 Swift's 1993
successes in exploration and development were located in various counties in the states of
Texas,
Oklahoma, Arkansas, Colorado, and Wyoming (counties highlighted in yellow). |
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After devoting several years to the development of risk management methodologies that
integrate traditional and advanced exploration techniques, Swift Energy significantly
accelerated its exploration and development program in 1993. The year ended with five
successes out of 12 exploratory wells drilled and 21 successes out of 22 development wells
drilled. Swift served as the operator for 10 of the exploratory wells and nine of the
development wells.
As a result of all these drilling activities (together with two additional exploratory
wells and two development wells completed in mid-January of 1994), approximately 16.7
million BOEs was added to the gross year-end reserves of Swift and its co-investors. In
addition, another 1.5 million BOEs previously booked as proved undeveloped reserves was
placed into production. Of these gross volumes, Swift Energy’s net revenue interests
totaled 2.3 million BOEs for reserves added and approximately 206,000 BOEs for previously
booked reserves placed into production. Swift’s 1993 capital expenditures for these
activities, together with the costs of acquiring leases for future drilling and performing
the associated geophysical analyses, totaled $9.3 million.
Of the 2.3 million BOEs added to the Company’s reserves through drilling, 1.2
million BOEs came from its exploration program and 1.1 million BOEs came from its
development program. These figures include over 890,000 BOEs of reserves associated with
newly identified proved undeveloped reserves (PUDs). In both the exploratory and the
development programs, the reserves were predominantly natural gas—88% and 69%,
respectively.
Except for one well drilled to the Jurassic Smackover formation in Columbia County,
Arkansas, all the successful exploratory wells were located in the Texas Gulf Coast
region, where over the years Swift’s exploration team has analyzed large quantities
of well survey data and seismic lines in 12 counties. Among them was one well drilled to
the Frio formation in Goliad County, and one well drilled to the Yegua formation in
Liberty County.
Also among the Texas Gulf Coast exploratory wells were two horizontal wells in Fayette
County, which, together with two horizontal development wells in the same area, have
firmly established Swift’s presence in the Austin Chalk trend, one of the most
prolific hydrocarbon regions in the United States. The Company’s interests in these
four wells resulted from its successful bid on an approximately 8,900-acre farmout from
the Lower Colorado River Authority (LCRA). After subsequently obtaining additional
leasehold rights from the city of Austin, Swift became the operator for most of the
acreage.
Other 1993 work in Fayette County, outside the LCRA area, included two additional
horizontal development wells in the vicinity of two horizontal prospects drilled and
completed as producers in 1992.
Development activities also continued during the year in two other major areas—in
the Weatherford Area of Oklahoma, where five successful wells were drilled, and in the
South Texas AWP Olmos Field, where three successful wells were drilled. Additional
development wells were located in the Texas counties of Schleicher, Live Oak,
Irion, and
Andrews; in Campbell County, Wyoming (two wells); in Crawford County, Arkansas; in
Garfield County, Colorado; and in Roger Mills County, Oklahoma.
As Swift begins its 1994 drilling program, it has already selected 64 drilling sites,
33 for exploratory wells and 31 for development wells. With these locations, the Company
continues to diversify its investments in a portfolio of attractive drilling prospects
identified through a process based on integrated geological and geophysical technologies
and risk management techniques. In this process, seismic data are analyzed and enhanced
with state-of-the-art computer systems utilizing many of the latest diagnostic and
enhancement programs, some of which have been customized by Swift employees.
To gain additional seismic data in areas of interest, Swift has obtained permits to
perform two significant seismic surveys during 1994. The first survey, which will be
performed as part of the LCRA farmout, has the potential for identifying 20 new well
sites. Covering more than 6,500 acres, it includes Fayette Lake, a 3,500-acre man-made
cooling lake for an LCRA power plant. The second survey, to be carried out in another
Texas Gulf Coast location, will provide data for three-dimensional seismic analysis.
With an experienced 17-member staff of reservoir engineers, geologists, geophysicists,
petrophysicists, and landmen, supported by multidisciplinary in-house teams that include
operations and drilling engineers, Swift remains confident that it will build upon its
1993 successes.
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