UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION



                             Washington, D.C. 20549



                                   F O R M 8-K

                                 CURRENT REPORT

                       Pursuant to Section 13 or 15(d) of
                       the Securities Exchange Act of 1934



                                 Date of Report
                                 October 3, 2001



                          Abraxas Petroleum Corporation
             (Exact name of registrant as specified in its charter)


                                     Nevada
                 (State of other jurisdiction of incorporation)





0-19118                                                   74-2584033
(Commission File Number)                (I.R.S. Employer Identification Number)




                        500 N. Loop 1604 East, Suite 100
                            San Antonio, Texas 78232
                    (Address of principal executive offices)

               Registrant's       telephone number, including area code:
                                  210-490-4788







Item 5.OTHER EVENTS

See attached Press Release











The following exhibits are filed as part of this report:

NUMBER                                           DOCUMENT

99.1                               Press release dated October 3, 2001





                                   SIGNATURES


     Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                       ABRAXAS PETROLEUM CORPORATION



                                By:    ___________________________________
                                       Chris Williford
                                       Executive Vice President, Chief Financial
                                       Officer and Treasurer


Dated:    October 3, 2001







                                  NEWS RELEASE

      ABRAXAS UPDATES SUCCESSFUL OPERATIONS AND GIVES OPERATIONAL GUIDANCE
                          FOR THIRD AND FOURTH QUARTER

SAN ANTONIO,  TX (October 3, 2001) - Abraxas  Petroleum  Corporation  (AMEX:ABP)
Chairman and CEO, Bob Watson,  commented on the Company's current  operations in
Canada and the United  States and gave  guidance  regarding  operations  for the
balance of 2001.

"In Canada,  the Company has now drilled nine successful wells since mid-year in
the Caroline and Pouce Coupe areas, none of which are currently booked as proved
or probable reserves by the Company's outside engineering firms. Abraxas expects
reserves of 3-5 Bcfe (gross) per well and has identified  over forty  additional
locations in the areas based on the recent  drilling and the 3-D seismic surveys
completed in each area this past  winter.  We also are eagerly  awaiting  winter
weather to begin our  drilling  program  in the  Ladyfern  area of  northeastern
British Columbia.  We expect to participate in the drilling of 4 gross (1.3 net)
wells this winter  based on 3-D  seismic  acquired  last  winter  that  compares
favorably with 3-D seismic  covering the successful wells drilled last winter by
Murphy Oil Corp.  (NYSE:MUR) and Apache Corp. (NYSE:APA) that immediately offset
our acreage block.

In the Pouce Coupe area, the third well since mid-year is online  producing over
5 MMcfpd and 40 Bopd  (gross).  Two  additional  wells are expected to be online
later this month and one well is currently drilling. In Caroline, two wells have
been  tested at a combined  rate of over 8 MMcfpd and 100 Bopd  (gross)  and are
expected to be online this month. One additional well is awaiting completion and
one well is currently  drilling.  Abraxas has an average 86% working interest in
the wells  drilled or  drilling to date but has a 100%  working  interest in the
majority of the subsequent drilling locations.

In the S.W. Oates area of west Texas, the Company recently completed  operations
to re-enter an existing  wellbore to a total depth of 13,400  feet.  Re-entering
the existing well saved approximately half the cost of a new well and will allow
the Company to test the Montoya formation in a cost effective manner.  The clean
out was done  with a  workover  rig and the  Company  is  currently  considering
options  for a drilling  rig to  complete  the  horizontal  portion of the well.
Abraxas has finished the evaluation of its recently acquired 3-D seismic and has
identified  as  many as 9  potential  locations  on its  100%  working  interest
acreage. In addition to the Montoya potential,  the shallower Devonian formation
will also be evaluated.

In the Montoya joint  participation area with EOG Resources  (NYSE:EOG),  EOG is
building  the  location  for the next well  which it expects to spud in the next
week and expects to spud an additional well before year end.

In light of current commodity prices,  our current level of drilling activity is
being  evaluated  and the current  pace of  drilling  will slow down to conserve
liquidity until industry  conditions  improve.  This will not have a significant
impact  on 2001  production  in light of the  successful  drilling  in the third
quarter,  but could impact projected  production  growth for 2002. While overall
production for the third quarter is expected to be modestly below second quarter
due to the impact of  previously  announced  asset sales and normal summer plant
turnarounds in Canada, Abraxas is expecting fourth quarter production to be back
to second quarter  levels and growing as we exit 2001. In addition,  the Company
expects LOE and G&A to be within current analysts'  estimates.  By operating and
controlling major projects, capital expenditures can be adjusted as there are no
current  drilling  obligations  to  maintain  acreage.  With the  closing of the
successful tender for Grey Wolf Exploration,  we are continuing to review,  with
our  investment  bankers,  options  to  refinance  some  or all of our  existing
long-term  debt including the potential  sale of additional  non-core  assets to
improve liquidity and give additional financial flexibility."

Abraxas Petroleum  Corporation is a San Antonio-based  crude oil and natural gas
exploitation and production company that also processes natural gas. The Company
operates in Texas, Wyoming and western Canada. For additional  information about
the Company,  please visit our web site,  www.abraxaspetroleum.com  for the most
current  and  updated  information.  The web site is  updated  daily in order to
comply with the SEC Regulation FD (Fair Disclosure).

Safe Harbor for  forward-looking  statement:  Statements in this release looking
forward in time involve  known and unknown  risks and  uncertainties,  which may
cause the Company's actual results in future periods to be materially  different
from any future performance suggested in this release. Such factors may include,
but may not be  necessarily  limited to,  changes in the prices  received by the
Company for crude oil and natural gas. In addition,  the Company's  future crude
oil and natural gas production is highly  dependent upon the Company's  level of
success in  acquiring  or finding  additional  reserves.  Further,  the  Company
operates in an industry  sector where the value of securities is highly volatile
and may be  influenced  by  economic  and other  factors  beyond  the  Company's
control.  In the context of  forward-looking  information  provided  for in this
release,  reference is made to the  discussion  of risk factors  detailed in the
Company's filing with the Securities and Exchange  Commission during the past 12
months.

FOR MORE INFORMATION CONTACT:
Janice Herndon/Manager Corp. Communications
Telephone 210.490.4788
jherndon@abraxaspetroleum.com
www.abraxaspetroleum.com