Sept 12, 2006

Texas American Resources Company Completes the sale of certain Gulf Coast Properties

AUSTIN, TEXAS – Texas American Resources Company (collectively referred to herein with its affiliates as “TARC” or the “Company”) announced today the completion of the sale of certain properties located in Harris, Liberty and Hardin counties, Texas to Foothills Resources, Inc. (“Foothills”) (OTCBB:FTRS) for $57.5 million in cash and $4.5 million in Foothills’ common stock. The closing of the transaction was subject to customary closing conditions with an effective date of September 1, 2006. The after-tax proceeds of the sale will primarily be used to reduce debt and fund planned capital expenditures.

David Honeycutt, TARC’s President, said “The sale of our Texas Gulf Coast properties is another significant step in focusing the Company’s future growth. We believe Foothills Resources will be a good steward over our former assets and we have an opportunity to participate in their success. We also want to thank Randall & Dewey (a division of Jefferies & Company, Inc.) for providing advisory services to us on this transaction.”