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10/23/2008 Avista Capital Partners Invests $55 Million in Laredo Energy

Avista Capital Partners, a leading private equity firm that invests primarily in growth-oriented energy, media, and healthcare companies, today announced it has committed $55 million to Laredo Energy IV, LP to fund the acquisition, exploration, and development of natural gas resources in the prolific Lobo Trend in South Texas.

Laredo IV, which is led by president and co-founder Glenn D. Hart, was formed in August 2006 through a $70 million commitment by EnCap Investments, L.P. and individual investors. Avista, alongside Laredo's existing shareholders, participated in a new commitment to Laredo IV of $135 million, which has been used to fund an acquisition of properties in South Texas and for additional development capital.

Steven Webster, Co-Managing Partner of Avista and Director of Laredo, said, "We know Glenn and his team at Laredo very well, and look forward to supporting their focused strategy of developing proven reserves in a region characterized by high return, low-risk opportunities with high drilling success rates. Long-term domestic gas fundamentals are favorable, and given management's outstanding track record - which includes an 84% success rate on 158 wells drilled in the Lobo Trend in the last 10 years - we are confident in their ability to continue to execute."

Mr. Hart said, "We are pleased to be working again with the Avista team, which was one of our major investors when we recapitalized Michael Petroleum in 2000. Since the sale of Michael in 2001, we have continued, as Laredo Energy, our strategy of developing Lobo Trend properties. We are pleased with our progress in building a solid lease position and growing reserve base in Laredo IV."

About Avista Capital Partners

Avista Capital Partners is a leading private equity firm with offices in New York, NY and Houston, TX. Founded in 2005, Avista's strategy is to make controlling or influential minority investments primarily in growth-oriented media, healthcare and energy companies. Through its team of seasoned investment professionals and industry experts, Avista seeks to partner with exceptional management teams to invest in and add value to well-positioned businesses. For more information, visit www.avistacap.com.



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