News reporting Fayetteville has sold for 1.8B
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Reserve life clarified=
The reserves to production ratio indicates the remaining lifespan of a natural resource, given a production rate. This ratio is expressed in terms of years, and is used in forecasting project life, income, employment, etc. While applicable to all natural resources, it is primarily used in the oil and gas industry.
Deliberate deception by Way and cronies.
Examples from IR deck (Fay sale version at https://www.swn.com/investors/LIP/Supplement_AugustInvestorUpdate.pdf):
-slide 3 - scary if everything checked on our strategy to-do’s and stock down 5% on big reveal and in $5 range
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slide 4 - Gross purchase price mentioned. We know it’ll be reduced significantly by net cash flows between July 1 and close. My guess is $150MM. Of course not mentioned here.
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slide 4 - no mention of the hedges we have to transfer to FlyWheel. At June 30, our nat gas hedges were worth ~$50mm. How much of this are they getting? Some or all?
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slide 4 - no mention of contractual liabilities (up to $126mm) that we keep and have to pay in future. Looks like Way omitted including this in his illustrative App economic slides
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slide 4 - share repurchase sold as returning capital to shareholders. I’ll believe it when I see it. No legal commitment to do it and nice addition of “of up to” language. Good Corp governance would not spend $ on this before it arrives from FlyWheel.
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slide 5 - the last bar is only one that is not deceiving. It reduces debt pro-forma for the expected funds from FlyWheel..... in December. As to the other bars, nothing substantially changed over this period of time - from year-end 2016 through Q2 2018 that changed our balance sheet. Year-end 2016 and 2017 we had cash on the balance sheet because we had to under our bank deal. Way went out of his way to refer to our “net debt” position (total debt less cash). Now, if we can spin the right way it’ll look like we’ve done more than we have
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slide 9 - reserve life index of 19+ years - smoke and mirrors -widely known and reported by Wall St analysts that our App assets give us maybe 7 years of drilling. Of course, we use data that is misleading.
What else is he misleading us and the public on? He’s still has a job how??
The market didn’t like this at all. SWN down 5% when our peers were down 2% on average. Go figure.
Purchase price adjustment likely to be closer to $(150) million due to July 1 effective date. We ain't getting all that cash.
Stock down 5% today. Looks like market didn't like it, but Way said its the greatest and he's the greatest....
Wonder when the Spring campus will be closed and relocated to the NE? Layoffs or relocation for those still left. Our CEO is a magician at making things disappear such as assets, people and stockholder value.
Another example of SWN shrinking under BW’s leadership.
Guessing zero to none FS staff to become Flywheel employees. Pretty sure they expect people with all their teeth, educated past fourth grade and not from the same branch of the family tree.
Advertised purchase price will be further reduced by net cash flows from July 1 to close. Not much drilling activity in Fayetteville, if any, so reduction to purchase price probably in the $100MM range.
We had to give buyer alot of our hedges too. No disclosure in what that looks like, but most likely some add'l value transferred. Another less than transparent disclosure by Way the snake oil salesman and team.
I wish the best for those that will be impacted. Hopefully many can latch on with FlyWheel
I got 2 more openings to work the drive thru at Cluckers Fried Chicken fer any of you soon to be laid off SWNtards. Better take the offers soon! I seen Walmart may have some greeter openings. Cluck cluck!
Southwestern Energy to sell its Fayetteville Shale E&P and related midstream assets for $1.865B in cash to Flywheel Energy.
$1.9B. SWN got a good deal. PE company overpaid. Expect extreme cost cutting by PE company. FS employees get ready.
Uh huh... and I sold my ragged out 1985 ford Pinto for 60k..