Giant Industries announces plans to purchase crude oil producing properties.

SCOTTSDALE, Ariz.--(BUSINESS WIRE)--Feb. 3, 1995--Giant Industries Inc. (NYSE:GI) announced Friday that its subsidiary, Giant Exploration & Production Co., has entered into an agreement to acquire an average 33.5% working interest in certain producing properties, primarily crude oil, in and near the Big Foot Field located 30 miles southwest of San Antonio.

Proved net reserves to be acquired in the transaction total approximately one million barrels of oil equivalent, comprised of approximately 98% crude oil and 2% of natural gas. Giant's share of the production from the properties would currently total approximately 235 barrels per day of crude oil and 88 Mcf per day of natural gas.

The properties will be acquired from Excelco Energy Inc., debtor in possession, subject to final bankruptcy court approval of Excelco's Plan of Reorganization. Terms of the purchase provide for a $2.5 million purchase price plus a small residual interest in all current and future wells drilled on the acquired property.

Commenting on the acquisition, Giant Chairman and Chief Executive Officer, James E. Acridge, said, "As a result of this transaction, our net crude oil production will increase by more than 25% and our aggregate proved reserves will increase by approximately 22%.

"In addition to the existing production and reserves being acquired, we also believe there is significant additional upside opportunity to increase production and reserves through further infield development," Acridge said.

Acridge stated that the company plans to invest approximately $1.5 million per year over the next 3 to 4 years to pursue the additional development opportunities.

Acridge also stated that the company will continue to seek additional acquisition candidates for its refinery, retail and exploration and production operations.

"With a fundamentally strong base of core assets, we will continue to be patient investors," Acridge concluded. "We will consummate those transactions that make sense to us and continue to expand on the internal growth and profitable opportunities within our existing operations."

The company expects the transaction to close in early March 1995, subject to receiving all required approvals.

Giant Industries Inc. is a refiner and marketer of petroleum products supported by its own crude oil and natural gas exploration and production company. Giant owns and operates a crude oil refinery, crude oil gathering pipeline system, an ethanol production plant, a fleet of crude oil and finished product truck transports and a chain of retail outlets in Arizona, New Mexico and Colorado.

CONTACT: Giant Industries Inc.

Thomas J. Gryp or George M. Seitts, 602/585-8888