**Exhibit 99.1**
|            |                  | RYDER SCOTT COMPANY |       |       |       |                       | FAX (713) 651-0849 |
|------------|-----------------------|---------------------|------------|------------|------------|----------------------------|--------------------|
|       | PETROLEUM CONSULTANTS |                |       |       |       |
|       | 1100 LOUISIANA        |                |       | SUITE 3800 |       | HOUSTON, TEXAS  77002-5218 |               | TELEPHONE (713)  651-9191 |
| ** ** | ** **            | ** **          | ** ** | ** ** | ** ** | ** **                 |               |   |
| ** ** | ** **            | ** **          | ** ** | ** ** | ** ** | ** **                 | ** **         |   |   |
|            |                       |                     |            |            |            |                            |                    |  |  |  |  |

 

February 6, 2007

Pogo Producing CompanyPost Office Box 2504Houston, Texas  77252-2504

Gentlemen:

At your request,we have prepared an estimate of the reserves, future production, and incomeattributable to certain leasehold and royalty interests of Pogo Producing Company(Pogo) as of December 31, 2006.  Thesubject properties are located in the states of Indiana, Kansas, Louisiana,Mississippi, New Mexico, Oklahoma, Texas, and in the state waters offshoreLouisiana and in federal waters offshore Louisiana and Texas.  The income data were estimated using theSecurities and Exchange Commission (SEC) requirements for future price and costparameters.

Theestimated reserves and future income amounts presented in this report arerelated to hydrocarbon prices. Hydrocarbon prices in effect at December 31, 2006 were used in thepreparation of this report as required by SEC rules; however, actual futureprices may vary significantly from December 31, 2006 prices.  Therefore, volumes of reserves actuallyrecovered and amounts of income actually received may differ significantly fromthe estimated quantities presented in this report.  The results of this study are summarizedbelow.

**SEC PARAMETERS**Estimated Net Reserves and Income DataCertain Leasehold and Royalty Interests of**Pogo Producing Company**As of December 31, 2006
|                               | ** **   | **Proved**    | ** **   |
|-------------------------------|--------------|---------------|--------------|
| ** **                    | ** **   | **Developed** | ** **   | ** ** | ** ** | **Total** | ** ** |
| ** **                    | ** **   | **Producing** | ** **   | **Non-Producing** | ** ** | **Undeveloped** | ** ** | **Proved** | ** ** |
| ***Net  Remaining Reserves*** | *** *** | *** ***  | *** *** | *** *** | *** *** | *** *** | *** *** | *** *** | *** *** |
| Oil/Condensate  — MBBL   | 25,590       |          | 12,477       |   | 8,043 |   | 46,110 |   |
| Plant Products —  MBBL   |         | 9,531         |         | 2,803 |   | 4,737 |   | 17,071 |   |
| Gas — MMCF               |         | 173,379       |         | 36,665 |   | 83,934 |   | 293,978 |   |
|                          |         |          |         |   |   |   |   |   |   |
| ***Income  Data — M$***  | *** *** | *** ***  | *** *** | *** *** | *** *** | *** *** | *** *** | *** *** | *** *** |
| Future Gross  Revenue         |         | $             | 2,614,073    |   | $ | 996,831 |   | $ | 1,053,548 |   | $ | 4,664,452 |   |
| Deductions                    |         | 845,876       |         | 268,408 |   | 552,551 |   | 1,666,835 |   |
| Future Net  Income (FNI)      |         | $             | 1,768,197    |   | $ | 728,423 |   | $ | 500,997 |   | $ | 2,997,617 |   |
|                          |         |          |         |   |   |   |   |   |   |
| Discounted FNI @ 10%          |         | $             | 1,068,801    |   | $ | 301,500 |   | $ | 193,377 |   | $ | 1,563,678 |   |

 

Liquidhydrocarbons are expressed in standard 42 gallon barrels.  All gas volumes are expressed in millions ofcubic feet (MMCF) at the official temperature and pressure bases of the areasin which the gas reserves are located.
| 1200, 530 – 8TH AVENUE, S.W. |   | CALGARY, ALBERTA T2P 3S8    |   | TEL (403) 262-2799 |   | FAX (403) 262-2790 |
|-----------------------------------|--------|-----------------------------|--------|--------------------|--------|--------------------|
| 621 17TH STREET, SUITE 1550       |   | DENVER, COLORADO 80293-1501 |   | TEL (303) 623-9147 |   | FAX (303) 623-4258 |

 

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Theestimates of the reserves, future production, and income attributable toproperties in this report were prepared using the economic software packageAries for Windows, a copyrighted program of Landmark Graphics.  The program was used solely at the request ofPogo.  Ryder Scott has found this programto be acceptable, but notes that certain summaries and calculations may varydue to rounding and may not exactly match the sum of the properties beingsummarized.  Furthermore, one lineeconomic summaries may vary slightly from the more detailed cash flowprojections of the same properties, also due to rounding.  The rounding differences are not material.

Thefuture gross revenue is after the deduction of production taxes.  The deductions comprise the normal directcosts of operating the wells, ad valorem taxes, recompletion costs, developmentcosts, and certain abandonment costs net of salvage.  The future net income is before the deductionof state and federal income taxes and general administrative overhead, and hasnot been adjusted for outstanding loans that may exist nor does it include anyadjustment for cash on hand or undistributed income.  Liquid hydrocarbon reserves account forapproximately 69 percent and gas reserves account for the remaining 31 percentof total future gross revenue from proved reserves.

Thediscounted future net income shown above was calculated using a discount rateof 10 percent per annum compounded monthly. Future net income was discounted at four other discount rates which werealso compounded monthly.  These resultsare shown on each estimated projection of future production and incomepresented in a later section of this report and in summary form below.

 
|                                 | ** ** | ** **                                                      | ** ** |
|---------------------------------|------------|-----------------------------------------------------------------|------------|
| ** **                      | ** ** | **Discounted Future  Net Income – M$** | ** ** |
| ** **                      | ** ** | **As of December 31, 2006**                 | ** ** |
| **Discount Rate  Percent** | ** ** | **Total Proved**                                           | ** ** |
|                            |       |                                                            |       |
| 8                               |       | $1,718,625                                                      |       |
| 12                              |       | $1,435,871                                                      |       |
| 15                              |       | $1,280,537                                                      |       |
| 18                              |       | $1,156,444                                                      |       |

 

Theresults shown above are presented for your information and should not beconstrued as our estimate of fair market value.

***ReservesIncluded in This Report***

The provedreserves included herein conform to the definition as set forth in theSecurities and Exchange Commission’s Regulation S-X Part 210.4-10 (a) asclarified by subsequent Commission Staff Accounting Bulletins.  The definition of proved reserves is includedunder the tab “Petroleum Reserves Definitions” in this report.

Because of thedirect relationship between volumes of proved undeveloped reserves anddevelopment plans, we include in the proved undeveloped category only reservesassigned to undeveloped projects or locations that we have been assured willdefinitely be developed or drilled.

Pogo has interestsin certain fields or leases that may contain substantial additional reservesthat are not included in this report.  Aportion of these reserves may qualify as either probable or possible reserves,but this study was limited to proved reserves at Pogo’s request  Pogo has active

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exploratory anddevelopment drilling programs that may result in the discovery orreclassification of significant additional volumes.

 

Thevarious reserve status categories are defined under the tab “Petroleum ReservesDefinitions” in this report.  Thedeveloped non-producing reserves included herein are composed of the behindpipe and shut in categories.

***Estimatesof Reserves***

Asignificant portion of the reserves included in this report was estimated usingvarious performance methods.  Thereserves estimated by performance methods utilized extrapolations of varioushistorical data in those cases where such data were definitive in ouropinion.  Reserves were estimated by thevolumetric method or analogy in those cases where the historical performance datawas inconclusive or for reservoirs that have not yet begun production.

Thereserves included in this report are estimates only and should not be construedas being exact quantities.  They may ormay not be actually recovered, and if recovered, the revenues therefrom and theactual costs related thereto could be more or less than the estimatedamounts.  Moreover, estimates of reservesmay increase or decrease as a result of future operations.

***FutureProduction Rates***

Initialproduction rates are based on the current producing rates for those wells nowon production.  Test data and otherrelated information were used to estimate the anticipated initial productionrates for those wells or locations that are not currently producing.  If no production decline trend has beenestablished, future production rates were held constant until a decline inability to produce was anticipated.  Anestimated rate of decline was then applied to depletion of the reserves.  If a decline trend has been established, thistrend was used as the basis for estimating future production rates.  For reserves not yet on production, saleswere estimated to commence at an anticipated date furnished by Pogo.

Thefuture production rates from wells now on production may be more or less than estimatedbecause of changes in market demand or allowables set by regulatorybodies.  Wells or locations that are notcurrently producing may start producing earlier or later than anticipated inour estimates of their future production rates.

***HydrocarbonPrices***

Pogofurnished us with hydrocarbon prices in effect at December 31, 2006 and withits forecasts of future prices which take into account SEC and FinancialAccounting Standards Board (FASB) rules, current market prices, contractprices, and fixed and determinable price escalations where applicable.

In accordance withFASB Statement No. 69, December 31, 2006 market prices were determined usingthe daily oil price or daily gas sales price (“spot price”) adjusted foroilfield or gas gathering hub and wellhead price differences (e.g. grade,transportation, gravity, sulfur and BS&W) as appropriate and provided byPogo.  Also in accordance with SEC andFASB specifications, changes in market prices subsequent to December 31, 2006were not considered in this report.

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***Costs***

Operatingcosts for the leases and wells in this report are based on the operating expensereports of Pogo or estimates by Pogo and include only those costs directlyapplicable to the leases or wells.  Whenapplicable, the operating costs include a portion of general and administrativecosts allocated directly to the leases and wells under terms of operatingagreements.  No deduction was made forindirect costs such as general administration and overhead expenses, loanrepayments, interest expenses, and exploration and development prepayments thatare not charged directly to the leases or wells.

Theinitial operating costs for each property were based on the current operatingcosts or estimated costs for each property. In most cases, these costs were held constant for the life of eachproperty.  However, in certain cases, theoperating cost is comprised of a fixed and variable component.  The variable component is typically relatedto well count or production throughput. Historically, the variable costs decline as the field is produced.

Developmentcosts were furnished to us by Pogo and are based on authorizations forexpenditure for the proposed work or actual costs for similar projects.  The estimated net cost of abandonment aftersalvage was included for all offshore properties where abandonment costs net ofsalvage are significant.  Abandonmentcosts were also included for other properties where the net cost of abandonmentis expected to exceed any salvage value. The estimates of the net abandonment costs furnished by Pogo wereaccepted without independent verification.

Currentcosts were held constant throughout the life of the properties, except as notedabove.

***General***

TableA presents a one line summary of proved reserve and income data for each of thesubject properties which are ranked according to their future net incomediscounted at 10 percent per year.  TableB presents a one-line summary of gross and net reserves and income data foreach of the subject properties.  Table Cpresents a one-line summary of initial basic data for each of the subjectproperties.  Volume 1 presents Pogocompany summaries.  Volumes 2 through 8present projections of production and income by years beginning January 1, 2007for each of Pogo’s divisions and are further segregated by field, then by leaseor well.

Whileit may reasonably be anticipated that the future prices received for the saleof production and the operating costs and other costs relating to suchproduction may also increase or decrease from existing levels, such changeswere, in accordance with rules adopted by the SEC, omitted from considerationin making this evaluation.

Theestimates of reserves presented herein were based upon a detailed study of theproperties in which Pogo owns an interest; however, we have not made any fieldexamination of the properties.  Noconsideration was given in this report to potential environmental liabilitiesthat may exist nor were any costs included for potential liability to restoreand clean up damages, if any, caused by past operating practices.  Pogo has informed us that they have furnishedus all of the accounts, records, geological and engineering data, and reportsand other data required for this investigation. The ownership interests, prices, and other factual data furnished byPogo were accepted without independent verification.  The estimates presented in this report aregenerally based on data available through November 2006.

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Pogo has assured us of their intent and ability toproceed with the development activities included in this report, and that theyare not aware of any legal, regulatory or political obstacles that wouldsignificantly alter their plans.

NeitherRyder Scott Company nor any of our employees have any interest in the subjectproperties and neither the employment to make this study nor the compensationis contingent on our estimates of reserves and future income for the subjectproperties.

This report wasprepared for the use and benefit of Pogo Producing Company and may not be putto other use without our prior written consent for such use.  The data, work papers, and maps used in thisreport are available for examination by authorized parties in our offices.  Please contact us if we can be of furtherservice.
|                                 |       | Very truly yours,             |
|---------------------------------|------------|-------------------------------|
|                            |       |                          |
| ** **                      | ** ** | **RYDER SCOTT COMPANY, L.P.** |
| ** **                      | ** ** | ** **                    |
| ** **                      | ** ** | ** **                    |
| ** **                      | ** ** | /s/ Brad A. Gouge             |
|                            |       | Brad A. Gouge, P.E.           |
|                            |       | Petroleum Engineer            |
| BAG/pl                          |       |                          |
|                            |       |                          |
|                            |       |                          |
| Reviewed by:                    |       |                          |
|                            |       |                          |
|                            |       |                          |
| /s/ Fred W.  Ziehe              |       |                          |
| Fred W. Ziehe,  P.E.            |       |                          |
| Managing Senior  Vice President |       |                          |

 

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