EXHIBIT 99.1

                               CONTANGO OIL & GAS

                                                                    NEWS RELEASE

    CONTANGO OIL & GAS COMPANY ANNOUNCES CHANGE IN STATE OF INCORPORATION TO
         DELAWARE, A 2 FOR 1 REVERSE SPLIT AND A CHANGE IN STOCK SYMBOL

         December 1, 2000 - HOUSTON, TEXAS - Contango Oil & Gas Company
(OTCBB:BTUX) announced today that the change in its state of incorporation from
Nevada to Delaware and the effecting of a 2 for 1 reverse stock split, approved
by stockholders at the Annual Meeting of Stockholders on November 20, 2000,
became effective on December 1, 2000. As a result of the merger, effective
Monday, December 4, 2000, the Company's stock symbol on the NASDAQ Bulletin
Board will be changed from "BTUX" to "CTGO".

         Kenneth R. Peak, Chairman and Chief Executive Officer, stated, "One of
our highest priorities for the year 2001 is to build liquidity in our common
stock. Becoming listed on a major exchange is a prerequisite to achieving this
goal, and the change to a Delaware incorporation and the reverse stock split are
important steps to that end. Our business is excellent. We now have drilled 11
wells in our south Texas exploration program, 10 of which have been successful,
and we anticipate revenues and cash flow for the month of December 2000 will
exceed $2.0 million."

         The most immediate effect of the 2 for 1 reverse split will be to
reduce the number of Contango's issued and outstanding common shares from
approximately 22.9 million shares to approximately 11.5 million shares.
Similarly, diluted shares, which assumes the exercise and conversion of all
outstanding options, warrants and convertible preferred stock, would be reduced
from approximately 31.9 million shares to approximately 16.0 million shares.
Basic and diluted per share net income or loss will be increased to reflect the
reduced number of common shares.

         As soon as practicable, the Company will send to each stockholder of
record a transmittal form that will contain instructions for the surrender of
the old Contango-Nevada common stock certificates to the Transfer Agent in
exchange for new Contango-Delaware common stock certificates. As set out in the
reincorporation documents, holders of old Contango-Nevada common stock are
entitled to one-half the number of shares of new Contango-Delaware common stock.
Stockholders of old Contango-Nevada common stock whose shares are not evenly
divisible by two, and who would otherwise be entitled to receive a fraction of a
share of new Contango-Delaware common stock, will receive cash in lieu of
fractional shares or alternatively, at the election of the Company, one full
share of new Contango-Delaware common stock rather than issuing fractional
shares.

         Contango is a Houston-based, development stage, independent natural gas
and oil company. The Company explores and acquires natural gas and oil
properties primarily in the onshore Gulf Coast and offshore Gulf of Mexico.
Additional information can be found on our web page at WWW.CONTANGO-OANDG.COM.




         This news release contains forward-looking statements within the
meaning of the Securities Litigation Reform Act. The statements reflect the
company's current views with respect to future events that involve risks and
uncertainties including uncertainties related to successful negotiations with
other parties, oil and gas exploration risks, price volatility, production
levels, closing of transactions, capital availability, operational and other
risks, uncertainties and factors described from time to time in the company's
publicly available SEC reports. In light of these risks and uncertainties, the
forward-looking events described in this release might not occur.

Contango Oil & Gas Company                            For information, contact:
3700 Buffalo Speedway, Suite 960                      Kenneth R. Peak
Houston, Texas 77098                                  (713) 960-1901
WWW.CONTANGO-OANDG.COM