DENVER, Colorado — Tipperary Corporation (AMEX-TPY), an independent oil and gas company, today announced results for its first fiscal quarter ended December 31, 1998.

The Company reported a net loss for the quarter of $7.3 million, or 49 cents per share, on revenue of $1.75 million compared with a net loss of $294,000, or 2 cents per share, on revenue of $2.56 million a year ago. The decrease in revenue was attributable to sharply lower oil and gas prices as compared with the prior year's first quarter. The loss for the first quarter of fiscal 1999 included a $5.7 million write-down of the Company's U.S. oil and gas properties, which was also caused by the severe deterioration in oil and gas prices.

First quarter oil volumes were 98,000 barrels versus 105,000 barrels in the same quarter last year. Domestic gas production during the quarter was 327,000 Mcf compared with 336,000 Mcf a year ago. U.S. production levels for both oil and gas were lower due to sales of producing properties and to natural production declines.

Tipperary's total gas production volumes were higher in the first quarter than they were a year ago due to the contribution of sales from the Comet Ridge coalbed methane project in Australia, which commenced during the second quarter of fiscal 1998. Sales from the Comet Ridge project were 181,000 Mcf in the first quarter of fiscal 1999.    

David L. Bradshaw, CEO, said, "Operating results continue to be negatively impacted by oil prices, which are in the range of historic lows, in real terms. This factor, coupled with decreasing domestic gas prices, has necessitated a staff reduction of 20% and other budget cuts. Fortunately, we are in the early development stages of a notable coalbed methane discovery in Queensland, Australia. We believe this project will provide unusual growth opportunities for Tipperary despite the dismal oil market."

Bradshaw added, "Our previously reported December 1998 financing transaction with our largest shareholder has provided capital for our next developmental drilling program in Australia. This eight well program is set to begin in the next few weeks."

In addition to its interest in the Comet Ridge Project, Denver-based Tipperary has producing properties primarily in the Rocky Mountain region and 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 Corporation expects or anticipates will or may occur in the future are forward-looking statements. Readers are encouraged to read the SEC reports of Tipperary Corporation, particularly its Annual Report on Form 10-K for the year ended September 30, 1998, for meaningful cautionary language disclosing why actual results may vary materially from those anticipated by management.