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Nuevo Nabs Some CA Assets From Texaco

Nuevo Nabs Some CA Assets From Texaco

Nuevo Energy, a Houston, TX-based exploration and production company, bolstered its California position Tuesday by paying Texaco $61 million for interests in six oil and gas fields. Including these acquisitions, 87% of Nuevo's total reserves and production will be based in California.

"One of Nuevo's goals for 1999 is to take advantage of the current industry cycle by buying producing properties in our core areas," said Doug Foshee, Nuevo CEO. "In addition to increasing our reserve base and production, the acquisitions will enable Nuevo to reduce operating expenses per Boe produced and realize immediate positive cash flow. We also expect to realize upside through additional recompletions and operating efficiencies; by transferring technologies such as multiple completions, horizontal drilling and waterflooding; and through exploratory drilling."

All of the newly acquired reserves are part or near existing Nuevo producing regions onshore Kern County and offshore Ventura County. The purchase expands Nuevo's acreage in the Cymric field, the company's largest asset, increases its interest in the East Coalinga, Dos Cuadras, Pitas Point and Monumant Junction fields, and adds the Buena Vista Field to Nuevo's list of assets. Once closed, the deal will increase Nuevo's production to 52,000 Boe/d from 47,000 Boe/d.

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