LAFAYETTE, La., Jan. 30, 2018 /PRNewswire/ -- Stone Energy
Corporation (NYSE: SGY) ("Stone" or the "Company") today announced
its estimated proved reserves, production volumes, and liquidity
for year-end December 31, 2017, its
capital expenditure budget for 2018, and production guidance for
the first quarter of 2018. Some highlights include:
- Estimated proved reserves totaled approximately 32.5 million
barrels of oil equivalent ("Boe") at December 31, 2017
- Production volumes averaged approximately 17.6 thousand Boe per
day for the three months ended December 31,
2017
- The Board of Directors authorized a 2018 capital expenditure
budget of up to $212 million
- Cash totaled approximately $282.2
million at December 31,
2017
Interim Chief Executive Officer and President James M. Trimble stated, "We exited 2017 with
solid operational results and a strong financial position, and with
several prospective near-term, deep water drilling
opportunities. We drilled a successful development well at
Mt. Providence in December 2017 and expect it to be tied into our
Pompano facility by the third quarter of 2018. We currently
expect to spud the Stone-generated Derbio exploration prospect in
late-February 2018 and could have
another non-operated drilling opportunity in the first half of
2018. Our strong liquidity position provides us with
financial flexibility for 2018. In addition, we continue to
advance the previously announced combination of Stone with Talos
Energy LLC, which we believe will create incremental long-term
value for our shareholders."
Year-End 2017 Estimated Proved Reserves
Estimated proved reserves as of December
31, 2017 totaled approximately 32.5 million barrels of oil
equivalent ("MMBoe"), compared to approximately 35.4 MMBoe of
estimated proved reserves for the Gulf of
Mexico ("GOM") at year-end 2016, which excludes reserves
from the Appalachia properties that Stone sold on February 27, 2017. The year-end 2017
estimated proved reserves were 67% oil, 26% natural gas, and 7%
natural gas liquids ("NGLs"), on an equivalent basis. The changes
in GOM estimated proved reserves from year-end 2016 to year-end
2017 included production of approximately 7.0 MMBoe, net upward
performance revisions of approximately 4.0 MMBoe, and
pricing-related revisions of approximately 0.1 MMBoe. In the
GOM, due primarily to the upward revisions of previous estimates,
Stone replaced approximately 59% of 2017 production.
The year-end 2017 estimated proved reserves included proved
developed reserves of approximately 28.3 MMBoe and proved
undeveloped reserves of approximately 4.2 MMBoe. In addition
to proved reserves, estimated probable reserves totaled
approximately 20.8 MMBoe and estimated possible reserves totaled
approximately 35.4 MMBoe at December 31,
2017.
All of Stone's year-end 2017 estimated proved, probable, and
possible reserves were independently engineered by Netherland,
Sewell & Associates, Inc.
2017 Production Results and First Quarter 2018 Production
Guidance
Net daily production during the fourth quarter of 2017 averaged
approximately 17.6 thousand barrels of oil equivalent ("MBoe") per
day, compared to net daily production of approximately 19.2 MBoe
per day for the quarter ended September
30, 2017. Fourth quarter 2017 volumes included five
full days of downtime from Hurricane Nate and a ten day planned
shut-in of the Pompano platform in November to replace a compressor
engine. The production mix for the fourth quarter of 2017 was
approximately 72% oil, 21% natural gas, and 7% NGLs. Net
daily production volumes from the GOM for full year 2017 averaged
19.2 MBoe per day, which excludes production from the Appalachia
properties that Stone sold on February
27, 2017. We expect production rates to range from
17.5 MBoe per day to 18.0 MBoe per day for the first quarter of
2018.
2018 Capital Expenditure Budget
Stone's Board of Directors has authorized a full-year 2018
capital expenditure budget of up to $212
million, which excludes acquisitions and capitalized
SG&A and interest, and does not give effect to the potential
Talos combination. The budget is spread across Stone's major
areas of investment with approximately 36% allocated to
exploration, 27% to development, and 37% to P&A expenditures.
The allocation of capital across the various areas is subject to
change based on several factors, including permitting times, rig
availability, non-operator decisions, farm-in opportunities, and
commodity pricing.
Liquidity Update
As of December 31, 2017, Stone's
liquidity approximated $369.6
million, which included approximately $87.4 million of undrawn capacity under the
Company's revolving credit facility plus approximately $263.5 million in cash on hand and approximately
$18.7 million in cash being held in a
restricted account to satisfy near-term plugging and abandonment
activities.
As of December 31, 2017, Stone's
outstanding debt totaled approximately $235.5 million, consisting of $225.0 million of 7.50% Senior Second Lien Notes
due 2022 and approximately $10.5
million outstanding under a building loan. Further,
the Company had no outstanding borrowings and outstanding letters
of credit of approximately $12.6
million under its $100 million
borrowing base.
We expect that cash flows from operating activities, cash on
hand, and availability under our revolving credit facility will be
adequate to meet the current 2018 operating and capital expenditure
needs of the Company.
Forward-Looking Statements
Certain statements in this press release are forward-looking and
are based upon Stone's current belief as to the outcome and timing
of future events. All statements, other than statements of
historical facts, that address activities or results that Stone
plans, expects, believes, projects, estimates, or anticipates will,
should, or may occur in the future, including future production of
oil and gas, future capital expenditures and drilling and
completion of wells, and future financial or operating results are
forward-looking statements. All forward-looking numbers are
approximate. Important factors that could cause actual
results to differ materially from those in the forward-looking
statements herein include, but are not limited to, the timing,
extent, and volatility of changes in commodity prices for oil and
gas; operating risks; liquidity risks, including risks relating to
our bank credit facility and the Company's ability to access the
capital markets; political and regulatory developments and
legislation, including developments and legislation relating to our
operations in the Gulf of Mexico
basin; risks related to our previously announced combination with
Talos Energy LLC; and other risk factors and known trends and
uncertainties as described in Stone's Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K as
filed with the Securities and Exchange Commission. For a more
detailed discussion of risk factors, please see Part I, Item 1A,
"Risk Factors" of the Company's most recent Annual Report on Form
10-K and Part II, Item 1A of the Company's Quarterly Report on Form
10-Q for the period ended March 31,
2017. Should one or more of these risks or uncertainties
occur, or should underlying assumptions prove incorrect, Stone's
actual results and plans could differ materially from those
expressed in the forward-looking statements. Stone assumes no
obligation and expressly disclaims any duty to update the
information contained herein, except as required by law.
Stone Energy is an independent oil and natural gas
exploration and production company headquartered in Lafayette,
Louisiana with an additional office in New Orleans.
Stone is engaged in the acquisition, exploration,
development, and production of properties in the Gulf of Mexico basin. For additional
information, contact Kenneth H. Beer, Chief Financial Officer,
at 337-521-2210 phone, 337-521-9880 fax or via e-mail at
CFO@StoneEnergy.com
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SOURCE Stone Energy Corporation