Southwestern Energy Company (NYSE: SWN) today announced that it
has closed the acquisition of Indigo Natural Resources.
“We are excited to incorporate Indigo’s assets into SWN’s
premier US natural gas portfolio. More importantly, we want to
welcome many of its talented people to Southwestern. They
complement our high performance culture and share our collective
passion to stretch the limits of what is possible,” said Bill Way,
Southwestern Energy President and Chief Executive Officer.
“With these assets and newly expanded team, we are well
positioned to take the Company to the next level. This acquisition
materially expands our opportunity set, adding high-margin
Haynesville production and substantial core drilling inventory
while providing additional global market access through the LNG
corridor. It also further de-risks our enterprise, increases free
cash flow, extends our maturity profile and accelerates our
deleveraging goals. Looking ahead, we will continue to pursue
opportunities to further increase our scale and enhance our ability
to responsibly and sustainably drive additional value for our
shareholders.”
Southwestern Energy is providing updated 2021 guidance, which
incorporates the acquired Haynesville assets starting on September
1, 2021. Free cash flow generation for 2021 is expected to increase
to a range of $425 to $475 million. The Company plans to use this
increased cash flow for debt reduction, which is expected to drive
its leverage below its 2 times net debt to EBITDA target by the end
of 2021.
In Haynesville, the Company expects to complete the 2021 capital
investment program currently in progress, and will average 6 rigs
and approximately 2 completion crews, placing 15 to 20 gross wells
to sales. To incorporate the investment in Haynesville, the
Company’s expected 2021 capital investment range has increased to
$1,085 to $1,145 million, which also includes the associated
increase in capitalization of interest and expense.
Guidance Update
Q3 2021
Q4 2021
Total Year 2021
Production
Total (Bcfe)
302 – 310
370 – 380
1,217 – 1,235
Total (Bcfe/day)
3.3 – 3.4
4.0 – 4.1
3.3 – 3.4
Liquids (% of production)
~18%
~14%
~18%
E&P Metrics
Lease operating expenses (per Mcfe)
$0.92 – $0.96
$0.88 – $0.92
$0.91 – $0.95
General & administrative (per
Mcfe)
$0.08 – $0.12
$0.08 – $0.12
$0.08 – $0.12
Taxes, other than income (per Mcfe)
$0.10 – $0.13
$0.06 – $0.10
$0.08 – $0.12
Natural gas discount to NYMEX, including
basis hedges (per Mcf)(1)
$0.79 – $0.85
$0.60 – $0.70
$0.57 – $0.67
NGL price realizations (% WTI)(2)
38 – 44%
40 – 48%
35 – 43%
Oil discount to WTI ($/Bbl)
$8.00 – $10.00
$8.00 – $10.00
$8.00 – $10.00
Income tax rate (~100% deferred)
24.3%
Capital investment ($MM)
$1,085 – $1,145
Capital investment (non-CI&E)(3)
$930 – $970
Capitalized interest and expense
$155 – $175
(1)
Natural gas discount to NYMEX includes an
estimated $0.12 to $0.15 per Mcf gain on basis hedges in Q3 2021,
an estimated $0.07 to $0.10 per Mcf gain on basis hedges in Q4
2021, and an estimated $0.08 to $0.10 per Mcf gain on basis hedges
for the full year 2021.
(2)
Based on $70 per Bbl WTI for Q3 2021 and
Q4 2021 and $65 per Bbl WTI for the full year 2021.
(3)
Includes E&P development, land
acquisition and other non-E&P investment.
About Southwestern Energy
Southwestern Energy Company (NYSE: SWN) is a leading U.S.
producer of natural gas and natural gas liquids focused on
responsibly developing large-scale energy assets in the nation’s
most prolific shale gas basins. SWN’s returns-driven strategy
strives to create sustainable value for its stakeholders by
leveraging its scale, financial strength and operational execution.
For additional information, please visit www.swn.com and
www.swn.com/responsibility.
Forward Looking Statement
Certain statements and information in this news release may
constitute “forward-looking statements” within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Exchange Act, as amended. The words “believe,” “expect,”
“anticipate,” “plan,” "predict," “intend,” "seek," “foresee,”
“should,” “would,” “could,” “attempt,” “appears,” “forecast,”
“outlook,” “estimate,” “project,” “potential,” “may,” “will,”
“likely,” “guidance,” “goal,” “model,” “target,” “budget” and other
similar expressions are intended to identify forward-looking
statements, which are generally not historical in nature.
Statements may be forward looking even in the absence of these
particular words. Examples of forward-looking statements include,
but are not limited to, statements regarding our financial
position, business strategy, production, reserve growth and other
plans and objectives for our future operations, and generation of
free cash flow. These forward-looking statements are based on our
current expectations and beliefs concerning future developments and
their potential effect on us. The forward-looking statements
contained in this document are largely based on our expectations
for the future, which reflect certain estimates and assumptions
made by our management. These estimates and assumptions reflect our
best judgment based on currently known market conditions, operating
trends, and other factors. Although we believe such estimates and
assumptions to be reasonable, they are inherently uncertain and
involve a number of risks and uncertainties that are beyond our
control. As such, management’s assumptions about future events may
prove to be inaccurate. For a more detailed description of the
risks and uncertainties involved, see “Risk Factors” in our most
recently filed Annual Report on Form 10-K, subsequent Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K, and other SEC
filings. We do not intend to publicly update or revise any
forward-looking statements as a result of new information, future
events, changes in circumstances, or otherwise. These cautionary
statements qualify all forward-looking statements attributable to
us, or persons acting on our behalf. Management cautions you that
the forward-looking statements contained herein are not guarantees
of future performance, and we cannot assure you that such
statements will be realized or that the events and circumstances
they describe will occur. Factors that could cause actual results
to differ materially from those anticipated or implied in the
forward-looking statements herein include, but are not limited to:
the timing and extent of changes in market conditions and prices
for natural gas, oil and natural gas liquids (“NGLs”), including
regional basis differentials and the impact of reduced demand for
our production and products in which our production is a component
due to governmental and societal actions taken in response to
COVID-19 or other public health crises and any related company or
governmental policies and actions to protect the health and safety
of individuals or governmental policies or actions to maintain the
functioning of national or global economies and markets; our
ability to fund our planned capital investments; a change in our
credit rating, an increase in interest rates and any adverse
impacts from the discontinuation of the London Interbank Offered
Rate; the extent to which lower commodity prices impact our ability
to service or refinance our existing debt; the impact of volatility
in the financial markets or other global economic factors;
difficulties in appropriately allocating capital and resources
among our strategic opportunities; the timing and extent of our
success in discovering, developing, producing and estimating
reserves; our ability to maintain leases that may expire if
production is not established or profitably maintained; our ability
to realize the expected benefits from recent acquisitions or the
acquisition of Indigo Natural Resources, LLC (the “Indigo
Transaction”); costs in connection with the Indigo Transaction;
integration of operations and results subsequent to the Indigo
Transaction; our ability to transport our production to the most
favorable markets or at all; the impact of government regulation,
including changes in law, the ability to obtain and maintain
permits, any increase in severance or similar taxes, and
legislation or regulation relating to hydraulic fracturing, climate
and over-the-counter derivatives; the impact of the adverse outcome
of any material litigation against us or judicial decisions that
affect us or our industry generally; the effects of weather;
increased competition; the financial impact of accounting
regulations and critical accounting policies; the comparative cost
of alternative fuels; credit risk relating to the risk of loss as a
result of non-performance by our counterparties; and any other
factors listed in the reports we have filed and may file with the
SEC that are incorporated by reference herein. All written and oral
forward-looking statements attributable to us are expressly
qualified in their entirety by this cautionary statement.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210901005609/en/
Investor Contact Brittany Raiford Director, Investor
Relations (832) 796-7906 brittany_raiford@swn.com
Bernadette Butler Investor Relations Advisor (832) 796-6079
bernadette_butler@swn.com
Southwestern Energy (NYSE:SWN)
Historical Stock Chart
From Mar 2024 to Apr 2024
Southwestern Energy (NYSE:SWN)
Historical Stock Chart
From Apr 2023 to Apr 2024