Clayton Williams Energy (CWEI) 8-K Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

Exhibit 99.7

Summary Historical Consolidated Financial Data

The following table shows our summary historical consolidated financial data as of and for the periods indicated. Our summary historical financial data as of and for the fiscal years ended December 31, 2008, 2009 and 2010 are derived from our audited financial statements incorporated by reference in this offering memorandum.

You should read the summary historical consolidated financial data below in conjunction with our consolidated financial statements, the accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended December 31, 2010, which is incorporated by reference in this offering memorandum.

	Year ended December 31,
	2008			2009			2010
	(In thousands)
Statement of operations data:
Revenues:
Oil and gas sales	$	463,964		$	242,338		$	326,320
Natural gas services	10,926			6,146			1,631
Drilling rig services	46,124			6,681			—
Gain on sales of assets	44,503			796			3,680
Total revenues	565,517			255,961			331,631
Costs and expenses:
Production	89,054			76,288			83,146
Exploration:
Abandonment and impairments	80,112			78,798			9,074
Seismic and other	22,685			8,189			6,046
Natural gas services	10,060			5,348			1,209
Drilling rig services	37,789			10,848			1,198
Depreciation, depletion and amortization	120,542			129,658			101,145
Impairment of property and equipment	12,882			59,140			11,908
Accretion of abandonment obligations	2,355			3,120			2,623
General and administrative	25,635			20,715			35,588
Loss on sales of assets and impairment of inventory	2,122			5,282			1,750
Total costs and expenses	403,236			397,386			253,687
Operating income (loss)	162,281			(141,425		)	77,944
Other income (expense):
Interest expense	(24,994		)	(23,758		)	(24,402		)
Gain (loss) on derivatives	74,743			(17,416		)	722
Other income	6,539			2,543			3,308
Total other income (expense)	56,288			(38,631		)	(20,372		)
Income (loss) before income taxes	218,569			(180,056		)	57,572
Income tax (expense) benefit	(77,327		)	64,096			(20,634		)
NET INCOME (LOSS)	141,242			(115,960		)	36,938
Less income attributable to noncontrolling interest, net of tax	(708		)	(1,455		)	—
NET INCOME (LOSS) attributable to Clayton Williams Energy, Inc.	$	140,534		$	(117,415	)	$	36,938

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The following table sets forth summary data with respect to additional financial and operating data on a historical basis for the periods presented:

	Year ended December 31,
	2008			2009			2010
	($ in thousands)
Balance sheet data:
Cash and cash equivalents	$	41,199		$	14,013		$	8,720
Property and equipment, net	810,028			670,046			767,089
Total assets	943,409			784,604			890,917
Total debt(a)	365,975			395,000			385,000
Total stockholders’ equity	314,682			212,275			249,452
Cash flow data:
Net cash flow provided by (used in):
Operating activities	$	381,980		$	104,711		$	208,251
Investing activities	(238,875		)	(168,598		)	(203,783		)
Financing activities	(114,250		)	36,701			(9,761		)
Other financial data:
EBITDAX(b)	$	395,854		$	130,007		$	233,891
Exploration and development expenditures	372,700			138,300			292,100
Ratio of total debt to EBITDAX	.9		x	3.0		x	1.6		x
Ratio of EBITDAX to interest expense	15.8		x	5.5		x	9.6		x

(a)Total debt includes current maturities.

(b)EBITDAX represents net income (loss) before interest expense, income taxes, exploration costs, gain/(loss) on sales of assets and impairment of inventory and all non-cash items in the Company’s statements of operations, including depreciation, depletion and amortization, impairment of property and equipment, accretion of abandonment obligations, certain employee compensation and changes in fair value of derivatives. EBITDAX provides useful information to investors as a measure commonly used by debt holders, industry analysts, lenders, ratings agencies and financial statement users to determine the ability of an entity to meet its interest obligations. However, EBITDAX in this table does not reflect EBITDAX as calculated pursuant to the indenture governing our 73/4% Notes or the indenture governing the notes. Because EBITDAX is commonly used in the oil and gas industry, we believe it is useful in evaluating our historical and pro forma ability to meet our interest obligations in connection with this offering. EBITDAX calculations may vary among entities, so our computation of EBITDAX may not be comparable to EBITDAX or similar measures of other entities. EBITDAX is not a measure calculated in accordance with GAAP. Our EBITDAX measure should not be considered an alternative to net income, income before taxes, cash flows from operating activities, or any other measure of financial performance presented in accordance with GAAP.

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The following table provides a reconciliation of net income (loss) from continuing operations to EBITDAX:

	Year ended December 31,
	2008			2009			2010
	($ in thousands)
Net income (loss)	$	141,242		$	(115,960	)	$	36,938
Interest expense	24,994			23,758			24,402
Income tax expense (benefit)	77,327			(64,096		)	20,634
Exploration:
Abandonments and impairments	80,112			78,798			9,074
Seismic and other	22,685			8,189			6,046
(Gain) loss on sales of assets and impairment of inventory	(42,381		)	4,486			(1,930		)
Depreciation, depletion and amortization	120,542			129,658			101,145
Impairment of property and equipment	12,882			59,140			11,908
Accretion of abandonment obligations	2,355			3,120			2,623
Non-cash employee compensation	5,834			1,434			13,898
Non-cash changes in fair value of derivatives	(49,738		)	1,480			9,153
EBITDAX	$	395,854		$	130,007		$	233,891

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