HOUSTON, TEXAS--(Marketwire -03/06/12)- Caza Oil & Gas, Inc. ("Caza" or the "Company") (TSX: CAZ.TO - News)(AIM: CAZA.L - News), the U.S. focused exploration, appraisal, development and production company, is pleased to announce that drilling has commenced on the WC 35 State No. 1 well on the Company's Sombrero prospect in Lea County, New Mexico. WC 35 State No. 1 is the initial test well on this property. The well has a proposed total depth of approximately 11,600 feet and is targeting oil and natural gas in the Pennsylvanian aged Cisco formation.
As previously announced, Caza entered into a farmout agreement with CML Exploration, LLC ("CML"), naming CML as operator. The prospect covers approximately 1,920 gross acres. Caza retained and is participating for a 20% working interest and an approximate 17.125% net revenue interest under the farmout with CML.
W. Michael Ford, Chief Executive Officer commented:
"We are very pleased that CML has commenced drilling operations on the Sombrero prospect. If successful, this property has good development potential and will add further value to the Company through increased cash flows and oil and natural gas reserves. Although this is a non-operated property, it is an example of utilizing our current prospect and lease inventory to target and test oil and liquids-rich opportunities in southeast New Mexico."
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).
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.
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 and completion of the well, future production, future cash flow, future reserves, intended production testing, future results from the well and the Company's future working interest and net revenue interest in the property 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 the well described in this press release is not complete. Future flow rates from the well disclosed in this press release 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.
The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.