TIDMCAZA
RNS Number : 5017H
Caza Oil & Gas, Inc.
12 July 2012
July 12, 2012
Caza Oil & Gas, Inc.
CAZA OIL & GAS PROVIDES BRADLEY OPERATIONAL UPDATE AND
ANNOUNCES SAN JACINTO PROPERTY DIVESTITURE
HOUSTON, TEXAS (Marketwire - July 12, 2012) - Caza Oil &
Gas, Inc. ("Caza" or the "Company") (TSX: CAZ) (AIM: CAZA) is
pleased to provide an operational update on the Bradley 29 Prospect
in Eddy County, New Mexico, and to announce the sale of its San
Jacinto Property in Midland County, Texas.
The Bradley "29" Fed Com No. 3H horizontal well (the "Well")
reached total measured depth of approximately 12,690 feet in early
June 2012, was successfully fracture stimulated in the 2(nd) Bone
Spring sand on June 14(th) and is currently flowing back
hydrocarbons and frac fluids at a gross rate of approximately 900
barrels (bbls) per day. The Well has averaged 361 bbls of oil and
524 thousand cubic feet of natural gas (Mcfg) per day over the past
seven days, which is 449 bbls of oil equivalent (Boe). The peak
rate day to date was 399 bbls of oil and 521 Mcfg, which equals 486
Boe, and 488 bbls of fluid. As the Well cleans up, the ratio of
hydrocarbons to frac fluids continues to climb, which is expected,
and this may also translate into higher producing rates for oil and
gas once the majority of the frac fluid is recovered. Caza has a
20% working interest and a 15% net revenue interest in the
Well.
The Bone Spring formation in Lea and Eddy Counties, New Mexico,
contains multiple potential pay zones for oil and liquids-rich
natural gas. Caza's current prospects in the horizontal Bone Spring
play are Lynch, Forehand Ranch, Lennox, Copperline, Mad River,
Bradley 29, Two Mesas, Azotea Mesa and Quail Ridge. The Company has
acquired approximately 4,000 net acres in the play to date.
Caza is also pleased to announce the successful sale of the San
Jacinto property, which includes the Caza Elkins 3401 and 3402
wells. Management decided to divest the property in order to take
advantage of attractive Wolfberry property sale prices and enable
the Company to participate in more favorable investment
opportunities. The Company was able to realize a fair price at
yesterday's Oil & Gas Asset Clearinghouse Auction, and the
disposal will complete on or before July 31, 2012. The price
received was $6.1MM and exceeded Caza's internal matrix for return
on investment and capital employment. Caza intends to use the
proceeds to further existing assets, specifically in the Bone
Spring play in southeast New Mexico, and to pursue new
opportunities in order to add additional shareholder value through
continued investment in suitable properties.
The Company had an 85% working interest in the Caza Elkins 3401
well with a 63.75% net revenue interest. In all subsequent wells on
the San Jacinto property, including the Caza Elkins 3402 well and
the remainder of the leases, Caza had a 75% working interest and a
56.25% net revenue interest. The property is currently producing
approximately 120 Boe per day net to the Company. The Company's
reserve report prepared by Netherland, Sewell & Associates,
Inc. dated December 31, 2011, gave the property proved reserves of
4.09 billion cubic feet of natural gas equivalent (Bcfe) and proved
plus probable reserves of 5.26 Bcfe net to Caza.
Caza's management regularly conducts on-going reviews and
appraisal programs with regard to both its existing asset base and
new, unsolicited opportunities. Some deals present themselves in
the form of asset swaps or farm-ins, while others include the
potential acquisition of multiple properties and existing corporate
entities. Caza remains actively involved in reviewing and grading
such opportunities on an on-going basis, and management remains
keen to continue growing the Company's asset base and production
profile using a variety of means.
W. Michael Ford, Chief Executive Officer commented:
"We are very pleased with the successful results from the
Bradley well. The producing rates are as predicted and will
increase Caza's oil to gas production ratio, while adding
additional cash flow and reserve value. The success at Bradley is a
good start for Caza in the horizontal Bone Spring play, and the
predictable nature of the play bodes well for Caza's future Bone
Spring projects.
We are also very pleased with the sale of the San Jacinto
property. This sale has permitted Caza to realize the increased
value created at San Jacinto, which will be utilized in more
favorable investment opportunities. At present, we are exploring
the options and opportunities available to us, but we do intend to
build on the success at the Bradley property and begin drilling the
Company's Bone Spring properties in the near future. We continue to
prepare Copperline, Forehand Ranch and Lennox prospects, in that
order, for drilling."
About Caza
Caza is engaged in the acquisition, exploration, development and
production of hydrocarbons in the following regions of the United
States of America through its subsidiary, Caza Petroleum, Inc.:
Texas and Louisiana Gulf Coast (on-shore), and the Permian Basin
(West Texas and Southeast New Mexico).
For further information, please contact:
Caza Oil & Gas, Inc.
Michael Ford, CEO +1 432 682 7424
John McGoldrick, Chairman +44 7796 861 892
Cenkos Securities plc
Jon Fitzpatrick +44 20 7397 8900 (London)
Beth McKiernan +44 131 220 6939 (Edinburgh)
VSA Capital Limited
Andrew Raca +44 (0)20 3005 5004
Malcolm Graham-Wood +44 (0)20 3005 5012
M:Communications
Patrick d'Ancona +44 20 7920 2330
Chris McMahon
The Toronto Stock Exchange has neither approved nor disapproved
the information contained herein.
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 STATEMENT
Information in this news release that is not current or
historical factual information may constitute forward-looking
information within the meaning of securities laws. Such information
is often, but not always, identified by the use of words such as
"seek", "anticipate", "plan", "schedule", "continue", "estimate",
"expect", "may", "will", "hope", "project", "predict", "potential",
"intend", "could", "might", "should", "believe", "develop", "test",
"anticipation" and similar expressions. In particular, information
regarding the depth, timing and location of future drilling,
intended completion operations, availability of funds to support
the Company's drilling program, future production, future cash
flow, future reserves, intended production testing, future results
from wells and the Company's future working interests and net
revenue interests in properties contained in this news release
constitutes forward-looking information within the meaning of
securities laws.
Implicit in this information, are assumptions regarding the
success and timing of drilling operations, rig availability,
projected revenue and expenses and well performance. These
assumptions, although considered reasonable by the Company at the
time of preparation, may prove to be incorrect. Readers are
cautioned that actual future operations, operating results and
economic performance of the Company are subject to a number of
risks and uncertainties, including general economic, market and
business conditions and could differ materially from what is
currently expected as set out above. In addition, the geotechnical
analysis and engineering to be conducted in respect of certain
wells described in this press release is not complete. Future flow
rates from the Well will vary, perhaps materially, and may prove to
be technically or economically unviable. Any future flow rates will
be subject to the risks and uncertainties set out herein.
For more exhaustive information on these risks and uncertainties
you should refer to the Company's most recently filed annual
information form which is available at www.sedar.com and the
Company's website at www.cazapetro.com. You should not place undue
importance on forward-looking information and should not rely upon
this information as of any other date. While we may elect to, we
are under no obligation and do not undertake to update this
information at any particular time except as may be required by
securities laws.
Boe may be misleading, particularly if used in isolation. A boe
conversion of six thousand cubic feet: 1 barrel is based on an
energy equivalency conversion method primarily applicable at the
burner tip and does not represent a value equivalency at the well
head.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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