Houston-based Swift Energy Co. reported Wednesday that production increased to 11.7 Bcfe in the third quarter of 2001, which marks an 11% increase from the third quarter of 2000. However, due to significantly lower oil and natural gas prices, the company reported earnings of $7.4 million, $0.29 per diluted share, down from $15.8 million, or $0.66 per diluted share, in the same quarter last year. Swift Energy said revenues in the third quarter were $41.2 million, down from $49.5 million, and cash flows from operations, before changes in working capital, declined 29% to $25.7 million ($1.04 per share) compared to $36.2 million ($1.69 per share) in the same quarter last year. The company said third quarter results include a gain of $1.6 million resulting from the company’s marking-to-market through earnings its oil and gas price derivatives. “Despite the current market prices, we are very optimistic about the outlook for the company’s future, and we believe that this environment can offer additional opportunities for growth,” said Terry Swift, CEO of Swift Energy. “The results of the 2001 exploration program both domestically and in New Zealand have been important to the company, resulting in additional prospects for growth in the coming year. We believe that we can further enhance these productivity gains through focused exploitation and acquisitions under the changing market environment.” During the quarter, the company said it participated in three operated and two non-operated exploratory wells. One of these operated wells is producing and another is drilling, while the third has been plugged and abandoned, as have both of the non-operated wells.
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DOE Picks Six Projects to Study Methane Hydrates
The Department of Energy (DOE) says that it will fund the bulk of the costs for six new projects to study the exploration and production potential of methane hydrates in the Gulf of Mexico and Alaska’s North Slope region. The total cost of the projects, which will be performed by the energy industry, universities and outside research institutions, has been valued at almost $48 million.
DOE Picks Six Projects to Study Methane Hydrates
The Department of Energy (DOE) says that it will fund the bulk of the costs for six new projects to study the exploration and production potential of methane hydrates in the Gulf of Mexico and Alaska’s North Slope region. The total cost of the projects, which will be performed by the energy industry, universities and outside research institutions, has been valued at almost $48 million.
Rush Still on to Build LNG Terminals in Bahamas
Despite falling gas prices, declining demand and increasing production, the rush is still on to bring more liquefied natural gas (LNG) to the United States. Two El Paso Corp. subsidiaries are conducting separate open seasons to determine non-binding customer interest in transportation capacity on pipelines that will transport natural gas from El Paso Global LNG’s planned LNG terminal on Grand Bahama Island to Florida.
‘Uncontrollable Outside Events’ Expected To Lower Kerr-McGee 3Q
Even though overall operations are performing well, with oil and gas production on track to be up 5% over 2000 and development projects on schedule, producer Kerr-McGee Corp. said Friday that uncontrollable outside events — mostly within its chemicals division — will push down projected third quarter earnings, which will be released in one month.
Chemical Business Lowers Kerr-McGee Prospects
Even though overall operations are performing well, with oil and gas production on track to be up 5% over 2000 and development projects on schedule, producer Kerr-McGee Corp. said Friday that uncontrollable outside events — mostly within its chemicals division — will push down projected third quarter earnings, which will be released in one month.
Correction
A story that ran in NGI’s Daily Gas Price Index on Sept. 7 titled, “CONSOL CEO Highlights Gas Production, Talks Power,” incorrectly reported the difference between analysts’ estimates of CONSOL Energy earnings and CEO J. Brett Harvey’s guidance for the six month period ending Dec. 31. Harvey told investors last Thursday at the Friedman Billings Ramsey 8th Annual Investor Conference in Washington, DC, that he expects the company to earn about $0.50/share for the six-month period, which is $0.34 below Wall Street estimates of $0.84/share for the six-month transition period ending Dec. 31. NGI regrets the error. In addition, CONSOL Energy issued a correction to its news release on Friday. CONSOL Energy acquired “366 Bcf” rather than “366 MMcf” as originally issued on Thursday.
Industry Brief
Houston-based Parker Drilling Co. reported on Wednesday that despite recent fears that production is on its way toward the outpacing of demand, its rig fleet is staying busy. The company announced it has reached a contract with Nexen Petroleum for Rig 15-J, which is a shallow water design mat-slot jackup capable of working in water depths ranging from nine to 85 feet. The rig is on location in the Eugene Island area where it will drill a 14,000 foot horizontal well in 9 feet of water. The contract calls for one well, which will take approximately 60 days to drill, plus options for two additional wells. “In spite of some recent softness in the industry, utilization of our Gulf of Mexico fleet remains strong,” said Toby Begnaud, Parker’s general manager of global sales and contracts. “A program such as this, with specific water depth limitation, is an example of the niche market Parker Drilling has targeted and why we feel our overall utilization does not track with current market trends.” Parker Drilling specializes in offshore drilling and workover services in the Gulf of Mexico and international land and offshore drilling. The company has 79 marketed rigs and employs more than 3,500 people worldwide.
Transportation Notes
Sonat plans to offer a blanket IT discount for any gas received at a Production Area zone pipeline interconnect and delivered to an interconnect in the same zone. The rate of 5 cents/Dth plus applicable fuel (includes all surcharges) will be implemented July 1 and remain in effect on a month-to-month basis until further notice. See the bulletin board for details.
Transportation Notes
Texas Eastern will require the shut-in of all production upstream of the Provident City Plant on its Wilcox System in the South Texas Zone starting Tuesday due to anomaly investigations and the subsequent pipe repair needed. The work is expected to be completed sometime Saturday in order for gas flow to resume Sunday.
