Operations Overview

Our diversified operations provide stable production and cash flow from our long-lived offshore producing fields for reinvesting into our multi-year onshore drilling program targeting low-risk, high-impact plays.

Our three major areas of operation are in the Permian Basin of West Texas, the Haynesville Shale play in northern Louisiana and offshore in the U.S. Gulf of Mexico.

Since 1950, we have operated onshore and offshore, primarily in the Gulf Coast region, and since 2009 in the Permian Basin.

Highlights:

• Increased Permian production by 67%
  and Permian proved reserves by 24% over 2011.
• Replaced 222% of its total 2012 production from additions of Permian reserves.
• Continued strong performance from its horizontal Wolfcamp B wells in Upton county, with average production of 390 Boe per day per well over the first five months of production, excluding downtime.
• Significant improvement in drilling efficiency for long-lateral horizontal wells, completing the drilling of its last three horizontal Wolfcamp wells in an average 21 days.