Abraxas Announces New 6 MMcfpd Producer in South Texas and Provides an Operational Update

SAN ANTONIO--(BUSINESS WIRE)--Abraxas Petroleum Corporation (NASDAQ:AXAS) today announced a new 6 MMcf of gas per day producer in South Texas and provided an operational update.

Herein, we refer to Abraxas Petroleum Corporation and its subsidiaries as “Abraxas Petroleum” and Abraxas Energy Partners, L.P. and its subsidiaries as “Abraxas Energy” or the “Partnership.”

South Texas:

• In DeWitt County, the new well is currently producing approximately 6 MMcfpd naturally from the first section of the lateral with an additional six sections of lateral remaining behind pipe. The Nordheim #2H was drilled to a total measured depth of approximately 17,100’, including a 3,000’ lateral in the Edwards formation. A liner with seven isolation packers was set in the lateral section and while preparing the well for its multi-stage fracture stimulation, the toe of the lateral was opened and produced gas with over 4,000 psi of flowing pressure. Abraxas Petroleum owns a 75% working interest in this well.
• In Lavaca County, the Henson #2H, a horizontal Edwards well originally drilled and completed in 2000, was stimulated with a multi-stage fracture treatment. As a result, production from this well increased 400% from 0.5 MMcfpd to 2.5 MMcfpd. Abraxas Energy owns a 75% working interest in this well.

West Texas:

• In Scurry County, four wells have been drilled on our Huddleston lease and each well is currently producing 10 – 25 barrels of oil per day from the Clearfork / Glorietta formations at approximately 3,500’. Abraxas Petroleum owns a 100% working interest in each of these wells.
• In Coke County, one well of the three-well program in our Millican Reef Unit has been drilled to a total depth of 6,700’, completed in the Strawn formation with production pending electrical connection. The next two wells will be drilled when commodity prices improve or service costs come down. Abraxas Petroleum owns a 92% working interest in each of these wells.

Wyoming:

• In Brooks Draw, the Turner sandstone tested commercial rates of oil and gas before being shut-in for construction of surface production facilities. The Lakeside #1H was drilled to a total measured depth of approximately 12,500’, including a 3,800’ lateral in the Turner sandstone, and successfully completed with a seven stage fracture stimulation. Abraxas Petroleum owns a 100% working interest in this well.

“We are tremendously pleased with the initial production rates out of the Nordheim #2H which is producing naturally from only one section of the lateral. The remaining six sections behind pipe represent a significant upside opportunity. We will monitor the production and pressure data to determine if and when to fracture stimulate this well. In Wyoming, we are quite intrigued with the potential of the Lakeside #1H. The successful multi-stage fracture treatment, the flow back, and the initial production tests were very positive. We have shut the well in while surface facilities and a natural gas pipeline are being constructed. We anticipate having this well on production in the first quarter which will hopefully coincide with higher crude oil prices,” commented Bob Watson, Abraxas’ President and CEO.

Abraxas Petroleum Corporation is a San Antonio based crude oil and natural gas exploration and production company with operations principally in Texas and the Rocky Mountains. Abraxas Petroleum Corporation also owns a 47% interest in an upstream master limited partnership, Abraxas Energy Partners, L.P., which entitles Abraxas Petroleum Corporation to receive its proportionate share of cash distributions made by the Partnership.

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.