Abraxas CEO Outlines Operations, Exploration Plays At Oil and Gas Conference.DENVER--(BUSINESS WIRE)--Sept. 16, 1999-- Bob Watson
See: Over-the-counter. OTC See over-the-counter market (OTC). BB:AXAS), gave an overview of the Company and upcoming exploration projects at the Dain Rauscher Wessels 1999 Energy Conference. Abraxas is a San Antonio-based crude oil and natural gas exploration and production company that also processes natural gas. The Company operates primarily along the Texas Gulf Coast, in the Permian Basin The Permian Basin is a sedimentary basin largely contained in the western part of the U.S. state of Texas. It reaches from just south of Lubbock, Texas, to just south of Midland & Odessa, extending westward into the southeastern part of the adjacent state of New Mexico. of western Texas, western Canada
Western Canada, commonly referred to as the West and southwestern Wyoming. Abraxas estimates its holdings contain 320 billion cubic feet of natural gas equivalent (Bcfe) of proved reserves proved reserves The quantity of minerals expected to be recoverable under current economic and operating conditions. The amount of proved reserves is important in valuing the stock of a company with significant holdings in natural resources. with a PV-10 value of 324 million (4/1/99 prices). The Company operates approximately 85% of its U.S. properties and produces an equivalent of approximately 95 to 99 million cubic feet (MMcfe) of natural gas per day. Abraxas' concentration of reserves and execution of its strategy to acquire producing properties with upside potential Upside potential The amount by which analysts or investors expect the price of a security may increase. upside potential The potential price or gain that may be expected in a security or in a security average, generally stated as the dollar through further development, has allowed the Company to operate as one of the lowest cost producers in its peer group. Abraxas incurs low cash production and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. and efficiently replaces its production through relatively low-risk development. Once fully developed, properties are monetized, such as the sale of Abraxas' Wyoming properties in late 1998, netting the Company an internal rate of return in excess of 30%. In south Texas, Abraxas plans continued exploration and development of its 100%-owned horizontal Edwards Reef Trend where the Company has developed proved reserves of almost 50 Bcfe with a finding and development cost of less than $0.35/mcf. In west Texas, Abraxas is studying the feasibility of employing its successful horizontal drilling technology to existing deep gas fields and is encouraged by the strengthening price of oil as the Company has identified as many as 100 possible incremental locations at its Block 16 Field. Exploitation and acquisition activities in Canada, including New Cache Petroleums, Ltd. acquired in January 1999, continue to increase production from the region and the Company's 22 gas processing facilities add to Abraxas' opportunities in the area. Canada also holds one of Abraxas' most exciting exploration plays with almost 116,000 acres bordering the Norman Wells Norman Wells, village (1991 pop. 627), Northwest Territories, Canada, on the Mackenzie River, W of Great Bear Lake. It is the center of an oil region. In 1985 a pipeline to the south was completed. Field, Canada's fourth largest, in the Northwest Territories. Although Abraxas was disappointed by the 1998-1999 winter drilling activity in the area, valuable information gained from the two shallow dry holes have refined leads and the Company hopes to drill a deeper (8,000'-10,000') exploratory test within two years. |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion