1. Lisa Stewart
President, El Paso Production and
Non-Regulated Operations
Gulf of Mexico Update
May 10, 2005

2. Cautionary Statement Regarding
Forward-looking Statements
This release includes forward-looking statements and projections, made in reliance on
the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The
company has made every reasonable effort to ensure that the information and
assumptions on which these statements and projections are based are current,
reasonable, and complete. However, a variety of factors could cause actual results to
differ materially from the projections, anticipated results or other expectations expressed
in this presentation, including, without limitation, our ability to implement and achieve
our objectives in the long-range plan, including achieving our debt-reduction targets;
uncertainties associated with production activities; our ability to meet production volume
targets in our Production segment; the uncertainties associated with governmental
regulation and other factors described in the company's (and its affiliates') Securities
and Exchange Commission filings. While the company makes these statements and
projections in good faith, neither the company nor its management can guarantee that
anticipated future results will be achieved. Reference must be made to those filings for
additional important factors that may affect actual results. The company assumes no
obligation to publicly update or revise any forward-looking statements made herein or
any other forward-looking statements made by the company, whether as a result of new
information, future events, or otherwise
2

3. Overview
Substantial progress in past 12 months
►
100% success rate since mid-2004
►
Production stabilized with shift to lower-risk program
►
Large acreage position provides opportunities for
►
low-risk to ultra-deep prospects
3

4. Acreage Position:
Gulf of Mexico (GOM)
GOM Position
Blocks Leases
Total El Paso 222 234
HBP El Paso Op 76 78
El Paso HBP Blocks
HBP Other Op 66 66
El Paso Lease Blocks
El Paso High Bid Lease Sale Blocks El Paso Operated Structures: 101
4

5. Apache
154
Newfield
115
Devon
103
El Paso
103
Chevron 99
Hunt
Spinnaker
Forrest
92 89 88
*Designated as operator of shelf offshore block
Kerr McGee
BP
Remmington
84 81 78
Magnum Hunter
Noble
69 67
BHP
Pioneer
Gryphon
62 62 62
Bois d'Arc
GOM Shelf Industry Comparison*
Houston Exploration
53 49
Unocal
Dominion
46 43
5
Operated Blocks

6. 3D Seismic: GOM
6

7. GOM Drilling Inventory
Currently 52 ready to drill prospects
►
– Depths range from 6,000'–23,000' TVD
► 22 prospects: 0'–12,000'
► 19 prospects: 12,000'–18,000'
► 11 prospects: 18,000'–23,000'
– Net risked mean reserve exposure: 452.2 Bcfe
Fully evaluated from a technical, risk, and
►
economic prospective
Key to successful portfolio management is the CMS planning
►
and tracking system
7

8. Capital Management System (CMS)
Managing Our Drilling Program
Value creation through the drill bit
►
Strive for balanced program
►
Disciplined pre-drill evaluation (risk, reserves, cost)
►
Monthly post-drill analysis (actual results)
►
Continuously comparing post-drill evaluation to
►
pre-drill assumptions
Adjust program based on monthly results
►
8

9. GOM/Southern Louisiana
2004 Drilling Schedule
Total
1st half: 7 dry wildcats in
►
Dry Hole
deep shelf with an average
TD 19,712'; 2 discoveries Cost
$60.5 MM
– $60.5 MM dry hole costs
Mid-year refocus in program
►
– Exploration & Production
departments merged
– ROSE risking and
evaluation stressed
– Emphasis on moderate risk
profile
2nd half: 7 successful wells
►
with average TD 11,185'
– Results from wells booked
in 2nd half, 1.0 PVR; with all
costs
$50.7 MM drilling cost for
►
9 total successful wells
9

10. GOM 2005/2006 Drilling Schedule
MD
Three wells drilled and completed
►
Five wells currently drilling
►
Five wells yet to spud
►
Moderate risk portfolio
►
Average TVD 13,592'
►
10

11. 2005: Balanced Drilling Program
Total: $54 MM
3 Wells
6 Wells
► WC75 Discovery
► WC504 B-3 ST (Drilled)
► WC62
► WC504 B-9 (Drilling)
► HI 115 ST $15,502
Development ► WC95 1 Cris A
28%
$21,747
► GA151 B-2 (OBOC)
40%
► MC151 (OBOC)
4 Wells
► VK823 (OBOC)
► HI48 Cris R
$17,279
► WC95 2 Marg A
32%
► WC62 Marg A
► VK385 A-4
0–12,000' 12–16,000' 16,000'+
11

12. El Paso Shelf Technology
3D seismic
►
Extensive database (60,000 mi2)
–
– In-house data processing—Prestack time and depth migration
– Multi-attribute analyses including: Inversion, coherency, and fluid factor
analysis
– Pore pressure modeling and prediction
Drilling
►
– Bi-center bits
– Expandable casing/liners
– Drilling with casing
Completions
►
– 4 ½quot; monobore for deep shelf wells
– Reduced time through single/half trip completions
– Rigless thru-tubing frac packs for recompletions
12

13. “Deep Shelf”
Upper/Middle Miocene Activity
EP ST204 initiated the play
►
Upper–middle Miocene at 18,000'–21,000'
►
Large 4-way closures
►
AVO has been successfully applied in the play as a DHI
►
High-rate reservoirs with significant liquids
►
13

14. Industry “Deep Shelf”
Sub Glide Plane Activity (Eocene Play)
Deep frontier exploration below the regional glide plane
►
Large 4-way closures with Eocene, Paleocene and Cretaceous objectives
►
Drill depths between 22,000'–38,000'
►
Leverages existing infrastructure and MMS royalty relief
►
14

15. El Paso “Deep Shelf”
Sub Glide Plane Potential (Eocene Play)
Eocene
Key well WC 53 “Black Diamond” Prospect
►
Shell HI10 “Joseph Prospect” PTD 30,000‘
►
(currently drilling)
Extension of onshore Wilcox play onto the Shelf
►
Delta fed slope apron depositional setting
►
EP has current prospect inventory
►
15

16. El Paso WC 53 Eocene Prospect
Drilled just short of targets in 2003
►
Gas shows in Yegua (Eocene) Section
►
Target is Wilcox sands
►
Large 4-way closure
►
Channel and fan morphology
►
16

17. GOM/SLA Production Profile
Net MMcfe/d
Hurricane Volumes stable at 200 MMcfe/d
300
Ivan on $150 MM capital per year
250
200
150
06 CAP
05 REC
100
05 DRLG
04 CAP
50
Base
0
Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct
2004 2004 2005 2005 2005 2005 2006 2006 2006 2006
17

18. Production Enhancements
Add Stability
375
325
NET M M cfe/d
Hurricane
Ivan
275
DRILLING:
16 MMcfe/d
225
2004/2005 increase
RECOMPLETIONS:
38 MMcfe/d
175 2004/2005 increase
WORKOVERS:
30 MMcfe/d
2004/2005 increase
125
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2004 GOM BASE VOLUMES WORKOVER VOLUMES RECOM VOLUMES DRILLING VOLUMES
18

19. El Paso Future Focus
Emphasize medium risk prospect portfolio
►
Further development of producing assets
►
Deeper wildcat opportunities based on 3D seismic
►
technology and regional studies
Leverage higher risk opportunities through strategic
►
alliances
Acquisitions that enhance overall prospect portfolio
►
and production
19

20. Lisa Stewart
President, El Paso Production and
Non-Regulated Operations
Gulf of Mexico Update
May 10, 2005