Carrizo CEO Says Transition to Focus on Oil “Now Completed”

Last November MDN told you that Carrizo was de-emphasizing the Marcellus and instead focusing on more oily and wet gas plays, like the Utica (see Carrizo Down on Marcellus, Up on Utica and Other Wet/Oil Plays). In releasing their 2013 fourth quarter and full year results yesterday, Carrizo’s CEO Chip Johnson said, “We began our shift from gas to oil back in 2010, and I’m pleased to say that we’ve now completed the transition. Crude oil now accounts for more than 60% of our proved reserves, and even though we sold almost 45% of our 2012 U.S. reserve base through our Barnett Shale and other non-core divestitures, we were still able to increase our PV-10 by 44% in 2013. Oil also now accounts for the majority of our production, as we expect it to be approximately 60% of 2014 volumes.”

Does that mean Carrizo is exiting the Marcellus completely? Not according to the update. Carrizo drilled 6 Marcellus wells in 4Q13. They complain that midstream (pipeline) delays continue to “impact” their operations in the Marcellus, along with really low commodity prices. So for now they’ve pulled back. For 2014 they plan to complete the wells they’ve already drilled–24 in all, and finish up drilling 3 wells already begun. According to our trusty NGI’s Shale Play Factbook, Carrizo owns leases on 49,200 acres in the Marcellus (and 21,700 acres in the Utica). Here’s yesterday’s update which clearly details the oil/wet gas direction of the company…

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