SOURCE: TX Holdings, Inc.

December 29, 2010 09:00 ET

TX Holdings Engages Hefcorp-Jon to Update Geology Report for 320-Acre Parks Lease in Callahan County, Texas

Company Files for Extension of 10K to Include Updated Geology Report

ASHLAND, KY--(Marketwire - December 29, 2010) - TX Holdings, Inc. (OTCBB: TXHG), an oil and gas operator and exploration company announces today that it has engaged Dr. M. Hugh Hefner, PH.D., President of Hefcorp-Jon, a registered Professional Geologist, to provide an updated geology report for the Company's 320-acre Parks lease located in Callahan County, Texas. Due to SEC reporting rules, requiring companies to provide current geology reports of leases, TX Holdings has elected to file for an extension of its annual report to include the updated report.

Dr. M. Hugh Hefner, Founder, Owner, and President of Hefcorp-jon, has over 25 years of experience in the sedimentary-minerals development industries (Oil, Natural Gas, Natural-Gas Condensate, Coal-Bed Methane, Coal, and Commercial Stone). Dr. Hefner also holds Adjunct Faculty appointments at three (3) Colleges and Universities. He holds Bachelor Degrees in Chemistry and Geology, Masters Degrees in Geotechnical Engineering and Business, and a Doctorate Degree in Geosciences.

During his career, Dr. Hefner has managed the successful drilling of over 8,000 commercial oil, natural-gas, and coal-bed methane wells, and has engineered, developed, and operated fourteen "underground natural-gas storage pools. He designed and built the first coal-bed methane development field in West Virginia."

In addition, TX Holdings would like to inform the investment community of its on-going lawsuit against MARK NEUHAUS, individually, DEXTER & DEXTER ATTORNEYS AT LAW, P.C. d/b/a DEXTER & DEXTER, a Utah corporation, MICHAEL CEDERSTROM, ESQUIRE, individually, HEWITT ENERGY GROUP, LLC, a Utah limited liability company, DOUGLAS C. HEWITT, individually, and GLOBAL INVESTMENT HOLDINGS, LLC, a Nevada limited liability company. The lawsuit is currently pending in the circuit court of the 11th judicial circuit in and for Miami-Dade County. Public information related to the lawsuit can be obtained at http://www2.miami-dadeclerk.com/civil/Search.aspx

TX Holdings is committed to developing the fields that the Company currently has working interests in while continuing its research for additional prospects which meet the profile that management has identified. The Company's ongoing commitment to increase shareholder value through merger and acquisitions and joint venture opportunities has resulted in discussions with several significant acquisition candidates that could provide TX Holdings with exponential growth and positive outlook for 2011. For more detailed information please visit the Company's Web page at: www.txholdings.com

About TX Holdings, Inc.
TX Holdings objective is to develop oil and gas fields that were under developed in the 1970s due to oversight and antiquated extraction methods used during the original development of the wells at that time. Most of these reserves are now accessible and identifiable with modern production methods using high-tech data accumulation and analysis capabilities.

The Company has acquired working interests on two (2) leases with significant recoverable reserves.

The Parks Lease is 320-acres and currently has 22 shallow wells. TX Holdings has a 75% working interest in this lease. To date we have reactivated 12 wells, 10 producers and 2 injectors. The current production averages 60-90 barrels a month. We are in the middle of a work-over and reactivation program to increase production. We anticipate 200-250 barrels per month within the next 12 months.

In addition to the Parks Lease, TX Holdings has acquired an 8.5% working interest on the 247-acre Contract Area 1 Lease located in Eastland County, Texas. The lease has 4 injector wells and 28 wells capable of production and is currently producing 5-6 bbls a day. The company believes it may be able to achieve higher production rates through the development of an effective water flood program. The water flood program involves the injection of water into the field through wells to force the oil to the production wells and thereby increasing the production rate. TX Holdings is currently working with the new operator to develop a plan to optimize the production. The operator is considering a water-flood method to increase the production while aggressively planning a 50 well drilling program for 2011.

Forward-Looking Statements
Safe Harbor Statement under the Private securities Litigation Reform Act of 1995: The statements contained herein, which are not historical, are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements including, but not limited to, certain delays beyond the Company's control with respect to market acceptance of new technologies, products and services, delays in testing and evaluation of products and services, and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.

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