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SAN ANTONIO, May 22, 2002 -- The Exploration Co. recently announced that it has completed the acquisition of The Maverick Pipeline System from Aquila Southwest Pipeline Corporation for approximately $4.9 million.
TXCO will fund the acquisition from cash available from the closing of its recent $15 million private placement.
The assets include a 69-mile natural gas pipeline from approximately 12 miles north of Eagle Pass, Texas in Maverick County to Carrizo Springs, Texas in Dimmit County. The terminus is the El Paso Energy Field Services delivery point. Also included is a compressor station with three compressors and three dehydrators which allow the system to have maximum deliverable capacity of 35 MMcf/d of which 50 percent is currently filled. Adding this system to TXCO's Maverick Basin infrastructure now gives the company control of approximately 80 miles of pipeline in the Basin.
TXCO purchased the pipeline system through its 80 percent ownership of the newly formed Maverick-Dimmit Pipeline Ltd. partnership. The remaining 20 percent of the partnership is held by an unaffiliated private energy concern.
Jim Sigmon, president of TXCO, said, "We are extremely pleased to be able to add these pipeline assets to our growing Maverick Basin system. TXCO continues to demonstrate its commitment to the Maverick Basin by expanding both our acreage position while complementing it with key infrastructure purchases and enhancements. Control of this system should strengthen our margins for natural gas sales by reducing transportation costs making it immediately accretive to cash flow."
About TXCO
The Exploration Company is an independent oil and gas enterprise with interests in Texas, North Dakota, South Dakota and Montana. Its long-term business strategy is to acquire undeveloped mineral interests and internally develop a multi-year drilling inventory. The Company's common stock trades on the Nasdaq Stock MarketSM under the symbol "TXCO".
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