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Petroleum industry

Costilla Energy Authorizes Stock Repurchase and Reports Strong Operational Performance

Strategic Insights

— 2 min read

Costilla Energy, Inc. reported that its board of directors has authorized the repurchase of 500,000 shares of the company's common stock, or about five percent of the 9,981,000 outstanding common shares. This decision reflects management's conviction that the current market price of the stock does not accurately reflect the company's underlying value. The company has reported strong operational performance, with average daily production increasing by 42 percent to 93.7 million cubic feet of gas equivalent per day (MMCFEPD) in the second quarter of 1998, compared to 66 MMCFEPD at the beginning of 1998. With a significant inventory of prospective drilling locations, Costilla has substantial growth opportunities.

Key Takeaways:

  • Costilla Energy's board of directors has authorized the repurchase of 500,000 shares of the company's common stock, representing approximately five percent of the outstanding common shares.
  • The company's management believes the current market price of the stock does not accurately reflect its underlying value, citing recent operating successes and significant prospects going forward.
  • Costilla has reported strong operational performance, with average daily production increasing by 42 percent to 93.7 million cubic feet of gas equivalent per day (MMCFEPD) in the second quarter of 1998.
  • The company's average net daily production grew at a compounded annual growth rate of 98 percent over the four years ended December 31, 1997.
  • Costilla has an inventory of more than 600 prospective drilling locations throughout its core operating areas in the Permian Basin, the Rocky Mountains, and South and East Texas.
  • The company's common stock is traded on the Nasdaq National Market under the symbol COSE.
  • Costilla Energy, Inc. is an independent energy company actively engaged in the exploration, acquisition, and development of oil and gas properties, with operations primarily in the Permian Basin, South and East Texas, and the Rocky Mountain regions.

Statistics:

  • 500,000 shares of common stock authorized for repurchase by the board of directors.
  • 5% of the 9,981,000 outstanding common shares equal to the number of shares authorized for repurchase.
  • 93.7 million cubic feet of gas equivalent per day (MMCFEPD) reported as average daily production in the second quarter of 1998.
  • 42% increase in average daily production from 66 MMCFEPD at the beginning of 1998 to 93.7 MMCFEPD in the second quarter of 1998.
  • 98% compounded annual growth rate in average net daily production over the four years ended December 31, 1997.
  • 600+ prospective drilling locations identified throughout the company's core operating areas.

Sources:

  • Costilla Energy, Inc. (PRNewswire, July 15, 1998)
  • Securities and Exchange Commission filings (incorporated by reference)
  • Company website: http://www.costillaenergy.com
  • Nasdaq National Market listing (symbol COSE)

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