DENVER, Colorado — Tipperary Corporation (AMEX-TPY), an independent oil and gas company, today announced it has entered into a contract to supply gas to Allgas Energy Ltd., a utility located in Brisbane, Queensland. Allgas was recently acquired by Energex, a retail electricity distributor owned by the Queensland government.

The five-year contract calls for the delivery of up to approximately 5.5 million cubic feet of gas per day from the Comet Ridge Coalbed Methane project, located some 250 miles northwest of Brisbane. Tipperary owns a 55.75% interest in the project.

David Bradshaw, CEO of Tipperary, said, "The contract should result in a net back around US$1.25 per Mcf at current abnormally low exchange rates. This would generate approximately US$1.3 million in revenues per year net to the Company. At higher exchange rates, our realized price per Mcf in U.S. dollars would be closer to $1.50."

"We are extremely pleased to announce the first long-term agreement for high-volume deliveries from the Comet Ridge project," Bradshaw continued. "We believe this will be the first in a series of arrangements for the sale of coalbed methane, which in turn, will support a renewed and more aggressive exploitation program on our 1.1 million acre Authority to Prospect. While the total sales volumes under this five-year contract are significant, they represent less than 5% of the total proved reserves currently assigned to the project. The agreement contemplates the drilling of several additional wells and potentially expanded sales to Allgas. We fully intend to explore and further develop this vast resource in conjunction with this unique public/private partnership."

In addition to its major interest in the Australia coalbed methane project, Tipperary has producing properties primarily in the Rocky Mountain region and in the Permian Basin of west Texas and southeast New Mexico.

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-K for the Fiscal Year Ended September 30, 1997, for meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.