Abraxas Announces Agreement To Dissolve Eagleford Joint Venture And A Strategic Acquisition Of Additional Interests In West Texas

In addition, Abraxas announced that it has closed on a transaction with a large independent to acquire their interests in jointly owned properties in Ward County, West Texas for $7.2 million less closing adjustments. The transaction adds approximately 240 barrels of oil equivalent production per day and proved developed producing reserves of approximately 1.2 million barrels of oil equivalent. Production and reserves are approximately 95 percent natural gas. Net acres acquired are approximately 2,345.

“While relatively small and natural gas, this transaction is very strategic for Abraxas as we will now own the biggest interest in all the wells and be the operator with our existing staff out of Pyote, Texas. We only paid for the PDP reserves, which have a very long life, and at a very low price deck. These properties have a significant and identified upside and by melding operations we should see a significant reduction in operating costs,” commented Bob Watson.

Abraxas Petroleum Corporation is a San Antonio based crude oil and natural gas exploration and production company with operations across the Rocky Mountain, Mid-Continent, Permian Basin and Gulf Coast regions of the United States and in the province of Alberta, Canada.

Copyright Business Wire 2010

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