Swift Energy Details 2006 Capital Expenditure Plans
Swift Energy Company (NYSE: SFY) currently plans to spend $300 million to $325 million in total capital expenditures in 2006, net of minor non-core dispositions and excluding any potential property acquisitions, which will be further detailed today at their annual Analyst/Investor meeting. Approximately 85% of the budget is targeted for domestic activities, primarily in its South Louisiana region, with about 15% planned for activities in its New Zealand region. For 2006, Swift Energy is targeting total production to increase 14% to 18% and proved reserves to increase 5% to 8% over their respective 2005 levels.
In updating its planned 2006 activity today, Swift Energy reported preliminary results from the drilling of its first well in the Cote Blanche Island field ("CBI") in St. Mary Parish, and part of the Company's South Louisiana region. The CBI development well has been recently logged to a depth of 13,814 feet with pipe set over an estimated 77 feet of net pay in the primary targeted sand and is currently drilling deeper for further evaluation of this area. Also in the South Louisiana region, the Company recently successfully drilled two development wells in the Lake Washington field, (one of which had 335 feet of net pay in five sands) and one well in the Bay de Chene field. In the South Bearhead Creek field, located in the Company's Toledo Bend region that spans east Texas and central Louisiana, Swift Energy has recently logged a well that had hydrocarbon shows in the Wilcox and Cockfield sands and is currently scheduled to be completed in the next several weeks. In the South Texas region, the Company recently has drilled three wells successfully in the region's anchor asset of AWP Olmos field. In New Zealand, the Company's fourth region, Swift Energy has drilled a successful development well and an unsuccessful exploration well, both of which targeted the Manutahi sand.
The Company has finished its 2005 planned facility upgrades in the Lake Washington field and is continuing with the commissioning process. The facility infrastructure in the field now has an effective capacity of 28,000 barrels of crude oil per day.
Planned 2006 Regional Activity
Swift Energy's domestic activity will again be predominately focused in the South Louisiana operating region, with the Lake Washington Field serving as an anchor asset for this region. Swift Energy plans to have at least two rigs operating in this field for most of 2006, which are targeted to drill at least 30 wells with several wells targeting vertical depths to 14,000 feet. At least four of these wells will be exploration wells with targets derived from the 2004 3-D seismic data acquisition. Swift Energy's average 2006 December exit rate at the Lake Washington field is expected to average at least 18,500 barrels of oil equivalent per day, compared to the 14,600 barrels of oil equivalent per day exit rate in December 2005. Swift Energy has begun planning for a fourth production platform in the western part of the field to handle anticipated future production increases. Total capital expenditures in Lake Washington for 2006 are expected to range from $95 million to $115 million. Additionally, the Company plans to drill up to four to eight wells in Bay de Chene and Cote Blanche Island in the South Louisiana region in 2006. This is in addition to the planned acquisition of approximately 77 square miles of new 3-D seismic data over the Cote Blanche Island field.
Swift Energy also plans to drill 12 to 17 wells in the South Texas region, with the majority of these wells focused in the AWP Olmos field. This South Texas drilling program is expected to maintain natural gas production near current levels throughout 2006. In the Toledo Bend region, Swift Energy expects to drill one to two wells in either the Brookeland or Masters Creek fields in Texas and Louisiana. And in its newest field in this region, South Bearhead Creek, the Company plans to drill up to four wells.
In New Zealand, Swift Energy's efforts will focus on further
delineation and development of the Kauri and Manutahi Sands. Swift
Energy expects to drill two to four wells targeting the intermediate
depth Kauri Sand and two to four wells in the shallow Manutahi Sand.
Swift Energy plans to continue with its Tarata thrust exploration
activity and is currently drilling the Goss and Trapper exploration
wells. The Company also plans to drill the Kowhai exploration well in
2006, as well as acquire additional seismic data, both onshore and in
the offshore Kaheru block.