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HARCOR ENERGY INC. ANNOUNCES PROPOSED ACQUISITION OF SOUTH TEXAS NATURAL GAS PROPERTIES

 HARCOR ENERGY INC. ANNOUNCES PROPOSED ACQUISITION
 OF SOUTH TEXAS NATURAL GAS PROPERTIES
 LOS ANGELES, Oct. 5 /PRNewswire/ -- HarCor Energy Inc. (NASDAQ: HARC) announced today it has entered into a letter of intent to acquire up to 25.25 percent interest in a partnership formed to purchase of a group of natural gas properties in South Texas with an effective date of July 1, 1992. HarCor's 25.25 percent share of the partnership's purchase of the reserves is $3.34 million. Financing for the purchase has been arranged through a limited recourse facility to the partnership which will advance 70 percent of the purchase price.
 HarCor has also secured a four-month option to acquire an additional 25.25 percent of the partnership at a cost of $3.76 million. Under the terms of this arrangement, if HarCor does not exercise its call option by Feb. 28, 1993, the limited partner is granted a four-month put option for HarCor common stock. The number of shares to be issued under the put would be calculated based on an estimated $1.4 million cash to be paid to the limited partner (net of loan proceeds) divided by the average bid price of HarCor's common stock for 10 days prior to exercise of the put.
 Total proved reserves net to the 25.25 percent interest are estimated at 4.4 billion cubic feet of natural gas and 88,000 barrels of liquids. A firm three-year wellhead gas purchase contract in excess of $1.80 per MCF is being arranged as part of the acquisition.
 Commenting on the transaction, Mark G. Harrington, HarCor's chairman and chief executive officer stated, "The proposed acquisition of these properties fits our strategic shift towards natural gas. The risk management tools utilized in financing and wellhead pricing should provide our shareholders with a well- protected stream of cash flow. In closing the first 25.25 percent of this purchase, the 10 percent net present value of our U.S. reserves will be increased 50 percent over its year-end 1991 level; the closing of the balance of the transaction would double those reserve values."
 HarCor is a Los Angeles-based independent oil and gas concern with operations in the United States and Canada.
 -0- 10/5/92
 /CONTACT: Mark G. Harrington, chairman and CEO of HarCor, 310-575-9599/
 (HARC) CO: HarCor Energy Inc. ST: California IN: OIL SU: TNM


BP-EH -- LA021 -- 6599 10/05/92 12:48 EDT
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Publication:PR Newswire
Date:Oct 5, 1992
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