2nd Jan 2014 09:41
LONDON (Alliance News) - Caza Oil & Gas Inc Thursday said it has received a USD10 million advance under its financing agreement with Apollo Investment Management, with the proceeds earmarked to fund development drilling at its West Copperline property in New Mexico.
The USD10 million advance is part of the company's USD50 million facility with Apollo, of which Caza now has drawn USD35 million.
Caza is hoping to build on recent success at its 62.5%-owned site, where it reported a 1,000 barrels per day test rate in November.
"Given success, production facilities are already in place on the West Copperline property, which should allow both oil and natural gas sales to begin straight away upon completion of the wells," the petroleum and natural gas company said in a statement.
The company also has drilling plans for its Jazzmaster, Marathon Road and Gramma Ridge Bone Spring properties in the first-half of 2014.
"Using our existing funding arrangements, we made significant progress in 2013, laying the groundwork for continued success in the Bone Spring play in Lea and Eddy Counties, New Mexico," Chief Executive Michael Ford said in a statement.
"During this initial Bone Spring drilling phase, we have added material production and cashflow to the company. We have also been able to identify properties with reservoir characteristics that should continue this trend in 2014, beginning with those mentioned in this announcement," he added.
"The Bone Spring play offers meaningful and consistent growth to the company's production, cashflow and reserves, which should translate into further realization of shareholder value from this area. We look forward to updating the market as these properties are developed and wells are drilled and brought online," Ford said.
Caza Oil & Gas shares were Thursday quoted at 8.55 pence, down 0.07 pence, or 0.9%.
By Samuel Agini; [email protected]; @samuelagini
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