"Caza continued its positive operational and financial performance in the third quarter of 2012."

"The proceeds from the sale of the San Jacinto property opened several doors for the Company, especially on the exploration front. Management used a portion of the proceeds to drill the Caza Ridge and Forehand Ranch horizontal Bone Spring test wells at our Copperline and Forehand Ranch prospects respectively. We are very pleased to report that oil and natural gas from the Caza Ridge well are already going to sales, and we continue to be impressed with the well's production results. We also look forward to fracture stimulating the Forehand Ranch well and bringing it online in December. The Caza Ridge well alone has made up for and surpassed any decreases in production, revenue and cash flow caused in this quarter by the sale of the San Jacinto assets and will provide a substantial increase to our oil to natural gas ratio in the fourth quarter."

"The horizontal Bone Spring play has proven to be a successful venture for Caza thus far, as we also participated as a non-operator in the Bradley 29 and Quail 16 State horizontal Bone Spring wells. Knowledge gained from the successful results of these wells has de-risked some of Caza's acreage position in the play, while also providing the Company with valuable information for future drilling from the Company's inventory of Bone Spring prospects. In addition to Copperline, Forehand Ranch, Quail Ridge and Bradley 29, Caza has five other horizontal Bone Spring prospects under lease including: Lynch, Lennox, Mad River, Two Mesas and Azotea Mesa. This gives the Company approximately 3,300 net acres in the play with many potential drillsite locations."

"In addition, positive reports continue to come from elsewhere in the Bone Spring play. In order to build on the momentum created by the Company's recent successes, management is preparing the Lennox prospect in Lea County, New Mexico for drilling as early as mid-January 2013."


http://www.cazapetro.com/

On the break

Hopefully this marks an end to the sell-off. The endless drip, drip, drip in the share price was most dispiriting.

agreed.,.

On the move, strong buying at the moment

Good volume today but crap spread

not earlier on, but once sellers get large spread does too

having a pause at the moment

Strong end to the day and a big rise for CAZA. Have we broken the downtrend at long last? Drilling news expected soon and a good result will move CAZA back to 20p.

Earlier profit taking got large punters in again and some of them paying premium at one time ( 100K @ 10.70p ) when offer was 10.50p.
now level with yesterday's price and also at level 2 of 1 v 1

http://www.proactiveinvestors.co.uk/companies/news/56815/caza-oil-gas-completion-begins-on-lennox-well-56815.html

Caza Oil & Gas: Completion begins on Lennox well

CAZA said completion of the Lennox well in the Bone Spring play in New Mexico had started, as it reported first quarter results and an operational update.

Fracking of the Lennox State Unit 32 No. 2H horizontal well began on May 6 and the firm hopes to have the well, which last month confirmed multiple potential pay zones, flowing back in the "near future".

The oil firm also revealed it increased production of oil and natural gas liquids (NGL) by 18% to 13,820 barrels (bbls) in the three months to March 31 compared to 11,723 bbls for the same period last year.

Increasing the ratio of oil and NGL production compared to natural gas has been one of Caza's main priorities for the last two years and it expects this to continue as more Bone Springs wells come online.

Natural gas production decreased 60% to 39,742 Mcf (million cuibic feet) for the three months compared to 99,563 Mcf for the same period last year, partly due to mechanical issues at a third party operated processing facility in Lea County, New Mexico.

However, operations have now been restored, which should help the company's production figure beginning in the second quarter, it added.

Revenues from oil and gas sales decreased 8% to US$1,279,296 for the three months compared to US $1,392,729 in 2012

http://oilbarrel.com/news/caza-oil-gas-encounters-some-first-quarter-2013-delays-in-its-bone-spring-developments

May 22, 2013

Caza Oil & Gas Encounters Some First Quarter 2013 Delays In Its Bone Spring Developments

We wrote last April about TSX and AIM listed Caza Oil & Gas’s programme to switch its focus from higher risk/higher impact drilling in Louisiana and Texas to fast emerging liquid –rich, low risk, hydrocarbon development opportunities in Bone Spring properties in the Permian Basin in New Mexico. This came after two years of jerky profits and haphazard production.


Based on details in the results report for the year ended December 31 2012, it seemed that the group had turned an important corner toward realising its so-called “make or break” strategy of moving towards stable and substantially growing output. The company had divested its interest in its San Jacinto property in Texas and sold down its Copperline, Lennox and Forehand Ranch Bone Spring properties from 100 per cent to average levels of 58.75 per cent, 50 per cent and 63 per cent respectively.

Bone Spring is highly prospective. Since 2011 it is reckoned that operators have brought 309 wells into production from these zones. The first six months average for these wells has been 320 boepd with a 30 day initial production range of between 205 boepd and 1003 boepd.

A point about the Bone Springs is that apart from being liquid rich is that there are multiple formations to target. These include the Delaware, the Avalon Shale, the First, Second and Third Bone Spring Sands and the Wolfcamp. Of these, it seems the Bone Spring has the best economics.

Following the Jacinta sell off Caza quickly brought on two wells in New Mexico, the Copperline 14 State#3H well on the Copperline prospect and the Forehand Ranch well in Eddy County late last year. By year end 2012 the company had achieved production and chalked up an increase in revenue. It was also starting new wells and acquiring fresh acreage.

Commenting on its 2012 results Caza said: “Notwithstanding the divestiture of the San Jacinto property and the selling down of the company’s Copperline, Lennox and forehand Ranch properties from 100 per cent ownership, the two wells on Copperline and Forehand Ranch quickly replaced and surpassed the oil and natural gas production, cash flows and reserve figures lost with the sale of San Jacinto. Management expects these figures to continue to improve as more Bone Spring wells are drilled completed and brought into production”.

Three months on though, it turns out that despite having turned the important corner, there were still some bumps and barriers on the road ahead. In its results report for the first three months of 2013 ending on March 31, the company said Caza’s oil and natural gas liquids (NGL) production increased 18 per cent to 13,820 barrels for the period from 11,723 barrels for the comparable three months in 2012. That it is to say production increased to 153 boepd relative to the same period in 2012 (130 boepd).

However, due to mechanical issues at a processing facility in Lea County, New Mexico the company was unable to sell natural gas liquids and natural gas for 61 days out of a 90 day period. This meant output fell 15 per cent to 13,820 bbls compared to 16,300 bbls in Q4 2012. In turn, although combined gas and oil prices rose to US$62.58 a boe against US$55.03 per boe in Q4 2012, Caza saw revenues fall 19 per cent to US$1.3 million for the three month period ended March 31 from US$1.6 million in Q4 2012. In all Caza incurred a net loss for the first three months of 2013 of US$1.31 million, better than the net loss of US$3.69 million during Q1 2012, but still a loss.

But it was not all bad news, due in part to the San Jacinta sale Caza still had a war chest of US$6 million cash in that bank at the end of March. The problems at Lea Country have been fixed and despite these troubles, the underlying shift towards oil and natural gas liquid (NGL) over gas production within the portfolio continues from the Bone Springs with liquids accounting for 68 per cent of production relative to 41 per cent in Q1 2012. This means overall better prices. The company has new wells at the Roja property in Lea County and with the Lennox State Unit 32 #2H horizontal drill.

Broker Cenkos believes all will be well, barring any more unforeseen bumps in the road. It says “Revenues remain relatively modest, particularly due to on-going low gas prices in the US and the disruption to production in the period. However we believe that the increase in production from the Bone Spring play in 2013 should go some way towards moving Caza towards profitability. We are encouraged by the results of the recent wells in New Mexico and believe there will be anuplift in production over the course of the year."

The broker says that at current levels Caza is trading at a substantial discount to risked net asset value (RENAV). However, we believe the progress made in unlocking the Bone Spring play and the transformational increase in production should go some way to restoring confidence in the stock. The broker has a target price of 28p and maintains its BUY recommendation. At the moment the shares are trading on AIM at 9.25p.

Caza Oil & Gas nets vital funding for ‘significant’ Bone Springs opportunity
By Jamie Ashcroft

Caza Oil & Gas (LON:CAZA, TSE:CAZ)) has secured vital debt funding to pay for a major phase of work over the next two years.

Apollo Investment Management has agreed to buy up to US$50mln of senior secured notes, with the first US$20mln being paid up front.

A further US$30mln may be drawn at Caza’s discretion over the next 15 months.

With the injection of cash Caza can now pursue an accelerated programme to develop the Bone Springs play in New Mexico, United States.

Initially it will drill as many as twelve new wells over the next twelve months.

Caza says this is a significant opportunity to deliver increased production, revenue growth and shareholder returns.

"We are extremely pleased to announce this financing facility with Apollo,” said chief executive Michael Ford.

“We made significant progress in 2012, laying the groundwork for continued success in the Bone Spring play in Lea and Eddy Counties, New Mexico. However, in order to efficiently and properly advance the Company's prospects and properties in the play, additional financing of proper size and scope was needed."

He adds: “Management will begin utilizing funds for the drilling program immediately.

“The first six projects to be funded include: the Lennox test well, which is currently being completed; a second Caza Ridge well at Copperline; a test well at Gateway; a test well at West Copperline; a test well at Roja, which is currently drilling; and a test well at Madera.”

market cap of 19.5 million but can get a loan of 50 million?

Lennox results due but must be looking very good to get 50 mill loan.......writing is on the wall.

flying at the moment

Good news, with more to come. I can't believe that Apollo would advance $50 millions without having had a sneak preview of the Lennox well results.

I cant either, also to put a further 3 Lennox wells to be drilled with the money in my eyes is a huge wink wink that all is well if not better than first thought.

Should find out results I think next week.......20P on good results

When are next set of results due out? Last post suggests today/tomorrow?

You mean LENNOX?
Any time

Yes I meant Lennox. Thanks.

Looks like the writing is on the wall

Looks like Madera 7 is commercial, plans submitted on 20th May for the installation of 3 * 500 bbl oil storage tanks.

http://ocdimage.emnrd.state.nm.us/Imaging/FileStore/hobbs/wf/252734/30025410590000_9_wf.pdf

http://www.proactiveinvestors.co.uk/companies/news/58312/caza-oil-gas-excited-about-commercial-lennox-well-58312.html

Gas (LON:CAZA) is excited about Lennox, the group’s latest success in the Bone Spring play in New Mexico.


This morning Caza revealed findings from a programme on the recently drilled Lennox 32 #2H well, which showed two of the three Bone Springs sands are commercial at that location.

“From what we’ve seen so far it is going to be a good well, we’re excited about Lennox,” chief executive Mike Ford told Proactive Investors.

“The first sand is wet, it is a non commercial zone at this location, but, the second and third sands appear to be very commercial.

“We’ve drilled the lateral well into the third sand, we have fracture stimulated it and we are flowing that back.”

Ford explains that the non-commercial First Sand must be ‘squeezed’ off before the well starts production. That work is ongoing, once complete a pump will be installed and the well will be brought online.


Caza has a 40% stake (before pay-out) in Lennox which will equate to 31.08% revenue interest, a 50.00% working interest after pay-out. It will participate in future Lennox wells with a 50% working interest.

The company also revealed today that drilled is now underway on its second well on the Copperline property in the Bone Spring play.

Drilling on the horizontal well started on 15 June. The well is a direct offset to the successful Caza Ridge 14 State #3H well.

The primary target is the third Bone Spring Sand interval with potential secondary targets in the Brushy Canyon, Avalon Shale, and first and second Bone Spring Sands.

Caza has a 58.75% working interest, which roughly equates to a 44.80% net revenue interest, in the Caza Ridge 14 State #4H well.

The company has also been busy elsewhere in New Mexico, and has provided updates on the Madera and Roja properties.

The initial well at the Madera property in Lea County is currently drilling the horizontal section of the well. Based on analysis of log data, OXY, the operator, will begin drilling the lateral section of the well through the primary objective third Bone Spring Sand interval to a total measured depth of round 16,839 feet.

Caza has a 20% working interest (15.60% net revenue interest) in the Madera 35 Fed #1H well and the Madera property.

Finally, the initial well on the Roja property, also in Lea County, has reached the intended total measured depth of around 13,568 feet. The well was recently fracture stimulated in multiple stages and is currently flowing back to clean up.

Caza has a 20.00% working interest (15.60% net revenue interest) in the Madera 17 Fed #1H well and the Roja property.

In this morning’s statement, Ford said: “The first Caza Ridge well at Copperline was a very good result, which we hope to duplicate with the recently commenced Caza Ridge development well.

The OXY operated Madera and Roja wells are progressing nicely, and we look forward to providing results on these wells and bringing them online in the near future, as well,” said Michael Ford, chief executive officer of Caza.

“Lennox, Madera and Roja provide the company with good development potential across expansive lease areas. This should mean repeatable success across multiple oil and liquids-rich zones in the broader Bone Spring play.

“The stacked pay potential for oil and liquids-rich gas is what makes this play so intriguing. It’s also the reason management has focused efforts on the play, and what should ultimately make the play successful for Caza and create value for our shareholders,” he added.