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    Mexco Energy buys royalty interests in Haynesville shale

    MIDLAND, Texas – Mexco Energy Corp. (AMEX:MXC) has purchased overriding royalty interests in 5,120 gross acres covering eight sections in the Haynesville trend area of DeSoto Parish, Louisiana, for roughly $1.65 million.

    Mexco paid $1.46 million in cash and 26,833 shares of its common stock. The cash portion was made from working capital and primarily from its $5.0 million credit facility. The stock was issued from Mexco's treasury shares.

    This acreage currently contains five horizontal wells producing from the Haynesville Shale formation and operated by Petrohawk Operating Co. which will operate six of the eight sections. The two remaining sections will be operated by Chesapeake Energy. The company owns average overriding royalty interests of approximately .28%. These 5,120 acres contain an additional 59 potential drill sites in the Haynesville Shale.

    Other wells drilled in the Haynesville area show the presence of at least two other potential producing zones, the Bossier and Cotton Valley, which are held by production and available for development should conditions warrant. Hundreds of Haynesville, hundreds of Cotton Valley and several dozen Bossier Shale wells are currently producing in the Haynesville trend area. The development of these royalties is free to Mexco of expenses for drilling, development and operations.

    Mexco Energy is a Colorado corporation located in Midland, Texas engaged in the acquisition, exploration and development of oil and gas properties.

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