Clayton Williams Energy, Inc. (NASDAQ: CWEI) today
filed a Form 8-K with the Securities and Exchange Commission to
provide financial guidance disclosures for the year ending December
31, 2010. This guidance was furnished to provide public disclosure
of the estimates being used by the Company to model its anticipated
results of operations for the periods presented.
A copy of these disclosures accompanies this release or may be
obtained electronically by accessing the Company’s website at
www.claytonwilliams.com.
Clayton Williams Energy, Inc. is an independent energy company
located in Midland, Texas.
This release contains 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. All statements, other
than statements of historical or current facts, that address
activities, events, outcomes and other matters that we plan,
expect, intend, assume, believe, budget, predict, forecast,
project, estimate or anticipate (and other similar expressions)
will, should or may occur in the future are forward-looking
statements. These forward-looking statements are based on
management’s current belief, based on currently available
information, as to the outcome and timing of future events. The
Company cautions that its future oil and natural gas production,
revenues, cash flows, liquidity, plans for future operations,
expenses, outlook for oil and natural gas prices, timing of capital
expenditures and other forward-looking statements are subject to
all of the risks and uncertainties, many of which are beyond our
control, incident to the exploration for and development,
production and marketing of oil and gas.
These risks include, but are not limited to, the possibility of
unsuccessful exploration and development drilling activities, our
ability to replace and sustain production, commodity price
volatility, domestic and worldwide economic conditions, the
availability of capital on economic terms to fund our capital
expenditures and acquisitions, our level of indebtedness, the
impact of the current economic environment on our business
operations, financial condition and ability to raise capital,
declines in the value of our oil and gas properties resulting in a
decrease in our borrowing base under our credit facility and
impairments, the ability of financial counterparties to perform or
fulfill their obligations under existing agreements, the
uncertainty inherent in estimating proved oil and gas reserves and
in projecting future rates of production and timing of development
expenditures, drilling and other operating risks, lack of
availability of goods and services, regulatory and environmental
risks associated with drilling and production activities, the
adverse effects of changes in applicable tax, environmental and
other regulatory legislation, and other risks and uncertainties are
described in the Company's filings with the Securities and Exchange
Commission. The Company undertakes no obligation to publicly update
or revise any forward-looking statements.
Financial Guidance Disclosures
Follow
CLAYTON WILLIAMS ENERGY,
INC.
FINANCIAL GUIDANCE DISCLOSURES FOR
2010
Overview
Clayton Williams Energy, Inc. and its subsidiaries have prepared
this document to provide public disclosure of certain financial and
operating estimates in order to permit the preparation of models to
forecast our operating results for each quarter during the year
ending December 31, 2010. These estimates are based on
information available to us as of the date of this filing, and
actual results may vary materially from these estimates. We do not
undertake any obligation to update these estimates as conditions
change or as additional information becomes available.
The estimates provided in this document are based on assumptions
that we believe are reasonable. Until our actual results of
operations for these periods have been compiled and released, all
of the estimates and assumptions set forth herein constitute
“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. All statements, other
than statements of historical facts, included in this document that
address activities, events or developments that we expect, project,
believe or anticipate will or may occur in the future, or may have
occurred through the date of this filing, including such matters as
production of oil and gas, product prices, oil and gas reserves,
drilling and completion results, capital expenditures and other
such matters, are forward-looking statements. Such forward-looking
statements involve known and unknown risks, uncertainties, and
other factors that may cause our actual results, performance, or
achievements to be materially different from the results,
performance, or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the
following: the volatility of oil and gas prices; the unpredictable
nature of our exploratory drilling results; the reliance upon
estimates of proved reserves; operating hazards and uninsured
risks; competition; government regulation; and other factors
referenced in filings made by us with the Securities and Exchange
Commission.
As a matter of policy, we generally do not attempt to provide
guidance on:
(a) production which may be obtained through future
exploratory drilling; (b) dry hole and abandonment costs that may
result from future exploratory drilling; (c)
the effects of Statement of
Financial Accounting Standards No. 133, “Accounting for Derivative
Instruments and Hedging Activities” superseded by topic 815-10 of
the Financial Accounting Standards Board Accounting Standards
Codification;
(d) gains or losses from sales of property and equipment unless the
sale has been consummated prior to the filing of financial
guidance; (e) capital expenditures related to completion activities
on exploratory wells or acquisitions of proved properties until the
expenditures are estimable and likely to occur; and (f) revenues
and expenses related to Desta Drilling, L.P., a wholly-owned
subsidiary of the Company which provides contract drilling services
for the Company.
Summary of Estimates
The following table sets forth actual and certain estimates
being used by us to model our anticipated results of operations for
each quarter during the fiscal year ending December 31, 2010. When
a single value is provided, such value represents the mid-point of
the approximate range of estimates. Otherwise, each range of values
provided represents the expected low and high estimates for such
financial or operating factor. See “Supplementary Information.”
Year Ending December 31, 2010 Actual
Estimated Estimated
Estimated First Quarter Second Quarter
Third Quarter Fourth Quarter (Dollars in
thousands, except per unit data) Average Daily
Production: Oil (Bbls) 8,356 8,600 to 8,800 9,400 to 9,600
10,500 to 10,700 Gas (Mcf) 36,978 34,500 to 38,500 32,500 to 36,500
32,000 to 36,000 Natural gas liquids (Bbls) 633 625 to 675 600 to
650 600 to 650 Total oil equivalents (BOE) 15,152 14,975 to 15,892
15,417 to 16,333 16,433 to 17,350
Differentials: Oil
(Bbls) $ (2.72) $(2.75) to $(3.25) $(2.75) to $(3.25) $(2.75) to
$(3.25) Gas (Mcf) $ 0.72
$(0.05) to $0.25
$(0.05) to $0.25
$(0.05) to $0.25
Natural gas liquids (Bbls) $ (32.54) $(27.00) to $(33.00) $(27.00)
to $(33.00) $(27.00) to $(33.00)
Costs Variable by
Production ($/BOE):
Production expenses (including
production taxes)
$ 15.34 $14.50 to $15.50 $13.80 to $14.80 $13.50 to $14.50 DD&A
– Oil and gas properties $ 18.03 $18.00 to $19.00 $18.00 to $19.00
$18.00 to $19.00
Other Revenues (Expenses): Natural
gas services: Revenues $ 503 $450 to $550 $450 to $550 $450 to $550
Operating costs $ (348) $(300) to $(500) $(300) to $(500) $(300) to
$(500) Exploration costs: Abandonments and impairments $ (2,878)
$(1,000) to $(3,000) $(1,000) to $(3,000) $(1,000) to $(3,000)
Seismic and other $ (1,660) $(250) to $(750) $(250) to $(750)
$(250) to $(750) DD&A – Other (a) $ (171) $(250) to $(350)
$(250) to $(350) $(250) to $(350) General and administrative (a) $
(6,166) $(5,500) to $(5,700) $(5,100) to $(5,300) $(5,500) to
$(5,700) Interest expense (a) $ (6,108) $(6,200) to $(6,400)
$(6,400) to $(6,600) $(6,400) to $(6,600) Other income (expense) $
828 $250 to $350 $250 to $350 $250 to $350
Effective
Federal and State Income Tax Rate: Current 0% 0% 0% 0%
Deferred 36% 36% 36% 36%
Weighted Average Shares
Outstanding (In thousands): Basic 12,146 12,146 12,146
12,146 Diluted 12,146 12,146 12,146 12,146 (a) Excludes
amounts derived from Desta Drilling, L.P.
Capital Expenditures
The following table sets forth, by area, our actual expenditures
for exploration and development activities for the first three
months of 2010 and our planned expenditures for the year ending
December 31, 2010.
Actual Planned
Expenditures Expenditures 2010
Three Months Ended Year Ended Percentage
March 31, 2010 December 31, 2010 of Total
(In thousands) Permian Basin $ 36,700 $ 195,000 69% Austin
Chalk (Trend) 12,400 71,900 26% South Louisiana 3,200 7,600 3%
California 300 2,300 1% Other 2,800 5,100 1% $ 55,400
$ 281,900 100%
We currently plan to spend approximately $281.9 million on
exploration and development activities in fiscal 2010. Our actual
expenditures during fiscal 2010 may be substantially higher or
lower than these estimates since our plans for exploration and
development activities may change during the year. Other factors,
such as prevailing product prices and the availability of capital
resources, could also increase or decrease the ultimate level of
expenditures during fiscal 2010.
Based on these current estimates, approximately 96% of our
planned expenditures for exploration and development activities for
fiscal 2010 will relate to developmental prospects, as compared to
approximately 60% in fiscal 2009.
Supplementary Information
Oil and Gas Production
The following table summarizes, by area, our actual and
estimated daily net production for each quarter during the year
ending December 31, 2010. These estimates represent the approximate
mid-point of the estimated production range.
Daily Net Production for 2010 Actual
Estimated Estimated Estimated
First Quarter Second Quarter Third Quarter
Fourth Quarter Oil (Bbls): Permian Basin 4,909 5,229
5,979 6,750 Austin Chalk (Trend) 2,595 2,603 2,728 3,154 North
Louisiana 148 132 130 109 South Louisiana 627 681 609 554 Other 77
55 54 33 Total 8,356 8,700 9,500 10,600
Gas (Mcf):
Permian Basin 13,911 14,948 14,685 14,817 Austin Chalk (Trend)
2,531 2,231 2,272 2,459 North Louisiana 8,718 7,871 7,207 6,795
South Louisiana 7,513 6,538 5,880 5,426 Cotton Valley Reef Complex
3,529 3,626 3,380 3,219 Other 776 1,286 1,076 1,284 Total 36,978
36,500 34,500 34,000
Natural Gas Liquids (Bbls):
Permian Basin 272 231 234 234 Austin Chalk (Trend) 271 232 228 228
Other 90 187 163 163 Total 633 650 625 625
Accounting for
Derivatives
The following summarizes information concerning our net
positions in open commodity derivatives applicable to periods
subsequent to March 31, 2010. The settlement prices of commodity
derivatives are based on NYMEX futures prices.
Swaps:
Oil
Gas Bbls
Price MMBtu (a)
Price Production Period: 2nd Quarter 2010 574,000 $
76.60 1,830,000 $ 6.80 3rd Quarter 2010 522,000 $
76.40 1,750,000 $ 6.80 4th Quarter 2010 480,000 $ 76.24 1,680,000 $
6.80
2011
1,656,000 $ 84.38 6,420,000 $ 7.07 3,232,000 11,680,000 (a)
One MMBtu equals one Mcf at a Btu factor of 1,000.
In March 2009, we terminated certain fixed-priced oil swaps
covering 242,000 barrels at a price of $57.35 from April 2010
through December 2010, resulting in an aggregate loss of
approximately $980,000, which will be paid to the counterparty
monthly as the applicable contracts are settled.
We did not designate any of the derivatives shown in the
preceding table as cash flow hedges; therefore, all changes in the
fair value of these contracts prior to maturity, plus any realized
gains or losses at maturity, will be recorded as other income
(expense) in our statement of operations.
Williams (CLAYTON) Energy, Inc. (NYSE:CWEI)
Historical Stock Chart
From May 2024 to Jun 2024
Williams (CLAYTON) Energy, Inc. (NYSE:CWEI)
Historical Stock Chart
From Jun 2023 to Jun 2024