Yup, it seems that there could be an NG shortage coming, probably
starting next year.
But SFY are going to be in this same boat. I trust we have all read the 10-k and spotted the tell-tale paragraph/sentence -
"Revenues from oil and gas sales comprised 97%, 92%, and 94%, respectively,
of total revenues for 1998, 1997, and 1996. The majority (73%, 83%, and
77%, respectively) of these oil and gas revenues in these periods were derived
from the sale of the Company's gas production. The Toledo Bend Properties
acquisition, which has a higher percentage of its production from oil
(56% of 1998 production), has somewhat altered the Company's predominate gas
production mix. Even though the Company has scaled back its 1999 capital
expenditures budget, the Company expects oil and gas sales volumes to increase in
1999 when compared to 1998, primarily due to the full year of production
from the Toledo Bend Properties. However, to the extent the Company curtails its
development and exploration program as a result of the continued low price
environment, oil and gas sales volumes will likely decrease in years subsequent to
1999."
I am hoping that their oil output will provide the cash needed to
increase their drilling activities. I suspect they will need it.
I *feel* that SFY are very capable of consuming large levels of cash
in drilling - perhaps more than other companies ? Please correct me
if you think this is wrong.
Mark |
