HOUSTON, TEXAS - Caza Oil & Gas, Inc. ("Caza" or the "Company") is pleased to provide a production update for the Company's initial horizontal Bone Spring well on its Lennox Prospect and an operational update on the Caza Ridge development well on its Copperline Prospect. Both properties are located in Lea County, New Mexico.
As previously announced, the fracture stimulation on the Lennox State Unit 32 #2H horizontal Bone Spring well was successful. The well was placed on artificial lift and has been producing to recover frac fluids and establish stabilized flow rates for oil and natural gas. During controlled flowback the oil and natural gas rates have continued to increase and have now stabilized at daily rates of 334 barrels (bbls) of oil and 337 thousand cubic feet of natural gas (Mcf), which equates to 390 bbls of oil equivalent (Boe) per day, in each case falling within the Company's expectations and typical play parameters.
Caza has a 40.00% working interest before payout (31.08% net revenue interest) and a 50.00% working interest after payout (38.85% net revenue interest) in the Lennox State Unit 32 #2H well and will participate with a 50.00% working interest in all subsequent wells drilled by Caza on the Lennox property.
The Company's Caza Ridge 14 State #4H well has reached its kick-off point above the 3rd Bone Spring sand interval in the vertical portion of the wellbore. Log data and core samples have been obtained across the Brushy Canyon, Avalon and 2nd Bone Spring sand intervals and have indicated the presence of oil and natural gas across each of these intervals. This is favourable for the future development potential of this property. The Company will now proceed to set the curve and drill the lateral section of the well in the 3rd Bone Spring sand interval, which is producing oil and natural gas in the offset Caza Ridge 14 State #3H well.
Caza has a 58.75% working interest (approximate 44.80% net revenue interest) in the Caza Ridge 14 State #4H well.
W. Michael Ford, Chief Executive Officer commented:
"This is a good result for the initial test well at Lennox. The detailed completion procedure performed on this well will help determine the future development of this property. The next Lennox well will be the Lennox State Unit 32 #4H, which will target the 3rd Bone Spring sand interval and should commence drilling operations later this year. We also continue to prepare the Gateway and West Copperline Bone Spring prospects for drilling in the near future."
"Additionally, we are pleased to report that the Caza Ridge 14 State #4H well has reached the lateral kick-off point, and log and core data have confirmed the presence of oil and natural gas in the shallower sections of the well. We are currently preparing to drill the lateral section of the well in the 3rd Bone Spring sand, which has proven to be a good producer of oil and natural gas in the offset Caza Ridge 14 State #3H well. We look forward to completing the 3rd Bone Spring lateral and fracture stimulating this well before bringing it online in the near future."
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