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11/4/2008 Carrizo Oil & Gas and Avista Capital Partners Announce Formation of Joint Venture in Marcellus Shale

HOUSTON, Nov. 4, 2008 -- Carrizo Oil & Gas, Inc. (Nasdaq: CRZO - News) and Avista Capital Partners (“Avista”) announced today that they have entered into a joint venture to pursue growth opportunities in the Marcellus Shale. Under the terms of the agreement, Carrizo and Avista have each committed to contribute up to $150 million in cash and properties to acquire and develop acreage in the Marcellus Shale play, including the dedication of all of their respective current Marcellus leasehold. The joint venture controls approximately 155,000 net acres in the play.

Carrizo will serve as operator of the joint venture properties and will provide all geotechnical, land and accounting support. Avista has agreed to fund 100% of the joint venture’s next approximately $71.5 million of expenditures, currently projected to be spent over the course of the next 8 to 12 months. After this initial cash contribution has been funded by Avista, the parties will share all costs of joint venture operations in accordance with their participating interests, which are expected to be 50/50 thereafter. Carrizo’s undivided interest in the joint venture’s business, including: (1) land and drilling expenditures, (2) future net oil and gas revenues, and (3) future oil and gas reserves, will be reflected in the company’s consolidated financial statements.

“It is gratifying to announce this agreement with our new private equity partner, Avista, whose investment professionals have a history of successful energy investments including several domestic resource plays”, said Carrizo Chief Executive Officer S. P. "Chip" Johnson, IV, “This new combination of Avista’s financial resources and Carrizo’s technical strengths will allow us to expand our activities in the Marcellus Shale to our mutual benefit, while at the same time conserving Carrizo’s capital for our ongoing Barnett development program through 2009. We view the Marcellus Shale as one of the company’s potential core growth areas and source of future shareholder value.”

“Avista is pleased to partner with Carrizo in this Marcellus Shale joint venture”, said Avista Partner Robert L. Cabes, Jr. “Carrizo’s demonstrated expertise in the exploitation of gas shales, gained during the development of the Barnett Shale, along with its existing land position in the Marcellus, makes them the ideal operating partner for Avista. We believe this is an excellent ground floor opportunity and we look forward to the successful growth of this venture in the years to come.”

About Carrizo Oil and Gas

Carrizo Oil & Gas, Inc. is a Houston-based energy company actively engaged in the exploration, development, exploitation, and production of oil and natural gas primarily in the Barnett Shale in North Texas and in proven onshore trends along the Texas and Louisiana Gulf Coast regions. Carrizo controls significant prospective acreage blocks and utilizes advanced 3-D seismic techniques to identify potential oil and gas reserves and drilling opportunities. Carrizo also controls large acreage positions in other productive shale resource plays including the Fayetteville and Marcellus.

About Avista Capital Partners

Avista Capital Partners is a leading private equity firm with offices in New York, NY and Houston, TX. Founded in 2005, Avista's strategy is to make controlling or influential minority investments primarily in growth-oriented media, healthcare and energy companies. Through its team of seasoned investment professionals and industry experts, Avista seeks to partner with exceptional management teams to invest in and add value to well-positioned businesses. For more information, visit www.avistacap.com.

Statements in this news release that are not historical facts, including those related to funding of development plans, financial flexibility, growth in reserves, new production and partnership activities, are forward-looking statements that are based on current expectations. Although Carrizo believes that its expectations are based on reasonable assumptions, it can give no assurance that these expectations will prove correct. Important factors that could cause actual results to differ materially from those in the forward-looking statements include market and other conditions, capital needs and uses, commodity price changes, effects of the global financial crisis on exploration activity and other risks described in Carrizo's Form 10-K for the year ended December 31, 2007 and its other filings with the Securities and Exchange Commission.



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