MT. PLEASANT, Mich., June 26, 2002 (PRIMEZONE) -- Gastar Exploration, Ltd. (TSE:YGA) is pleased to announce that it has signed a Lease Exchange and Purchase Agreement with Lance Oil & Gas Company, Inc., Williams Production RMT Company and Western Gas Resources, Inc. (collectively "Lance/Williams/WGR") that results in Gastar and its affiliates trading approximately 5,457 net acres of coal bed methane rights in the Amos Draw area of the Powder River Basin for approximately 21,828 net acres of coal bed methane leases in an area immediately adjacent to Gastar's existing Squaw Creek development area. In addition, Gastar acquired 2,999 additional net acres of coal bed methane leases in the Squaw Creek area and has reimbursed Lance/Williams/WGR for its costs in 35 wells drilled by itself and other operators on a portion of the leases acquired through trade or acquisition. As a result of the transactions described above, Gastar has paid a total of $1,134,594 in cash to Lance/Williams/WGR, subject to adjustments subsequent to closing. No Gastar stock or any other securities have been or will be issued as a result of these transactions.
Commenting on the transaction, J. Russell Porter, Gastar's Chief Operating Officer, said, "These transactions are a win-win situation for Gastar and for Lance/Williams/WGR. With these transactions Gastar has taken a very significant step forward in the process of rationalizing and upgrading its Powder River Basin assets and consolidating its various leasehold positions. The new, mostly contiguous, lease block is primarily comprised of State of Wyoming and fee leases that will be much easier to develop, especially as related to infrastructure development. Lance/Williams/WGR also benefited by acquiring high quality, mostly Federal acreage that compliments their existing holdings. As a result of the transactions announced today, Gastar's position in the Powder River Basin has grown to approximately 39,247 net acres in which Gastar maintains an average 75% working interest position, allowing for the development of approximately 1,800 additional CBM wells."
Gastar Exploration is an exploration and production company focused on finding and developing natural gas in North America and Australia. The Company pursues a balanced strategy combining low-risk CBM development with select higher risk, deep natural gas exploration prospects. Gastar's CBM activities are conducted within the Powder River Basin of Wyoming and upon the approximate 4 million acres controlled by Gastar in Australia's Gunnedah and Gippsland Basins located in New South Wales and Victoria respectively. The Company owns prospective acreage in the Bossier Sand gas play of East Texas and in the deep Temblor gas play in the East Lost Hills field within the San Joaquin Basin of California.
This Press Release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. Although Gastar believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals and assumptions will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements contained herein, include, among others, the success and timing of certain projects, the success in drilling and producing oil and gas properties, changes in commodity prices for oil and natural gas, operating risks, the uncertainty associated with estimating underground quantities of crude oil and natural gas reserves and other risk factors as described in the Company's Annual Information Form filed on May 17, 2002, on the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release.