8-K

UNITED STATES
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
May 9, 2007
(Date of earliest event reported)

Callon Petroleum Company

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization) 001-14039
(Commission File Number) 64-0844345
(I.R.S. Employer
Identification Number)

200 North Canal St.
Natchez, Mississippi 39120
(Address of principal executive offices, including zip code)

(601) 442-1601
(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

Section 2 — Financial Information
	Item 2.02. Results of Operations and Financial Condition
Section 7 — Regulation FD
	Item 7.01. Regulation FD Disclosure
Section 9 — Financial Statements and Exhibits
	Item 9.01. Financial Statements and Exhibits
SIGNATURES
Exhibit Index
Press Release - Operating Results for the Quarter
Press Release - First Quarter 2007 Results
Press Release - Announcing Second Quarter Guidance

Section 2 — Financial Information

Item 2.02. Results of Operations and Financial Condition

     The following information, including Exhibits 99.1 and 99.2, is being furnished pursuant to Item 2.02 “Results of Operations and Financial Condition,” not filed, for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). This information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

     On May 9, 2007, Callon Petroleum Company issued the press release attached as Exhibit 99.1 providing information regarding the company’s operating results for the quarter and three months ended March 31, 2007.

     As disclosed in a press release dated May 3, 2007 attached as Exhibit 99.2, Callon Petroleum Company announced that its conference call reporting first quarter 2007 results would be held on May 10, 2007 beginning at 10:00 a.m. Central Standard Time.

Section 7 — Regulation FD

Item 7.01. Regulation FD Disclosure

     The following information, including Exhibit 99.3, is being furnished pursuant to Item 7.01 “Regulation FD Disclosure,” not filed, for purposes of Section 18 of the Exchange Act. This information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference in any filing under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

     On May 9, 2007, Callon Petroleum Company issued the press release attached as Exhibit 99.3 announcing guidance for the second quarter and full year of 2007.

Section 9 — Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits

     (c) Exhibits

Exhibit Number		Title of Document
	99.1	Press release dated May 9, 2007 providing information regarding Callon Petroleum Company’s operating results for the quarter and three months ended March 31, 2007.
	99.2	Press release dated May 3, 2007 announcing Callon Petroleum Company’s conference call reporting first quarter 2007 results.
	99.3	Press release dated May 9, 2006 announcing guidance for second quarter and full year of 2007.

1

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.

	Callon Petroleum Company
May 9, 2007	By:	/s/ B. F. Weatherly
		B. F. Weatherly
		Executive Vice President and Chief Financial Officer

2

Exhibit Index

Exhibit Number		Title of Document
	99.1	Press release dated May 9, 2007 providing information regarding Callon Petroleum Company’s operating results for the quarter and three months ended March 31, 2007.
	99.2	Press release dated May 3, 2007 announcing Callon Petroleum Company’s conference call reporting first quarter 2007 results.
	99.3	Press release dated May 9, 2007 announcing guidance for the second quarter and full year of 2007.

3

EX-99.1

Exhibit 99.1

For further information contact
Rodger W. Smith 1-800-451-1294

FOR IMMEDIATE RELEASE

Callon Petroleum Company Reports
First Quarter 2007 Results of Operations

     Natchez, MS (May 9, 2007) — Callon Petroleum Company (NYSE: CPE) today reported results of operations for the three-month period ended March 31, 2007.

     The company reported that average production in the first quarter was 60.3 million cubic feet of natural gas equivalent per day (MMcfe/d) compared to 56.0 MMcfe/d in the first quarter of 2006, or an increase of 8%. Revenue in the first quarter of 2007, at $45.5 million, was essentially flat with the $45.6 million of revenue reported in the first quarter of 2006. Net income for the three-month period ended March 31, 2007 was $5.8 million, or $0.27 per diluted share, compared to $12.8 million, or $0.60 per diluted share, for the same period in 2006. The difference in net income is almost entirely attributable to a spike in the depreciation, depletion and amortization (DD&A) rate to $4.03 per thousand cubic feet equivalent (Mcfe) in the first quarter of 2007. The DD&A rate is expected to be within a range of $3.28 to $3.38 per Mcfe for the second quarter of 2007 and the balance of 2007. This range is very close to the full year rate in 2006 of $3.14 per Mcfe.

     First Quarter 2007 Discretionary Cash Flow. For the quarter ended March 31, 2007, discretionary cash flow remained consistent at $33.5 million compared to $33.8 million during the same period in 2006. Net cash flow provided by operating activities, as defined by GAAP, totaled $32.9 million and $41.0 million during the quarter ended March 31, 2007 and 2006, respectively. (See “Non-GAAP Financial Measure” and the accompanying financial information for a reconciliation of discretionary cash flow, a non-GAAP measure, to net cash flow provided by operating activities.)

     Non-GAAP Financial Measure — This news release refers to a non-GAAP financial measure as “discretionary cash flow.” Callon believes that the non-GAAP measure of discretionary cash flow is useful as an indicator of an oil and gas exploration and production company’s ability to internally fund exploration and development activities and to service or incur additional debt. The company also has included this information because changes in operating assets and liabilities relate to the timing of cash receipts and disbursements which the company may not control and may not relate to the period in which the operating activities occurred. Discretionary cash flow should not be considered an alternative to net cash provided by operating activities or net income as defined by GAAP.

(MORE)

Reconciliation of Non-GAAP Financial Measure:	Three Months Ended
(In thousands)	March 31,
(Unaudited)
	2007			2006
Discretionary cash flow	$	33,506		$	33,780
Net working capital changes and other changes		(637	)		7,236
Net cash flow provided by operating activities	$	32,869		$	41,016

Consolidated Condensed Balance Sheet Information:	March 31,		December 31,
(In thousands)	2007		2006
(Unaudited)
Cash and cash equivalents	$	3,064	$	1,896
Oil and gas properties, net		542,278		547,027
All other assets		66,090		76,604
Total assets	$	611,432	$	625,527
Long-term debt excluding current maturities	$	225,999	$	225,521
All other liabilities		103,438		118,643
Stockholders’ equity		281,995		281,363
Total liabilities and stockholders’ equity	$	611,432	$	625,527

Production and Price Information:	Three Months Ended
(Unaudited)	March 31,
	2007			2006
Production:
Oil (MBbls)		288			515
Gas (MMcf)		3,702			1,950
Total Production (MMcfe)		5,427			5,042
Average daily (MMcfe)		60.3			56.0
Average prices:
Oil ($/Bbl) (a)	$	55.53		$	53.95
Gas ($/Mcf)	$	7.97		$	9.12
Gas equivalent ($/Mcfe)	$	8.38		$	9.04
(a) Below is a reconciliation of the average NYMEX price to the average realized sales price per barrel of oil:
Average NYMEX oil price	$	58.27		$	63.48
Basis differentials and quality adjustments		(5.11	)		(7.52	)
Transportation		(1.14	)		(1.27	)
Hedging		3.51			(0.74	)
Average realized oil price	$	55.53		$	53.95

Callon Petroleum Company
Consolidated Statements of Operations
(Unaudited)
(In thousands, except per share amounts)

	Three Months Ended
	March 31,
	2007			2006
Operating revenues:
Oil sales	$	15,968		$	27,799
Gas sales		29,516			17,782
Total operating revenues		45,484			45,581
Operating expenses:
Lease operating expenses		6,599			5,905
Depreciation, depletion and amortization		21,847			13,836
General and administrative		2,221			1,726
Accretion expense		1,112			1,419
Derivative expense		—			90
Total operating expenses		31,779			22,976
Income from operations		13,705			22,605
Other (income) expenses:
Interest expense		4,585			4,148
Other (income)		(325	)		(330	)
Total other (income) expenses		4,260			3,818
Income before income taxes		9,445			18,787
Income tax expense		3,803			6,550
Income before equity in earnings of Medusa Spar LLC		5,642			12,237
Equity in earnings of Medusa Spar LLC, net of tax		161			530
Net income available to common shares	$	5,803		$	12,767
Net income per common share:
Basic	$	0.28		$	0.66
Diluted	$	0.27		$	0.60
Shares used in computing net income per share amounts:
Basic		20,722			19,396
Diluted		21,193			21,329

     Callon Petroleum Company is engaged in the exploration, development, acquisition and operation of oil and gas properties in the Gulf Coast region. The majority of Callon’s properties and operations are concentrated in Louisiana, Alabama and the offshore waters of the Gulf of Mexico.

     This news release is posted on the company’s website at www.callon.com and will be archived there for subsequent review. It can be accessed from the “News Releases” link on the left side of the homepage.

     It should be noted that this news release contains projections and other 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. These projections and statements reflect the company’s current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results could differ materially from those projected as a result of certain factors. Some of the factors which could affect our future results and could cause results to differ materially from those expressed in our forward-looking statements are discussed in our filings with the Securities and Exchange Commission, including our Annual Reports on Form 10-K, available on our website or the SEC’s website at www.sec.gov.

#

EX-99.2

Exhibit 99.2

For further information contact
Terry Trovato, 1-800-451-1294

FOR IMMEDIATE RELEASE

Callon Petroleum Company Announces First Quarter 2007
Reporting Date and Conference Call

     Natchez, MS (May 3, 2007)—Callon Petroleum Company (NYSE: CPE) today announced its first quarter 2007 results of operations will be released on Wednesday afternoon, May 9, 2007. A conference call discussing the results and current activity is scheduled for 10 a.m. Central Daylight Time Thursday, May 10, 2007.

     The conference call may be accessed live over the internet through the Presentations Section of the company’s website at www.callon.com, and will be archived there for subsequent review.

     In addition, a telephone recording of the conference call will be available from noon May 10 until noon May 11 Central Daylight Time, and may be accessed by dialing 1-800-633-8284 and entering Reservation Number 21337878.

     Callon Petroleum Company is engaged in the exploration, development, acquisition and operation of oil and gas properties primarily in the Gulf Coast region. Callon’s properties and operations are geographically concentrated in Louisiana, Alabama and the offshore waters of the Gulf of Mexico.

     This news release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The opinions, forecasts, projections or other statements, other than statements of historical fact, are forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to have been correct. Certain risks and uncertainties inherent in our businesses are set forth in our filings with the SEC. These risks and uncertainties include general economic conditions; the volatility of oil and natural gas prices; the uncertainty of estimates of oil and natural gas reserves; the availability and cost of seismic, drilling and other equipment; operating hazards inherent in the exploration for and production of oil and natural gas; difficulties encountered during the exploration for and production of oil and natural gas; weather conditions; and other factors listed in the reports filed by us with the SEC. For additional information with respect to these and other factors, see our reports filed with the SEC. Our forward-looking statements speak only as of the date made, and we have no obligation to update these forward-looking statements.

#

EX-99.3

Exhibit 99.3

For further information contact
Rodger W. Smith 1-800-451-1294

FOR IMMEDIATE RELEASE

Callon Petroleum Company Issues Guidance
For Second Quarter, Full-Year 2007

     Natchez, MS (May 9, 2007)—Callon Petroleum Company (NYSE: CPE) is issuing guidance for the second quarter and full-year 2007. The guidance, found in the table below, is expressed in ranges for the detailed components.

Second Quarter and Full-Year 2007
Guidance Estimates
(In thousands, except per production unit amounts)

	Guidance for			Guidance for
	2nd Quarter 2007			Full-Year 2007
Estimated production volumes:
Natural gas (Bcf)		3.2 -- 3.4			12.3 -- 13.2
Crude oil (Mbo)		250 -- 270			1,050 -- 1,125
MMcfe/d		51 -- 55			51 -- 55
Lease operating expenses:
Cash	$	7,000 -- $8,000		$	25,000 -- $28,000
Non-cash		—			—
Total $		7,000 -- $8,000		$	25,000 -- $28,000
General and administrative expenses:
Cash	$	1,900 -- $2,000		$	7,200 -- $7,700
Non-cash		500 -- 600			2,100 -- 2,300
Total	$	2,400 -- $2,600		$	9,300 -- $10,000
Interest expense:
Cash	$	7,900 -- $8,800		$	30,400 -- $33,200
Non-cash		1,300 -- 1,400			4,500 -- 4,800
Total	$	9,200 -- $10,200		$	34,900 -- $38,000
Medusa Spar LLC, net of tax	$	150 -- $200		$	600 -- $700
DD & A — Oil and gas properties	$	15,000 -- $17,000		$	66,000 -- $71,000
Accretion expense	$	1,100 -- $1,200		$	4,500 -- $4,800
Derivative expense (income)		—			—
Income tax rate		35	%		35	%
Cash income tax rate		0	%		0	%

(MORE)

     The preceding guidance estimates contain assumptions that we believe are reasonable. These estimates are based on information that is available as of the date of this news release. We are not undertaking any obligation to update these estimates as conditions change or as additional information becomes available.

     Listed below are the outstanding hedges for natural gas and crude oil for the remainder of 2007.

	6/30/07		9/30/07		12/31/07
Natural Gas
Collars          Volume (Mmcf)		1,800		1,800		1,800
Ceiling	$	12.70	$	12.70	$	12.70
Floor	$	8.00	$	8.00	$	8.00

Crude Oil
Collars          Volume (Mbo)		75		75		75
Ceiling	$	83.30	$	83.30	$	83.30
Floor	$	65.00	$	65.00	$	65.00
Collars          Volume (Mbo)		75		75		75
Ceiling	$	94.20	$	94.20	$	94.20
Floor	$	65.00	$	65.00	$	65.00

     Callon Petroleum Company is engaged in the exploration, development, acquisition and operation of oil and gas properties in the Gulf Coast region. The majority of Callon’s properties and operations are concentrated in the offshore waters of the Gulf of Mexico.

     This news release is posted on the company’s website at www.callon.com and will be archived there for subsequent review. It can be accessed from the “News Releases” link on the left side of the homepage.

     This news release contains projections and other forward-looking statements (including statements about fiscal second quarter and full-year financial and operating performance) within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These projections and statements reflect the company’s current views with respect to future events and financial performance. No assurances can be given, however, that these events will occur or that these projections will be achieved and actual results could

differ materially from those projected as a result of certain factors. Some of the factors which could affect our future results and could cause results to differ materially from those expressed in our forward-looking statements include:

• general economic and industry conditions;

• volatility of oil and natural gas prices;

• uncertainty of estimates of oil and natural gas reserves;

• impact of competition;

• availability and cost of seismic, drilling and other equipment;

• operating hazards inherent in the exploration for and production of oil and natural gas;

• difficulties encountered during the exploration for and production of oil and natural gas;

• difficulties encountered in delivering oil and natural gas to commercial markets;

• changes in customer demand and producers’ supply;

• uncertainty of our ability to attract capital;

• compliance with, or the effect of changes in, the extensive governmental regulations regarding the oil and natural gas business;

• actions of operators of our oil and gas properties;

• weather conditions; and

• the risk factors discussed in our filings with the Securities and Exchange Commission, including but not limited to those in our Annual Report for the year ended December 31, 2006 on Form 10-K.

     The preceding estimates reflect our review of continuing operations only. These estimates do not take into account any material transactions such as sales of debt and equity securities, acquisitions or divestitures of assets, and formations of joint ventures. We continually review these types of transactions and may engage in one or more of these types of transactions without prior notice.

#