Abraxas Petroleum Corporation declares its 2009 capital expenditure budget of $20 million, on a stand-alone basis, which excludes the capital expenditures of Abraxas Energy Partners, L.P., the master limited partnership (MLP) in which the Company owns a 47% interest.

The capital program for 2009 will be selected from the Company's inventory of projects and will include new drills and re-completions / workovers in the Company's primary producing regions of Texas and the Rocky Mountains. The ultimate mix of projects will be based on commodity prices, service costs and drilling results.

The 2009 capital expenditure budget will be funded from cash flow and cash on hand, including cash distributions from Abraxas Energy.

"As previously announced, we have chosen to be conservative and reduce our capital spending in 2009 due to the events that have occurred in the markets over the past few months, including a staggering decline in commodity prices and unprecedented turmoil in the equity and credit markets. It is anticipated that our 2009 capital program will be funded solely out of cash flow from operations, cash on hand, and quarterly cash distributions received from our 47% ownership in Abraxas Energy Partners and we do not anticipate borrowing any monies under our credit facility to fund our 2009 capital program. Even though we are reducing capital spending in 2009 by 35-40% from 2008 levels, we continue to expect double digit growth in production year over year, on a stand-alone basis," commented Bob Watson, Abraxas' President and CEO.

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