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Abraxas Announces Third Party Pipeline Constraints in South Texas

Posted on: Tuesday, 15 November 2005, 12:00 CST

Abraxas Petroleum Corporation (AMEX:ABP) today announced that due to third party pipeline constraints, the Yoakum Field in South Texas has been shut-in since November 4, 2005.

The Yoakum Field produces approximately 3.4 MMcf of natural gas per day, or approximately 16% of the Company's current daily net production. The pipeline constraints stem from capacity issues downstream that ultimately caused increased pipeline pressures upstream, and the gas from the Yoakum Field is currently unable to meet the high-pressure demands of the third party pipeline.

"We are currently reviewing every possible alternative, some of which involve negotiations with other operators as well as third parties, to relieve these pipeline constraints. We believe these constraints are a short-term issue that can be relieved with additional compression or by the arrival of seasonal weather, thus increasing demand and reducing pipeline pressures. The loss of this production should not affect our exit rate guidance of 19 - 21 MMcfepd, provided this shut-in production is back on-line by year-end; however, it will affect our overall fourth quarter and full year production figures," commented Bob Watson, Abraxas' President and CEO.

Abraxas Petroleum Corporation is a San Antonio-based crude oil and natural gas exploitation and production company with operations in Texas and Wyoming.

Safe Harbor for forward-looking statements: Statements in this release looking forward in time involve known and unknown risks and uncertainties, which may cause Abraxas' 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 Abraxas for natural gas and crude oil. In addition, Abraxas' future natural gas and crude oil production is highly dependent upon Abraxas' level of success in acquiring or finding additional reserves. Further, Abraxas operates in an industry sector where the value of securities is highly volatile and may be influenced by economic and other factors beyond Abraxas' control. In the context of forward-looking information provided for in this release, reference is made to the discussion of risk factors detailed in Abraxas' filings with the Securities and Exchange Commission during the past 12 months.

Source: Business Wire

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