Tidelands Oil & Gas Co., headquartered in Corpus Christi, TX, said Wednesday that Reef International LLC, a subsidiary, has filed applications to construct and operate an international pipeline crossing into Mexico. The Eagle Pass/Piedras Negras pipe crossing would deliver natural gas, propane and butane, and is expected to be operational by the first quarter of next year.

Tidelands, which declared bankruptcy in 2000, said the pipeline crossing “represents the first step” in refocusing the company into becoming a major transporter. It expects “significant” revenues with the pipe crossing, which it said would be reflected by the second quarter of 2002’s operating results. Earlier this year, the company restructured its operations, getting rid of its non-producing wells and turning its attention toward pipelines, forming Reef International specifically to construct the international pipe. It also said that its subsidiaries Rio Bravo Energy LLC and Sonora Pipeline LLC, the 50% owned pipeline and processing plant entities, would increase the volume of gas shipped by acquiring additional gas for processing with increased shipments of gas products to end-user customers.

In the next year, Tidelands expects that its net cash requirements will be approximately $600,000. This net cash flow requirement consists primarily of the company’s short-term repayments. Current and expected increased production from its operations are expected to give Tidelands enough revenues to cover its expenses, it said. In May, Tidelands secured a three-year 10% $1 million line of credit to meet its future cash flow requirements and issued 200,000 shares of restricted common stock. The stock trades over-the-counter.

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