Carrizo Oil & Gas Provides Update on Operations Following Hurricane Harvey and Announces the Sale of Its Utica Shale Assets
September 05 2017 - 6:30AM
Carrizo Oil & Gas, Inc. (Nasdaq:CRZO) today
provided an update on its operations following Hurricane Harvey as
well as announced an agreement to sell its assets in the Utica
Shale.
Operational Update Following Hurricane
Harvey
Carrizo’s producing assets and facilities in the
Eagle Ford Shale sustained no damage as a result of Hurricane
Harvey. In preparation for the storm, the Company suspended its
drilling and completions operations in the play, but crews were
able to return to the field last week, and all of the Company’s
operated Eagle Ford rigs and frac crews have resumed operations. As
a result of downtime at third party midstream facilities and Gulf
Coast refineries, sales volumes were temporarily reduced. The
Company was able to secure some storage capacity, which has
partially mitigated the impact on its production. Many of the third
party facilities have restarted and resumed taking crude oil and
natural gas, and Carrizo expects to be able to ramp back to nearly
full sales capacity in the play this week. The Company plans to
update its production guidance once more detailed information is
available.
Utica Shale Divestiture
On August 31, 2017, Carrizo entered into an
agreement to sell substantially all of its assets in the Utica
Shale, located primarily in Guernsey County, OH, for $62 million in
cash, subject to customary closing conditions. Additionally,
Carrizo could receive contingent payments of up to $15 million in
aggregate based on average annual WTI prices exceeding certain
thresholds over the next three years. The effective date of the
transaction is April 1, 2017, and the transaction is currently
expected to close by October 31, 2017.
S.P. “Chip” Johnson, IV, Carrizo’s President and
CEO, commented, “While we cannot yet fully quantify the impact of
Hurricane Harvey given potential damage to third party midstream
and refining assets along the Gulf Coast, we are pleased to report
that our employees are safe and our assets were not damaged. I’d
like to commend our staff for their effort and dedication leading
up to the storm as well as in the days following it. As a result,
our team was able to return to drilling and completion operations
with limited downtime as well as finalize the sale of our Utica
Shale package while also dealing with the personal aftermath of
this historic storm. As a Houston-based company, our thoughts
continue to be with our employees as well as our neighbors and the
many other Texans who were impacted by Hurricane Harvey and are
dealing with very difficult conditions.”
Carrizo Oil & Gas, Inc. is a Houston-based
energy company actively engaged in the exploration, development,
and production of oil and gas from resource plays located in the
United States. Our current operations are principally focused in
proven, producing oil and gas plays primarily in the Eagle Ford
Shale in South Texas, the Delaware Basin in West Texas, the DJ
Basin in Colorado, and the Marcellus Shale in Pennsylvania.
Statements in this release that are not
historical facts, including but not limited to those related to
sales capacity, updates, closing date timing, contingent payments,
guidance, production, the estimated production results and
financial performance, effects of transactions, timing, levels of
and potential production, downspacing, oil and gas prices, drilling
and completion activities, drilling inventory, including timing
thereof, production mix, development plans, growth, hedging
activity, the Company’s or management’s intentions, beliefs,
expectations, hopes, projections, assessment of risks, estimations,
plans or predictions for the future, results of the Company’s
strategies and other statements that are not historical facts are
forward-looking statements that are based on current expectations.
Although the Company believes that its expectations are based on
reasonable assumptions, it can give no assurance that these
expectations will prove correct. Important factors that could cause
actual results to differ materially from those in the
forward-looking statements include assumptions regarding well
costs, estimated recoveries, pricing and other factors affecting
average well returns, results of wells and testing, failure of
actual production to meet expectations, performance of rig
operators, spacing test results, availability of gathering systems,
costs of oilfield services, actions by governmental authorities,
joint venture partners, industry partners, lenders and other third
parties, actions by purchasers or sellers of properties,
satisfaction of closing conditions and failure of disposition to
close, purchase price adjustments, integration, WTI price levels,
and other risks and effects of acquisitions, market and other
conditions, risks regarding financing, availability of well
connects, capital needs and uses, commodity price changes, effects
of the global economy on exploration activity, results of and
dependence on exploratory drilling activities, operating risks,
right-of-way and other land issues, availability of capital and
equipment, weather, and other risks described in the Company’s Form
10-K for the year ended December 31, 2016 and its other filings
with the U.S. Securities and Exchange Commission. There can be no
assurance any transaction described in this press release will
occur on the terms or timing described, or at all.
Source: Carrizo Oil & Gas, Inc.
Contact:
Jeffrey P. Hayden, CFA, VP - Investor Relations
(713) 328-1044
Kim Pinyopusarerk, Manager - Investor Relations
(713) 358-6430
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