Pogo Closes Acquisition of Latigo Petroleum, Inc.

Pogo Producing Company has closed the previously announced acquisition of Latigo Petroleum, a privately owned exploration and production company, for $750 million in cash.

"We are pleased to announce the closing of the Latigo acquisition, which increases Pogo's proven long-lived reserves, low risk development and exploration opportunities in a core geographic area," said Paul G. Van Wagenen, Chairman and Chief Executive Officer of Pogo. "This Latigo acquisition is expected to be followed by the strategic sale, in early June, of one-half of our Gulf of Mexico properties. These two transactions should enhance Pogo's onshore North American presence."

As previously announced, on a pro forma basis, the sale of 50% interest in Pogo's Gulf of Mexico assets and the acquisition of Latigo's oil and gas assets in the Permian Basin and Texas panhandle are expected to:

     *  increase Pogo's total proven oil and gas reserves by more than 6%,
        from 2,042 billion cubic feet of natural gas equivalent ("bcfe") to
        2,174 bcfe;

     *  complement Pogo's existing core operating area with a significant
        under developed contiguous acreage position;

     *  extend Pogo's indicated reserves life to over 10 years; and

     *  add over 400 development and exploration drilling locations to Pogo's

Pogo Producing Company explores for, develops and produces oil and natural gas. Headquartered in Houston, Pogo owns approximately 4,000,000 gross leasehold acres in major oil and gas provinces in North America, 1,044,000 acres in New Zealand and 1,480,000 acres in Vietnam. Pogo common stock is listed on the New York Stock Exchange under the symbol "PPP."