Abraxas Announces 2011 Year-End Reserves With A 45% Increase In Oil And NGLs Over 2010

Abraxas Petroleum Corporation (NASDAQ:AXAS) today announced reserves as of December 31, 2011 which reflect a 45% increase in oil and NGLs over reserves as of December 31, 2010.

Abraxas’ total proved reserves, including its equity share of Blue Eagle Energy, LLC’s (“Blue Eagle”) proved reserves, at December 31, 2011 were 29.0 MMBoe. In addition, DeGolyer and MacNaughton, Abraxas’ independent reservoir engineering firm, estimated 24.2 MMBoe of probable reserves and 16.5 MMBoe of possible reserves on certain properties.

Net capital expenditures for development of our properties in 2011 were approximately $56.9 million. Overall 4.6 MMBoe of proved reserves were added through extensions, discoveries and revisions. Production for 2011 was 1.4 MMBoe. Finding and development cost for 2011, including future development costs of $67.5 million which was the amount that exceeded the year-end 2010 estimated costs, was $17.41 per Boe. Reserve replacement was 521% for 2011. The finding and development cost and reserve replacement calculations exclude approximately 15.2 Bcf of proved gas reserves that were re-classified as a result of the SEC’s 5 year PUD rule that went into effect at the end of 2009.

The following table contains certain proved reserve information at year-end 2011:

Total Proved Reserves (MMBoe) (a)			29.0
Reserve Replacement			521%
Finding Cost (F&D) per Boe			$17.41
Oil / NGL %			53%
Proved Developed %			53%
Operated %			86%
Reserve Life Index			21.2 years

The following table provides a reconciliation of proved reserves from December 31, 2010 to December 31, 2011 in MMBoe:

Proved Reserves at 12/31/10 (a)				26.6
Extensions / Discoveries				4.4
Acquisitions / Divestitures				—
Revisions				0.2
Decrease in Blue Eagle Equity				(0.8	)
Production				(1.4	)
Proved Reserves at 12/31/11 (a)				29.0
Present Value, Discounted 10% - Future Net Cash Flow (“PV10”) ($MM) (b)			$	326.3

The following table contains probable and possible reserve information at year-end 2011 on certain properties:

Total Probable Reserves (MMBoe) (a)				24.2
PV10 ($MM) (b)			$	154.7
Total Possible Reserves (MMBoe) (a)				16.5
PV10 ($MM) (b)			$	52.0

(a)		Includes Abraxas’ equity share of Blue Eagle’s proved reserves.
(b)		Calculated utilizing NYMEX benchmark prices for the 12-month first-day-of-the-month average for 2011 of $96.19 per barrel and $4.16 per Mcf and adjusted for appropriate differentials.

“We made a lot of progress in 2011 with respect to increasing our percentage of oil and NGLs by 45% and increasing our percentage of operated properties to 86%. We look forward to continued reserve and production growth going forward,” commented Bob Watson, Abraxas’ President and CEO.

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