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John S. Weatherly, CFO 1-800-451-1294

FOR IMMEDIATE RELEASE

Callon Petroleum Company Increases

Senior Notes Offering to $185 Million

Natchez, MS (December 30, 2003)--Callon Petroleum Company (NYSE: CPE / CPE.PrA) announced today that it sold an additional $85 million of senior unsecured notes in a private placement. On December 8, 2003, the company sold $100 million of senior unsecured notes in a similar transaction. The total of $185 million of seven-year notes will carry a coupon rate of 9.75% with a maturity on December 8, 2010.

The company used the net proceeds of the initial $100 million private placement to redeem its 10.125% Senior Subordinated Notes due 2004 and its 10.25% Senior Subordinated Notes due 2004 and to reduce the balance outstanding under its senior secured revolving credit facility.

The proceeds of the additional private placement will be used to redeem $85 million of the company’s $95 million in outstanding 12% Senior Unsecured Notes due 2005.

In conjunction with the additional senior unsecured notes, Callon issued detachable warrants to purchase 1.275 million shares of its common stock at an exercise price of $10 per share. This brings the total number of detachable warrants issued in the combined private placements to 2.775 million.

The notes, warrants and underlying common stock have not been registered under the Securities Act of 1933 or any state securities laws and may not be offered or sold in the United States absent registration under the Securities Act of 1933 and applicable state laws, or an exemption from such registration requirements.

Callon Petroleum Company has been engaged in the exploration, development, acquisition and operation of oil and gas properties in the Gulf Coast region since 1950.

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. Forward-looking statements include those related to our future capital needs, future capital availability, and the timing and success of future development operations. These forward-looking 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. Such factors include prices of oil and gas, inaccuracies in predicting the timing of future operations, possible cost overruns, operational risks and other risks. These factors are discussed at length in Callon’s annual report on Form 10-K for fiscal year 2002 filed with the SEC.

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