Pincus, Laredo Petroleum is led by Randy Foutch and a highly talented team of technical professionals, many of who worked together for many years successfully building Lariat Petroleum and Latigo Petroleum, among other industry experience. For additional information, please contact Laredo Petroleum at (918) 513-4570.


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