Caza Oil & Gas provides unaudited financial and operational results for the three-months ended March 31, 2014

Caza Oil & Gas provides unaudited financial and operational results for the three-months ended March 31, 2014

Unaudited First Quarter Financial Results
Highlights
Caza’s revenues from oil and natural gas sales increased 259% to US$4,591,507 for the three-month period ended March 31, 2014, from US$1,279,296 for the comparative period in 2013. This also represents a quarter-on-quarter increase of 36% compared to US$3,381,486 in Q4 2013.
Adjusted EBITDA increased by 695% to $2,139,210 for the three-month period ended March 31, 2014, as compared to ($359,576) for the comparative period in 2013.
Caza’s oil and natural gas liquids (NGL) production increased 224% to 44,724 bbls for the three-month period ended March 31, 2014, from 13,820 bbls for the comparative period in 2013. This was also an increase of 31% from 34,219 bbls in Q4 2013.
The Company’s oil and NGL production has increased to 73% of the Company’s combined oil and natural gas production in Q1 2014 from 68% in Q1 2013.
Caza’s natural gas production increased 156% to 101,709 Mcf for the three-month period ended March 31, 2014, from 39,742 Mcf for the comparative period in 2013.
Average net production volumes increased 198% to 685 Boe/d for the three-month period ended March 31, 2014, from 230 Boe/d for the comparative period in 2013, and have since increased to an average of 985 Boe/d during the month of April 2014, which is inline with Company forecasts and expectations.
Operating net back increased to $57.76 for the three month period ended March 31, 2014, from $41.35 for the comparative period in 2013.
The average oil price received by Caza increased 8% to US$93.28 per bbl during the three-month period ended March 31, 2014, from US$86.41 per bbl during the comparative period in 2013. The average natural gas price received by Caza increased 42% to US$4.69 per Mcf during the three-month period ended March 31, 2014, from US$3.30 per Mcf during the comparative period in 2013.
The average combined price received by Caza in Q1 2014 increased 19% to US$74.45 per Boe compared to US$62.58 per Boe in Q1 2013.
Caza had a cash and cash equivalents balance of US$5,082,401 as of March 31, 2014, as compared to US$18,495,086 at December 31, 2013. The Company has drawn an aggregate of US $35MM from the total amount of US$50MM available to it pursuant to its Note Purchase Agreement with Apollo Investment Corporation, an investment fund managed by Apollo Investment Management.
First Quarter Operational Results and Recent Events
On May 8, 2014, Caza commenced drilling operations on the West Copperline 29 Fed #4H horizontal Bone Spring well in Lea County, New Mexico. The well is currently drilling ahead at approximately 3,800 feet. This well is a direct offset to the West Copperline 29 Fed #3H well (see below) and is planned to be drilled through the 3rd Bone Spring Sand interval to a total measured depth of approximately 15,800 feet. Caza currently has a 62.5% working interest (approximate 46.94% net revenue interest) in this well.
On April 29, 2014, the non-operated Jazzmaster 17 State #3H horizontal Bone Spring well was commenced in Lea County, New Mexico, and is currently drilling ahead at approximately 10,040 feet. This well is a direct offset to the Jazzmaster 17 State #4H well and is planned to be drilled through the 2nd Bone Spring Sand interval to a total measured depth of approximately 15,315 feet. Caza has a 25.0% working interest (approximate 19.44% net revenue interest) in this well
On April 17, 2014, the Company announced the results of its West Copperline 29 Fed #2H well in Lea County, New Mexico. Under controlled flowback, the well produced at a peak 24 hour gross rate of 1,177 bbls of oil and 1.133 MMcf of natural gas, which equates to 1,366 boe on April 12, 2014. Caza currently has a 62.5% working interest (approximate 46.94% net revenue interest) in this well.
On March 26, 2014, the Company announced the results of the non-operated Marathon Road 15 PA Fed #1H well in Lea County, New Mexico. Under controlled flowback, the well produced at a rate of approximately 2,032 bbls of oil and 1.974 MMcf of natural gas, which equates to 2,361 Boe on March 21, 2014. Caza currently has a 14.7% working interest (approximate 12.5% net revenue interest) in this well.
On March 20, 2014, the Company commenced drilling operations on the Gramma Ridge 27 State #1H horizontal Bone Spring well in Lea County, New Mexico. The well is the initial test well on Caza’s Gramma Ridge Property and is targeting the 3rd Bone Spring Sand interval. The well has reached the intended total measured depth and the fracture stimulation began on May 13, 2014. Caza currently has a 52.5% working interest (approximate 41.61% net revenue interest) in this well.
On March 11, 2014, the Company announced the results of its West Copperline 29 Fed #3H well in Lea County, New Mexico. Under controlled flowback, the well produced at a peak 24 hour gross rate of 879 bbls of oil and 1.374 MMcf of natural gas, which equates to 1,108 boe on March 7, 2014. The well subsequently produced at the higher rate of 969 bbls of oil and 1.21 MMcf, which equates to 1,176 boe on March 11, 2014. Caza currently has a 62.5% working interest (approximate 46.94% net revenue interest) in this well.
On February 5, 2014, the Company provided a Fourth Quarter production update highlighting the significance of the Bone Spring production to the Company to date. The announcement forecasted Caza’s net aggregate production reaching 32,783 boe for the month of April 2014, which equates to 1,092 boe/d. That growth was forecasted to continue through August 2014, when net aggregate production is expected to reach 35,538 boe for the month, which equates to 1,185 boe/d. The Company continues to progress towards meeting these forecasts and is performing in line with Management expectations.
On January 2, 2014, the Company announced that it had drawn an advance of US$10MM pursuant to its Note Purchase Agreement with Apollo Investment Corporation, and Investment fund managed by Apollo Investment Management (collectively “Apollo”). With this advance, the Company has drawn an aggregate of US$35MM from the total facility of US$50MM.
W. Michael Ford, Chief Executive Officer commented:
“We are pleased to provide our financial and operational results for the first quarter of 2014. Once again our numbers are up across the board. Our oil and NGL volumes are up 224% year-on-year and 31% since Q4 2013. Oil and NGL’s now comprise 73% of the Company’s combined oil and natural gas production. Additionally, our natural gas production was up 156% year-on-year, which is the direct result of associated natural gas production and quick hook-ups to sales lines in the Bone Spring play.”
“These production increases have led to correlative increases in Company revenues. Company revenues from oil and natural gas sales increased 259% year-on-year and 36% quarter-on-quarter. Our adjusted EBITDA also increased 695% year-on-year.”
“I am very pleased with the Company’s continued operational success and progress in the Bone Spring play. This area has been the primary focus for the Company and continues to generate material value creation for our shareholders. We hope to continue this success throughout the remainder of 2014.”
Source: Caza Oil & Gas

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