Newfield & BP Terminate "Treasure Island" Agreement

Newfield and BP have agreed to terminate their mutual interest agreement in the Treasure Island concept area. The termination of the AMI, which originally covered 112 blocks, does not effect the joint exploration agreement between Newfield and BP that currently covers 27 Treasure Island blocks. The termination also has no effect on the number of blocks subject to the Newfield-sponsored Treasure Island Royalty Trust. Newfield inherited these agreements with BP through its acquisition of EEX Corporation.

"We are excited about the Treasure Island concept and our continuing relationship with BP to explore this frontier play," said David A. Trice, Newfield President and CEO. "However, under the terms of the AMI, we would have been required to provide BP with the option to participate with a 75% interest in any future prospects developed on these blocks, regardless of drilling depth. We are one of the most active companies in the shallow waters of the Gulf and we weren't willing to limit any future activities on this large acreage base to just a 25% interest."