Abraxas Energy was formed in May 2007 by Abraxas Petroleum Corporation (AMEX:ABP) to exploit, develop, produce and acquire oil and gas properties. Our assets are located in South and West Texas.  Abraxas Petroleum is a thin volume oil & gas producer that operates in South and West Texas and in central Wyoming.  This is the parent of the spin-co and its market cap is only $193 million.  This is an interesting situation as it is very thinly covered, but keep in mind that this is a speculative play of what is already a speculative energy stock that has traded all over the place and used to be over $10.00 before 2000.

At December 31, 2006, its properties had estimated net proved reserves of 65.4 Bcfe, of which 91% were gas, with a standardized measure of $116.3 million. Net proved reserves as of December 31, 2006 were 58% proved developed and 42% proved undeveloped. At March 31, 2007, it owned an average working interest of 81% in 104 producing wells that produced 6.7 Bcfe during 2006 and 1.5 Bcfe during the three months ended March 31, 2007.  Primary producing properties are located in mature fields that exhibit relatively long-lived production, with a reserve to production index of 10.8 years based on pro forma reserves as of December 31, 2006 and pro forma annualized production for the three months ended March 31, 2007. Abraxas Petroleum operates over 90% of properties. We currently have over 80 identified drilling locations, of which 20 were classified as proved undeveloped as of December 31, 2006.

Jon C. Ogg
July 13, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.