Carrizo Oil & Gas Announces Closing of Marcellus Shale Joint Venture

Carrizo Oil & Gas, Inc.

today announced that the company closed its previously announced joint venture transaction in the Marcellus Shale with a subsidiary of Reliance Industries Limited. In connection with the joint venture, Reliance acquired a 20% interest in approximately 52,200 net Carrizo acres in Pennsylvania considered highly prospective for Marcellus Shale natural gas at a purchase price of $65 million. Reliance paid $11.4 million in cash to Carrizo at closing with $1.7 million more expected later this year. In addition, Reliance will pay an expected $52 million of Carrizo's share of future drilling, completion, and seismic costs. The joint venture agreement is effective immediately. Simultaneous with the closing of this transaction, an affiliate of Carrizo's already existing joint venture partner, Avista Capital Partners, closed on the sale its entire interest in the same properties to Reliance for approximately $327 million. Under the terms of Carrizo's current joint venture agreement with Avista, Carrizo expects to receive approximately $44 million in cash from Avista based on the sale of Avista's approximately 52,200 net acres. The amounts to be received by Avista and Carrizo are subject to adjustment, pending completion of land title work.