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| Costilla Scores Record Production Levels With Continued Drilling Successes |
Company Exits Second Quarter Producing 93.7 MMCFEPD;
New SW Speaks Well Estimated to Produce 11 MMCFPD; AOF Potential of 120
MMCFPD; Second Quarter Drilling Achieves 91 Percent Success Rate; Drilling
Underway on Six New Gas Wells
MIDLAND, Texas, June 30 /PRNewswire/ -- Costilla Energy, Inc.
(Nasdaq: COSE) reported today that it exited the second quarter of 1998 with a
production rate of approximately 93.7 million cubic feet of gas equivalent per
day (MMCFEPD), buoyed by its recent drilling successes in its gas-rich
prospects. This is the highest level of production in the company's history.
The company announced that production from its third well in the Southwest
Speaks project is estimated to be approximately 11 MMCFD. The absolute open
flow potential of this well has been calculated at 120 MMCFD. The company
estimates this well's reserves at 20 to 40 Billion cubic feet of natural gas.
Costilla is targeting gas plays drilling in its core areas of operations
in South and East Texas. Currently, the company has six drilling rigs
deployed, with three wells drilling on the Southwest Speaks prospect in Lavaca
County, two in the East Texas/Hopewell project, and one in the Scott & Hopper
project in far South Texas. During the quarter ended June 30th, Costilla
drilled eleven wells, ten of which were productive, achieving a drilling
success rate of 91 percent.
"We are extremely pleased with our continued drilling successes,
especially as we mark this record in our production history," said Mike
Grella, president and CEO of Costilla. "Our strategic focus on high impact
gas wells provides the most opportunistic vehicle for building reserves and
cash flow at this time, and as we continue to exploit the potential of our
core properties, Costilla looks forward to improved results in the months to
come."
Costilla Energy, Inc. is an independent energy company actively engaged in
the exploration, acquisition and development of oil and gas properties, with
operations primarily in the Permian Basin of Texas and New Mexico, South and
East Texas, and the Rocky Mountain regions. Headquartered in Midland, Texas,
the Company and its predecessors have been in business since 1988. The
Company's common stock is traded on the Nasdaq National Market under the
symbol COSE. Additional information about Costilla Energy is on the Internet
at http://www.costillaenergy.com.
Certain statements in this news release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties, and other factors which may cause the actual results,
performance, or achievements of Costilla Energy, Inc. to be materially
different from any future results, performance, or achievements expressed or
implied by such forward-looking statements. Such factors include, among
others, the following: the volatility of oil and gas prices; the Company's
ability to replace its oil and gas reserves; the availability of capital
resources; the reliance upon estimates of proved reserves; operating hazards
and uninsured risks; competition; government regulation; and the ability of
the Company to implement its business strategy. Additional information is
available in the Company's filings with the Securities and Exchange
Commission, which are incorporated by this reference as though fully set forth
herein.
SOURCE Costilla Energy, Inc.
back to topRelated links:
Company News On-Call:
fax, 800-758-5804, ext. 126873
CONTACT:
Mike Grella, President & Chief Executive
Officer of Costilla Energy, Inc., 915-683-3092
