CAZA Caza Oil & Gas

RNS Number:6196O
Caza Oil & Gas, Inc.
25 February 2008

25 February 2008

                 Caza Oil & Gas, Inc. ("Caza" or the "Company")

                        Farmout Agreement with Singular

Houston, Texas (February 25, 2008) - Caza (CAZA AIM SYMBOL/CAZ TORONTO SYMBOL)
is pleased to announce that it has entered into a farmout agreement with
Singular Oil & Gas Sands, LLC ("Singular") on the Wilcox 116 Property in South
Texas.

Under the terms of the agreement Singular has acquired a 10.00% interest in the
Wilcox 116 Property. In return Singular will bear 13.33% of the drilling costs
through completion of the Jonell Cerny Gas Unit #1 test well (the "Cerny Well")
and 10.00% of all costs on the Wilcox 116 Property thereafter.  Singular will
also pay US$64,625 of back costs associated with this property to Caza.  This
transaction has been entered into by the Company's subsidiary, Caza Petroleum,
Inc. ("Caza Petroleum") in accordance with standard industry practices and
management's risk management strategy.

The Wilcox 116 Property is located in Wharton County, Texas.  Within this
property, the Cerny Well commenced drilling on 15 January 2008, and is
anticipated to take up to 60 days to drill to a depth of 16,500 feet.  The Cerny
Well is targeting gas in the Deep Wilcox Sands, which are analogous to sands
currently producing in Caza's nearby Matthys-McMillan Gas Unit #1 well (the "
Matthys-McMillan Well"). The Cerny Well, if successful, will establish numerous
development locations.  The dry well cost of the Cerny Well is estimated to be
US$8.3 million.

Caza, through Caza Petroleum, is the operator of the Wilcox 116 Property and,
following the disposal noted above, now holds a right to earn a 29.88% working
interest (which reduces to a 27.81% working interest after completion of the
initial well with a corresponding 20.86% net revenue interest).

For the purposes of the AIM Rules for Companies (the "AIM Rules"), the Company
is treating Singular as an associate of Sercor Limited, which is a substantial
shareholder of Caza, and therefore as a related party of the Company under the
AIM Rules.  The Company is also treating Singular as a related party of the
Company under Canadian securities laws and therefore this farmout agreement is
being treated by the Company as a related party transaction for the purposes of
both the AIM Rules and Canadian securities laws.

The transaction has been approved by Caza's board of directors, all of whom are
unrelated to Singular.  The board of directors of Caza considers, having
consulted with its nominated adviser, Noble & Company Limited, that the terms of
this related party transaction are fair and reasonable insofar as the Company's
shareholders are concerned.  This transaction is exempt from the formal
valuation and minority shareholder approval requirements of Multilateral
Instrument 61-101 of the Canadian Securities Administrators because the board of
directors of Caza has determined that the fair market value of the subject
matter of the transaction does not exceed 25% of Caza's market capitalization.

In March 2007, Caza entered into a farmout agreement with Singular on the Hite
Offset Property to drill the Matthys-McMillan Well in Wharton County, Texas.
Under the terms of that agreement Singular paid 15.67% of the drilling costs to
casing point of the Matthys-McMillan Well to earn a 14.01% interest in the
property thereafter.  "Casing point" is the point at which operations to
complete the well as a producer are commenced.

The Hite Offset Property and Matthys-McMillan Well are located in Wharton
County, Texas. Drilling began on the Matthys-McMillan Well in March 2007, and it
was drilled to a depth of 17,700 feet. In September 2007 this well was
perforated in the Upper Wilcox section and is currently flowing at 4.6 MMcf/d.

Caza holds a 19.62% working interest (14.32% net revenue interest) in the Hite
Offset Property.

Mike Ford, Chief Executive Officer of the Company, commented:

"Like the recent transaction with Sojitz, this transaction consolidates our
relationship with Singular in the Wharton West Wilcox area following our
collaboration on the successful Matthys-McMillan Well."

For further information contact:

John McGoldrick, Executive Chairman, Caza Oil & Gas, Inc.   +1 281 363 4442

Nick Naylor / Jamie Boyd, Noble & Company Limited           +44 (0) 20 7763 2200
(Nominated Adviser and Joint Broker)

Peter Reilly, Aquila Financial Ltd                          +44 (0) 20 7202 2601
(Financial Public Relations Advisers)


www.cazapetro.com


About Caza

Caza is engaged in the acquisition, exploration, development and production of
hydrocarbons in the Texas Gulf Coast (on-shore), south Louisiana, southeast New
Mexico and the Permian Basin of West Texas regions of the United States of
America through its subsidiary, Caza Petroleum, Inc..

In accordance with AIM Rules - Guidance Note for Mining, Oil and Gas Companies,
the information contained in this announcement has been reviewed and approved by
Anthony B. Sam, Vice President Operations of Caza who is a Petroleum Engineer
and a member of The Society of Petroleum Engineers.

ADVISORY REGARDING FORWARD-LOOKING STATEMENTS - In the interests of providing
Caza shareholders and potential investors with information regarding Caza,
including management's assessment of Caza's and its subsidiaries' future plans
and operations, certain statements contained in this news release are
forward-looking statements or information within the meaning of applicable
securities legislation, collectively referred to herein as "forward-looking
statements." Forward-looking statements in this news release include, but are
not limited to: future economic and operating performance (including per share
growth, cash flow and increase in net asset value); future drilling costs;
anticipated growth and success of resource plays and the expected
characteristics of resource plays; free cash flow which may be generated in 2008
and beyond, and potential uses for such free cash flow; anticipated production
and sales of oil, natural gas and NGLs in 2008; anticipated impact and success
of Caza's price hedging strategy, if any; anticipated costs; anticipated prices
for oil and natural gas; anticipated capital investment in 2008 and the
allocation thereof; anticipated capital inflation; anticipated capital and
operating cost efficiencies; anticipated growth in hydrocarbon production;
forecast cash flow for 2008 and the anticipated ability to meet guidance
targets.

Readers are cautioned not to place undue reliance on forward-looking statements,
as there can be no assurance that the plans, intentions or expectations upon
which they are based will occur. By their nature, forward-looking statements
involve numerous assumptions, known and unknown risks and uncertainties, both
general and specific, that contribute to the possibility that the predictions,
forecasts, projections and other forward-looking statements will not occur,
which may cause the company's actual performance and financial results in future
periods to differ materially from any estimates or projections of future
performance or results expressed or implied by such forward-looking statements.
These risks and uncertainties include, among other things: volatility of and
assumptions regarding oil and gas prices; assumptions based upon the company's
current guidance; fluctuations in currency exchange and interest rates; product
supply and demand; market competition; risks inherent in the company's marketing
operations, including credit risks; imprecision of reserve estimates and
estimates of recoverable quantities of oil, natural gas and liquids from
resource plays and other sources not currently classified as proved; the
company's ability to replace and expand oil and gas reserves; the company's
ability to generate sufficient cash flow from operations to meet its current and
future obligations; the company's ability to access external sources of debt and
equity capital; the timing and the costs of well and pipeline construction;
blowouts, fires, explosions and other sudden emergencies; drilling difficulties,
such as lost circulation; the company's ability to secure adequate product
transportation; changes in royalty, tax, environmental and other laws or
regulations or the interpretations of such laws or regulations; the risk of
terrorist threats; risks associated with future lawsuits and regulatory actions
made against the company; and other risks and uncertainties described from time
to time in the reports and filings made with securities regulatory authorities
by Caza.

Although Caza believes that the expectations represented by such forward-looking
statements are reasonable, there can be no assurance that such expectations will
prove to be correct. Readers are cautioned that the foregoing list of important
factors is not exhaustive.  Furthermore, the forward-looking statements
contained in this news release are made as of the date of this news release,
and, except as required by law or regulation, Caza does not undertake any
obligation to update publicly or to revise any of the included forward-looking
statements, whether as a result of new information, future events or otherwise.
The forward-looking statements contained in this news release are expressly
qualified by this cautionary statement.

The Toronto Stock Exchange has neither approved nor disapproved the information
                               contained herein.




                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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