Operational Update on Arran Prospect

December 21, 2010

Caza Oil & Gas, Inc.

CAZA OIL & GAS PROVIDES AN OPERATIONAL UPDATE

ON ARRAN PROSPECT

HOUSTON, TEXAS (Marketwire - December 21, 2010) - Caza Oil & Gas, Inc. ("Caza" or the "Company") (TSX: CAZ) (AIM: CAZA) has been advised by its drilling contractor Nabors Drilling USA, that the Nabors Rig 4 is continuing operations at its current location longer than anticipated. Site preparations are now substantially complete and Caza is ready to receive the Nabors Rig 4 immediately following its release.Caza will update the market when the Marian Baker #1 well spuds, which is now expected in mid January.

Caza has a 25% working interest before casing point and a 35.94% working interest after casing point in the Marian Baker #1 well with an approximate net revenue interest of 26.24%.

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The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.

In accordance with AIM Rules - Guidance Note for Mining, Oil and Gas Companies, the information contained in this announcement has been reviewed and approved by Anthony B. Sam, Vice President Operations of Caza who is a Petroleum Engineer and a member of The Society of Petroleum Engineers.

ADVISORY REGARDING FORWARD LOOKING STATEMENTS

Information in this news release that is not current or historical factual information may constitute forward-looking statements within the meaning of securities laws. Such information is often, but not always, identified by the use of words such as "seek", "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", "high-impact", "significant upside" and similar expressions. Information regarding the Arran Prospect, Marian Baker #1 well and/or future exploration and drilling activities (including timing thereof) contained in this news release constitutes forward-looking information within the meaning of securities laws.

Implicit in this information, particularly in respect of the "Nabors drilling contract", "Arran Prospect" and "Marian Baker #1 well" are assumptions regarding drilling rig availability, projected revenue and expenses and well performance. Specifically, the Company has assumed that the agreement, prospect, wells and/or activities will produce positive results. These assumptions, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. Readers are cautioned that actual future operating results and economic performance of the Company are subject to a number of risks and uncertainties, including general economic, market and business conditions and could differ materially from what is currently expected as set out above.

For more exhaustive information on these risks and uncertainties you should refer to the Company's most recently filed annual information form which is available at www.sedar.com. You should not place undue importance on forward-looking information and should not rely upon this information as of any other date. While we may elect to, we are under no obligation and do not undertake to update this information at any particular time, except as required by applicable securities laws.