NEWS RELEASE For Further Information Contact:
Greg D. Kerley
Executive Vice President
and Chief Financial Officer
(501) 521-1141
ARKANSAS SUPREME COURT AFFIRMS LOWER COURT DECISION IN
SOUTHWESTERN ENERGY COMPANY APPEAL
Southwestern Will Pay Settlement and Raise Cash Through Sales of Assets
FAYETTEVILLE, ARKANSAS - June 22, 2000...Southwestern Energy Company
(NYSE: SWN) today announced the Arkansas Supreme Court today has ruled to affirm
the 1998 decision of a Sebastian County Circuit Court awarding more than $109
million in a class action to royalty owners of SEECO, Inc., a wholly-owned
Southwestern Energy subsidiary.
While this decision was not expected by Southwestern, the Company had
prepared for the outcome including posting a $109 million bond supported by
letters of credit from the Company's lead lending institutions.
"Southwestern is disappointed at the Supreme Court Decision. It is not
the outcome we had anticipated. It will take some time to recoup the cost of
this judgment and will involve the disposition of some Company assets," said
Harold Korell, Southwestern President and Chief Executive Officer. "Fortunately,
Southwestern has the financial flexibility to allow it the time to recoup
settlement costs and to continue development of its quality exploration and
production projects."
In late 1999 and early this year, Southwestern successfully drilled
exploratory wells in south Louisiana at Gloria and North Grosbec and has had
continued success in its Arkoma Basin and Permian Basin investments. The
exploration successes in south Louisiana are of particular note as they were the
first prospects in this area developed in-house by our new exploration team.
Southwestern's full-year 1999 and first quarter 2000 earnings were consistent
with previous years' levels despite the warmest winter in the Company's history.
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The Company said that within the next few days it will disclose
specific action it will take to fund the judgment and the near term effects of
the judgment on the financial condition of the Company.
"Following the Court's decision today, let us be clear, our position is
unchanged. We believe that from the beginning in this matter Southwestern Energy
has acted honestly and responsibly and has served the best interests of its
royalty owners and utility customers, and we will continue to do so in the
future," said Mr. Korell. "Despite the disappointment of the ruling, we remain
optimistic about the Company's future because the outlook for our exploration
and production operations has never been brighter."
Southwestern Energy will broadcast a conference call in conjunction
with this press release over the Internet at 12:00 p.m. EST (11:00 a.m. CST)
today at the Company's website: http://www.swn.com. RealPlayer 8 Basic is
required to listen to the teleconference and can be downloaded from the website.
Southwestern Energy is an integrated natural gas company whose
wholly-owned subsidiaries are engaged in gas and oil exploration and production,
natural gas gathering, transmission and marketing and natural gas distribution.
Additional Company information can be accessed at http://www.swn.com.
All statements, other than historical financial information, included
in this press release may be deemed to be forward-looking statements within the
meaning of the Securities Litigation Reform Act. These statements reflect the
Company's current views with respect to future events and performance and
involve risks and uncertainties that are detailed in the Company's Securities
and Exchange Commission filings. These risks would include, but are not limited
to, the timing and extent of the Company's success in discovering, developing,
producing and estimating oil and natural gas reserves. Although these statements
are made in good faith and the Company believes they are reasonable
representations of the Company's expected performance at this time, the
Company's actual financial and operating results could differ materially from
those projected as a result of certain factors. A discussion of those factors is
included in the Company's periodic reports filed with the Securities and
Exchange Commission including its Annual Report on Form 10-K for the year ended
December 31, 1999.
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