Eksplorasi.id – SilverBow Resources Inc., Houston, has cut its 2020 capital program to $80-95 million, a 55% reduction at the midpoint from previous guidance, and has suspended drilling and completions activity in response to global health and safety events impacting the oil and gas market.
In early March, the planned a 2020 budget of $175-195 million, which provided for 26 gross (25 net) operated wells drilled with 90% of the budget allocated to drilling and completion activity with the continuation of one rig primarily dedicated to the development of the La Salle Condensate area and the McMullen Oil area.
The company now has deferred completing and bringing online eight oil wells until at least the second half of the year and is contemplating “a pivot to gas development late in 2020 if prices support return thresholds.”
SilverBow expects first quarter total net production to average 230 MMcfe/d, with a commodity mix of 79% natural gas, 12% oil, and 9% natural gas liquids.
During the second half of March, the company elected to curtail 35 MMcf/d of net gas production. In April, SilverBow has elected to curtail a total of 50 MMcf/d of net gas production and 2,000 b/d of net oil production.
Silverbow, formerly Swift Energy, recently acquired a private entity with Eagle Ford assets and entered into a definitive agreement to divest certain assets located in the Powder River basin (OGJ Online, May 4, 2017).
The acquisition adds 10 MMcf/d of net natural gas production directly offsetting the company’s existing assets, bringing SilverBow’s combined acreage to more than 200,000 net acres in the western portion of the Eagle Ford.
The Powder River basin divesture includes an overriding royalty interest in 188 net acres across Campbell, Converse, and Niobrara Counties, Wyo. The transaction is expected to close during the second quarter.
As of Mar. 31, SilverBow’s liquidity was $145.6 million, consisting of $35.6 million of cash and $110.0 million of availability under the company’s revolving credit facility.
SilverBow’s net debt was $454.4 million, calculated as total long-term debt of $490.0 million less $35.6 million of cash, a 5% decrease from Dec. 31, 2019.
Sources: ogj.com
