Laredo Petroleum Announces Formation and Funding of New Mid-Continent Oil and Gas Company

Randy Foutch, Founder of Lariat Petroleum, Inc. and Latigo Petroleum, Inc., in third venture with investment firm Warburg Pincus TULSA, Okla., July 31 /PRNewswire/ -- Laredo Petroleum, a newly formedindependent oil and gas company, announced today that Warburg Pincus, theglobal private equity firm, and company management have agreed to aline-of- equity financing for up to $300 million. Funding from thisline-of-equity, which may be increased to $500 million subject to theagreement of the investors, will be provided over time as needed by thecompany to pursue the acquisition, exploration and development of oil andgas properties in the Mid- Continent region of the United States. LaredoPetroleum will then seek to add value to these properties by deploying itssignificant operating experience and exploration skills to expand reservesand production through new drilling programs. Shortly following itsformation, Laredo Petroleum completed its first such investment, a $75million acquisition of assets from Austin-based Jones Energy Ltd. Inaddition to the equity funding provided by Warburg Pincus, Laredo hasarranged a $300 million revolving credit facility with commercial banks. Laredo Petroleum is led by Randy Foutch, a highly successfulentrepreneur who previously created three notable Mid-Continent-focusedexploration and production companies, each of increasing scale. Mr. Foutchis joined by experienced senior industry executive Jerry Schuyler, whobrings more than 30 years of experience at ARCO Oil & Gas, DominionExploration and Production and St. Mary Land & Exploration, as well as byPat Curth, Oran Hall, Mark Womble and several other of Mr. Foutch's formercolleagues from previous Warburg Pincus portfolio companies LariatPetroleum and Latigo Petroleum. Lariat was founded in 1997 and sold in 2001to Newfield Exploration Company for approximately $333 million, and Latigowas formed in 2002 and sold in 2006 to Pogo Producing Company forapproximately $750 million. "I am pleased to have the opportunity to once again launch a companywith the support of Warburg Pincus," said Mr. Foutch. "In the currentmarket environment, there is no shortage of capital available forinvestment in upstream oil and gas properties. However, Warburg Pincusdistinguishes itself as one of the largest, most experienced and mostsophisticated private equity investors in the E&P sector, and I believethat Laredo is best positioned for long-term success through thispartnership. I am also honored that Jerry Schuyler and many of my formercolleagues who were so instrumental in the success of Lariat Petroleum andLatigo Petroleum have chosen to join Laredo Petroleum as well." Jeffrey A. Harris, a Warburg Pincus Managing director, said: "Ourprevious investments in Lariat and Latigo were very successful, primarilydue to the talents of Randy Foutch and his team. We welcome the addition ofJerry Schuyler to the team and are thrilled to have another opportunity towork with such a talented group of entrepreneurs." Peter R. Kagan, also aWarburg Pincus Managing Director, added: "We are excited by the opportunityto assist in building Laredo Petroleum into a durable business ofconsiderable scale. We are optimistic that the company can become animportant player in the oil and gas industry in the Mid-Continent region." Laredo Petroleum's first completed transaction, the acquisition of 130producing properties located primarily in Hansford County, Texas, has aneffective date of March 1, 2007. In addition to exploiting the existingproduction, Laredo Petroleum will implement new drilling programs to targetundeveloped opportunities. Commenting on this first acquisition, COO JerrySchuyler stated: "This set of producing properties is in an area with whichour team is extremely familiar, and is a good fit for our overall strategy.We believe that this transaction will provide a strong platform from whichto pursue additional opportunities throughout the Texas and OklahomaPanhandle area." About Laredo Petroleum: Laredo Petroleum, LLC is a newly formed independent oil and gas companywith headquarters in Tulsa, Oklahoma. Laredo's business strategy is focusedon the acquisition, exploration and development of oil and gas propertiesin the Mid-Continent region of the United States. Formed with financialsupport from Warburg Pincus, Laredo Petroleum is led by Randy Foutch and ahighly talented team of technical professionals, many of whom workedtogether for many years successfully building Lariat Petroleum and LatigoPetroleum, among other industry experience. For additional information,please contact Laredo Petroleum at (918) 513-4570. About Warburg Pincus: Warburg Pincus has been a leading private equity investor since 1971.The firm has more than $20 billion under management and invests globallyand at all stages of a company's life cycle across a range of sectorsincluding energy, technology, media and telecommunications, financialservices, healthcare and life sciences, retail, consumer and industrial andreal estate. Since the late 1980s, the firm has invested more than $2.4billion in companies involved in oil and gas exploration and production,energy and power projects and oilfield and other services. For more thantwo decades, Warburg Pincus has been the lead investor in a multitude ofsuccessful public and private energy companies, including Latigo Petroleum,Inc., Lariat Petroleum, Inc., Newfield Exploration Co., SpinnakerExploration, Inc., (since acquired by Norsk Hydro ASA), Encore AcquisitionCo., Bill Barrett Corp., MEG Energy Corp., Antero Resources Corp. andKosmos Energy LLC. For more information, please visithttp://www.warburgpincus.com.