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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): June 17, 1996
TransTexas Gas Corporation
(Exact Name of Registrant as Specified in Charter)
Delaware 1-12204 76-0401023
(State or Other (Commission File Number) (IRS Employer
Jurisdiction of Identification No.)
Incorporation)
1300 East North Belt
Suite 310
Houston, Texas 77032
(Address of Principal Executive Offices, including Zip Code)
Registrant's telephone number, including area code: (713) 987-8600
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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INFORMATION TO BE INCLUDED IN THE REPORT
ITEM 5. OTHER EVENTS
On June 28, 1996, the Company consummated a settlement of litigation
with Tennessee Gas Pipeline Company ("Tennessee") pursuant to which the
Company received $96 million in cash. The settlement concluded litigation in
which the Company had contended that Tennessee was obligated to take
quantities of natural gas from a large area of South Texas at favorable
contract rates. A claim to a portion of the settlement proceeds in an amount
up to $31 million has been made by a royalty owner.
On July 2, 1996, TransTexas Gas Corporation (the "Company")
consummated the sale, effective as of May 1, 1996, of certain producing
properties and related gathering system located in the Charco area of the Lobo
Trend, in Zapata County, Texas to The Houston Exploration Company ("THEC") for
consideration of approximately $62 million. Proved reserves attributable to
the Charco properties were 111.7 Bcf of gas as of May 1, 1996. Production from
the Charco properties averaged approximately 41MMcfd for the quarter ended
April 30, 1996.
As additional consideration for the purchase of the Charco
properties, THEC agreed to exchange all of its daily gas production from the
acquired wells and leases, up to 115 MMcfd, for an equivalent amount of the
Company's gas at the Company's Agua Dulce sales station in Nueces County,
Texas. The exchange agreement is for the life of the acquired oil and gas
leases and requires THEC to pay the Company an exchange fee of $0.17 for
each Mcf of gas exchanged.
In addition to the sale of the Charco Properties described above, on
June 17, 1996, the Company sold to North Central P.N.G., Inc., effective as of
February 1, 1996, certain producing properties in the Hereford area in Webb
County, Texas for consideration of approximately $9.95 million. Proved
reserves attributable to the Hereford properties were 12 Bcf of gas as of
February 1, 1996. Production from such properties averaged approximately 6
MMcfd for the quarter ended April 30, 1996. Pursuant to an agreement between
the parties, the Company, through its wholly owned subsidiary, will continue
to transport gas from the area at $0.05 per Mcf for 18 months from the
effective date of the sale.
The Company has entered into a purchase and sale agreement with an
unrelated third party pursuant to which it has agreed to sell, subject to the
satisfaction of certain closing conditions, certain producing properties and
related gathering system in the Schwarz-Rottersman area, in Webb County, Texas,
effective as of February 1, 1996, for consideration of approximately $23
million. The Company anticipates closing the sale in August 1996. Proved
reserves attributable to the Schwarz-Rottersman properties were 47 Bcf of gas
as of February 1, 1996. Production from such properties averaged approximately
10 MMcfd for the quarter ended April 30, 1996. The Company also
anticipates entering into an exchange agreement with terms similar to the
agreement covering the Charco properties, covering all of the production
from the Schwarz-Rottersman leases. In addition, the Company would retain the
rights to process all of the gas produced from the Schwarz-Rottersman
properties and sell the extracted natural gas liquids.
The purchase price for each of the properties discussed herein was or
is subject to adjustment for gas sales between the effective date and the
closing date. The Company retained or will retain the proceeds of all such gas
sales.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
TransTexas Gas Corporation
Date: July 18, 1996 By: /s/ ED DONAHUE
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Ed Donahue, Vice President and
Chief Financial Officer
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