SAN ANTONIO, March 19 /PRNewswire-FirstCall/ -- Tidelands Oil & Gas Corporation (OTCBulletinBoard:TIDE), would like to provide our shareholders and the investment community with an update concerning the status of activities within Frontera Pipeline LLC ("Frontera") and the Burgos Hub project in South Texas and Northern Mexico.
Last week, representatives of Frontera Pipeline LLC received an update from the CRE (Comision Reguladora de Energia) concerning the status of various matters connected with the Burgos Hub project.
With respect to the application for a permit to develop an underground natural gas storage facility in the Brasil field in northern Mexico, the CRE informed Frontera that consideration of the policy options for granting an award of a storage permit has been delayed due to the need of SENER (the Mexican Energy Ministry) to focus on the energy reform legislative proposals currently being considered by the Mexican legislature. The CRE indicated that they are hopeful that SENER will be able to turn their attention back to the storage permit issues in approximately six weeks, after the adjournment of the legislative session.
With respect to the existing pipeline permits now held by Frontera and the expected amendment of those permits, the CRE indicated its willingness to consider an extension of the current pipeline permit provided Frontera files the requisite information and observes all necessary procedures for the extension request. After this extension of the current permit is granted, Frontera would proceed with the activities necessary to file for amendment of the current pipeline permit in order to add a new pipeline segment beginning at Station 19 of the National Pipeline System south of Reynosa, Tamaulipas, and extending to a central distribution point in Monterrey, Nuevo Leon. Frontera expects to conduct a valuation of the rights of way for this new pipeline segment, additional gas flow modeling and engineering design work prior to the filing of the application for amendment of the current pipeline permit. These activities are expected to take several more months and must occur prior to the filing of the amendment to the pipeline permits held by Frontera.
The CRE also indicated that changes in the regulatory scheme for the use of natural gas pipelines in Mexico have now been finalized. Frontera, with the assistance of legal counsel in Mexico, is studying these changes with a view towards an analysis of the commercial impact of such changes on the proposed pipelines of the Burgos Hub project. The CRE explained that the changes will be effective in 2009 and are intended to require the unbundling of pipeline services in natural gas transportation. As a result of these changes, various forms of capacity rights are expected to be bid for by natural gas users in an open season process similar to that conducted under the regulatory regime that exists in the United States of America. The CRE also stated that on a national basis, the existing natural gas pipeline network was operating at 85% of capacity which indicates a need for further pipeline capacity development in order to ensure safe and reliable transportation services for natural gas users in Mexico.
James B. Smith, Tidelands' President and CEO, said, "Our management team remains committed to exploring new opportunities in the energy industry while bringing to fruition the projects with which we are currently involved. Our business strategy includes corporate level debt reduction and disposal of non-core and underperforming business segments with a view towards positioning Tidelands for future growth and expansion in areas that complement our current business plans."
About Tidelands Oil & Gas Corporation
Tidelands Oil & Gas Corporation, San Antonio, Texas, focuses its business on natural gas pipeline infrastructure and natural gas receiving and storage facilities. For more information about the Company, please visit http://www.tidelandsoilandgas.com.
This press release may be deemed to contain certain Forward-Looking Statements with respect to the Company that are subject to risks and uncertainties that include, but are not limited to, those identified in the Company's press releases or discussed from time to time in the Company's Securities and Exchange Commission Filings. Actual results may vary.
COMPANY CONTACT James B. Smith Tidelands Oil & Gas 210-764-8642 email@example.com
Source: Tidelands Oil & Gas Corporation