The Virtual Telescope for X-Ray Observations (VTXO) is an Astrophysics SmallSat mission being developed to demonstrate 10-milliarcsecond X-ray imaging using a Phase Fresnel Lense (PFL) based space telescope. PFLs promise to provide several orders of magnitude improvement in angular resolution over current state of the art X-ray optics. However, PFLs for astronomical applications require a long focal length, for VTXO the focal length is estimated to be in the range of 0.5 km to 4 km. Since these focal lengths are not feasible on a single spacecraft, the proposed solution is to use two separate spacecraft, one with the lense(s), and the second with an X-ray camera. These two spacecrafts will then fly in a formation approximating a single rigid telescope. In order to achieve this configuration, the two spacecraft must maintain the formation a focal length distance apart, with centimeter level control, and sub-millimeter level knowledge requirements. Additionally, the system must keep the telescope axis pointed at a fixed target on the celestial sphere for extended durations. VTXOs system architecture calls for two CubeSats to operate in a highly eccentric Earth orbit with one of the spacecrafts traveling on a natural keplarian orbit. The second spacecraft will then fly on a pseudo orbit maintaining a fixed offset during observations. Observations with this system will occur near apogee where differential forces on the spacecrafts are minimal which in turn minimizes fuel consumption. This paper overviews VTXOs system architecture, and looks in depth at the formation flying techniques, including fuel consumption, and methods maintaining the formation. Beyond its use in X-ray astronomy, these formations flying techniques should eventually contribute to the development of distributed aperture telescopes, with imaging performance orders of magnitude better than the current state of the art.