Tidelands Oil & Gas Receives Permitting Approval from CRE for Natural Gas Project in Mexico

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Researched by Industrial Info Resources (Sugar Land, Texas). Tidelands Oil & Gas Corporation (San Antonio, Texas) (OTC:TIDE) subsidiary, Terranova Energia S de RL de CV (San Antonio, Texas) has been awarded a permit by the Comision Reguladora de Energia de Mexico (CRE) to begin construction on portions of the Burgos Hub Export & Import Project. The permitted portions include Terranovia Occidente and Oriente pipeline portions of the Burgos Hub. The Burgos Hub Project is composed of several integrated projects that will form the backbone of a 50 billion cubic foot underground natural gas storage facility, an offshore LNG receiving project, and pipelines linking the LNG receiving project to the storage facility, in addition to several cross boarder bi-directional natural gas pipelines. The function of the Burgos Hub Project is to create a viable energy infrastructure in northern Mexico, not only to service residential and industrial customers, but to alleviate the impact of price swings for natural gas, as well.

The recent permit award for the Occidente and Oriente sections of the project will cover the construction of approximately 323 kilometers of 30” diameter natural gas transmission pipeline, originating from the Brasil storage field to Nuevo Progreso, Mexico, and an interconnection with a proposed international pipeline crossing into south Texas. The international section will make pipeline interconnections with TETCO, TGPL and Texas Gas Services. The Oriente section of the Terranova pipeline will encompass a 149 kilometers section of 30” diameter natural gas transmission pipeline from Tideland’s proposed offshore LNG re-gasification terminal to the Norte Puerto Mezquital and then terminate at the Brasil storage field.

Tidelands Oil & Gas estimates that the total capital cost for the entire project to be approximately $1 billion and has retained the services of HSBC Securities Incorporated to help arrange the financing. All things considered, construction on the project is expected to begin later in 2006. The entire project could be completed by 2009.

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