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Gold/Mining/Energy : KERM'S KORNER -- Ignore unavailable to you. Want to Upgrade?

To: Kerm Yerman who wrote (11436)	6/25/1998 12:38:00 PM
From: Kerm Yerman	Respond to of 15196

FIELD ACTIVITIES / Abraxas Petroleum Corporation Drilling Update Including Joint Venture WithGrey Wolf Exploration, Inc. (formerly Cascade Oil and Gas) In Canada Wednesday June 24, 11:16 am Eastern Time SOURCE: Abraxas Petroleum Corporation Abraxas Petroleum Corporation Announces South Texas Natural Gas Completions and Canadian Exploration Drilling Plans and Development Activities SAN ANTONIO, Texas, June 24 /PRNewswire/ -- Abraxas Petroleum Corporation (Nasdaq: AXAS - news) today announced an update on the Company's horizontal drilling program targeting the Edwards Limestone Formation in south Texas and plans for Canadian exploratory and development efforts. In the Three Rivers Field, Live Oak County, Texas, Abraxas has placed its third well, the Schultz #3H on stream flowing 2.8million cubic feet (MMcf) of gas per day with 2,410 pounds of flowing tubing pressure. Production from the well is from a3,600' horizontal lateral section, completed open hole, in the Edwards which was encountered at vertical depth ofapproximately 13,200'. A third party-operated gas processing plant was recently placed in operation and Abraxas' three wellsare currently flowing 5.7 MMcf per day into the plant. A total of 11 additional locations have been identified on the Company's 3,500 acre leasehold. In the Yoakum Field, DeWitt County, Texas, Abraxas placed on stream its first horizontal well, the Kuester #2H which is flowing at the plant capacity limited rate of 1.7 MMcf per day with 4,200 pounds of flowing tubing pressure. The well was drilled to a total depth of approximately 16,500' including a horizontal lateral of 2,600' and was completed open hole in the Edwards Limestone. Plans include the installation of additional gas processing capacity and the drilling of as many as seven horizontal wells on the Company's 2,200 acre lease block. Abraxas owns a 100% working interest in both the Three Rivers Field and the Yoakum Field. In Canada, the Company's two Canadian subsidiaries, Grey Wolf Exploration, Inc. (formerly Cascade Oil and Gas) an Canadian Abraxas Petroleum, Ltd., have recently drilled three successful wells in its Bellis area on acreage owned 100% by the two subsidiaries. The Bellis 15-36-59-16 W4 has been completed from the Nisku Formation and is currently shut in waiting on pipeline after testing 1.2 MMcf of gas per day. Completion operations on the other two wells are currently under way. The Abraxas operated Bellis plant is currently at capacity and the Company will be installing additional capacity this summer to handle this new production as well as production from additional wells scheduled to be drilled later this year. In the Northwest Territories, the Company's two Canadian subsidiaries have executed a drilling contract with Sheetah Drilling Company for Sheetah Rig 7 for the entire winter drilling season of 1998-1999. The Company has scheduled at least two exploratory Key Scarp Reef tests on its 116,000 acre block adjacent to the Norman Wells Oil Field to evaluate potential reef structures identified from seismic shot during the last winter season. The Norman Wells Field has produced in excess of 130 million barrels of 40 plus gravity oil and is currently producing approximately 29,000 barrels per day. The Company is currently shipping drilling supplies north by barge down the McKenzie River for storage in the town of Norman Wells in anticipation of this winter's drilling season. A seismic program to follow up additional leads developed as a result of this past winter's seismic program is also planned. Through its two Canadian subsidiaries, Abraxas has committed to drill three wells on its Slave Point Reef prospects in the Cranberry/Chinchaga area in northwestern Alberta. These wells are the result of last winter's seismic program. Abraxas holds interests in 68 sections of land on this play. Abraxas has secured a drilling rig for all three wells which are scheduled to be drilled this winter. Abraxas Petroleum Corporation is a San Antonio-based crude oil and natural gas exploration and production company that also processes natural gas. It operates primarily along the Texas Gulf Coast, in the Permian Basin of western Texas, western Canada and southwestern Wyoming. Safe Harbor for forward-looking statement: Statements in this release looking forward in time involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to be materially different from any future performance suggested in this release. Such factors may include, but may not be necessarily limited to, changes in the prices received by the Company for crude oil and natural gas. In addition, the Company's future crude oil and natural gas production is highly dependent upon the Company's level of success in acquiring or finding additional reserves. Further, the Company operates in an industry sector where securities values are highly volatile and may be influenced by economic and other factors beyond the Company's control. In the context of forward- looking information provided for in this release, reference is made to the discussion of risk factors detailed in the Company's filing with the Securities and Exchange Commission during the past 12 months.