Southwestern Energy Co. Aug 04
- ID: 2083288
- August 2004
- Standard & Poors
A good all-in cost structure of roughly $2.60 will allow the company to maintain good cash flows in a midcycle pricing environment. Aggressive hedging on near-term production should ensure cash flows and the ability to fund capital expenditures internally. The company's natural gas distribution utility, Arkansas Western Gas Co., provides a stable source of cash flow, helping to offset fluctuations in commodity prices. If internal growth initiatives are unsuccessful, the company could be forced to enter the acquisition market and higher cost basins that would erode its cost structure. The ratings on Southwestern Energy Co. reflect its participation in the highly competitive, cyclical, and capital-intensive exploration and production (E&P) segment of the oil and natural gas industry, competitive cost structure,...
Companies mentioned in this report are:
- Southwestern Energy Co.
- Noark Pipeline Finance, L.L.C.
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