Aug. 26, 2009 (Business Wire) -- Clayton Williams Energy, Inc. (NASDAQ:CWEI) today announced that it had terminated drilling operations on the Miami Corp. #2, an exploratory test well in the Bayou Sale field on its Liger Prospect in St. Mary Parish, Louisiana. The well targeted multiple lower Miocene sands which were encountered at depths ranging from 15,928 feet to 16,916 feet. Based on well logs, the Company has determined that no commercial quantities of hydrocarbons exist in these sands and that the well will be plugged and abandoned.
The Miami Corp. #2 well was a replacement well for the Miami Corp. #1 that was abandoned in May 2009 after encountering mechanical difficulties. Since the accumulated drilling costs of both wells were capitalized pending the results of drilling activities on the Miami Corp. #2 well, the Company will record a pre-tax charge of approximately $18.5 million, net to the Company’s interest, related to the abandonment of these wells during the third quarter of 2009.
Clayton Williams Energy, Inc. is an independent energy company located in Midland, Texas.
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical or current facts, that address activities, events, outcomes and other matters that we plan, expect, intend, assume, believe, budget, predict, forecast, project, estimate or anticipate (and other similar expressions) will, should or may occur in the future are forward-looking statements. These forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events. The Company cautions that its future natural gas and liquids production, revenues, cash flows, liquidity, plans for future operations, expenses, outlook for oil and natural gas prices, timing of capital expenditures and other forward-looking statements are subject to all of the risks and uncertainties, many of which are beyond our control, incident to the exploration for and development, production and marketing of oil and gas.
These risks include, but are not limited to, the possibility of unsuccessful exploration and development drilling activities, our ability to replace and sustain production, commodity price volatility, domestic and worldwide economic conditions, the availability of capital on economic terms to fund our capital expenditures and acquisitions, our level of indebtedness, the impact of the current economic recession on our business operations, financial condition and ability to raise capital, declines in the value of our oil and gas properties resulting in a decrease in our borrowing base under our credit facility and impairments, the ability of financial counterparties to perform or fulfill their obligations under existing agreements, the uncertainty inherent in estimating proved oil and gas reserves and in projecting future rates of production and timing of development expenditures, drilling and other operating risks, lack of availability of goods and services, regulatory and environmental risks associated with drilling and production activities, the adverse effects of changes in applicable tax, environmental and other regulatory legislation, and other risks and uncertainties are described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statements.
