Caza Oil & Gas announces commencement of drilling operations on Lennox Prospect and provides operational update
Wednesday, Jan 23, 2013Caza Oil & Gas, Inc. ("Caza" or the "Company") (TSX:CAZ)(AIM:CAZA) is pleased to announce that drilling has commenced on the Company's Lennox Prospect ("Lennox") in Lea County, New Mexico. The Lennox State Unit 32 No. 2H horizontal well is the initial test well at Lennox.
Lennox Prospect, Lea County, New Mexico. As stated above, the Lennox State Unit 32 No. 2H horizontal well has commenced drilling. The well will be drilled to a total vertical depth of approximately 11,850 feet with a total measured depth of approximately 14,740 feet. The primary target is the Bone Spring Sands with potential secondary targets in the Delaware, Lower Brushy Canyon, Avalon Shale and Wolfcamp.
After selling an additional 7.5% working interest on a promoted basis and trading a 20% working interest on an acreage basis between Lennox and Madera/Roja Prospects (see below), Caza now has a 40.00% working interest before payout (31.88% net revenue interest) and a 50.00% working interest after payout (39.85% net revenue interest) in the Lennox State Unit 32 No. 2H well.
Madera and Roja Prospects, Lea County, New Mexico. The Company completed a working interest trade ahead of drilling at Lennox for interests in leases on two new Company projects called Madera and Roja Prospects ("Madera" and "Roja"). Caza traded a 20% non-operated working interest (15.94% net revenue interest) in the Lennox leases in return for a 20% non-operated working interest (16% net revenue interest) in two leases covering approximately 1,680 acres operated by Occidental Petroleum Corporation ("OXY"). OXY is expected to propose two wells, one on each lease, later this year.
Roja is a 280 acre lease located approximately 18 miles south of the Company's Copperline Prospect, and Madera is a 1,400 acre lease located approximately 20 miles south of Copperline. Both prospects contain target objectives similar to the Company's other Bone Spring projects, namely: Delaware, Lower Brushy Canyon, Avalon Shale, 1st, 2nd and 3rd Bone Spring Sands and Wolfcamp.
Copperline Prospect, Lea County, New Mexico. The Company has filed for an Application for Permit to Drill (APD) the Caza Ridge 14 State No. 4H horizontal well. This well will be a direct offset to the Caza Ridge 14 State No. 3H horizontal 3rd Bone Spring well and is currently scheduled to be drilled later this year.
Caza will have a 58.75% working interest (45.97% net revenue interest) in the Caza Ridge 14 State No. 4H well.
Quail Ridge Prospect, Lea County, New Mexico. The Quail "16" State No. 4H horizontal well has reached its intended total depth of 15,605 feet measured depth and will be completed in the 3rd Bone Spring Sand. Once the well is fracture stimulated, it will be brought online. The operator intends to skid the rig to the Quail "16" State No. 6H horizontal well location and commence drilling operations to the 3rd Bone Spring Sand. Caza has elected to participate in the Quail "16" State No. 6H well.
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