Carrizo Oil & Gas, Inc. Announces Continued Transformation to Oil With Record Oil Production, Revenue and EBITDA in Fourth

Carrizo Oil & Gas, Inc. Announces Continued Transformation to Oil With Record 
Oil Production, Revenue and EBITDA in Fourth Quarter and
Full Year 2012 Financial Results 
HOUSTON, TX -- (Marketwire) -- 02/26/13 --  Carrizo Oil & Gas, Inc.
(NASDAQ: CRZO) today announced the Company's record financial results
for the fourth quarter of 2012, which included the following
highlights: 
Results for the fourth quarter of 2012- 


 
--  Record Oil Production of 9,033 Bbls/d, a 4% sequential increase over
    the third quarter of 2012 and a 190% increase over the fourth quarter
    of 2011
    
    
--  Natural Gas and NGL Production of 100,924 Mcfe/d
    
    
--  Total Production of 2,379 MBoe, or 25,859 Boe/d
    
    
--  Record Oil Revenue of $81.2 million, amounting to 76% of total
    revenue, a 6% sequential increase over the third quarter of 2012 and
    a188% increase over the fourth quarter of 2011
    
    
--  Record Revenue of $107.5 million, or adjusted revenue of $116.7
    million, including the impact of realized hedges, a 12%sequential
    increase over the third quarter of 2012 and a 93% increase over the
    fourth quarter of 2011
    
    
--  Net Income of $18.5 million, $0.46 per diluted share, or Adjusted Net
    Income (as defined below) of $21.7 million, $0.54 per diluted share
    
    
--  Record EBITDA (as defined below) of $93.0 million, an 8% sequential
    increase over the third quarter of 2012 and a 90% increase over the
    fourth quarter of 2011

  
Production volumes during the fourth quarter of 2012 were 2,379 MBoe,
an increase of 25 MBoe, or 1%, from third quarter of 2012 production
of 2,354 MBoe. The 1% sequential increase in production from the
third quarter of 2012 to the fourth quarter of 2012 was primarily due
to new wells brought on during the quarter primarily in the Eagle
Ford and Niobrara partially offset by decreases in the Niobrara due
to the sales to affiliates of OIL India Ltd. and Indian Oil
Corporation Ltd. in connection with the joint ventures, which closed
during the fourth quarter of 2012.  
Adjusted revenues were $116.7 million for the fourth quarter of 2012,
which includes oil and gas revenues of $107.5 million and realized
hedge gains of $9.2 million, compared to adjusted revenu
es of $66.3
million for the fourth quarter of 2011, which includes oil and gas
revenues of $55.8 million and realized hedge gains of $10.5 million.
The increase in adjusted revenues was primarily driven by the
significant increase in oil production partially offset by lower gas
production. Including the impact of realized hedges, the Company's
average realized oil price decreased 1% to $99.57 per barrel for the
fourth quarter of 2012 compared to $100.26 per barrel for the fourth
quarter of 2011 and the average realized gas price decreased 2% to
$3.48 per Mcf for the fourth quarter of 2012 compared to $3.55 per
Mcf for the fourth quarter of 2011. Oil and gas revenues and average
realized prices excluding the impact of realized hedges are presented
in the table below. 
Adjusted net income, which excludes certain non-cash items described
in the statements of income included below ("Adjusted Net Income"),
was $21.7 million, or $0.55 and $0.54 per basic and diluted share,
respectively, during the fourth quarter of 2012, as compared to $9.1
million, or $0.23 per basic and diluted share during the fourth
quarter of 2011. The Company reported net income of $18.5 million, or
$0.47 and $0.46 per basic and diluted share, respectively, for the
three months ended December 31, 2012, as compared to net income of
$6.5 million, or $0.17 and $0.16 per basic and diluted share,
respectively, for the fourth quarter of 2011
. 
Earnings before interest, income tax, depreciation, and depletion and
amortization, as described in the statements of income included below
("EBITDA"), was $93.0 million, or $2.34 and $2.32 per basic and
diluted share, respectively, during the fourth quarter of 2012, as
compared to $48.9 million, or $1.24 and $1.23 per basic and diluted
share, respectively, during the fourth quarter of 2011.  
Lease operating expenses were $8.9 million ($3.73 per Boe) for the
three months ended December 31, 2012 as compared to lease operating
expenses of $6.9 million ($3.48 per Boe) for the same period in 2011.
The $2.0 million increase in lease operating expenses is primarily
due to increased production from new wells partially offset by the
sale of Barnett properties to Atlas Resource Partners, L.P.
("Atlas"). The increase in operating cost per Boe is primarily due to
the higher operating cost per Boe associated with the increased oil
production. 
Production taxes were $3.9 million (or 3.6% of oil and gas revenues)
for the three months ended December 31, 2012 as compared to $2.0
million (or 3.5% of oil and gas revenues) for the same period in
2011. The increase in production taxes is due primarily to increased
oil production. The increase in production taxes as a percentage of
oil and gas revenues was primarily due to increased oil production,
which has a higher effective production tax rate as compared to our
natural gas production. 
Ad valorem taxes increased to $1.6 million ($0.66 per Boe) for the
three months ended December 31, 2012 from $0.9 million ($0.47 per
Boe) for the same period in 2011. The increase in ad valorem taxes is
due primarily to new oil wells drilled in 2011. The increase in ad
valorem taxes per Boe is due primarily to new oil wells drilled in
2011, which have higher property tax valuations as compared to our
natural gas wells. 
General and administrative expense was $9.4 million during the fourth
quarter of 2012 as compared to $7.6 million during the same period in
2011. The increase was primarily due to compensation costs related to
an increase in personnel in the fourth quarter of 2012 as compared to
the same period of 2011. 
Depreciation, depletion and amortization ("DD&A") expense for the
fourth quarter of 2012 increased $17.2 million to $44.2 million
($18.56 per Boe) from the DD&A expense for the fourth quarter of 2011
of $27.0 million ($13.57 per Boe). The increase in DD&A is
attributable to both the increase in production and an increase in
the DD&A rate per Boe. The increase in the DD&A rate per Boe is
largely due to the impact of the significant decrease in natural gas
reserves in the Barnett as a result of the Atlas sale as well as the
significant increase in crude oil reserves in the Eagle Ford that
were added in 2012, which have a higher finding cost per Boe than our
natural gas reserves. 
Cash interest expense, net of amounts capitalized, increased to $13.6
million for the fourth quarter of 2012 as compared to $7.4 million
for the fourth quarter of 2011. The increase was primarily
attributable to interest on the $200.0 million aggregate principal
amount of our 8.625% Senior Notes issued in the fourth quarter of
2011 as well as interest on the $300.0 million aggregate principal
amount of our 7.50% Senior Notes issued in the third quarter of 2012
partially offset by a decrease in interest expense attributable to
reduced borrowings outstanding under the U.S. revolving credit
facility during the fourth quarter of 2012. 
An unrealized loss on derivatives of $4.4 million was recorded for
the fourth quarter of 2012 as compared to an unrealized loss on
derivatives of $1.4 million for the fourth quarter of 2011 due to the
change in fair value of our open derivative positions during those
periods. 
Non-cash, stock-based compensation expense of $1.1 million was
recorded for the three months ended December 31, 2012 as compared to
$5.3 million for the fourth quarter of 2011. The decrease was
primarily driven by a decrease in the fair value of stock
appreciation rights as the stock price decreased during the fourth
quarter of 2012 as compared to an increase in stock price during the
same period of 2011, partially offset by higher stock-based
compensation expense due to a higher number of restricted stock
awards outstanding during the fourth quarter of 2012 as compared to
the same period of 2011. 
The estimated annual effective income tax rates (which are used for
purposes of computing Adjusted Net Income) for the three months ended
December 31, 2012 and 2011 were 38.1% and 36.6%, respectively. The
actual effective income tax rate for the fourth quarter of 2012 was
32.6%, which was lower than the estimated annual effective income tax
rate due to the foreign tax benefit of our U.K. Huntington field
development project. Substantially all of the income tax expense for
the three months ended December 31, 2011 was offset by prior period
adjustments related to the Company's state and U.K. income tax
provisions recorded during the fourth quarter of 2011.  
Results for the Year Ended December 31, 2012- 


 
--  Record Oil Production of 7,820 Bbls/d, an increase of 256% over the
    same period of 2011
    
    
--  Record Total Production of 9,436 MBoe, or 25,781 Boe/d, an increase of
    26% over the same period of 2011
    
    
--  Record Oil Revenue of $286.1 million, amounting to 78% of total
    revenue, an increase of 279% over the same period of 2011
    
    
--  Record Revenue of $368.2 million, or adjusted revenue of $406.2
    million, including the impact of realized hedges, an 82% increase over
    the same period of 2011
    
    
--  Net Income of $55.5 million, $1.39 per diluted share, or Adjusted Net
    Income of $67.5 million, $1.69 per diluted share
    
    
--  Record EBITDA of $319.0 million, an 85% increase over the same period
    of 2011

  
Production volumes during the year ended December 31, 2012 were 9,436
MBoe, an increase of 1,925 MBoe, or 26%, compared to production of
7,511 MBoe during the year ended December 31, 2011. The increase in
production was primarily due to increased production from new wells,
partially offset by normal production decline, the Atlas sale and the
sale of substantially all of our non-core area Barnett properties to
KKR Natural Resources ("KKR") in May 2011. 
Adjusted revenues were $406.2 million for the year ended December 31,
2012, which includes oil and gas revenues of $368.2 million and
realized hedge gains of $38.0 million, compared to $231.9 million for
the same period of 2011, which includes oil and gas revenues of
$202.2 million and realized hedge gains of $29.7 million. The
increase in adjusted revenues was primarily driven by increased oil
production and prices partially offset by lower gas prices. Including
the impact of realized hedges, the Company's average realized oil
price increased 6% to $100.50 per barrel for the year ended December
31, 2012 compared to $94.67 per barrel for the year ended December
31, 2011 and the average realized gas price decreased 23% to $2.87
per Mcf for the year ended December 31, 2012 compared to $3.73 per
Mcf for the year ended December 31, 2011. Oil and gas revenues and
average realized prices excluding the impact of realized hedges are
presented in the table below. 
Adjusted Net Income was $67.5 million, or $1.71 and $1.69 per basic
and diluted share, respectively, during the year ended December 31,
2012, as compared to $38.7 million, or $0.99 and $0.98 per basic and
diluted share, respectively, during the year ended December 31, 2011.
The Company reported net income of $55.5 million, or $1.40 and $1.39
per basic and diluted share, respectively, for the year ended
December 31, 2012, as compared to net income of $36.6 million, or
$0.94 and $0.92 per basic and diluted share for the same period of
2011. 
EBITDA was $319.0 million, or $8.06 and $7.97 per basic and diluted
share, respectively, during the year ended December 31, 2012, as
compared to $172.1 million, or $4.40 and $4.34 per basic and diluted
share, respectively, for the same pe
riod of 2011.  
Lease operating expenses were $31.5 million ($3.34 per Boe) for the
year ended December 31, 2012 as compared to lease operating expenses
of $28.3 million ($3.77 per Boe) for the year ended December 31,
2011. Lease operating expenses increased $3.2 million primarily due
to increased production from new wells partially offset by the Atlas
and KKR sales. The decrease in operating cost per Boe is due to the
Atlas and KKR sales (which were higher operating cost per Boe
properties as compared to our remaining Barnett properties) partially
offset by the higher operating cost per Boe associated with oil
production. 
Production taxes were $13.5 million (or 3.7% of oil and gas revenues)
for the year ended December 31, 2012 as compared to $5.7 million (or
2.8% of oil and gas revenues) for the year ended December 31, 2011.
The increase in production taxes is due primarily to increased oil
production. The increase in production taxes as a percentage of oil
and gas revenues was primarily due to increased oil production, which
has a higher effective production tax rate as compared to our natural
gas production. 
Ad valorem taxes increased to $9.8 million ($1.04 per Boe) for the
year ended December 31, 2012 from $3.6 million ($0.48 per Boe) for
the same period of 2011. The increase in ad valorem taxes is due
primarily to new oil wells drilled in 2011 and the Commonwealth of
Pennsylvania's February 2012 enactment of an "impact fee" on the
drilling of unconventional natural gas wells. Because of the
retroactive nature of the impact fee, approximately $1.0 million of
ad valorem taxes recognized during 2012 is attributable to wells
drilled prior to 2012. The increase in ad valorem taxes per Boe is
due primarily to new oil wells drilled in 2011, which have higher
property tax valuations as compared to our natural gas wells, as well
as the recognition of the impact fee in 2012. 
General and administrative expense was $32.6 million during the year
ended December 31, 2012 as compared to $25.6 million during the year
ended December 31, 2011. The increase was primarily due to increased
compensation costs related to an increase in personnel in the year
ended December 31, 2012 as compared to the same period of 2011. 
DD&A expense for the year ended December 31, 2012 increased $81.0
million to $165.6 million ($17.55 per Boe) from the DD&A expense for
the year ended December 31, 2011 of $84.6 million ($11.26 per Boe).
The increase in DD&A is attributable to both the increase in
production and an increase in the DD&A rate per Boe. The increase in
the DD&A rate per Boe is largely due to the impact of the significant
decrease in natural gas reserves in the Barnett as a result of the
Atlas and KKR sales as well as the increase in crude oil reserves in
the Eagle Ford that have been added during 2011 and 2012, which have
a higher finding cost per Boe than our natural gas reserves. 
Cash interest expense, net of amounts capitalized, increased to $43.7
million for the year ended December 31, 2012 compared to $26.1
million for the same period of 2011. The increase was primarily
attributable to interest on the $200.0 million aggregate principal
amount of our 8.625% Senior Notes issued in the fourth quarter of
2011 as well as interest on the $300.0 million aggregate principal
amount of our 7.50% Senior Notes issue
d in the third quarter of 2012. 
An unrealized loss on derivatives of $7.2 million was recorded for
the year ended December 31, 2012 as compared to an unrealized gain on
derivatives of $15.7 million for the same period of 2011 due to the
change in fair value of our open derivative positions during those
periods. 
Non-cash, stock-based compensation expense of $11.7 million was
recorded for the year ended December 31, 2012 as compared to $11.9
million for the same period of 2011. The decrease in stock-based
compensation expense was primarily due to a decrease in the fair
value of stock appreciation rights due to a decrease in stock price
during 2012 as compared to an increase in stock price during 2011,
partially offset by higher stock-based compensation expense due to a
higher number of restricted stock awards outstanding during 2012 as
compared to 2011. 
The estimated annual effective income tax rates (which are used for
purposes of computing Adjusted Net Income) for the years ended
December 31, 2012 and 2011 were 38.1% and 36.6%, respectively. The
actual effective income tax rate for the year ended December 31, 2012
was 31.8%, which was lower than the estimated annual effective income
tax rate due to the foreign tax benefit of our U.K. Huntington field
development project. The actual effective income tax rate for the
year ended December 31, 2011 was 33.2%, which was lower than the
estimated annual effective income tax rate due to revisions of prior
period estimates of state income taxes as well as prior period
adjustments related to the Company's state and U.K. income tax
provisions recorded during the fourth quarter of 2011.  
S.P. "Chip" Johnson, IV, President and CEO of Carrizo commented on
the quarter's results, "Our fourth quarter performance once again
sets new records on a number of fronts, capping off a
transformational year for the Company. Thanks to our record oil
production, we reported the highest quarterly revenue and EBITDA in
the history of the Company. We have now reported sequential revenue
growth for the last nine quarters and remain confident that this
growth trend will continue. Executing on our approved development
plans and using reasonable assumptions for commodity prices, our
operations could show sequential quarterly growth in revenue and
EBITDA in 2013. As I mentioned in our recent reserves press release,
we are seeing dramatic benefits from our transformation to a more
oily company. Our EBITDA margin per Boe expanded once again to $39.08
from $36.73 last quarter and from $24.55 for the fourth quarter of
2011. Our EBITDA margin came in at 80% this quarter, even higher than
the 74% reported for the fourth quarter of 2011. 
"Our staff has done a remarkable job of managing both our rapid
growth and our changing production mix. This quarter we exceeded the
high end of guidance for both oil and gas production. We grew our
EBITDA to $93.0 million for the quarter, an increase of 90% from the
fourth quarter of 2011, and to $319.0 million for the year, an
increase of 85% from 2011. These exceptional results exclude any
adjustment for the loss of approximately 7,572 Boe/d of production
associated with the sale of 53.8 MMBoe of reserves during the year. 
"We enter 2013 well positioned for continued growth with every
drillsite for the year already identified, and currently with over
$100.0 million of cash and an undrawn revolving credit facility."  
The Company will hold a conference call to discuss 2012 fourth
quarter and full year financial results on Tuesday, February 26, 2013
at 10:00 AM Central Standard Time. To participate in the call, please
dial (800) 670-5957 ten minutes before the call is scheduled to
begin. A replay of the call will be available through Tuesday, March
5, 2013 at 11:59 AM Central Standard Time at (800) 633-8284. The
reservation number for the replay is 21647863.  
A simultaneous webcast of the call may be accessed over the internet
at http://www.investorcalendar.com/IC/CEPage.asp?ID=170543 or by
visiting our website at http://www.crzo.net, clicking on "Investor
Relations" and then clicking on "2012 Fourth Quarter Conference Call
Webcast." To listen, please go to either website in time to register
and install any necessary software. The webcast will b
e archived for
replay on the Carrizo website for 15 days. 
Carrizo Oil & Gas, Inc. is a Houston-based energy company actively
engaged in the exploration, development, and production of oil and
gas primarily from resource plays located in the United States. Our
current operations are principally focused in proven, producing oil
and gas plays primarily in the Eagle Ford Shale in South Texas, the
Niobrara Formation in Colorado, the Barnett Shale in North Texas, the
Marcellus Shale in Pennsylvania, and the Utica Shale in Ohio. 
Statements in this release that are not historical facts, including
but not limited to those related to capital requirements, spending
plans, production rate target guidance for the quarter, timing and
levels of production, drilling and completion, production mix,
expected locations, development plans, growth, sales transactions
(including effects thereof), use of proceeds, oil and gas sales, the
Company's or management's intentions, beliefs, expectations, hopes,
projections, assessment of risks, estimations, plans or predictions
for the future, results of the Company's strategies, timing of
completion and drilling of wells, completion and pipeline
connections, expected income tax rates and deferral of income taxes
and other statements that are not historical facts are
forward-looking statements that are based on current expectations.
Although Carrizo believes that its expectations are based on
reasonable assumptions, it can give no assurance that these
expectations will prove correct. Important factors that could cause
actual results to differ materially from those in the forward-looking
statements include results of wells and production testing,
performance of rig operators and gathering systems, actions by
governmental authorities, joint venture partners, industry partners,
lenders and other third parties, purchasers obtaining financing,
satisfaction of closing conditions, market and other conditions,
availability of well connects, capital needs and uses, commodity
price changes, effects of the global economy on exploration activity,
results of and dependence on exploratory drilling activities,
operating risks, right-of-way and other land issues, availability of
capital and equipment, weather, and other risks described in
Carrizo's Form 10-K for the year ended December 31, 2011 and its
other filings with the U.S. Securities and Exchange Commission. There
can be no assurance any financing matter or transaction described in
this press release will occur on the terms or timing described, or at
all. 
(Financial Highlights to Follow) 


 
                                                                            
                                                                            
                          CARRIZO OIL & GAS, INC.                           
                     CONSOLIDATED STATEMENTS OF INCOME                      
                  (In thousands, except per share amounts)                  
                                (unaudited)                                 
                                                                            
                                  Three Months Ended        Year Ended      
                                     December 31,          December 31,     
                                 --------------------  -------------------- 
                                    2012       2011       2012       2011   
                                 ---------  ---------  ---------  --------- 
Revenues:                                                                   
  Oil and condensate             $  81,229  $  28,218  $ 286,119  $  75,502 
  Natural gas                       22,252     25,565     71,430    116,103 
  NGLs                               3,969      1,986     10,631     10,562 
                                 ---------  ---------  ---------  --------- 
Total oil and gas revenues         107,450     55,769    368,180    202,167 
Realized gain on derivatives,                                               
 net (1), (2)                        9,257     10,573     38,042     29,765 
                                 ---------  ---------  ---------  --------- 
Adjusted revenues                  116,707     66,342    406,222    231,932 
                                 ---------  ---------  ---------  --------- 
                                                                            
Costs and expenses:                                                         
  Lease operating                    8,872      6,929     31,471     28,314 
  Production taxes                   3,866      1,965     13,542      5,696 
  Ad valorem taxes                   1,575        927      9,813      3,625 
  General and administrative         9,417      7,645     32,628     25,644 
                                 ---------  ---------  ---------  --------- 
Total costs and expenses            23,730     17,466     87,454     63,279 
                                 ---------  ---------  ---------  --------- 
                                                                            
Other items of income (expense)                                             
 included in EBITDA, as defined:                                            
  Cash Distributions-Related                                                
   Party                                --         --         --      3,333 
  Other income, net                      1          1        226         80 
                                 ---------  ---------  ---------  --------- 
EBITDA, as defined               $  92,978  $  48,877  $ 318,994  $ 172,066 
                                 =========  =========  =========  ========= 
EBITDA per common share-Basic    $    2.34  $    1.24  $    8.06  $    4.40 
                                 =========  =========  =========  ========= 
EBITDA per common share-Diluted  $    2.32  $    1.23  $    7.97  $    4.34 
                                 =========  =========  =========  ========= 
                                                                            
Other items of income (expense)                                             
 included in adjusted net                                                   
 income, as defined:                                                        
  Depreciation, depletion and                                               
   amortization expense          $ (44,162) $ (27,010) $(165,621) $ (84,606)
  Cash interest expense            (20,511)   (13,055)   (68,772)   (46,733)
  Cash interest capitalized          6,961      5,673     25,111     20,656 
  Accretion expense related to                                              
   asset retirement obligations       (197)       (96)      (735)      (311)
  Interest income                        9          7         38         18 
                                 ---------  ---------  ---------  --------- 
Adjusted income before income                                               
 taxes                              35,078     14,396    109,015     61,090 
Adjusted income tax expense        (13,350)    (5,269)   (41,491)   (22,359)
                                 ---------  ---------  ---------  --------- 
ADJUSTED net income, as defined  $  21,728  $   9,127  $  67,524  $  38,731 
                                 =========  =========  =========  ========= 
ADJUSTED net income per common                                              
 share-Basic                     $    0.55  $    0.23  $    1.71  $    0.99 
                                 =========  =========  =========  ========= 
ADJUSTED net income per common                                              
 share-Diluted                   $    0.54  $    0.23  $    1.69  $    0.98 
                                 =========  =========  =========  ========= 
                                                                            
Other non-cash items of income                                              
 (expense) included in net                                                  
 income:                                                                    
  Unrealized gain (loss) on                                                 
   derivatives, net (2), (3)     $  (4,408) $  (1,395) $  (7,246) $  15,700 
  Stock-based compensation                                                  
   expense                          (1,066)    (5,269)   (11,689)   (11,864)
  Other non-cash general and                                                
   administrative expenses (4)        (895)      (536)    (3,620)    (2,748)
  Non-cash interest expense         (2,084)    (1,747)    (7,790)    (6,070)
  Non-cash interest capitalized        823        759      3,293      2,712 
  Non-cash reclassification of                                              
   Cash Distributions-Related                                               
   Party to oiland gas property                                             
   costs                                --         --         --     (3,333)
  Loss on extinguishment of debt        --         --         --       (897)
  Foreign currency transaction                                              
   gain (loss)                          --        270       (588)       259 
                                 ---------  ---------  ---------  --------- 
Income before income taxes          27,448      6,478     81,375     54,849 
Income tax (expense) benefit        (8,958)        32    (25,888)   (18,220)
                                 ---------  ---------  ---------  --------- 
Net income (5)                   $  18,490  $   6,510  $  55,487  $  36,629 
                                 =========  =========  =========  ========= 
Net income per common share-                                                
 Basic                           $    0.47  $    0.17  $    1.40  $    0.94 
                                 =========  =========  =========  ========= 
Net income per common share-                                                
 Diluted                         $    0.46  $    0.16  $    1.39  $    0.92 
                                 =========  =========  =========  ========= 
                                                                            
Weighted average common shares                                              
 outstanding-Basic                  39,688     39,361     39,591     39,077 
                                 ---------  ---------  ---------  --------- 
Weighted average common shares                                              
 outstanding-Diluted                40,141     39,767     40,026     39,668 
                                 ---------  ---------  ---------  --------- 
                                                                            
NOTES:                                                                      
(1) Includes reclassifications of approximately $0.2 million and $0.1       
 million for the three months ended December 31, 2012 and 2011,             
 respectively, and $0.5 million and $0.7 million for the years ended        
 December 31, 2012 and 2011, respectively, from general and administrative  
 to realized gain on derivatives, net, related to agency fees paid to enter 
 into certain derivative positions.                                         
                                                                            
(2) Includes reclassifications of approximately $1.0 million and $1.3       
 million for the three months ended December 31, 2012 and 2011,             
 respectively, and $2.2 million and $5.0 million for the years ended        
 December 31, 2012 and 2011, respectively, from unrealized gain on          
 derivatives, net, to realized gain on derivatives, net, for cash received  
 from the optimization of certain hedge positions that settle in future     
 periods. Amounts for cash received are offset by the related non-cash      
 amortization during the period in which such hedge positions settle.       
                                                                            
(3) Includes reclassifications of approximately $0.2 million and $0.2       
 million for the three months ended December 31, 2012 and 2011,             
 respectively, and $0.4 million and $0.8 million for the years ended        
 December 31, 2012 and 2011, respectively, from general and administrative  
 to unrealized gain/loss on derivatives, net, related to accrued agency     
 fees incurred to enter into certain derivative positions.                  
                                                                            
(4) Non-cash general and administrative expenses include non-cash           
 contribution expense, rent expense, and allowance for doubtful accounts.   
                                                                            
(5) The Company completed the sale of its wholly owned subsidiary Carrizo   
 UK Huntington Ltd, and all of its interest in the Huntington Field in the  
 U.K. North Sea, to a subsidiary of Iona Energy Inc. during the first       
 quarter of 2013. We will classify the U.K. North Sea results of operations 
 as discontinued operations, net of income taxes, for all periods in the    
 consolidated statements of income that will be included in our Annual      
 Report on Form 10-K for the year ended December 31, 2012. Net income for   
 the U.K. North Sea was $2.0 million and $1.8 million for the three months  
 ended December 31, 2012 and 2011, respectively, and $4.3 million and $4.1  
 million for the years ended December 31, 2012 and 2011, respectively, and  
 primarily related to deferred income tax benefits.                         
                                                                            
                                   (more)                                   
                                                                            
                                                                            
                                                                            
                                                                            
                           CARRIZO OIL & GAS, INC.                          
                    CONDENSED CONSOLIDATED BALANCE SHEETS                   
                               (In thousands)                               
                                 (unaudited)                                
                                                                            
                                                                            
                                         December 31, 2012 December 31, 2011
                                         ----------------- -----------------
ASSETS                                                                      
Cash and cash equivalents                $          52,614 $          28,112
Fair value of derivative instruments                24,003            27,877
Other current assets                               132,088            64,408
                                         ----------------- -----------------
  Total current assets                             208,705           120,397
Investment                                           2,523             2,523
Fair value of derivative instruments                 5,203             9,617
Deferred income taxes                               32,517            59,755
Property and equipment, net                      1,608,406         1,310,514
Other assets                                        26,642            24,874
                                         ----------------- -----------------
TOTAL ASSETS (1)                         $       1,883,996 $       1,527,680
                                         ================= =================
                                                                            
LIABILITIES AND SHAREHOLDERS' EQUITY                                        
Accounts payable and accrued liabilities $         257,193 $         261,635
Current maturities of long-term debt                33,800                --
Deferred income taxes                                7,925             9,685
                                         ----------------- -----------------
  Total current liabilities                        298,918           271,320
Long-term debt, net of current                                              
 maturities and debt discount                      986,008           729,300
Other liabilities                                   14,054            17,205
Shareholders' equity                               585,016           509,855
                                         ----------------- -----------------
TOTAL LIABILITIES AND SHAREHOLDERS'                                         
 EQUITY (1)                              $       1,883,996 $       1,527,680
                                         ================= =================
                                                                            
NOTE:                                                                       
(1) The Company completed the sale of its wholly owned subsidiary Carrizo UK
 Huntington Ltd, and all of its interest in the Huntington Field in the U.K.
 North Sea, to a subsidiary of Iona Energy Inc. during the first quarter of 
 2013. We will classify the U.K. North Sea assets and liabilities as held   
 for sale for all periods in the consolidated balance sheets that will be   
 included in our Annual Report on Form 10-K for the year ended December 31, 
 2012. Assets of the U.K. North Sea were $134.5 million and $82.6 million as
 of December 31, 2012 and 2011, respectively, and consisted primarily of    
 property and equipment, net. Liabilities of the U.K. North Sea were $72.2  
 million and $26.7 million as of December 31, 2012 and 2011, respectively,  
 and consisted primarily of long-term debt and current maturities of long-  
 term debt.                                                                 
                                                                            
                                   (more)                                   
                                                                            
                                                                            
                                                                            
                                                                            
                           CARRIZO OIL & GAS, INC.                          
                        PRODUCTION VOLUMES AND PRICES                       
                                 (unaudited)                                
                                                                            
                                                                            
                                      Three Months Ended      Year Ended    
                                         December 31,        December 31,   
                                     ------------------- -------------------
                                        2012      2011      2012      2011  
                                     --------- --------- --------- ---------
Production volumes -                                                        
  Oil and condensate (MBbls)               831       287     2,862       802
  NGLs (MBoe)                              114        35       305       210
  Natural gas (MMcf)                     8,601    10,013    37,612    38,991
                                     --------- --------- --------- ---------
    Total Natural gas and NGLs                                              
     (MMcfe)                             9,285    10,223    39,442    40,251
                                     --------- --------- --------- ---------
  Total barrels of oil equivalent                                           
   (MBoe)                                2,379     1,991     9,436     7,511
                                     ========= ========= ========= =========
                                                                            
Production volumes per day -                                                
  Oil and condensate per day                                                
   (Bbls/d)                              9,033     3,120     7,820     2,197
  NGLs per day (Boe/d)                   1,239       380       833       575
  Natural gas per day (Mcf/d)           93,489   108,837   102,765   106,825
                                     --------- --------- --------- ---------
    Total Natural gas and NGLs per                                          
     day (Mcfe/d)                      100,924   111,120   107,765   110,277
                                     --------- --------- --------- ---------
  Total barrels of oil equivalent                                           
   per day (Boe/d)                      25,859    21,641    25,781    20,578
                                     ========= ========= ========= =========
                                                                            
Average realized prices -                                                   
  Oil and condensate ($ per Bbl)     $   97.75 $   98.32 $   99.97 $   94.14
  Oil and condensate ($ per Bbl) -                                          
   with hedge impact                 $   99.57 $  100.26 $  100.50 $   94.67
  NGLs ($ per Boe)                   $   34.82 $   56.74 $   34.86 $   50.30
  Natural gas ($ per Mcf)            $    2.59 $    2.55 $    1.90 $    2.98
  Natural gas ($ per Mcf) - with                                            
   hedge impact                      $    3.48 $    3.55 $    2.87 $    3.73

  
Contact:
Carrizo Oil & Gas, Inc.
Richard Hunter
Vice President of Investor Relations
Paul F. Boling
Chief Financial Officer
(713) 328-1000 
 
 
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