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KEY PRODUCTION ELECTS NEW CEO AND PURSUES REDIRECTION; CASH FLOW DIRECTED AT GROWTH VS. DIVIDENDS

 KEY PRODUCTION ELECTS NEW CEO AND PURSUES REDIRECTION;
 CASH FLOW DIRECTED AT GROWTH VS. DIVIDENDS
 HOUSTON, Sept. 15 /PRNewswire/ -- The board of directors of Key Production Co. Inc. (NASDAQ: KPCI) today announced a shift in the company's direction aimed at growing Key's oil and gas production and reserves. Francis H. "Mick" Merelli was elected chairman, chief executive officer and president of the company to implement the new strategy.
 Key, an independent energy company formed in 1988, has foregone reserve replacement in favor of reducing its debt, repurchasing shares of its common stock and paying dividends to shareholders. With Key's debt virtually eliminated, Merelli will lead the company in pursuit of active exploration and production operations and acquisitions to grow oil and gas reserves and production.
 Merelli's career spans 33 years. He was a director of Key for three years while also serving as president and chief operating officer of Apache Corp. (NYSE: APA) from 1988 to 1991. Merelli was instrumental in Apache's transformation from a drilling-fund company to a more conventional exploration and production company.
 To foster Key's independence, the Apache-affiliated directors have resigned from Key's board of directors. In addition to Merelli, the new board of directors will include Cortlandt Dietler, chairman and chief executive officer of Associated Natural Gas in Denver, and Tim Moylan, president and chief executive officer of Omaha-based Mainline Enertech Corp.
 Key's strategic redirection calls for the bulk of the company's cash flow to be dedicated to potential growth opportunities. To pursue these opportunities in a meaningful way, Key's new board has elected to discontinue the semi-annual dividend until further notice.
 Endorsing the shift in Key's corporate direction, Apache continues to hold approximately 2 million shares, or approximately 20 percent, of Key's outstanding common stock.
 Key is an independent natural gas and crude oil production company. Shares of Key's common stock trade on the NASDAQ system (symbol KPCI).
 -0- 9/15/92
 /CONTACT: Jeanne Buchanan of Key Production, 713-296-6155/
 (KPCI APA) CO: Key Production Co. Inc.; Apache Corp. ST: Texas IN: OIL SU: PER


TS-MC -- DV002 -- 9456 09/15/92 08:36 EDT
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Publication:PR Newswire
Date:Sep 15, 1992
Words:348
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