Status of Drilling.

Pool A & B.

 In the area East of Bowen, the first well was completed and brought on line on March 15^th. Royalties from this production are scheduled 120 days following the first month of sales (probably in August).

Three more wells have been drilled to production depth in May and June and are awaiting fracturing/completion when Pantego Town water supply is available later this fall. 

In the area west of Bowen, two more wells have been bored and are awaiting fracturing/completion.

The big drilling rig will be leaving the site in a matter of days.

Royalties and Division Orders.  Before Carrizo pays out the royalties due, property owners should expect to receive a mailing containing a Division Order. This is an important legal document which states the official decimal share of revenue that each property owner is entitle to receive. The decimal is calculated by dividing the acre size of the property including strips and gores (streets) by the total acres in the B pool (last May this was calculated as 524 acres. Since then, a small sector south of Pioneer has been restored to the unit, so the present acreage is estimated around 545 acres. We do not know the exact amount yet. Finally, the product of the above computation would be multiplied by your royalty percentage. For those who signed a Carrizo lease, the number will be .25. The result is the decimal percentage shown on your Division Order. Generally, if there are small variances in your acreage size as a part of the entire pool,  it is of trivial impact on the amount of royalty. But, when you get your Division Order, if you have questions, feel free to contact Carrizo, or call us at 817-261-5479. Property owners are requested by the company to review and confirm the information, and return it to the company as the basis for royalty payment.

Suspended Payments:

In Pool A, while most lessors received their Division Orders to sign, and their first royalty at the end of April, about 275 did not. The same situation will likely occur in Pool B east of Bowen later this year when the time comes at the end of the summer (End of August). .

If you do not receive a division order, or a royalty, and you have determined that your neighbors have, there is a good chance that the formal, complete title search and title opinion that Carrizo is getting before paying royalties has turned up some sort of blemish in the chain of title. Carrizo has indicated they will need to suspend the royalty disbursement until the title is cleared. Their title attorneys will be in touch with everyone on the suspended list to obtain the information and action needed to free up the property for payment. Some of the reasons have been very minor and quickly cleared; others have been more significant and take some effort. In the end, the process is a service to property owners because it clears up clouds on the title that will eventually need to be corrected anyway for other purposes (sale, estate, etc.). Carrizo has provided the following contacts to obtain information on what is needed to clear a title if you are one of the properties affected: Royalty Owner Relations at 713-358-6490 or email LandOwnerRelations@crzo.net . Please do not take this step until you are sure royalties are being paid in your neighborhood.