UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report
November 26, 2002
Abraxas Petroleum Corporation
(Exact name of registrant as specified in its charter)
Nevada
(State of other jurisdiction of incorporation)
0-19118 74-2584033
(Commission File Number) (I.R.S. Employer Identification Number)
500 N. Loop 1604 East, Suite 100
San Antonio, Texas 78232
(Address of principal executive offices)
Registrant's telephone number, including area code:
210-490-4788
Item 5.OTHER EVENTS
See attached Press Release
The following exhibits are filed as part of this report:
NUMBER DOCUMENT
99.1 Press release dated November 26, 2002
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ABRAXAS PETROLEUM CORPORATION
By: ___________________________________
Chris Williford
Executive Vice President, Chief Financial
Officer and Treasurer
Dated: November 26, 2002
Exhibit 99.1
NEWS RELEASE
ABRAXAS TO SELL CANADIAN ASSETS WITH PROCEEDS TO REDUCE DEBT
SAN ANTONIO, TX (November 26, 2002) - Abraxas Petroleum Corporation (AMEX:ABP)
today announced that it and its wholly-owned Canadian subsidiaries, Canadian
Abraxas Petroleum Limited and Grey Wolf Exploration Inc., have entered into a
Purchase and Sale Agreement with a Canadian royalty trust to sell certain
reserves and associated gas processing plants in western Canada for
approximately $138 million, subject to closing adjustments. Closing is expected
in 30-60 days with net proceeds to be used to reduce the Company's debt.
This transaction represents approximately 60 Bcfe of net proved reserves and
current production of 4,500 Boepd which equates to a purchase price of $2.30 per
Mcfe and over $30,000 per Boepd. Additionally, it represents a 7.0x multiple of
EBITDA based on annualizing actual results for the first nine months of 2002.
Abraxas will retain some production and most of its undeveloped acreage in
Canada, including all of its interests in the Ladyfern area. Subsequent to the
sale, portions of this undeveloped acreage may be developed with the buyer under
a proposed farmout arrangement.
CEO Bob Watson commented, "This monetization of a portion of our Canadian
assets, on attractive terms, will allow Abraxas to continue progress on the
previously stated goal of reducing our debt and improving our balance sheet. Our
ability to realize this kind of value in the sale is clearly indicative of the
quality assets Abraxas has been able to accumulate. We are continuing to explore
various alternatives to reduce our debt including further asset sales,
negotiating the restructuring and/or refinancing of existing debt, exchanging
debt for equity, issuing additional debt or equity securities or otherwise
raising additional funds."
CIBC World Markets and BMO Nesbitt Burns acted as co-lead financial advisors to
the Company in connection with this transaction.
Abraxas Petroleum Corporation is a San Antonio-based crude oil and natural gas
exploitation and production company that also processes natural gas. The Company
operates in Texas, Wyoming and western Canada. Please visit
www.abraxaspetroleum.com for the most current and updated information. The web
site is updated daily to comply with the SEC Regulation FD (Fair Disclosure).
Safe Harbor for forward-looking statement: Statements in this release looking
forward in time involve known and unknown risks and uncertainties, which may
cause the Company's actual results in future periods to be materially different
from any future performance suggested in this release. Such factors may include,
but may not be necessarily limited to, changes in the prices received by the
Company for crude oil and natural gas. In addition, the Company's future crude
oil and natural gas production is highly dependent upon the Company's level of
success in acquiring or finding additional reserves. Further, the Company
operates in an industry sector where the value of securities is highly volatile
and may be influenced by economic and other factors beyond the Company's
control. In the context of forward-looking information provided for in this
release, reference is made to the discussion of risk factors detailed in the
Company's filing with the Securities and Exchange Commission during the past 12
months.
FOR MORE INFORMATION CONTACT:
Janice Herndon/Manager Corp. Communications
Telephone 210.490.4788
jherndon@abraxaspetroleum.com
www.abraxaspetroleum.com