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                                                                   Exhibit 10.14

                              EMPLOYMENT AGREEMENT

     This Employment Agreement ("Agreement") by and between Plains Exploration &
Production Company, a Delaware corporation ("Company"), and John T. Raymond
("Employee") is entered into as of September 19, 2002, but, other than Section
4(d) hereof, shall not be effective until the date (the "Effective Date") on
which all the shares of the common stock of Company held by its parent
corporation, Plains Resources Inc. ("PLX") are distributed to PLX's stockholders
(the "Distribution"); provided, however, that if the Distribution does not take
place on or before May 23, 2003, this Agreement shall not become effective.

     WHEREAS, Company desires to employ Employee and Employee desires to be
employed by Company;

     NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties, and agreements contained herein, and for other valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties agree as follows:

     1.   Employment. Contingent on the Distribution occurring no later than
May 23, 2003, Company agrees to employ Employee, and Employee hereby agrees to
be employed by Company, on the terms and conditions set forth in this Agreement.

     2.   Term of Employment. Subject to the provisions for earlier termination
provided in the Agreement, the term of this Agreement (the "Term") shall
commence on the Effective Date and shall terminate on the fifth anniversary of
the Effective Date; provided, however, that following the fifth anniversary of
the Effective Date, the Term shall automatically be extended one year and again
for successive one-year periods on each anniversary thereof, if Employee and
Company shall have agreed to new compensation terms at least ninety days prior
to the end of the initial five-year period and any additional one-year
extensions. Notwithstanding any provision of this Agreement to the contrary,
termination of this Agreement shall not alter or impair any rights or benefits
of Employee (or Employee's estate or beneficiaries) that have arisen under this
Agreement on or prior to such termination.

     3.   Employee's Duties. During the Term, Employee shall serve as the
President and Chief Operating Officer of Company, with such customary duties and
responsibilities as may from time to time be assigned to him by the Board,
provided that such duties are at all times consistent with the duties of such
positions. Employee shall report to the Chief Executive Officer. Employee agrees
to serve without additional compensation, if elected or appointed thereto, in
one or more offices or a director of any of Company's Subsidiaries. For purposes
of this Agreement, a "Subsidiary" shall mean any entity in which Company owns a
majority of the voting stock of the class of securities (or other interests in
the case of a limited liability company or partnership) that may vote in the
election of the members of the governing body of such entity.

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     Employee agrees to use reasonable best efforts to perform faithfully and
efficiently his duties and responsibilities hereunder. Company understands and
acknowledges that Employee shall be an employee and executive officer of PLX,
and therefore, Employee will not be able to devote all of his attention and time
during normal business hours to Company. Accordingly, Company agrees that the
performance of Employee's duties on behalf of PLX shall not be a breach of this
Agreement. Notwithstanding the foregoing, during the Term, Employee may engage
in the following activities so long as they do not interfere in any material
respect with the performance of Employee's duties and responsibilities
hereunder: (i) serve on corporate, civic or charitable boards or committees,
(ii) deliver lectures, fulfill speaking engagements or teach on a part-time
basis at educational institutions but not more than 20 hours per month, and
(iii) manage his personal investments; provided, however, that in no event shall
the conduct of any such activities by Employee be deemed to materially interfere
with Employee's duties hereunder until Employee has been notified in writing
thereof by the Board and given a reasonable period in which to cure such
interference; and further provided that Employee shall notify and obtain
approval of the Board prior to accepting any of the positions described in
clause (i) above, which approval shall not be unreasonably withheld. In
addition, Employee shall be permitted to manage his personal investments
described in clause (iii) above in accordance with the preceding sentence
provided that (a) such management shall not interfere in any material respect
with the performance of Employee's duties and responsibilities hereunder or
violate Company's conflicts policy as in effect from time to time, (b) Employee
informs the Board of any conflicts of interest (whether actual or apparent) with
Company and any of its Subsidiaries, including any event reasonably likely to
raise the appearance of conflicts, and (c) Employee notifies the Board of, and
discuss with the Board with respect to, any opportunities presented to Employee
or any of the entities in which Employee owns a majority interest in connection
with such continued ownership and management that should be offered to Company
or its Subsidiaries. Notwithstanding the foregoing, Company agrees that
Employee's management of his current personal investments, as disclosed to
Company prior to the Effective Date, shall not be deemed to materially interfere
with his duties hereunder.

     4.   Compensation.

          (a) Base Compensation. For services rendered by Employee under this
     Agreement Company shall pay to Employee a base salary ("Base Compensation")
     of $350,000 per annum payable in accordance with Company's customary
     payroll practice for its senior executive officers. The amount of Base
     Compensation shall be reviewed periodically by the Board and may be
     increased from time to time as the Board may deem appropriate. Base
     Compensation, as in effect at any time, may not be decreased without the
     prior written consent of Employee.

          (b) Annual Bonus. In addition to his Base Compensation, Employee shall
     be eligible to receive each year during the Term, a cash incentive payment
     in an amount equal to 100% of Employee's Base Compensation (the "Target
     Bonus"). The amount of the Target Bonus earned for any year shall be
     determined by the Compensation

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     Committee of the Board based on Employee's individual performance and the
     performance of Company.

          (c) SARs. In accordance with the Performance Stock Option Agreement
     dated June 7, 2001 between PLX and Employee (the "Option Agreement"), the
     Incentive Stock Option and Nonqualified Stock Option Agreement dated June
     7, 2001 between PLX and Employee (the "Second Option Agreement"), the
     Incentive Stock Option and Nonqualified Stock Option Agreement dated
     February 20, 2002 between PLX and Employee (the "Third Option Agreement")
     and, along with the Second Option Agreement, the "Other Option
     Agreements"), the Amended and Restated Employment Agreement entered into on
     the date hereof between PLX and Employee (the "Restated Agreement"), the
     Employee Matters Agreement dated July 3, 2002, between the Company and PLX,
     as amended (the "Employee Matters Agreement"), the Company 2002 stock
     incentive plan, and the PLX 2001 stock incentive plan, the Company shall
     issue certain stock appreciation rights to Employee (the "Performance
     SARs") to effect an adjustment to certain performance options (the
     "Performance Options") granted to Employee by PLX under the Option
     Agreement, which adjustment results from the Distribution, and certain
     stock appreciation rights to Employee ("Other SARs") to effect an
     adjustment to the remaining stock options (the "Other Options") granted to
     Employee by PLX under the Other Option Agreements. The Performance SARs and
     Other SARs shall have the same terms and conditions as the Performance
     Options and Other Options, as the case may be, with a strike price and a
     number of Performance SARs and Other SARs, as the case may be, calculated
     in accordance with the Employee Matters Agreement. The Company and Employee
     shall execute an agreement reflecting the Performance SARs and Other SARs.

          (d) New Grant. On the effective date of an initial public offering of
     Company common stock by the Company, Company will grant Employee 60,000
     restricted shares of Company common stock with respect to which
     restrictions will lapse pro rata over a three-year period beginning on the
     first anniversary of such effective date and under such other terms and
     conditions as provided in the agreement evidencing such award.

     5.   Other Benefits; Business Expenses.

          (a) Employee shall be entitled to participate in all incentive
     compensation plans and to receive all fringe benefits and perquisites
     offered by Company to any of its senior executive officers, including,
     without limitation, participation in the various health, retirement, life
     insurance, disability insurance and other employee benefit plans or
     programs provided to the employees of Company in general, subject to the
     regular eligibility requirements with respect to each of such benefit plans
     or programs, and such other benefits or perquisites as may be approved by
     the Board during the Term, all on a basis at least as favorable to Employee
     as may be provided to similarly situated senior executive officers of
     Company. Employee shall be entitled to take appropriate and

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     reasonable annual vacation time provided that such vacation time does not
     interfere with his duties hereunder.

          (b) Company shall reimburse Employee for all reasonable business
     expenses incurred by Employee in the performance of his duties; which
     expenses will be subject to the oversight of Company's audit committee in
     the normal course. It is understood that Employee is authorized to incur
     reasonable business expenses for promoting the business of Company,
     including reasonable expenditures for travel, lodging, meals and client or
     business associate entertainment. Request for reimbursement for such
     expenses must be accompanied by appropriate documentation.

          (c) Company shall reimburse Employee for his monthly country club
     fees.

     6.   Termination. This Agreement may be terminated prior to the end of its
Term as set forth below.

          (a) Resignation. Employee may resign his position at any time. In the
     event of such resignation, except in the case of resignation for Good
     Reason (as defined below), Employee shall not be entitled to further
     compensation pursuant to this Agreement except as may be provided by the
     terms of any benefit plans of Company in which Employee may be a
     participant and the terms of any outstanding equity grants, and for salary
     accrued but unpaid through the date of resignation and reimbursement of
     expenses prior to such date.

          (b) Death. If Employee's employment is terminated due to his death,
     this Agreement shall terminate and Company shall have no obligations to his
     legal representatives with respect to this Agreement other than the payment
     of benefits as described in Section 6(c)(i) below, salary accrued but
     unpaid through the date of termination, reimbursement of expenses prior to
     such date and benefits under the terms of any outstanding equity grants.

          (c) Discharge.

              (i) Company may terminate this Agreement and Employee's employment
     for any reason deemed sufficient by Company upon notice as provided in
     Section 10. However, in the event that Employee's employment is terminated
     during the Term by Company for any reason other than Cause, in the event of
     Employee's death or Disability, or if Employee's employment is terminated
     for Good Reason, then: (A) Company shall pay Employee immediately upon
     termination of Employee's employment a lump sum equal to two times the sum
     of the Base Compensation and last earned annual bonus (provided, however,
     that if the Date of Termination (as defined below) occurs before a bonus
     amount has been determined for the first calendar year of Employee's
     employment hereunder, the bonus amount shall be the Target Bonus); (B) for
     the 36-month

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          period after the Date of Termination, Company shall provide or arrange
          to provide Employee (and Employee's dependents) with health insurance
          benefits no less favorable than the health plan benefits provided by
          Company (or any successor) during such 36-month period to any senior
          executive officer of Company; provided, further, to the extent the
          coverage or benefits received are taxable to Employee, Company shall
          make Employee "whole" on a net after tax basis; and provided, however,
          that such coverage shall cease if Employee obtains comparable
          replacement coverage (although Employee shall have no obligation to
          pursue such coverage); (C) on the Date of Termination all then
          outstanding Company stock-based awards of Employee, whether under this
          Agreement, a Company stock plan or otherwise, shall become immediately
          exercisable and payable in full, as the case may be, with any
          performance goals associated therewith being deemed to have been
          achieved at the maximum levels and all restrictions removed with
          respect thereto (including without limitation with respect to any
          options that would otherwise vest in accordance with performance goals
          and any grants of restricted stock that shall have been granted prior
          to the Effective Date); and (D) Company shall reimburse Employee for
          expenses incurred prior to the Date of Termination.

              (ii) Notwithstanding the foregoing provisions of this Section 6,
          in the event Employee is terminated because of Cause, Company shall
          have no obligations pursuant to this Agreement after the Date of
          Termination other than reimbursement of expenses incurred prior to
          such date. For purposes herein, "Cause" means (A) the failure by
          Employee to perform reasonably assigned duties with Company, (B) the
          engaging by Employee in conduct which is demonstrably and materially
          injurious to Company and its Subsidiaries taken as a whole, (C)
          Employee's having been convicted of, or entered a plea of nolo
          contendere to burglary, larceny, murder or arson or a crime involving
          deceit, fraud, perjury or embezzlement, or (D) failure to notify
          Company of any actual or apparent conflicts of interest relating to
          Employee's management of personal investments in accordance with
          Section 3 of this Agreement. Notwithstanding the foregoing, prior to
          any termination for Cause under clauses (A), (B) or (D) of the
          preceding sentence, (X) Company must provide Employee with reasonable
          notice detailing the failure or conduct which the Board believes to
          constitute Cause, (Y) Company must provide Employee a reasonable
          opportunity to cure such failure or conduct, and (Z) after such notice
          and an opportunity to cure, a majority of the Board must reasonably
          determine that Employee has not cured such failure or conduct.
          Notwithstanding the foregoing provisions, Employee shall not be deemed
          to have been terminated for Cause unless and until Employee shall have
          been provided an opportunity to be heard in person by the Board (with
          the assistance of Employee's counsel if Employee so desires).

          (d) Disability. If Employee shall have been absent from the full-time
     performance of Employee's duties with Company for six consecutive months as
     a result

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     of Employee's incapacity due to physical or mental illness as determined by
     Employee's physician ("Disability"), Employee's employment may be
     terminated by Company for Disability. If Employee's employment is
     terminated for Disability, Employee shall be entitled to the compensation
     and benefits provided in Section 6(c)(i) hereof. If Employee fails during
     any period during the Term to perform Employee's full-time duties with
     Company as a result of incapacity due to physical or mental illness, as
     determined by Employee's physician, Employee shall continue to receive his
     benefits under this Agreement during such period until this Agreement is
     terminated for Disability by Company.

          (e)  Resignation for Good Reason. Employee shall be entitled to
     terminate his employment for Good Reason as defined herein. If Employee
     terminates his employment for Good Reason, Employee shall be entitled to
     the compensation and benefits provided in Section 6(c)(i) hereof. "Good
     Reason" shall mean (1) the material breach of any of Company's obligations
     under this Agreement without Employee's written consent or (2) the
     occurrence of any of the following circumstances, as the case may be,
     without Employee's written consent:

               (i)   the assignment by the Board to Employee of any duties that
          materially adversely alter the nature or status of Employee's office,
          title, responsibilities, including reporting responsibilities, from
          those in effect immediately prior to such assignment;

               (ii)  the failure by Company to continue in effect any
          compensation plan in which Employee participates that is material to
          Employee's total compensation unless an equitable arrangement
          (embodied in an ongoing substitute or alternative plan) has been made
          with respect to such plan, or the failure by Company to continue
          Employee's participation therein (or in such substitute or alternative
          plan) on a basis not materially less favorable to Employee, unless any
          such failure to continue in effect any compensation plan or
          participation relates to a discontinuance of such plans or
          participation on a management-wide or Company-wide basis;

               (iii) the taking of any action by Company which would directly or
          indirectly materially reduce or deprive Employee of any material
          pension, welfare or fringe benefit then enjoyed by Employee, unless
          such action relates to a discontinuance of benefits on a
          management-wide or Company-wide basis;

               (iv)  the failure of Company to obtain a satisfactory agreement
          from any successor to assume and agree to perform this Agreement, as
          contemplated in Section 12 hereof;

               (v)   the relocation of Company's principal executive offices
          outside the greater Houston, Texas metropolitan area, or Company's
          requiring Employee to

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          relocate anywhere other than the location of Company's principal
          executive offices, except for required travel on Company's business to
          an extent substantially consistent with Employee's obligations under
          this Agreement; or

               (vi)  the Employee's termination of his employment with Company
          or any successor who has assumed this Agreement in accordance with
          Section 12 hereof within the 30-day period following the first
          anniversary of a Change in Control of Company.

     Employee's right to terminate employment pursuant to this subsection shall
not be affected by Employee's incapacity due to physical or mental illness. In
addition, Employee's continued employment following any event, act or omission,
regardless of the length of such continued employment, shall not constitute
Employee's consent to, or a waiver of Employee's rights with respect to, such
event, act or omission constituting a Good Reason circumstance hereunder.

          (f)  Notice of Termination. Any purported termination of Employee's
     employment by Company or by Employee shall be communicated by written
     Notice of Termination to the other party hereto in accordance with Section
     10 hereof. For purposes of this Agreement, a "Notice of Termination" shall
     mean a notice which shall set forth in reasonable detail the reason for
     termination of Employee's employment, or in the case of resignation for
     Good Reason, said notice must specify in reasonable detail the basis for
     such resignation. No purported termination which is not effected pursuant
     to this Section 6(f) shall be effective.

          (g)  Date of Termination, Etc. "Date of Termination" shall mean in the
     case of Employee's death, his date of death, and in all other cases, the
     date specified in the Notice of Termination. If no notice is given by
     Employee, termination shall be effective on the last date Employee reported
     for work with Company, and shall be deemed to be a voluntary termination
     without Good Reason.

          (h)  Mitigation. Employee shall not be required to mitigate the amount
     of any payment or benefit provided for in this Section 6 by seeking other
     employment or otherwise, nor, except as provided in clause (B) of Section
     6(c)(1), shall the amount of any payment or benefit provided for in this
     Agreement be reduced by any compensation or benefit earned by Employee as a
     result of employment by another employer, self-employment earnings, by
     retirement benefits, by offset against any amount claimed to be owing by
     Employee to Company, or otherwise.

          (i)  Full Tax Gross-Up of Parachute Payments. (i) In the event that
     any payment, award, benefit or distribution (or any acceleration of any
     payment, award, benefit or distribution) made or provided to or for the
     benefit of Employee in connection with this Agreement, or Employee's
     employment with Company or the termination thereof (the "Payments") are
     determined to be subject to the excise tax imposed by

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     Section 4999 of the Code or any interest or penalties with respect to such
     excise tax (such excise tax, together with any such interest and penalties,
     are collectively referred to as the "Excise Tax"), then the Employee shall
     be entitled to receive an additional payment (a "Gross-Up Payment") from
     Company in an amount equal to the Excise Tax (excluding any income tax or
     employment tax imposed upon the Gross Up Payment). The determination of
     whether the Payments are subject to the Excise Tax and, if so, the amount
     of the Gross-Up Payment, shall be made by a nationally recognized United
     States public accounting firm that has not, during the two years preceding
     the date of its selection, acted in any way on behalf of Company or any of
     its affiliates; provided, however, that if the accounting firm has
     determined that Section 4999 does not apply, and the Internal Revenue
     Service claims that Section 4999 applies to the Payments (or any portion
     thereof), then paragraph (ii) below of this Section 6(i) shall be
     applicable.

               (ii) Employee shall notify Company in writing of any claim by the
          Internal Revenue Service that, if successful, would require the
          payment by Company of a Gross-Up Payment. Such notification shall be
          given as soon as practicable but no later than ten (10) business days
          after Employee is informed in writing of such claim and shall apprise
          Company of the nature of such claim and the date on which such claim
          is requested to be paid. Employee shall not pay such claim prior to
          the expiration of the thirty (30) day period following the date on
          which he gives such notice to Company (or such shorter period ending
          on the date that any payment of taxes with respect to such claim is
          due). If Company notifies Employee in writing prior to the expiration
          of such period that it desires to contest such claim, Employee shall:

                    (A)  give Company any information reasonably requested by
               Company relating to such claim,

                    (B)  take such action in connection with contesting such
               claim as Company shall reasonably request in writing from time to
               time, including, without limitation, accepting legal
               representation with respect to such claim by an attorney
               reasonably selected by Company,

                    (C)  cooperate with Company in good faith in order
               effectively to contest such claim, and

                    (D)  permit Company to participate in any proceedings
               relating to such claim;

     provided, however, that Company shall bear and pay directly all costs and
expenses (including additional interest, penalties, accountant's and legal fees)
incurred in connection with such contest and shall indemnify and hold Employee
harmless, on an after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on the

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foregoing provisions of this subsection, Company shall control all proceedings
taken in connection with such contest and, at its sole option, may pursue or
forgo any and all administrative appeals, proceedings, hearings and conferences
with the taxing authority in respect of such claim and may, at its sole option,
either direct Employee to pay the tax claimed and commence a proceeding to
obtain a refund or contest the claim in any permissible manner, and Employee
agrees to prosecute such contest to a determination before any administrative
tribunal, in a court of initial jurisdiction and in one or more appellate
courts, as Company shall determine; provided, however, that if Company directs
Employee to pay such claim and seek a refund, Company shall advance the amount
of such payment to Employee, on an interest-free basis, and shall indemnify and
hold Employee harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of Employee with respect to which such
contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, Company's control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder, and
Employee shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing authority.

               (iii) If, after the receipt by Employee of an amount advanced by
          Company pursuant to the foregoing, Employee becomes entitled to
          receive any refund with respect to such claim, Employee shall (subject
          to Company's complying with the requirements of the foregoing)
          promptly pay to Company the amount of such refund (together with any
          interest paid or credited thereon after taxes applicable thereto). If,
          after the receipt by Employee of an amount advanced by Company
          pursuant to the previous subsection, a determination is made that
          Employee shall not be entitled to any refund with respect to such
          claim and Company does not notify Employee in writing of its intent to
          contest such denial of refund prior to the expiration of thirty (30)
          days after such determination, such advance shall be forgiven and
          shall not be required to be repaid and the amount of such advance
          shall offset, to the extent thereof, the amount of Gross-Up Payment
          required to be paid.

          (j)  Change in Control. For purposes of this Agreement, a Change in
     Control shall mean an occurrence of the following during the Term:

               (i)   The "acquisition" by any "Person" (as the term person is
          used for purposes of Section 13(d) or 14(d) of the Securities Exchange
          Act of 1934, as amended (the "1934 Act")) of "Beneficial Ownership"
          (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of
          any securities of Company which generally entitles the holder thereof
          to vote for the election of directors of Company (the "Voting
          Securities") which, when added to the Voting Securities then
          "Beneficially Owned" by such Person, would result in such Person
          either "Beneficially Owning" fifty percent (50%) or more of the
          combined voting power

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          of Company's then outstanding Voting Securities or having the ability
          to elect fifty percent (50%) or more of Company's directors; provided,
          however, that for purposes of this paragraph (i) of Section 6(j), a
          Person shall not be deemed to have made an acquisition of Voting
          Securities if such Person: (a) becomes the Beneficial Owner of more
          than the permitted percentage of Voting Securities solely as a result
          of open market acquisition of Voting Securities by Company which, by
          reducing the number of Voting Securities outstanding, increases the
          proportional number of shares Beneficially Owned by such Person; (b)
          is Company or any corporation or other Person of which a majority of
          its voting power or its equity securities or equity interest is owned
          directly or indirectly by Company (a "Controlled Entity"); (c)
          acquires Voting Securities in connection with a "Non-Control
          Transaction" (as defined in paragraph (iii) of this Section 6(j)); or
          (d) becomes the Beneficial Owner of more than the permitted percentage
          of Voting Securities as a result of a transaction approved by a
          majority of the Incumbent Board (as defined in paragraph (ii) below);
          or

               (ii)  The individuals who, as of the Effective Date, are members
          of the Board (the "Incumbent Board"), cease for any reason to
          constitute at least a majority of the Board; provided, however, that
          if either the election of any new director or the nomination for
          election of any new director by Company's stockholders was approved by
          a vote of at least a majority of the Incumbent Board, such new
          director shall be considered as a member of the Incumbent Board;
          provided further, however, that no individual shall be considered a
          member of the Incumbent Board if such individual initially assumed
          office as a result of either an actual or threatened "Election
          Contest" (as described in Rule 14a-11 promulgated under the 1934 Act)
          or other actual or threatened solicitation of proxies or consents by
          or on behalf of a Person other than the Board (a "Proxy Contest")
          including by reason of any agreement intended to avoid or settle any
          Election Contest or Proxy Contest; or

               (iii) The consummation of a merger, consolidation or
          reorganization involving Company (a "Business Combination"), unless
          (1) the stockholders of Company, immediately before the Business
          Combination, own, directly or indirectly immediately following the
          Business Combination, at least fifty percent (50%) of the combined
          voting power of the outstanding voting securities of the corporation
          resulting from the Business Combination (the "Surviving Corporation")
          in substantially the same proportion as their ownership of the Voting
          Securities immediately before the Business Combination, and (2) the
          individuals who were members of the Incumbent Board immediately prior
          to the execution of the agreement providing for the Business
          Combination constitute at least a majority of the members of the Board
          of Directors of the Surviving Corporation, and (3) no Person (other
          than (x) Company or any Controlled Entity, (y) a trustee or other
          fiduciary holding securities under one or more employee benefit plans
          or arrangements (or any trust forming a part thereof) maintained by

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          Company, the Surviving Corporation or any Controlled Entity, or (z)
          any Person who, immediately prior to the Business Combination, had
          Beneficial Ownership of fifty percent (50%) or more of the then
          outstanding Voting Securities) has Beneficial Ownership of fifty
          percent (50%) or more of the combined voting power of the Surviving
          Corporation's then outstanding voting securities (a Business
          Combination described in clauses (1), (2) and (3) of this paragraph
          shall be referred to as a "Non-Control Transaction");

               (iv) A complete liquidation or dissolution of Company; or

               (v)  The sale or other disposition of all or substantially all of
          the assets of Company to any Person (other than a transfer to a
          Controlled Entity).

     Notwithstanding the foregoing, if Employee's employment is terminated and
Employee reasonably demonstrates that such termination (x) was at the request of
a third party who has indicated an intention or has taken steps reasonably
calculated to effect a Change in Control and who effectuates a Change in Control
or (y) otherwise occurred in connection with, or in anticipation of, a Change in
Control which actually occurs, then for all purposes hereof, the date of a
Change in Control with respect to Employee shall mean the date immediately prior
to the date of such termination of employment.

     A Change in Control shall not be deemed to occur solely because fifty
percent (50%) or more of the then outstanding Voting Securities is Beneficially
Owned by (x) a trustee or other fiduciary holding securities under one or more
employee benefit plans or arrangements (or any trust forming a part thereof)
maintained by Company or any Controlled Entity or (y) any corporation which,
immediately prior to its acquisition of such interest, is owned directly or
indirectly by the stockholders of Company in substantially the same proportion
as their ownership of stock in Company immediately prior to such acquisition.

     7.   Restrictive Covenants.

          (a)  Employer Covenants. Company agrees that during the Term, Company
     shall disclose to Employee or provide Employee with access to trade secrets
     or confidential information of Company or its Subsidiaries; or place
     Employee in a position to develop business goodwill on behalf of Company or
     its Subsidiaries; or entrust Employee with business opportunities of
     Company or its Subsidiaries.

          (b)  Confidential Information; Unauthorized Disclosure. During the
     period of his employment hereunder and for any period following the
     termination of employment, the Employee shall not, whether during the
     period of his employment hereunder or thereafter, without the written
     consent of the Board or a person authorized thereby, disclose to any
     person, other than an employee of Company or a person to whom disclosure is
     reasonably necessary or appropriate in connection with the performance by
     the Employee of his duties as an executive of Company, any confidential
     information

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     obtained by him while in the employ of Company with respect to Company's
     business, including but not limited to technology, know-how, processes,
     maps, geological and geophysical data, other proprietary information and
     any information whatsoever of a confidential nature, the disclosure of
     which he knows or should know will be damaging to Company; provided,
     however, that confidential information shall not include any information
     known generally to the public (other than as a result of unauthorized
     disclosure by the Employee) or any information which the Employee may be
     required to disclose by any applicable law, order, or judicial or
     administrative proceeding.

          (c)  Non-Competition. As part of the consideration for the
     compensation and benefits to be paid to Employee hereunder; to protect the
     trade secrets and confidential information of Company or its Subsidiaries
     that have been and will in the future be disclosed or entrusted to
     Employee, the business good will of Company or its Subsidiaries that has
     been and will in the future be developed by Employee or the business
     opportunities that have been and will in the future be disclosed or
     entrusted to Employee by Company or its Subsidiaries, and as an additional
     incentive for Company to enter into this Agreement, Company and Employee
     agree to the following competition provisions:

     During the Term and for a period of one year thereafter, Employee shall not
     in North America, directly or indirectly engage in or become interested
     financially in as a principal, employee, partner, shareholder, agent,
     manager, owner, advisor, lender, guarantor of any person engaged in any
     business substantially identical to the Business (defined below); provided,
     however, that (a) Employee may invest in stock, bonds or other securities
     in any such business (without participating in such business) if: (i)(A)
     such stock, bonds or other securities are listed on any United States
     securities exchange or are publicly traded in an over the counter market
     and (B) its investment does not exceed, in the case of any capital stock of
     any one issuer, 5% of the issued and outstanding capital stock, or in the
     case of bonds or other securities, 5% of the aggregate principal amount
     thereof issued and outstanding, or (ii) such investment is completely
     passive and no control or influence over the management or policies of such
     business is exercised, or (b) any such business shall be deemed to exclude
     ownership by Employee or any affiliated entity of interests in PLX, Plains
     All American GP LLC, Plains AAP LP, Plains All American Pipeline, L.P., and
     any of their respective subsidiaries and any board positions with respect
     to such entities. The term "Business" shall mean the exploration,
     development and production of crude petroleum and natural gas.
     Notwithstanding the foregoing provisions of this Section 7(c), in the event
     of a termination of Employee's employment by Company without Cause or in
     the event of Employee's resignation for Good Reason, Employee shall have no
     further obligations under this Section 7(c).

          (d)  Non-Solicitation. Employee undertakes toward Company and is
     obligated, during the Term and for a period of one year thereafter, not to
     solicit or hire, directly or indirectly, in any manner whatsoever (except
     in response to a general solicitation), in the capacity of employee,
     consultant or in any other capacity whatsoever, one or more of the

                                       12

<PAGE>

     employees, directors or officers or other persons (hereinafter collectively
     referred to as "Employees") who at the time of solicitation or hire, or in
     the 90-day period prior thereto, are working full-time or part-time for
     Company or any of its Subsidiaries and not to endeavour, directly or
     indirectly, in any manner whatsoever, to encourage any of said Employees to
     leave his or her job with Company or any of its Subsidiaries and not to
     endeavour, directly or indirectly, and in any manner whatsoever, to incite
     or induce any client of Company or any of its Subsidiaries to terminate, in
     whole or in part, its business relations with Company or any of its
     Subsidiaries.

          (e)  Enforcement. It is the desire and intent of the parties that the
     provisions of this Section 7 shall be enforced to the fullest extent
     permissible under the laws and public policies applied in each jurisdiction
     in which enforcement is sought. Accordingly, if any particular provision of
     this Section 7 shall be adjudicated to be invalid or unenforceable, such
     provision shall be deemed amended to delete therefrom the portion thus
     adjudicated to be invalid or unenforceable. Such deletion shall apply only
     with respect to the operation of such provisions of this Section 7 in the
     particular jurisdiction in which such adjudication is made. In addition, if
     the scope of any restriction contained in this Section 7 is too broad to
     permit enforcement thereof to its fullest extent, then such restriction
     shall be enforced to the maximum extent permitted by law, and the Executive
     hereby consents and agrees that such scope may be judicially modified in
     any proceeding brought to enforce such restriction.

          (f)  Remedies. In the event of a breach or threatened breach by the
     Executive of the provisions of this Section 7, Company shall be entitled to
     an injunction and such other equitable relief as may be necessary or
     desirable to enforce the restrictions contained herein. Nothing herein
     contained shall be construed as prohibiting Company from pursuing any other
     remedies available for such breach or threatened breach or any other breach
     of this Agreement.

          (g)  The parties hereto understand and acknowledge that Employee will
     serve in various capacities (including, without limitation, stockholder,
     employee, executive officer and director) of PLX. Company acknowledges that
     no actions by Employee in any or all of his capacities with PLX shall be a
     violation of the provisions of this Section 7.

     8.   Non-exclusivity of Rights. Nothing in this Agreement shall prevent or
limit Employee's continuing or future participation in any benefit, bonus,
incentive or other plan or program provided by Company or any of its affiliated
companies and for which Employee may qualify, nor shall anything herein limit or
otherwise adversely affect such rights as Employee may have under any stock
option or other agreements with Company or any of its affiliated companies.

     9.   Assignability. The obligations of Employee hereunder are personal and
may not be assigned or delegated by him or transferred in any manner whatsoever,
nor are such

                                       13

<PAGE>

obligations subject to involuntary alienation, assignment or transfer, except by
will or the laws of descent and distribution.

     10.  Notice. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when personally delivered, sent by overnight
courier or by facsimile with confirmation of receipt or on the third business
day after being mailed by United States registered mail, return receipt
requested, postage prepaid, addressed to Company at its principal office address
and facsimile number, directed to the attention of the Board with a copy to the
Secretary of Company, and to Employee at Employee's residence address and
facsimile number on the records of Company or to such other address as either
party may have furnished to the other in writing in accordance herewith except
that notice of change of address shall be effective only upon receipt.

     11.  Validity. The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.

     12.  Successors; Binding Agreement.

          (a)  Company will require any successor (whether direct or indirect,
     by purchase, merger, consolidation or otherwise) to all or substantially
     all of the business and assets of Company ("Successor") or any corporation
     which becomes the ultimate parent corporation of Company or any such
     Successor ("Ultimate Parent") to expressly assume and agree in writing
     satisfactory to the Employee to perform this Agreement in the same manner
     and to the same extent that Company would be required to perform it if no
     such succession had taken place; provided, however, that express assumption
     shall not be required where this agreement is assumed by operation of law.
     As used in this Agreement, including, without limitation, in Section 3, the
     term "Company" shall include any Successor and Ultimate Parent which
     executes and delivers the Agreement as provided for in this Section 12 or
     which otherwise becomes bound by all terms and provisions of this Agreement
     by operation of law.

          (b)  After the death or Disability of Employee, this Agreement and all
     rights of Employee hereunder shall inure to the benefit of and be
     enforceable by Employee's personal or legal representatives, executors,
     administrators, successors, heirs, distributees, devisees and legatees.

     13.  Indemnification. During the Term and for a period of six years
thereafter, Company shall cause Employee to be covered by and named as an
insured under any policy or contract of insurance obtained by it to insure its
directors and officers against personal liability for acts or omissions in
connection with service as an officer or director of Company or service in other
capacities at the request of Company. The coverage provided to Employee pursuant
to this Section 13 shall be of a scope and on terms and conditions at least as
favorable as the most favorable coverage provided to any other officer or
director of Company (or any successor). In

                                       14

<PAGE>

addition, to the maximum extent permitted by the by-laws of Company in effect
from time to time and applicable law, during the Term and for a period of six
years thereafter, Company shall indemnify Employee against and hold Employee
harmless from any costs, liabilities, losses and exposures for Employee's
services as an employee, officer and director of Company (or any successor).

     14.  Miscellaneous. No provision of this Agreement may be modified, waived
or discharged unless such waiver, modification or discharge is agreed to in
writing and signed by Employee and such officer as may be specifically
authorized by the Board. No waiver by either party hereto at any time of any
breach by the other party hereto of, or in compliance with, any condition or
provision of this Agreement to be performed by such other party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. This Agreement is an integration of the parties'
agreement; no agreement or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not set forth expressly in this Agreement. Employee represents
and warrants that the execution of this Agreement will not result in any breach
of any prior or existing agreement executed by Employee with respect to any
third party. The validity, interpretation, construction and performance of this
Agreement shall be governed by the laws of the State of Texas.

     15.  Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

     16.  Entire Agreement. This Agreement contains the entire understanding of
the parties in respect of the subject matter and supersedes and replaces in full
all prior written or oral agreements and understandings between the parties with
respect to such subject matters.

                           - SIGNATURE PAGE FOLLOWS -

                                       15

<PAGE>

     IN WITNESS WHEREOF, the parties have executed this Agreement as of
September 19, 2002 effective for all purposes as provided above on the
Effective Date.

                                        PLAINS EXPLORATION & PRODUCTION
                                        COMPANY

                                            /s/ James C. Flores
                                        By:_____________________________________
                                            James C. Flores
                                            Chairman and Chief Executive Officer

                                        EMPLOYEE

                                            /s/ John T. Raymond
                                        ________________________________________
                                        John T. Raymond

                                       16<PAGE>

                                                                   EXHIBIT 10.15

                          [PLAINS RESOURCES LETTERHEAD]

August 19, 2001

Mr. Steve Thorington
6623 Westchester
Houston, Texas 77005

                    Re: Terms of Employment with the Company

Dear Steve:

I am pleased to offer you the position of Executive Vice President - Chief
Financial Officer of Plains Exploration & Production Company L.P. (the
"Company"). This offer letter shall outline the terms of your employment with
the Company.

Subject to earlier termination by either you or the Company, you will be
employed by the Company for a term of five years commencing as soon as possible
but no later than September 3, 2002 (the "Effective Date"). The term of your
employment will automatically be extended one year and again for successive
one-year periods on each anniversary thereof, if you and the Company have agreed
to new compensation terms at least ninety days prior to the end of the initial
five-year period and any additional one-year extensions (the initial five-year
term and any additional years are hereinafter referred to as the "Term"). Your
annual salary shall be $300,000, and you shall be eligible for an annual target
bonus of $300,000, (pro-rata for 2002 bonus consideration), subject to
attainment of goals set forth by the Company's Board of Directors (the "Board").

Your compensation shall include Stock Appreciation Rights ("SARs") covering
300,000 shares of the Company's commons stock. The grant date of the SARs shall
be the Effective Date and the SARs shall have a per share exercise price equal
to the price of the Company stock in its initial public offering. The SARs
generally shall be fully exercisable upon a "change in control" of the Company
(as defined in the Company Stock Plan), upon a termination of employment by the
Company for any reason other than "cause" (as defined in the Company Stock Plan)
and upon your death.

In addition, you will be entitled to receive a signing bonus of $350,000 and
45,000 shares of restricted stock in Plains Resources, Inc., vesting ratably
over three years from the Effective Date. Should the Spin-Off of the Company not
be successfully completed on or before May 22, 2003, you will succeed to the
position of Executive Vice President - Chief Financial Officer of Plains
Resources Inc., with the same terms of employment outlined herein and the SARs
will be converted to options in Plains Resources Inc. stock with an exercise
price equal to the closing price of Plains Resources Inc. common stock on the
Effective Date.

<PAGE>

August 19, 2002
Page 2 of 3

If the Company terminates your employment during the Term for any reasons other
than cause or if a "change of control" of the Company (as defined in the Stock
Plan) occurs or if your employment terminates due to your death during the
Term, you will receive a severance payment equal to two times the sum of your
base salary and last earned annual bonus, (provided that if such termination
shall take place prior to the end of the first full calendar year of employment
(i.e., prior to December 31, 2003) the bonus used for the severance calculation
shall be the target bonus), and the SARs shall immediately vest. In addition,
you will be entitled to health benefits for up to two years, subject to
mitigation should you become entitled to health benefits under another plan.

During the Term and for any period thereafter, you shall not, without the
written consent of the Board or a person authorized by the Board, disclose to
any person, other than an employee of the Company or a person to whom disclosure
is reasonably necessary or appropriate in connection with the performance of
your duties as an executive of the Company, any confidential information
obtained by you while in the employ of the Company with respect to the Company's
business, including but not limited to technology, know-how, processes, maps,
geological and geophysical data, other proprietary information and any
information whatsoever of a confidential nature, the disclosure of which you
know or should know will be damaging to the Company; provided, however, that
confidential information shall not include any information known generally to
the public (other than as a result of unauthorized disclosure by you) or any
information which you may be required to disclose by any applicable law, order,
or judicial or administrative proceeding.

While you are an employee of the Company, you shall not in North America,
directly or indirectly engage in or become interested financially in as a
principal, employee, partner, shareholder, agent, manager, owner, advisor,
lender or guarantor of any person engaged in any business substantially
identical to the Business (defined below); provided, however, that you may
invest in stock, bonds or other securities any such business (without
participating in such business) if: (i)(A) such stock, bonds, or other
securities are listed on any United States securities exchange or are publicly
traded in an over the counter market and (B) its investment does not exceed, in
the case of any capital stock of any one issuer, 5% of the issued and
outstanding capital stock, or in the case of bonds or other securities, 5% of
the aggregate principal amount thereof issued and outstanding, or (ii) such
investment is completely passive and no control or influence over the management
or policies of such business is exercised. The term "Business" shall mean the
exploration, development and production of crude petroleum and natural gas.

Further, during the Term and for a period of one year thereafter, you shall not
solicit or hire, directly or indirectly, in any manner whatsoever (except in
response to a general solicitation), in the capacity of employee, consultant or
in any other capacity whatsoever, one or more of the employees, directors or
officers or other persons (hereinafter collectively referred to as "Employees")
who at the time of solicitation or hire, or in the

<PAGE>

August 19, 2002
Page 3 of 3

90-day period prior thereto, are working full-time or part-time for the Company
or any of its subsidiaries and you shall not endeavor, directly or indirectly,
in any manner whatsoever, to encourage any Employee to leave his or her job with
the Company or any of its Subsidiaries and you shall not endeavor, directly or
indirectly, and in any manner whatsoever, to incite or induce any client of the
Company or any of its Subsidiaries to terminate, in whole or in part, its
business relations with the Company or any of its Subsidiaries.

If you agree with the terms as set forth herein, please sign both copies of this
letter and return one copy to me at the above address.

Sincerely,

/s/ James C. Flores
---------------------------
James C. Flores
Chairman and Chief Executive Officer

Agreed to and accepted by on the 20th day of August, 2002:

/s/ Steve Thorington
---------------------------
Steve Thorington

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