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TEXAS
- WILCOX AREAS
The
Wilcox Central subgroup area contains
the Cabeza Creek Project Area
in Goliad County along with the
Higgins Project Area in Bee and
Live Oak Counties, Texas. The
Wilcox South subgroup contains
project areas in Duval, Webb,
Zapata and McMullen Counties,
Texas. The Wilcox East subgroup
contains project areas primarily
in Victoria, Fort Bend and Wharton
Counties, as well as in Dewitt
and Lavaca Counties, Texas and
includes the Company's Cologne
Project Area and Highway 59 Project
Area. The prolific Wilcox trend
in South Texas continues to be
a primary area of exploration
and development focus for Carrizo.
The Company has a total of 1,162
square miles of 3-D seismic data
that covers potential Wilcox formation
exploration and development targets.
Wilcox prospects occur at a variety
of depths but are often relatively
deeper targets with both high
reserve potential as well as higher
well costs. While Carrizo operates
almost all of its Wilcox area
projects, portions of these wells
are typically sold down to industry
partners to reduce costs and offset
exploration and operational risk.
Wilcox Central
- Goliad, Live Oak, Bee Counties
The
Company drilled six wells within
the central Wilcox area in 2001
with a 100% success rate. The
Company continued its exploration
activities and drilling in the
Cabeza Creek area, drilling three
successful wells during 2001,
including a significant discovery
well, the "Riverdale #2".
Carrizo is the operator of the
well and owns a 68.75% working
interest. The well commenced production
in October 2001 at a rate of approximately
9,000 Mcfe per day. Two additional
successful Wilcox wells have been
drilled in the Cabeza Creek area
since year end. Two successful
wells were also drilled during
2001 on the NE Weesatche prospect
area in Goliad County where the
Company owns a 15.5% working interest.
The latest field extension well
reached total depth in November
2001, logged 32 feet of Wilcox
net pay and commenced production
in January 2002 at a rate of 3,410
Mcfe per day. Currently the Company
is participating in an 11,500
foot test in Goliad County with
the results expected in the second
quarter 2002. If successful, this
well has the potential to have
two additional follow up locations.
The Company has identified nine
additional prospects that are
drill ready within the 10,781
net acre area that the Company
plans to further evaluate over
the next 12 to 18 months.
Wilcox South
- Duval, Webb, Zapata, McMullen
Counties
The
Company continues to develop prospects
within its 474 square mile 3-D
database and is working to secure
leases over the areas it believes
have the highest potential. Target
intervals include Upper Wilcox
through Lobo formations. The Company
plans to drill an initial test
well in this area during 2002.
Wilcox East
- Dewitt, Lavaca, Victoria, Fort
Bend, Wharton Counties
The
Company continues to develop prospects
within its 311 square mile 3-D
database and is working to secure
leases over the areas it believes
have the highest potential. Targets
range from the Lower Wilcox to
expanded Upper Wilcox between
12,000 and 16,000 feet. Depending
upon the success of leasing efforts,
initial drilling is expected to
begin in 2003.
TEXAS FRIO/VICKSBURG/YEGUA
AREAS
This
combined area trend sometimes
overlaps but is generally closer
to the Texas Gulf Coast than the
Wilcox areas discussed above.
In any particular target or prospect,
the Frio is usually a shallower
formation, while the Yegua and
Vicksburg are generally relatively
deeper formations. Across the
Carrizo project areas, prospect
targets vary greatly in depth
and area distribution. The Company
has a total of 1,385 square miles
of 3D seismic data that covers
development potential within these
Frio, Vicksburg and Yegua sands,
450 acres of which are in the
Matagorda, Ganado and Starr Project
Areas. Several key areas are discussed
below which highlight areas of
expected focus during 2002 and
future years.
Matagorda
The
Matagorda area currently includes
license to 98 square miles of
3-D seismic and over 3,863 net
acres of current leasehold. The
Company continues to have success
in the area with two successful
exploratory wells being drilled
in 2001. These successful wells,
the "Pitchfork Ranch #1"
and the "Staubach #1"
both exhibited high reservoir
quality and deliverability in
the target Middle and Lower Frio
sands each having initial production
rates of over 15 MMcfe per day.
While the Pitchfork Ranch well
declined fairly rapidly, the most
recent well the "Staubach
#1" in which Carrizo owns
a 35% interest before payout,
was a significant discovery, reaching
total depth in December 2001 and
logging 36 feet of net pay. The
well commenced production in January
2002 at 2,094 Bbls and 4,769 Mcf
(17,333 Mcfe) per day and as of
March 25, 2002 was continuing
to produce at a rate of 2,000
Bbls and 5,500 Mcf per day. The
first follow up well targeting
the same formations as the Staubach
#1 well was spud on March 6, 2002,
at the far south end of the structure.
On March 24, 2002, a subsidiary
of the Brigham Exploration Company,
the operator of this well (the
"Burkhart #1") in the
Matagorda area, reported a loss
of surface control while drilling
the well and as of March 28, 2002,
operations were underway to bring
the well under control. The Company
owns a 35% working interest in
the well and has liability and
well
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