Plains Exploration & Production Company (PXP)

[OilStockReport]

Operations are strong and getting stronger for 2011 IMO.

OPERATIONAL UPDATE

* Average daily sales volumes for the third quarter 2010 were 90.6 thousand BOE, or 9% higher than the 83.0 thousand BOE in the third quarter 2009. Fourth-quarter 2010 average daily sales volumes are expected to be in line with third quarter volumes reflecting the impact of the Gulf of Mexico shelf asset sale, downtime on certain California and Texas assets and the previously announced repair work following a fire at the Madden Field in Wyoming.

* In the Texas Panhandle Granite Wash development, PXP is currently operating 5 rigs drilling horizontal wells to develop its inventory of over 150 potential locations. PXP plans to spud up to 20 horizontal wells in 2010 and over 25 wells in 2011. Four wells have been drilled, completed and are producing and 4 wells are waiting on completion.

Initial production rates for the two most recent completions are 10.4 million cubic feet per day with 344 barrels of condensate per day and an estimated 1,076 barrels of natural gas liquids per day (2,528 BOE net per day) for the Hanson 29-2H well, and 8.2 million cubic feet per day with 358 barrels of condensate per day and an estimated 773 barrels of natural gas liquids per day (1,993 BOE net per day) for the Sanders 74-1H well.

* In the Haynesville Shale, third quarter 2010 average daily sales volumes were 129 million cubic feet equivalent (MMcfe) per day net to PXP, an approximate 22% increase over the 106 MMcfe net per day average rate for the second quarter of 2010. With interests in 45 active drilling rigs, production from this asset area is expected to exceed 135 MMcfe net per day in the fourth quarter 2010.

* In California, PXP drilled 22 wells in the San Joaquin Valley and 8 wells in the Los Angeles Basin during the third quarter and expects to drill up to 16 wells in the San Joaquin Valley and up to 9 wells in the Los Angeles Basin during the fourth quarter.

* In the South Texas Eagle Ford, the previously announced acquisition is on track for a November closing. Currently, four rigs are operating on the properties and 20 gross wells have been drilled, completed or are producing. Once closed, PXP will have a net acreage position of approximately 60,000 acres, an estimated 140 to 175 million BOEs of net resource potential and approximately 500 net well locations. This asset area is poised to be a significant driver of future production and reserve growth for PXP.

* On September 19, 2010, PXP, together with certain of its subsidiaries, entered into an agreement with McMoRan Exploration Co. (MMR) and certain of its subsidiaries to divest our interest in properties located in the Gulf of Mexico shallow water for a combination of cash and stock. PXP will receive $75 million in cash and 51 million shares of MMR common stock in exchange for its interest in all of its Gulf of Mexico leasehold located in less than 500 feet of water. The transaction is subject to customary closing conditions and adjustments and the approval of MMR's stockholders. The transaction will have an effective date of August 1, 2010 and is expected to close by year-end 2010.

* On September 20, 2010, PXP announced that the data room process for the planned Gulf of Mexico deepwater divestment was underway. PXP expects to set an early December bid date and close the transaction by year-end 2010 or early 2011.