Contango Affiliate the High Bidder on Two Louisiana Lease Tracts

Contango Oil & Gas Co. said that its affiliated company, Republic Exploration LLC (REX), was the high bidder on two lease tracts at the State of Louisiana Mineral Lease Sale held on Thursday.

REX bid approximately $0.2 million ($0.08 million net to Contango) on 51.65 acres of Tract 38858, and approximately $4.4 million ($1.8 million net to Contango) on 1,436.26 acres of Tract 38860 (collectively, the "Mary Rose" prospect).

Contango also announced that its Dutch #1 well at Eugene Island 10 is flowing at 37 million cubic feet equivalent per day ("Mmcfe/d") (12.2 Mmcfe/d net to Contango). Further, the remaining $20 million of its previously announced $30 million secured term loan facility with a private investment firm is now fully available.

Contango is a Houston-based, independent natural gas and oil company. The Company's core business is to explore, develop, produce and acquire natural gas and oil properties primarily offshore in the Gulf of Mexico and onshore in the Arkansas Fayetteville Shale. The Company also owns a 10% interest in a limited partnership formed to develop an LNG receiving terminal in Freeport, Texas, and holds investments in companies focused on commercializing environmentally preferred energy technologies.