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| Costilla's Fourth Speaks Well Tests with AOF Potential of 64 MMCFD |
Speaks Field Production Ramps up 30 Percent with New Well Producing 6.7 MMCFD;
Natural Gas Production Rises to 64 Percent of Costilla's Total Production;
Company Continues Share Repurchases
MIDLAND, Texas, Aug. 25 /PRNewswire/ -- Costilla Energy, Inc.
(Nasdaq: COSE) announced today that its fourth well in the gas-rich Southwest
Speaks property tested with a calculated absolute open flow rate of 64 million
cubic feet of natural gas per day (MMCFD). Actual production from the well is
currently at 6.7 MMCFD, with flowing tubing pressure of 9,350 pounds on a
12/64-inch choke. The new well brings the company's gross production from the
Speaks field to approximately 30 MMCFD, an increase of 30 percent over
previously reported levels.
"Our strategy of drilling high-impact gas wells continues to be a
successful one," said Mike Grella, president and CEO of Costilla Energy. "As
planned, our focus has strengthened the gas component of our reserves and
production rates."
The new Speaks well brings the gas ratio of Costilla's current total
production to approximately 64 percent. For the six months ended
June 30, 1998, Costilla's production mix included 55 percent natural gas.
Costilla presently has three additional wells in progress on the 11,000 acre
Speaks project which is located in Lavaca County in southeast Texas. A rig
presently drilling on one of these wells will be deployed late in the current
quarter to commence the sidetracking of the Migl-Mitchell #2.
The company continues to purchase its common shares, which the company
believes to be undervalued, through the previously announced stock buyback
program. Since initiation of the program in July 1998, approximately 160,000
shares have been repurchased. Additionally, senior officers of the company
have individually purchased approximately 40,000 shares since the last Form 4
filing period reported on August 10th.
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 & CEO, or Guy McCrary,
Manager, Investor Relations, both of Costilla Energy, Inc.,
915-683-3092
