* OCTOBER 25, 2010, 6:55 A.M. ET
Carrizo 3Q Output Below Estimates; Plans Debt Refinancing
DOW JONES NEWSWIRES
Carrizo Oil & Gas Inc. (CRZO) said third-quarter production rates were below expectations following delays in completing a pipeline expansion as the oil-and-gas explorer plans to sell $325 million in eight-year notes to buy back convertible debt.
The announcements come as Carrizo aims to significantly increase its crude oil and liquids production and reserves by early next year and said it's pursuing land acquisitions in the Eagle Ford shale formation in Texas and the Niobrara formation in Colorado.
Carrizo offered to buy back at par up to $300 million of its 4.375% convertible senior notes due in 2028, of which about $373.8 million remain outstanding. It plans to use the note offering, as well as its credit facility, to finance the repurchase. Recent months have seen a parade of companies issue debt, many seeking to reduce borrowing costs by refinancing.
Meanwhile, Carrizo said third-quarter production was 8.6 billion cubic feet of oil equivalent, or a daily average of 93.4 million, compared with the 8.2 billion and 89.2 million, respectively, it reported last year. The company said the latest quarter's results missed expectations after the delays in a pipeline expansion by one of its partners. Carrizo plans to release full third-quarter results Nov. 9.
The company raised its capital spending budget for the current year by $55 million to $280 million in the wake of its new joint venture with Reliance Industries Ltd. (500325.BY).
Carrizo shares closed Friday at $23.06 and were inactive premarket. The stock is down 13% this year.
-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240; [email protected]
http://online.wsj.com/article/BT-CO-20101025-704321.html
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