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ZaZa Energy Announces Production Results from Three East Texas Vertical Wells

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ZaZa Energy Corporation (“ZaZa” or the “Company”) (NASDAQ:ZAZA) today announced the one-year production results (October 1, 2013 to September 30, 2014) from three of its East Texas vertical wells in Madison and Walker counties, Texas:

  • Toby #1 (“Toby”). During 336 producing days, average three-stream production for the Toby well was approximately 539 boe/d, consisting of about 230 b/d of liquids and 1,853 mcf/d of natural gas (cumulative one-year production of ~181,069 boe).
  • Grisham #1 (“Grisham”). During 358 producing days, average three-stream production for the Grisham well was approximately 533 boe/d, consisting of about 456 b/d of liquids and 460 mcf/d of natural gas (cumulative one-year production of ~190,720 boe).
  • Laura Unit #1 (“Laura”). During 356 producing days, average three-stream production for the Laura well was approximately 382 boe/d, consisting of about 293 b/d of liquids and 532 mcf/d of natural gas (cumulative one-year production of ~135,911 boe).

ZaZa holds a 25% working interest in the Toby well and a 29.38% working interest in each of the Grisham and Laura wells.

President and CEO Todd A. Brooks stated, “The one-year performance of these three vertical wells illustrates how ZaZa’s East Texas acreage can be developed using two alternative approaches: horizontal or vertical wells. The horizontal approach is exemplified by the results of two recent wells in southern Madison and northern Walker counties: (i) ZaZa’s McAdams Cattle Company #1H (929 boe/d IP-30) and (ii) nearby offset Vick B Unit #1H (2,311 boe/d IP-30). The vertical approach has been confirmed by the Toby, Grisham, and Laura well results.”

ZaZa’s internal models indicate similarly strong economics of greater than 50% IRR for both horizontal and vertical wells, assuming horizontal well costs of ~$9.5 mm, vertical well costs of ~$4.5 mm, ~$80 oil, and ~$3.70 per mmbtu gas.

With respect to its horizontal program, the Company is expecting completion procedures to be underway by the end of the month for the Josey Wales #1H, which targets a formation similar to the McAdams 1H, and is currently drilling the lateral portion of the Colburn #3H, which will be our first horizontal test of a deeper, known productive formation.

About ZaZa Energy Corporation

Headquartered in Houston, Texas, ZaZa Energy Corporation is a publicly-traded exploration and production company with primary assets in the Eagle Ford and Eagle Ford East resource plays in Texas. More information about the Company may be found at www.zazaenergy.com.

This news 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 fact, including without limitation, statements and projections regarding the Company’s future financial position, operations, performance, business strategy, returns, budgets, reserves, levels of production and costs, ability to raise additional capital or refinance indebtedness, statements regarding future commodity prices and statements regarding the plans and objectives of the Company’s management for future operations, are forward-looking statements. The Company’s forward looking statements are typically preceded by, followed by or include words such as “will,” “may,” “could,” “would,” “should,” “likely,” “believe,” “expect,” “anticipate,” “plan,” “estimate,” “target,” “goal,” “project,” “plan,” “intend” and similar words or expressions. The Company’s forward-looking statements are not guarantees of future performance and are only predictions and statements of the Company’s beliefs based on assumptions that may prove to be inaccurate. Forward-looking statements involve known, unknown or currently unforeseen risks and uncertainties that may be outside of the Company’s control and may cause the Company’s actual results and future developments to differ materially from those projected in, and contemplated by, such forward-looking statements. Risks, uncertainties and other factors that could cause the Company’s actual results to materially differ from the expectations reflected in the Company’s forward-looking statements include, without limitation, our former registered public accounting firm has expressed doubt about our ability to continue as a going concern; fluctuations in the prices for, and demand for, oil, natural gas and natural gas liquids; our substantial level of indebtedness; risks associated with whether and when the reserve based debt facility will be finalized and on what terms; problems with our joint ventures or joint venture partners; our ability to raise necessary capital in the future; exploratory risks associated with new or emerging oil and gas formations; risks associated with drilling and operating wells; inaccuracies and limitations inherent in estimates of oil and gas reserves; our ability to replace oil and gas reserves and any other factors or risks listed in the reports and other filings that the Company has filed and may file with the Securities and Exchange Commission. Any forward-looking statements made by the Company in this presentation and in other written and oral statements are based only on information currently available to the Company and speak only as of the date on which they are made. The Company undertakes no obligation to update or revise any of its forward-looking statements, whether as a result of new information, future developments or otherwise.

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