**Exhibit 99.5**
|                |        |       |
|----------------|--------|------------|
| 1100 LOUISIANA |   | SUITE 3800 |   | HOUSTON, TEXAS 77002-5218 |   | FAX (713) 651-0849 |
|           |   |       |   |   |   | TELEPHONE (713) 651-9191 |
|                |        |            |  |  |  |  |  |  |

 

February 3, 2003

 

Pogo Producing Company

Post Office Box 2504

Houston, 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 ProducingCompany (Pogo) as of January 1, 2003.  The subject properties are located in thestates of Louisiana, New Mexico, Oklahoma, Texas and in the state and federalwaters offshore Louisiana and Texas. The international reserves are locatedoffshore Thailand.  The income data wereestimated using the Securities and Exchange Commission (SEC) requirements forfuture price and cost parameters.

 

The estimatedreserves and future income amounts presented in this report are related tohydrocarbon prices. Hydrocarbon prices in effect at December 31, 2002 were usedin the preparation of this report as required by SEC rules; however, actualfuture prices may vary significantly from December 31, 2002 prices. Therefore,volumes of reserves actually recovered and amounts of income actually receivedmay differ significantly from the estimated quantities presented in thisreport. The results of this study are summarized below.

 

**SEC PARAMETERS**

Estimated Net Reservesand Income Data

Certain Leasehold andRoyalty Interests of

**Pogo Producing Company**

As of January 1, 2003

 
| ** **                    | ** ** | **Proved**        | ** ** |
|-------------------------------|------------|-------------------|------------|
| ** **                    | ** ** | **Developed**     | ** ** | **Undeveloped** | ** ** | **Total  Proved** | ** ** |
| **Producing**                 | ** ** | **Non-Producing** |
| ***Net  Remaining Reserves*** |       |              |       |   |   |   |   |   |   |
| Oil/Condensate -  MBBL        |       | 58,178            |       | 24,862 |   | 18,379 |   | 101,419 |   |
| Plant Products -  MBBL        | ** ** | 4,333             |       | 1,856 |   | 523 |   | 6,712 |   |
| Gas - MMCF                    |       | 154,189           |       | 101,804 | ** ** | 105,611 |   | 361,604 |   |
|                          |       |              |       |   | ** ** | ** ** |   |   |   |
| ***Income  Data - M$***       |       |              |       |   |   |   |   |   |   |
| Future Gross Revenue          |       | $                 | 2,405,545  |   | $ | 1,146,309 | ** ** | $ | 914,140 |   | $ | 4,465,994 |   |
| Deductions                    |       | 613,515           |       | 420,459 |   | 445,932 |   | 1,479,906 |   |
| Future Net  Income (FNI)      |       | $                 | 1,792,030  |   | $ | 725,850 |   | $ | 468,208 |   | $ | 2,986,088 |   |
|                          |       |              |       |   |   |   |   |   |   |
| Discounted FNI @  10%         |       | $                 | 1,439,756  | ** ** | $ | 423,113 |   | $ | 308,085 |   | $ | 2,170,954 |   |

 
| 1100, 530 - 8TH AVENUE, S.W. |   | CALGARY, ALBERTA T2P 3S8    |       | TEL (403) 262-2799 |       | FAX (403) 262-2790 |
|------------------------------|--------|-----------------------------|------------|--------------------|------------|--------------------|
| 600 17TH STREET, SUITE 1610N |   | DENVER, COLORADO 80202-5416 | ** ** | TEL (303) 623-9147 | ** ** | FAX (303)623-4258  |

 

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Liquid hydrocarbonsare expressed in standard 42 gallon barrels. All gas volumes are sales gasexpressed in millions of cubic feet (MMCF) at the official temperature andpressure bases of the areas in which the gas reserves are located.

 

The estimates ofthe reserves, future production, and income attributable to properties in thisreport were prepared using the economic software package Aries for Windows, acopyrighted program of Landmark Graphics.  The program was used solely at the request ofPogo. Ryder Scott has found this program to be generally acceptable, but notesthat certain summaries and calculations may vary due to rounding and may notexactly match the sum of the properties being summarized. Furthermore, one lineeconomic summaries may vary slightly from the more detailed cash flowprojections of the same properties, also due to rounding. The roundingdifferences are not material.

 

The future grossrevenue is after the deduction of production taxes. The deductions comprise thenormal direct costs of operating the wells, ad valorem taxes, recompletioncosts, development costs, and certain abandonment costs net of salvage. SRBtaxes on the Thailand properties were estimated by Pogo and included under the “Other”deductions column in the Thailand cash flow tables. The future net income isbefore the deduction of state and federal income taxes and generaladministrative overhead, and has not been adjusted for outstanding loans thatmay exist nor does it include any adjustment for cash on hand or undistributedincome. Liquid hydrocarbon reserves account for approximately 71 percent andgas reserves account for the remaining 29 percent of total future gross revenuefrom proved reserves.

 

The discountedfuture net income shown above was calculated using a discount rate of 10percent per annum compounded monthly. Future net income was discounted at fourother discount rates which were also compounded monthly. These results areshown on each estimated projection of future production and income presented ina later section of this report and in summary form below.

 
| ** **                 | ** ** | **Discounted Future Net Income -  M$  As of January 1, 2003** | ** ** |
|----------------------------|------------|---------------------------------------------------------------|------------|
| **Discount Rate  Percent** | ** ** | **Total  Proved**                                             | ** ** |
| ** **                 | ** ** | ** **                                                    | ** ** |
| 8                          |       | $  2,285,213                                        |       |
| 12                         |       | $  2,070,496                                        |       |
| 15                         |       | $  1,940,050                                        |       |
| 18                         |       | $  1,828,545                                        |       |

 

The results shownabove are presented for your information and should not be construed as ourestimate of fair market value.

 

***Reserves Included 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 definitionof proved reserves is included under the tab “Reserve Definitions” in thisreport.

 

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

 

RYDER SCOTTCOMPANY          PETROLEUMCONSULTANTS

 

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Pogo has interestsin certain fields or leases that may contain substantial additional reservesthat are not included in this report. A portion of these reserves may qualifyas either probable or possible reserves, but this study was limited to provedreserves at Pogo’s request. Pogo has active exploratory and developmentdrilling programs that may result in the discovery or reclassification ofsignificant additional volumes.

 

The various reservestatus categories are defined under the tab “Reserve Definitions” in thisreport. The proved producing reserve projections include future liabilitiesfrom depleted wells or leases. The developed non-producing reserves includedherein are composed of the behind pipe and shut in categories.

 

***Estimates of Reserves***

 

A significantportion of the reserves included in this report was estimated using variousperformance methods. The reserves estimated by performance methods utilizedextrapolations of various historical data in those cases where such data weredefinitive in our opinion. Reserves were estimated by the volumetric method inthose cases where the historical performance data was inconclusive or forreservoirs that have not yet begun production. A significant portion ofreserves attributed to the Thailand properties are based on volumetricanalysis.

 

The reservesincluded in this report are estimates only and should not be construed as beingexact quantities. They may or may not be actually recovered, and if recovered,the revenues therefrom and the actual costs related thereto could be more orless than the estimated amounts. Moreover, estimates of reserves may increaseor decrease as a result of future operations.

 

***Future Production Rates***

 

Initial productionrates are based on the current producing rates for those wells now onproduction. Test data and other related information were used to estimate theanticipated initial production rates for those wells or locations that are notcurrently producing. If no production decline trend has been established,future production rates were held constant until a decline in ability toproduce was anticipated. An estimated rate of decline was then applied todepletion of the reserves. If a decline trend has been established, this trendwas used as the basis for estimating future production rates. For reserves notyet on production, sales were estimated to commence at an anticipated datefurnished by Pogo.

 

The futureproduction rates from wells now on production may be more or less thanestimated because of changes in market demand or allowables set by regulatorybodies. Wells or locations that are not currently producing may start producingearlier or later than anticipated in our estimates of their future production rates.

 

***Hydrocarbon Prices***

 

Pogo furnished uswith hydrocarbon prices in effect at December 31, 2002 and with its forecastsof future prices which take into account SEC and Financial Accounting StandardsBoard (FASB) rules, current market prices, contract prices, and fixed anddeterminate price escalations where applicable.

 

In accordance withFASB Statement No. 69, December 31, 2002 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

 

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appropriate. Also in accordance with SEC and FASB specifications,changes in market prices subsequent to December 31, 2002 were not considered inthis report.

 

For hydrocarbonproducts sold under contract, the contract price including fixed and determinableescalations, exclusive of inflation adjustments, was used until expiration ofthe contract. Upon contract expiration, the price was adjusted to the currentmarket price for the area and held at this adjusted price to depletion of thereserves.

 

***Costs***

 

Operating costsfor the leases and wells in this report are based on the operating expensereports of Pogo and include only those costs directly applicable to the leasesor wells. When applicable, the operating costs include a portion of general andadministrative costs allocated directly to the leases and wells under terms ofoperating agreements. No deduction was made for indirect costs such as generaladministration and overhead expenses, loan repayments, interest expenses, andexploration and development prepayments that are not charged directly to theleases or wells.

 

Development costswere furnished to us by Pogo and are based on authorizations for expenditurefor the proposed work or actual costs for similar projects. The estimated netcost of abandonment after salvage was included for offshore properties whereabandonment costs net of salvage are significant. The estimates of the netabandonment costs furnished by Pogo were accepted without independentverification.

 

The initialoperating costs for each property were based on the current operating costs orestimated costs for each property. In most cases, these costs were heldconstant for the life of each property. However, in certain cases, theoperating cost is comprised of a fixed and variable component. The variablecomponent is typically related to well count or production throughput.Historically, the variable costs decline as the field is produced.

 

***General***

 

Table A presents aone line summary of proved reserve and income data for each of the subjectproperties which are ranked according to their future net income discounted at10 percent per year. Table B presents a one-line summary of gross and netreserves and income data for each of the subject properties. Table C presents aone-line summary of initial basic data for each of the subject properties.Volume 1 presents Pogo company summaries. Volumes 2 through 7 presentprojections of production and income by years beginning January 1, 2003 foreach of Pogo’s divisions and are further broken down by field, lease or well.

 

While it mayreasonably be anticipated that the future prices received for the sale ofproduction and the operating costs and other costs relating to such productionmay also increase or decrease from existing levels, such changes were, inaccordance with rules adopted by the SEC, omitted from consideration in makingthis evaluation.

 

The estimates ofreserves presented herein were based upon a detailed study of the properties inwhich Pogo owns an interest; however, we have not made any field examination ofthe properties. No consideration was given in this report to potential environmentalliabilities that may exist nor were any costs included for potential liabilityto restore and clean up damages, if any, caused by past operating practices.Pogo has informed us that they have furnished us all of the accounts, records,geological and engineering data, and reports and other data required for thisinvestigation. The ownership interests, prices, and other factual datafurnished by Pogo were accepted without

 

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independent verification.  The estimates presented in this report arebased on data available through December 31, 2002.

 

Pogo has assuredus of their intent and ability to proceed with the development activitiesincluded in this report, and that they are not aware of any legal, regulatoryor political obstacles that would significantly alter their plans.

 

Neither RyderScott 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 exclusive use and sole benefit of Pogo Producing Company.  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 further service.

 
|   | Very truly yours,                             |
|--------|-----------------------------------------------|
|   |                                          |
|   | **RYDER SCOTT COMPANY, L.P.**                 |
|   | ** **                                    |
|   |                                          |
|   | /s/ Robert M. Wagner                          |   |
|   | Robert M. Wagner, P.E.  Senior Vice President |

 

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