DENVER, Colorado --Tipperary Corporation (AMEX-TPY), an independent energy company, today announced that it has entered into an agreement to jointly pursue a coalbed methane exploration project with Koch Exploration Company. Tipperary completed the sale to Koch of a 50% interest in 52,000 acres which Tipperary had recently leased in Moffat County, Colorado. Koch paid Tipperary approximately $2 million in cash on closing and will spend an additional $2 million for capital costs attributable to Tipperary's retained interest over the next 18 months. Tipperary will act as operator of the project.

Jeff Obourn, Tipperary senior vice president of operations, stated, "We are encouraged that we were able to assemble such a high-quality acreage position and look forward to working with Koch. We will begin drilling operations in July, and will evaluate not only coals but other formations that have potential for conventional gas production."

Brian Kissick, vice president of business development for Koch Exploration Company, U.S. added, "This acquisition is an example of Koch Exploration's ongoing initiative to acquire unconventional gas properties in the Rocky Mountain region. We are pleased to have the opportunity to work with Tipperary in the evaluation of this highly prospective project."

The project represents Tipperary's second major coalbed methane exploration project in the Rocky Mountains. Tipperary and Barrett Resources are currently joint explorers in the Hanna Basin in Carbon County, Wyoming.

Koch Exploration Company, U.S. is one of the many companies of Koch Industries, Inc. that operate worldwide. Koch Industries and its subsidiary companies employ 11,000 people worldwide and are involved in nearly all phases of the oil and gas industry, as well as in chemicals, plastics, chemical and environmental technology products, asphalt products, mineral services, ranching, pipeline operations, financial services and ventures. More information on Koch is available at www.kochind.com on the Internet.

Tipperary Corporation is an independent energy company focused primarily on exploration for and production of coalbed methane. Headquartered in Denver, Colorado, Tipperary owns 90% of Queensland, Australia-based Tipperary Oil & Gas (Australia) Pty Ltd. This subsidiary, which holds a 62.25% interest in southeastern Queensland's Comet Ridge coalbed methane project, also owns various exploration permits in Queensland. Domestically, Tipperary holds a 49% interest in the 38,000-acre Hanna Draw coalbed methane exploration project in Wyoming and 50% of the 52,000-acre Colorado coalbed methane exploration project described above.

Information herein contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as "may," "will," "expect," "anticipate," "estimate," or "continue," or comparable words. In addition, all statements other than statements of historical facts that address activities that Tipperary expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of Tipperary, particularly its Form 10-KSB for the Transition Period Ended December 31, 2000, for meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.