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AIG Financial Products Corp. Closes $72 Million Volumetric Production Payment Transaction

Business Wire, July 27, 2005

WILTON, Conn. -- AIG Financial Products Corp. (AIG-FP) today announced that it closed a $72.2 million volumetric production payment (VPP) transaction for a southeastern energy company, under which AIG-FP purchased approximately 2.0 million barrels oil equivalent (BOE) of proved reserves.

The VPP includes producing oil and gas properties from 10 fields in Mississippi and Louisiana. The transaction has a term of 7.33 years and an average life of 2.8 years.

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David Ackert, energy team leader and head of the AIG-FP Transaction Development Group, said, "The VPP is a powerful tool which allows companies to unlock the value of long-lived assets at today's high oil and gas prices, substantially enhancing financial flexibility. AIG-FP is capable of participating as a principal at all levels of the capital structure by leveraging our strong balance sheet, trading capabilities and trademark ability to execute."

Joe Cassano, President of AIG-FP added, "AIG-FP brings exceptional resources, and talents, to bear in providing financial solutions to energy companies. In growing the AIG-FP energy business, we can bring to bear the capabilities of our unique and powerful global platform, where we combine an investment portfolio in excess of $50 billion with corporate finance capabilities and full service trading in currencies, commodities and a wide range of credit, equity and other financial products and indices."

About AIG Financial Products Corp.

AIG Financial Products (AIG-FP) is a wholly-owned subsidiary of American International Group, Inc. The AIG-FP group has offices in London, Paris, Tokyo, Houston, and Wilton, CT. As a leading participant in the capital and derivatives markets, AIG-FP provides its clients with corporate finance, investment and financial risk management solutions. AIG-FP's clients include the world's top corporations, asset managers, insurance companies, banks, investment banks, sovereigns and high-net-worth individuals. AIG-FP is an active trader/dealer in foreign exchange and in a full spectrum of derivative products markets including commodities, credit, energy, equity, and rates.

Business Services Industry

AIG Financial Products Corp. Closes $72 Million Volumetric Production Payment Transaction

Business Wire, July 27, 2005

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