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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549




                                    FORM 8-K

                                 CURRENT REPORT

     PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


       Date of Report (date of earliest event reported): December 8, 2000


                             CARRIZO OIL & GAS, INC.
             (Exact name of registrant as specified in its charter)

                                                                                         
         TEXAS                                        000-22915                                  76-0415919
(State or other jurisdiction of                      (Commission                                  (I.R.S. Employer
incorporation)                                      File Number)                               Identification No.)




                              14701 ST. MARY'S LANE
                                    SUITE 800
                              HOUSTON, TEXAS 77079
              (Address of principal executive offices and zip code)


       Registrant's telephone number, including area code: (281) 496-1352




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ITEM 5.   OTHER EVENTS.

                  Settlement of Litigation. The Company, as one of three
plaintiffs, filed a lawsuit against BNP Petroleum Corporation ("BNP"), Seiskin
Interests, LTD, Pagenergy Company, LLC and Gap Marketing Company, LLC, as
defendants, in the 229th Judicial District Court of Duval County, Texas, for
fraud and breach of contract in connection with an agreement between plaintiffs
and defendants whereby the defendants were obligated to drill a test well in an
area known as the Slick Prospect in Duval County, Texas. The allegations of the
Company in this litigation were that BNP gave the Company inaccurate and
incomplete information on which the Company relied in making its decision not to
participate in the test well and the prospect, resulting in the loss of the
Company's interest in the lease, the test well and four subsequent wells drilled
in the prospect. The Company has sought to enforce its approximate 23.68%
interest in the prospect and sought damages or rescission, as well as costs and
attorneys' fees. The case was originally filed in Duval County, Texas on
February 25, 2000.

                  In mid March, 2000, the defendants filed an original answer
and certain counterclaims against plaintiffs, seeking unspecified damages for
slander of title, tortious interference with business relations, and exemplary
damages. The case proceeded to trial before the Court (without a jury) on June
19, 2000 after the plaintiffs' were found by the court to have failed to comply
with procedural requirements regarding the request for a jury. After several
days of trial the case was recessed and later resumed on September 5, 2000. The
court at that time denied the plaintiffs' motion for mistrial based on the
court's denial of a jury trial. The court also ordered that the defendants'
counterclaims would be the subject of a separate trial that is to commence on
December 11, 2000. The parties proceeded to try issues related to the
plaintiffs' claims on September 5, 2000. All parties rested on the plaintiffs'
claims on September 13, 2000. The court took the matter under advisement and has
not yet announced a ruling. Defendants filed a second amended answer and
counterclaim and certain supplemental responses to request for disclosure in
which they stated that they were seeking damages in the amount of $33.5 million
by virtue of an alleged lost sale of the subject properties, $17 million in
alleged lost profits from other prospective contracts, and unspecified
incidental and consequential damages from the alleged wrongful suspension of
funds under their gas sales contract with the gas purchaser on the properties,
alleged damage to relationships with trade creditors and financial institutions,
including the inability to leverage the Slick Prospect, and attorneys' fees at
prevailing hourly rates in Duval County, Texas incurred in defending against
plaintiffs' claims and for 40% of any aggregate recovery in prosecuting their
counterclaims. In subsequent testimony, the defendants have verbally alleged $26
million of damages by virtue of the alleged lost sale of the properties (as
opposed to the $33.5 million previously sought), $7.5 million of damages by
virtue of loss of a lease development opportunity and $100 million of damages by
virtue of the loss of a business opportunity related to BNP's alleged inability
to participate in a 3-D seismic project.

                  A dispositive motion for summary judgment on all of BNP's
counterclaims for monetary damages was filed by the plaintiffs and was
originally set for a hearing on November 29, 2000. The court cancelled the
hearing and stated that it would announce its ruling when the case proceeded to
trial on the counterclaims on December 11, 2000.




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                  The Company had also alleged that BNP Petroleum Corporation,
Seiskin Interests, LTD and Pagenergy Company, LLC breached a contract with the
plaintiffs by obtaining oil and gas leases within an area restricted by that
contract. This breach of contract allegation is the subject of an additional
lawsuit by plaintiffs in the 165th District Court in Harris County, Texas. The
defendants took the position that the claim must be tried in the Duval County
case. The Duval County court has taken that question under advisement and might
rule that the claim should be included in the December 11, 2000 trial. The
Company was seeking damages as a result of defendants' actions as well as costs
and attorneys' fees.

                  On December 8, 2000 the Company entered into a Compromise and
Settlement Agreement ("Settlement Agreement") with the defendants with regard to
the above described litigation. Under the terms of the Settlement Agreement, the
Company and the defendants agreed to enter into an Agreed Order of Dismissal
with Prejudice of the litigation and, among other things, agreed as follows:

                  1. Should a co-plaintiff to the Duval County litigation secure
     a final judgment (without regard to appeals, new trials or other such
     actions) in the trial court in Duval County that results in such plaintiff
     being entitled to recover a five percent or greater undivided interest in
     the Slick Prospect, BNP will pay to Carrizo, at BNP's option, either
     $500,000 or an amount equal to the judgment rendered in favor of such
     plaintiff.

                  2. Should the defendants secure a final judgment (without
     regard to appeals, new trials or other such actions) in the trial court in
     Duval County against a co-plaintiff, the Company will be obligated to pay
     BNP an amount equal to five percent of any percentage of the total judgment
     apportioned to the Company in the case, such payment being limited however
     to no more than five percent of 47.2 percent of the total judgment entered
     in the case.

                  3. In the event the defendants and such co-plaintiff reach a
     full and final settlement prior to the entry of a written final judgment in
     the trial court in Duval County (including but not limited to any type of
     agreed judgment or any agreement that such co-plaintiff will not be
     ultimately liable to BNP for the full amount of any judgment rendered in
     favor of the defendants), the obligations described in (1) and (2) above
     will be null and void. Also, in the event BNP and such co-plaintiff both
     only obtain take nothing judgments in the case, such obligations will be
     null and void.

                  4. Both the Company and the defendants released each other
     from any and all claims, demands, actions or causes of action relating to
     or arising out of the litigation.

                  Statements in this document, including but not limited to
those relating to the above-described litigation, its outcome, effects and
timing, and the Settlement Agreement, and any other statements that are not
historical facts are forward-looking statements that are based on current
expectations. Although the Company believes that its expectations are based on
reasonable assumptions, it can give no assurance that these expectations will
prove correct. Important factors



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that could cause actual results to differ materially from those in the
forward-looking statements include the outcome and timing of the litigation,
rulings by the court, timing, actions by other parties in the litigation and
other factors described in the Company's most recent Form 10-Q and other filings
with Securities and Exchange Commission.




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                                   SIGNATURES



                  Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.


                                     CARRIZO OIL & GAS, INC.



                                             By: /s/ FRANK A. WOJTEK
                                                 -------------------------------
                                                 Name:  Frank A. Wojtek
                                                 Title: Vice President and Chief
                                                        Financial Officer



Date:  December 11, 2000




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