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Swift Energy Co. Message Board

  • sammy_kayy sammy_kayy Nov 17, 2012 8:25 AM Flag

    Natural gas's future and SFY

    I used to really like Swift a number of years ago, owning it often. But the balance of natural gas (not liquids) compared to oils has been troubling for several years and the metrics on the company are worsening as well..

    Let's review. Future good performance for a good E & P is based on a priority of what makes up your reserves and production.

    1. Having quality oil is essential (like Shale oil in the Dakotas etc.). If it compares to W.T.I., then more refineries around the country can use it and process it (East Coast refineries as just one example) and thus more price per barrel can be justified.

    2. Next comes NGLs (natural gas liquids). If you have liquids like those in Canada etc., there is good value and demand by foreign ownerships - not as good as #1 above but still quite good (currently $60s a barrel for good NGLs versus $85 per for good oil)

    3. Worst to have is heavy percentages of Natural gas (especially if it is at all sour or acid gas requiring scrubbing/processing). But its not just horribly low prices per mcf that is the concern, but the reasons why the prices are so low . . . massive GROWING glut on the market. The pipelines aren't even done yet to move huge gas quantities from every Dakota explorer who currently are flaring off quantities of gas that rival the total productions of many smaller E & Ps. Then you add in all the new anaerobic digester methane productions from herd/farm productions plus all the widely expanding methane gas recoveries from landfill efforts that are popping up all over the country.

    And SFY ? Its not growing revenues fast enough compared to expenses. And its been quite disappointing in growth percentage of reserves compared to many other E & Ps of similar size and pricing, as well as their well life expectancy. As we see more and more 60% to 175% reserve growth reports for other companies compared to maybe just 15% for SFY, you have to wonder why the price of SFY is as good as it is right now. Sadly I expect more repeated near term downgrades on SFY from where we are at and what we've seen. Its as if SFY is trying to protect a lead rather than try to score a touchdown, except SFY doesn't have a lead to protect.

    Swing and sway.

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    • "Its as if SFY is trying to protect a lead rather than try to score a touchdown, except SFY doesn't have a lead to protect."

      EXCELLENT SUMMARY - I left the company because of this.

    • hey mr shorter we are not buying it. hate to break it too you but you will get sqeezed out!!!

      • 1 Reply to mechcanic408
      • If you are referring to me as a "shorter" after my post . . . then it shows only how troubled you are. I present factual information that you can evaluate compared to a dozen other smaller E & P's like Swift. The facts are clear and concise to see . . . the speed of growth and opportunity at Swift has not been well done or fetching. Small E & P's can't sit still when the opportunities around them and the technologies have changed so greatly. 10 years ago and today . . . Swift has grown very little in that 10 years in its impact or reach as a company. Compare it to Continental, Kodiak, Magnum Hunter and dozens of others. Reserve and revenue growth aren't there in comparison. It doesn't mean Swift goes out of business, but it does mean that investors are not about companies - they are about making money on investments. Swift today reminds me greatly of the way Petroleum Development was 12 years ago or so. It took a shake up in the corporate structure and suddenly there was dramatic benefit for investors after years of not, because investors finally shared in the benefit instead of just providing them.

        spend a little effort studying instead of even less effort on unfounded comments.

        Swing and Sway