Exhibit 99.1
ABRAXAS PETROLEUM CORPORATION
www.abraxaspetroleum.com
500 N. Loop 1604 East, Suite 100, San Antonio, Texas 78232
P.O. Box 701007, San Antonio, Texas 78270-1007 Office:
210.490.4788 Fax: 210.490.8816
NEWS RELEASE
Abraxas Announces 2006 Capital Expenditure Budget and Guidance
SAN ANTONIO (Dec. 1, 2005) - Abraxas Petroleum Corporation (AMEX:ABP) today
announced a 2006 capital expenditure budget of $40 million and issued guidance
for the year.
Individual projects that comprise the $40 million capital expenditure budget
will be selected from the Company's large inventory of projects based on
availability of drilling rigs and service equipment. Every project in inventory
is located on existing leasehold in Texas and Wyoming and considered development
in nature, with the vast majority being 100% owned and operated by the Company.
Abraxas plans to fund the 2006 capital expenditure budget out of cash flow and
availability under its revolving credit facility.
Abraxas further provided the following operational and financial guidance for
2006:
Production
Annual 7.5 - 8.5 Bcfe
Exit Rate (per day) 22 - 24 MMcfe
Differentials off NYMEX
Oil $ 1.00
Gas 5%
Production Taxes 10% of revenue
Direct Lease Operating Expenses (LOE) $ 1.10 per Mcfe
General & Administrative (G&A) $ 0.55 per Mcfe
Interest $ 2.00 per Mcfe
Depreciation, Depletion & Amortization (D/D/A) $ 1.30 per Mcfe
(The above guidance does not include non-cash and extraordinary items,
including, but not limited to, stock-based compensation, stock option
expensing or bonuses.)
"Even though we remain in a tight environment in terms of available rigs and
related services, we are optimistic about our ability to spend our 2006 capital
expenditure budget of $40 million, a 25% increase over the 2005 budget. We will
begin the year utilizing our own workover rigs for re-entry and re-completion
projects, primarily in the Delaware Basin of West Texas, while we secure larger
rigs for grass roots and deeper projects. As the selected projects are
successfully completed and placed on-line, we anticipate a growing production
profile in line with our guidance", commented Bob Watson, President and CEO.
Abraxas Petroleum Corporation is a San Antonio-based crude oil and natural gas
exploitation and production company with operations in Texas and Wyoming.
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.
FOR MORE INFORMATION CONTACT:
Barbara M. Stuckey/Director of Corporate Development
Direct Telephone 210.757.9835
Main Telephone 210.490.4788
bstuckey@abraxaspetroleum.com
www.abraxaspetroleum.com