Caza O&G Increases Production by 28%
Caza Oil & Gas announced the Company's final results for the year ended December 31, 2009.
Highlights of 2009 include:
- During 2009 Caza focused on its oil exploration projects in response to low natural gas prices;
- Four wells drilled under agreement with Endeavour International Corporation at nominal cost to Caza;
- Production volumes increased 28% in period but revenues fell 27% due to low gas prices;
- Net present value of future net revenue attributable to proved reserves of US $17.9 million and proved plus probable reserves of US $76.1 million as estimated by Netherland, Sewell & Associates (before taxes and discounted 10%) at 31 December 2009;
- Cash preserved through farm out arrangements and cost savings;
- Cash and cash equivalents at 31 December 2009 of $9,268,547 (2008 - $14,103,827);
- Net Working Capital of $8,376,463 (2008-$10,812,048) at 31 December 2009.
W. Michael Ford, Chief Executive Officer commented, "Caza's operations in the period were primarily focused on its activities in the Abo/Wolfcamp horizontal oil play in New Mexico, USA, where four wells were drilled under the Company's agreement with Endeavour. Under the Endeavour arrangement Caza had significant down side protection which enabled the Company to explore while preserving capital.
"Caza increased its production volumes by 28% during the year. The net present values of our proved and proved plus probable reserves are estimated to be US $17.9 million and US $76.1 million respectively. Caza's cash and cash equivalents balance as of December 31, 2009, was approximately US $9.3 million, and the Company plans to deploy a significant portion of these funds on drilling. We believe that with our cash reserves, Caza is well placed to execute a strategy of revenue and reserves growth.
"Accordingly, the Company is again focused on high impact projects in Texas and Louisiana, generated from its extensive 3-D seismic library, and is currently drilling the Matthys-McMillan GU #2 well in the Wharton West Field. Subject to a positive outcome on this well, Caza will continue developing its position in the field. Approximately 2.2 miles south of the Matthys-McMillan property, we have staked the test well on the Bongo prospect, which is planned to commence drilling in June, subject to partner approvals. Management believes that this prospect could yield significant reserves and looks forward to drilling the test well.
Subject to farm out discussions, Caza also expects to drill at least two tests in Louisiana, one further test in Texas and one test on its Wolfberry position in the Permian basin during 2010."