Filed by Plains Exploration & Production Company
Pursuant to Rule 165 and Rule 425 of the Securities Act of 1933, as amended
Subject Company: Stone Energy Corporation
Commission File No: 001-12074
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PXP PXP PXP Forward Looking Statements Except for the historical information contained herein, the matters discussed in this
presentation are forward-looking statements that involve certain
assumptions and known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially. These risks and uncertainties include,
among other things, uncertainties inherent in the exploration for and
development and production of oil & gas and in estimating reserves, unexpected difficulties in integrating Stone Energy Corporation’s (Stone) operations into ours, unexpected future capital
expenditures, general economic conditions, oil and gas price volatility, the
success of our risk management activities, competition, regulatory changes and
other factors discussed in PXP’s filings with the Securities and Exchange
Commission. PXP and Stone will file a joint proxy statement/prospectus and
other documents with the SEC. Investors and security holders are urged to carefully read the joint proxy statement/prospectus when it becomes available, because it will contain important information regarding PXP, Stone and the acquisition. A definitive joint proxy
statement/prospectus will be sent to security holders of PXP and Stone seeking
their approval of the acquisition. Investors and security holders may obtain a free copy of the proxy statement/prospectus (when available) and other documents filed by PXP and Stone
with the SEC at the SEC’s web site at www.sec.gov. The proxy
statement/prospectus and such other documents (relating to PXP) may also be obtained for free from PXP by directing such request to: Plains Exploration & Production Company, 700
Milam, Suite 3100, Houston, TX 77002, Attention: Joanna Pankey; telephone:
(713) 579-6000; e-mail: jpankey@plainsxp.com. The proxy statement/prospectus and such other documents (relating to Stone) may also be obtained for free from Stone by directing
such request to: Stone Energy Corporation, 625 E. Kaliste Saloom Road,
Lafayette, LA 70508, Attention: Kenneth Beer; telephone: (337) 237-0410; e-mail: CFO@stoneenergy.com. PXP, its directors, executive officers and certain members of management and employees may
be considered “participants in the solicitation” of proxies from PXP’s stockholders in connection with the acquisition. Information
regarding such persons and a description of their interests in the acquisition
will be contained in the joint proxy statement/prospectus when it is filed. Stone, its directors, executive officers and certain members of management and employees
may be considered “participants in the solicitation” of proxies from Stone’s stockholders in connection with the acquisition. Information
regarding such persons and a description of their interests in the acquisition
will be contained in the joint proxy statement/prospectus when it is filed. |
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PXP PXP Today’s Announcement PXP entered into an agreement to acquire Stone Energy in a tax-free stock-for-stock transaction. The exchange ratio is 1.25 PXP shares for each Stone share. PXP will assume $483 million of debt net of cash on the balance sheet at year-end 2005. Terminated PXP’s 2007 and 2008 crude oil collars. Eliminates all commodity price caps on future PXP production. |
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PXP PXP Corporate Strategy Accelerate PXP’s Per Share Growth Increased Cash Flow - Highly accretive from improved realizations Production Growth - Gulf of
Mexico - Jonah/Pinedale Reserve Potential - Green River
Basin - Williston Basin Bakken - Uinta Basin |
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PXP PXP 2007 Cash Margin Increase NYMEX Strip $46 $34 2007 w/Collars 2007 Pro Forma NYMEX Strip: Crude Oil - 2007: $73.43, Natural Gas - $10.28 /BOE /BOE 35% |
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PXP PXP Pro Forma Production * From Jan. 1, 2006 * BOEPD 0 65,000 130,000 2005 2006 2007 2008 |
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PXP PXP 500 MMBOE proved reserves (1) 12 - 14 yr R/P 80% Oil reserves 70% - 75% Oil production Pro Forma Business Profile _________________________ (1) 2005 year-end proved reserves. 385 MMBOE 74 MMBOE 41 MMBOE Williston Basin Wind River Basin Powder River Basin West Texas Gulf of Mexico Greater Green River Basin Uinta Basin Offshore California San Joaquin Valley San Joaquin Valley L.A. Basin L.A. Basin |
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PXP PXP 2007 Pro Forma Capital Budget Regional Breakdown 30% 20% 50% $900 to $1,000 MM Gulf of Mexico Rockies/Texas California |
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PXP PXP Expanded Project Inventory Rocky Mountains/Texas 45,000 net developed acres 487,750 net undeveloped acres 550+ future well locations Williston Basin Wind River Basin Powder River Basin West Texas Greater Green River Basin Uinta Basin Wyoming North Dakota Utah |
 9 PXP PXP Expanded Project Inventory Gulf of Mexico 175+ Gulf of Mexico blocks covering 1,000,000 acres 3,600 blocks of 3-D seismic coverage Significant 2006 Discovery Big Foot Gulf of Mexico Significant 2006 Drills Caesar Norman Grand Cayman Friesian |
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PXP PXP California 385 MMBOE proved reserves and 53,600 BOEPD production 350 MMBOE resource potential 2,500+ future well locations Los Angeles Basin Los Angeles Basin San Joaquin Valley San Joaquin Valley Santa Maria Basin Santa Maria Basin |
 11 PXP PXP Corporate Strategy Disciplined capital expenditure program Selective acquisitions Reduce debt Repurchase stock Accelerate PXP’s Per Share Growth |
 12 PXP PXP Pro Forma EOY 2006 Credit Statistics 10.0 – 11.0x EBITDAX/Interest 1.50 – 1.20x Debt/EBITDAX $5.00 – 6.00 Debt/Proved Developed $3.50 – 4.00 Debt/Proved Reserves 40% – 50% Debt to Equity $1.5 – 1.9 Billion Total Debt |
 13 PXP PXP Transaction Expectations Significant cash flow per share accretion 2007/2008 oil price realization increase with 100% commodity price exposure with downside protection at $55 WTI in 2006, 2007 and 2008 Stronger balance sheet and significant increase in potential free cash flow per share in 2007 and 2008 Diversified near-term opportunities to complement long-lead time growth projects |