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| Costilla Gains Strong Stockholder Support for Pioneer Acquisition; Special Meeting Vote Paves Way for Closing Transaction |
MIDLAND, Texas, Nov. 30 /PRNewswire/ -- The stockholders of Costilla Energy, Inc. (Nasdaq: COSE) today overwhelmingly approved the Company's proposals to issue new stock thus paving the way for the completion of the previously announced acquisition of assets from Pioneer Natural Resources USA, Inc. (NYSE: PXD; Toronto). "Today's vote indicates strong confidence in Costilla and demonstrates the near unanimous support of our stockholders for the acquisition of assets from Pioneer," said Mike Grella, president and CEO of Costilla. The announcement followed a special meeting at which stockholder approval was sought for (1) an amendment to the Company's certificate of incorporation, providing for the issuance of an increased number of common shares, (2) the issuance of new preferred stock and additional common stock, and (3) an amendment to the Company's stock option plan increasing the number of shares reserved and authorized for the plan. Each of the proposals presented in the proxy statement for the special meeting received a better than 91 percent approval of the shares voted. Costilla's purchase of domestic oil and gas properties from Pioneer is expected to close in mid-December, with an effective date of October 1, 1998. The transaction will effectively triple Costilla's reserve base and production levels, while creating significant new operating synergies and exploration opportunities. 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. 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.
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Company News On-Call:
800-758-5804, ext. 126873
CONTACT:
Mike Grella, President and CEO, or Guy
McCrary, Manager, Investor Relations, both of Costilla Energy,
Inc., 915-683-3092
