Swift Energy Announces Second Quarter 2008 Results:

Swift Energy Company (NYSE:SFY) announced today that its income from continuing operations for the second quarter of 2008 increased 173% to a record $83.2 million, or $2.66 per diluted share, compared to $30.5 million, or $1.00 per diluted share of income from continuing operations earned in the second quarter of 2007. Adjusted cash flow from continuing operations (*cash flow before working capital changes, a non-GAAP measure - see page 6 for reconciliation to the GAAP measure) for the second quarter of 2008 increased 71% to a record $184.4 million, or $5.88 per diluted share, compared to $107.8 million of adjusted cash flow, or $3.52 per diluted share, for the same period of 2007. Swift Energy produced 2.69 million barrels of oil equivalent ("MMBoe”) from continuing operations during the second quarter of 2008, which is a 4% increase when compared to second quarter 2007 production of 2.59 MMBoe from continuing operations. Terry Swift, CEO of Swift Energy, commented, "The high commodity price environment and strong operational results of the second quarter lifted Swift Energy to record revenues, earnings and cash flow from continuing operations. Activity levels remained high and important work was completed across all of our operating areas. In our Lake Washington field, we’ve experienced certain operational delays which have impacted our production plans for the remainder of this year. Due to these challenges, we are lowering our full year 2008 production guidance to a range of 10.8 – 11.2 MMBoe. Although this is disappointing in the short term, we are confident that the work plans we have initiated will allow us to meet or exceed our strategic production growth targets for 2009.” Revenues and Expenses Total revenues from continuing operations for the second quarter of 2008 increased 68% to a record $262.7 million from the $156.4 million from continuing operations generated in the second quarter of 2007, due to higher commodity prices. Depreciation, depletion and amortization expense ("DD&A”) of $21.26 per barrel of oil equivalent ("Boe”) in the second quarter 2008 increased from $16.94 per Boe of DD&A in the comparable period in 2007 primarily as a result of an increased depletable base and higher production, partially offset by higher reserves during the 2008 period. Lease operating expenses, before severance and ad valorem taxes, were $10.61 per Boe in the second quarter 2008, an increase of 70% compared to $6.25 per Boe in the second quarter of 2007. The increase in lease operating expenses was predominately due to higher than projected workover expenses and higher field expenses associated with increased activity. Also, severance and ad valorem taxes were up appreciably to $9.97 per Boe from $6.87 per Boe in the comparable period due to higher realized commodity prices. General and administrative expenses associated with increased staffing levels rose to $3.82 per Boe during the second quarter 2008 from $3.72 per Boe in the same period in 2007. Interest expense per Boe increased 8% to $3.06 per Boe in the second quarter 2008 compared to $2.82 per Boe for the same period in 2007 due to increased bank debt and lower capitalized interest. Production & Pricing Swift Energy’s second quarter 2008 production from continuing operations of 2.69 MMBoe represents a 4% increase over comparable production from continuing operations in the same period in 2007 and a 5% increase compared to the first quarter of 2008 production from continuing operations. Year-over-year second quarter production benefited from the recent acquisition of three fields in South Texas and increased activity in our Lafayette South (Cote Blanche Island, Horseshoe Bayou, Bayou Sale, Jeanerette, Bayou Penchant) and Lafayette North (Brookeland, Masters Creek, South Bearhead Creek) areas. The Company realized an aggregate average price of $97.70 per Boe for its continuing operations, an increase of 62% from the $60.37 average price received in the second quarter of 2007. In the second quarter of 2008, average crude oil prices increased 89% to $125.20 per barrel from $66.20 per barrel realized in the same period in 2007. For the same periods, average natural gas prices were $10.49 per thousand cubic feet ("Mcf”), an increase of 39% from the $7.56 per Mcf average realized a year earlier. Prices for natural gas liquids ("NGL”) averaged $67.73 per barrel in the second quarter for a 53% increase over second quarter 2007 NGL prices of $44.22 per barrel. Operations Update Swift Energy completed 25 of 27 development wells in the second quarter of 2008 for a 93% success rate. One non-operated well was completed and no exploration wells were completed during the quarter. In the Company’s Lake Washington area in South Louisiana, 8 development wells were drilled in the Lake Washington Field in Plaquemines Parish and 1 development well was drilled in the Bay de Chene Field in Jefferson and Lafourche Parishes. The Company currently has 6 barge rigs contracted in this area, with 4 operating in Lake Washington and 2 operating in Bay de Chene. At Lake Washington in the second quarter, along with experiencing natural declines, the Company reduced the choke size of several wells in the Newport area to manage reservoir pressure in anticipation of the pressure maintenance program that commenced with the West Side facility start-up early in the second quarter of 2008, as previously announced. Although pressure maintenance was commenced during the quarter, the required water injection volumes have not yet been achieved. The Company is moving forward with converting some existing wells and drilling additional wells to enable higher water injection volumes to be achieved. Deeper wells with higher flowing pressures and higher gas-to-oil ratios continue to be drilled at Lake Washington. The increased pressure from the newer wells coupled with increasing volumes of associated gas, has increased the over-all operating pressure in the field’s bulk gathering lines and production facilities, negatively impacting production rates from the more mature, lower flowing pressure wells. Additionally, higher volumes of produced water from older more mature wells are being handled with oil production in the field, causing higher artificial lift demand from the mature areas of the field. As a result, the Company designed and permitted additional gathering lines during the second quarter that are intended to provide additional flexibility to the gathering system. These new lines will be used to segregate newer wells from the older more mature wells, thereby reducing the back pressure of the older wells and maintaining higher production rates from these older wells. The first additional line is being installed between Newport and the West Side facility and is expected to be operational in the third quarter. Additional lines have also been designed and will be installed later in the year. We anticipate that pressure maintenance activities planned for 2008, together with the West Side infrastructure enhancements, will reduce the production constraints experienced in the first half of 2008. In Bay de Chene, the previously announced increase in export capacity has positioned the Company to increase production in this area during the remainder of 2008. During the second quarter, the BDC VUB #152 was drilled and completed and is currently producing 350 Boe per day. The BDC VUB #150 was completed and is producing 1,200 Boe/d. The BDC #142 was recompleted and is producing 1,000 Boe/d, and the BDC UC #7 was recompleted during the third quarter and is being placed on production. Swift Energy Company is also in the process of executing a strategic 3-D based South Louisiana exploration program during the second half of 2008. The Company is currently drilling, as operator, one high potential 18,000 foot prospect in the Lake Washington/Bay de Chene area and is also participating, as non-operator in one 16,000 foot prospect that is currently being drilled closer to the High Island area. Swift’s working interest participation in these prospects is 50% and 25% respectively. The Company also intends to drill two additional high potential prospects in the 3rd and 4th quarters of 2008. One will be a 12,000-15,000 foot test in the Westside area of Lake Washington while the other will be a 15,000 foot test in the Bay de Chene area. Swift maintains a 100% working interest in both of these prospects. Further, the Company is now carrying out the work necessary to design and plan an 18,000 – 20,000 foot sub-salt test in the Lake Washington area for drilling sometime during the first half of 2009. In the Lafayette North area, a production enhancement program is underway in the Brookeland field in the counties of Jasper and Newton in Texas, Masters Creek field in the parishes of Vernon and Rapides in Louisiana and South Bearhead Creek field in Beauregard Parish, all designed to allow the Company to grow base production from existing wells. This program and production from new wells brought online at South Bearhead Creek resulted in a 13% increase in production in this area when compared to first quarter 2008 levels, and a 27% production increase when compared to second quarter 2007 production in this area. In the Lafayette South area, also in South Louisiana, 1 development well was drilled in the Jeanerette Field. In Cote Blanche Island, the SL 340 #189, an exploration well drilled in the first quarter was completed and is producing approximately 300 Boe/d with flowing tubing pressure above 1600 psi. In the South Texas area, the Company completed 5 of 6 development wells drilled in its Cotulla area in La Salle, Dimmit and Webb Counties, Texas and 9 of 10 development wells targeting the Olmos sand in its AWP area in McMullen County, Texas. The Company will have two rigs in its AWP field and one rig in its Cotulla area during the second half of the year and plans to drill a well in its AWP area to the Edwards formation during the second half of the year. Update on Discontinued Operations During the second quarter, Swift Energy Company incurred a $1.3 million or $0.04 per diluted share loss from discontinued operations. On June 13, 2008, the Company announced the closing of the sale of the majority of Swift Energy New Zealand’s assets for $82.7 million, which was used to pay down existing bank debt. As previously announced, Swift Energy New Zealand has reached an agreement to sell its remaining permit for $15 million to be received over the next 2 ½ years, which will result in a $12.8 million non-cash gain upon closing. Closing of this transaction is expected to occur within the next few months. Price Risk Management Swift Energy has purchased natural gas floors that cover approximately 58% to 61% of its currently expected third quarter 2008 natural gas production at an average NYMEX strike price of $9.28 per MMBtu. Additionally, natural gas floors have been purchased for the fourth quarter of 2008 covering approximately 41% to 44% of that quarter’s estimated natural gas production. These fourth quarter floors have an average NYMEX strike price of $9.15 per MMBtu. The Company has also purchased floors at a $94.84 average NYMEX strike price covering 60% to 63% of its third quarter crude oil production. Floors covering 38% to 41% of fourth quarter crude oil production have been purchased at an average NYMEX strike price of $98.15. On an ongoing basis, details of Swift Energy’s complete price risk management activities can be found on the Company’s website (www.swiftenergy.com). Earnings Conference Call Swift Energy will conduct a live conference call today, August 7, at 9:00 a.m. CDT to discuss second quarter 2008 financial results. To participate in this conference call, dial 973-339-3086 five to ten minutes before the scheduled start time and indicate your intention to participate in the Swift Energy conference call. A digital replay of the call will be available later on August 7 until August 14, by dialing 706-645-9291 and using Conference ID # 52522627. Additionally, the conference call will be available over the Internet by accessing the Company’s website at www.swiftenergy.com and by clicking on the event hyperlink. This webcast will be available online and archived at the Company’s website. Swift Energy Company, founded in 1979 and headquartered in Houston, engages in developing, exploring, acquiring and operating oil and gas properties, with a focus on oil and natural gas reserves in the onshore and inland waters of Louisiana and Texas. Over the Company’s 28-year history, Swift Energy has shown long-term growth in its proved oil and gas reserves, production and cash flow through a disciplined program of acquisitions and drilling, while maintaining a strong financial position. This press release includes "forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The opinions, forecasts, projections, guidance or other statements other than statements of historical fact, are forward-looking statements. These statements are based upon assumptions that are subject to change and to risks, especially the availability of labor, services, supplies and facility capacity, results of exploratory and development drilling, volatility in oil or gas prices, uncertainty and costs of finding, replacing, developing or acquiring reserves, and disruption of operations Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Certain risks and uncertainties inherent in the Company’s business are set forth in the filings of the Company with the Securities and Exchange Commission. Estimates of future financial or operating performance provided by the Company are based on existing market conditions and engineering and geologic information available at this time. Actual financial and operating performance may be higher or lower. Future performance is dependent upon oil and gas prices, exploratory and development drilling results, engineering and geologic information and changes in market conditions. SWIFT ENERGY COMPANY SUMMARY FINANCIAL INFORMATION FROM CONTINUING OPERATIONS (Unaudited) (In Thousands Except Per Share and Price Amounts)     Three Months Ended Six Months Ended June 30, June 30, 2008     2007     Percent Change 2008     2007     Percent Change Revenues: Oil & Gas Sales $ 263,184 $ 156,311   68 % $ 463,157 $ 286,533   62 % Other (503) 99 NM %   (1,516)   (44) NM % Total Revenue $ 262,681 $ 156,410 68 % $ 461,641 $ 286,489 61 %   Income From Continuing Operations $ 83,245 $ 30,523 173 % $ 133,080 $ 56,968 134 % Basic EPS – Continuing Operations $ 2.72 $ 1.02 167 % $ 4.37 $ 1.91 129 % Diluted EPS – Continuing Operations $ 2.66 $ 1.00 166 % $ 4.27 $ 1.86 129 % Net Cash Provided By Operating Activities – Continuing Operations $ 155,053 $ 114,808 35 % $ 294,743 $ 193,383 52 % Net Cash Provided By Operating Activities, Per Diluted Share – Continuing Operations $ 4.95 $ 3.75 32 % $ 9.46 $ 6.33 50 % Cash Flow Before Working Capital Changes(1) (non-GAAP measure) – Continuing Operations $ 184,385 $ 107,817 71 % $ 320,637 $ 192,023 67 % Cash Flow Before Working Capital Changes, Per Diluted Share – Continuing Operations $ 5.88 $ 3.52 67 % $ 10.29 $ 6.28 64 % Weighted Average Shares Outstanding (Diluted) 31,341 30,613 (2) % 31,149 30,554 (2) %   EBITDA(1) (non-GAAP measure) $ 196,950 $ 100,056 97 % $ 337,430 $ 190,782 77 %   Production (MBoe) – Continuing Operations: 2,694 2,589 4 % 5,264 5,123 3 %   Realized Price ($/Boe) – Continuing Operations: $ 97.70 $ 60.37 62 % $ 87.98 $ 55.93 57 %   (1) See reconciliation on page 6. Management believes that the non-GAAP measures EBITDA and cash flow before working capital changes are useful information to investors because they are widely used by professional research analysts in the valuation, comparison, rating and investment recommendations of companies within the oil and gas exploration and production industry. Many investors use the published research of these analysts in making their investment decisions. Reconciliation of GAAP (a) to non-GAAP Measures (Unaudited) (In Thousands)   Three Months Ended June 30, 2008     June 30, 2007 INCOME TO EBITDA RECONCILIATIONS:   Income from Continuing Operations $ 83,245 $ 30,523   173 % Provision for Income Taxes 47,727 18,034 Interest Expense, Net 8,231 7,296 Depreciation, Depletion & Amortization & ARO (b)   57,747   44,203 EBITDA $ 196,950 $ 100,056 97 %   Six Months Ended June 30, 2008 June 30, 2007   Income from Continuing Operations $ 133,080 $ 56,968 134 % Provision for Income Taxes 76,734 33,506 Interest Expense, Net 16,921 14,042 Depreciation, Depletion & Amortization & ARO (b)   110,695   86,266 EBITDA $ 337,430 $ 190,782 77 %   Three Months Ended June 30, 2008     June 30, 2007 CASH FLOW RECONCILIATIONS:   Net Cash Provided by Operating Activities – Continuing Operations $ 155,053 $ 114,808 35 % Increases and Decreases In: Accounts Receivable 34,220 (5,176) Accounts Payable and Accrued Liabilities (7,443) (5,730) Income Taxes Payable 658 90 Accrued Interest   1,897   3,825 Cash Flow Before Working Capital Changes – Continuing Operations $ 184,385 $ 107,817 71 %   Six Months Ended June 30, 2008 June 30, 2007   Net Cash Provided by Operating Activities – Continuing Operations $ 294,743 $ 193,383 52 % Increases and Decreases In: Accounts Receivable 31,948 (5,762) Accounts Payable and Accrued Liabilities (6,493) 1,531 Income Taxes Payable 79 974 Accrued Interest   360   1,897 Cash Flow Before Working Capital Changes – Continuing Operations $ 320,637 $ 192,023 67 % (a) GAAP—Generally Accepted Accounting Principles (b) Includes accretion of asset retirement obligation Note: Items may not total due to rounding SWIFT ENERGY COMPANY SUMMARY BALANCE SHEET INFORMATION (Unaudited) (In Thousands)         As of June 30, 2008   As of December 31, 2007 Assets: Current Assets: Cash and Cash Equivalents $ 13,147 $ 5,623 Other Current Assets 133,096 97,778 Current Assets Held for Sale 564 96,549 Total Current Assets 146,807 199,950   Oil and Gas Properties 3,015,882 2,717,112 Other Fixed Assets 35,169 33,064 Less-Accumulated DD&A (1,100,632)   (989,981) 1,950,419 1,760,195 Other Assets   8,516   8,906 $ 2,105,742 $ 1,969,051   Liabilities: Current Liabilities $ 188,471 $ 202,095 Current Liabilities Associated with Assets Held for Sale --- 8,066 Long-Term Debt 524,200 587,000 Deferred Income Taxes 373,438 302,303 Asset Retirement Obligation 34,607 31,066 Other Long-term Liabilities   2,347   2,467 Stockholders’ Equity   982,679   836,054 $ 2,105,742 $ 1,969,051 Note: Items may not total due to rounding SWIFT ENERGY COMPANY SUMMARY INCOME STATEMENT INFORMATION (Unaudited) In Thousands Except Per Boe Amounts   Three Months Ended Six Months Ended June 30, 2008   Per Boe June 30, 2008   Per Boe   Revenues: Oil & Gas Sales $ 263,184 $ 97.70 $ 463,157 $ 87.98 Other Revenue (503) (0.18) (1,516) (0.28) 262,681 97.52 461,641 87.70   Costs and Expenses: General and Administrative, net 10,291 3.82 20,210 3.84 Depreciation, Depletion & Amortization 57,280 21.26 109,774 20.85 Accretion of Asset Retirement Obligation (ARO) 467 0.17 921 0.17 Lease Operating Costs 28,584 10.61 55,009 10.45 Severance & Other Taxes 26,856 9.97 48,992 9.31 Interest Expense, Net 8,231 3.06 16,921 3.21   Total Costs & Expenses $ 131,709 $ 48.90 $ 251,827 $ 47.84     Income from Continuing Operations Before Income Taxes 130,972 48.62 209,814 39.86 Provision for Income Taxes 47,727 17.72 76,734 14.58 Income from Continuing Operations $ 83,245 $ 30.90 $ 133,080 $ 25.28 Loss from Discontinued Operations, Net of Taxes (1,326) NM (2,800) NM Net Income $ 81,919 NM $ 130,280 NM     Additional Information: Capital Expenditures $ 142,560 $ 318,962 Capitalized Geological & Geophysical $ 7,350 $ 13,761 Capitalized Interest Expense $ 1,960 $ 3,921 Deferred Income Tax $ 45,302 $ 73,730 Note: Items may not total due to rounding SWIFT ENERGY COMPANY CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited) (In Thousands)   Six Months Ended June 30, 2008     June 30, 2007 Cash Flows From Operating Activities: Net Income $ 130,280 $ 59,098 Plus (Income) Loss From Discontinued Operations, Net of Taxes 2,800 (2,130) Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities - Depreciation, Depletion, and Amortization 109,774 85,576 Accretion of Asset Retirement Obligation (ARO) 921 690 Deferred Income Taxes 73,730 33,473 Stock Based Compensation Expense 5,965 5,147 Debt Retirement Cost – Cash and Non-Cash --- 12,765 Other (2,833) (2,596) Change in Assets and Liabilities - (Increase)/Decrease in Accounts Receivable (31,948) 5,762 Increase/(Decrease) in Accounts Payable and Accrued Liabilities 6,493 (1,531) Decrease in Income Taxes Payable (79) (974) Decrease in Accrued Interest (360) (1,897) Cash Provided by Operating Activities – Continuing Operations 294,743 193,383 Cash Provided by Operating Activities – Discontinued Operations 6,690 12,672 Net Cash Provided by Operating Activities 301,433 206,055   Cash Flows From Investing Activities: Additions to Property and Equipment (318,962) (199,373) Proceeds from the Sale of Property and Equipment 113 215 Net Cash Received as Operator of Partnerships and Joint Ventures --- 485 Cash Used in Investing Activities – Continuing Operations (318,849) (198,673) Cash Provided by (Used) in Investing Activities – Discontinued Operations 80,731 (7,536) Net Cash Used in Investing Activities (238,118) (206,209)   Cash Flows From Financing Activities: Proceeds From Long-Term Debt --- 250,000 Payments of Long-Term Debt --- (200,000) Net Payments of Bank Borrowings (62,800) (31,400) Net Proceeds From Issuance of Common Stock 7,313 2,244 Excess Tax Benefits From Stock-Based Awards 1,083 --- Purchase of Treasury Shares (1,387) (955) Payments of Debt Retirement Costs --- (9,376) Payments of Debt Issuance Costs --- (4,201) Cash Provided by (Used) in Financing Activities – Continuing Operations (55,791) 6,312 Cash Provided by Financing Activities – Discontinued Operations --- --- Net Cash Provided by Financing Activities (55,791) 6,312 Net Increase in Cash and Cash Equivalents 7,524 6,158 Cash and Cash Equivalents at the Beginning of the Period 5,623 1,058 Cash and Cash Equivalents at the End of the Period $ 13,147 $ 7,216 SWIFT ENERGY COMPANY OPERATIONAL INFORMATION(1) QUARTERLY COMPARISON -- SEQUENTIAL & YEAR-OVER-YEAR (Unaudited)           Three Months Ended   Three Months Ended June. 31,2008     Mar. 31,2008 Percent Change June 30,2007     Percent Change     Domestic Production :     Oil & Natural Gas Equivalent (MBoe) 2,694 2,570 5 % 2,589 4 % Natural Gas (Bcf) 5.53 5.01 10 % 3.50 58 % Crude Oil (MBbl) 1,482 1,420 4 % 1,872 (21) % NGL (MBbl) 290 316 (8) % 134 116 %   Domestic Average Prices: Combined Oil & Natural Gas ($/Boe) $ 97.70 $ 77.80 26 % $ 60.37 62 % Natural Gas ($/Mcf) $ 10.49 $ 7.97 32 % $ 7.56 39 % Crude Oil ($/Bbl) $ 125.20 $ 99.43 26 % $ 66.20 89 % NGL ($/Bbl) $ 67.73 $ 59.80 13 % $ 44.22 53 % (1) Does not include production and pricing information for our New Zealand activities, which have been included in discontinued operations in our financial statements. SWIFT ENERGY COMPANY THIRD QUARTER AND FULL YEAR 2008 GUIDANCE ESTIMATES       Actual For Second Quarter 2008 Guidance For Third Quarter 2008 Guidance For Full Year 2008   Production Volumes (MMBoe) 2.69 2.66 - 2.81 10.80 - 11.20   Production Mix: Natural Gas (Bcf) 5.53 5.6 - 5.9 22.8 - 23.6 Crude Oil (MMBbl) 1.48 1.42 - 1.51 5.76 - 5.97 Natural Gas Liquids (MMBbl) 0.29 0.30 - 0.32 1.24 - 1.28 Product Pricing (Note 1): Natural Gas (per Mcf) NYMEX Differential (Note 2) $ (0.44) ($0.60) - ($1.00) ($0.50) - ($1.25) Crude Oil (per Bbl) NYMEX differential (Note 3) $ 1.40 ($1.25) - ($2.25) ($1.00) - ($3.00) NGL (per Bbl) Percent of NYMEX Crude 55 % 50% - 65% 50% - 65% Oil & Gas Production Costs: Lease Operating Costs (per Boe) $ 10.61 $9.15 - $10.00 $9.70 - $10.20 Severance & Ad Valorem Taxes (as % of Revenue dollars) 10.2 % 10.7% - 11.0% 10.5% - 10.6% Other Costs: G&A per Boe $ 3.82 $3.90 - $4.25 $3.75 - $4.00 Interest Expense per Boe $ 3.06 $2.50 - $2.70 $2.75 - $2.90 DD&A per Boe $ 21.26 $21.00 - $21.95 $21.00 - $21.75 Supplemental Information: Capital Expenditures Operations $ 133,249 $135,000 - $150,000 $493,500 - $544,500 Acquisition/ Dispositions, net $ --- $0 - ($1,000) ($5,000) - ($10,000) Capitalized G&G (Note 4) $ 7,350 $7,100 - $7,500 $28,000 - $30,500 Capitalized Interest $ 1,960 $2,000 - $2,300 $8,500 - $10,000 Total Capital Expenditures $ 142,560 $144,100 - $158,800 $525,000 - $575,000   Basic Weighted Average Shares 30,608 30,700 - 31,000 30,400 - 30,900 Diluted Computation: Weighted Average Shares 31,341 31,400 - 32,500 30,900 - 32,000   Effective Tax Rate (Note 5) 36.4 % 36.0% - 37.0% 36.0% - 37.0% Deferred Tax Percentage 96.0 % 85% - 95% 80% - 90% Note 1:   Swift Energy now maintains all its current price risk management instruments (hedge positions) on its Hedge Activity page on the Swift Energy website (www.swiftenergy.com). Note 2: Average of monthly closing Henry Hub NYMEX futures price for the respective contract months, included in the period, which best benchmarks the 30-day price received for domestic natural gas sales. Note 3: Average of daily WTI NYMEX futures price during the calendar period reflected which best benchmarks the daily price received for the majority of crude oil sales. Note 4: Does not include capitalized acquisition costs, incorporated in acquisitions when occurred. Note 5: Effective Tax rate guidance is based off of NYMEX strip pricing This press release includes "forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The opinions, forecasts, projections, guidance or other statements other than statements of historical fact, are forward-looking statements. These statements are based upon assumptions that are subject to change and to risks, especially the uncertainty of finding, replacing, developing or acquiring reserves, availability of labor, services and supplies, hurricanes or tropical storms disrupting operations, and volatility in oil or gas prices. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Certain risks and uncertainties inherent in the Company’s business are set forth in the filings of the Company with the Securities and Exchange Commission. Estimates of future financial or operating performance provided by the Company are based on existing market conditions and engineering and geologic information available at this time. Actual financial and operating performance may be higher or lower. Future performance is dependent upon oil and gas prices, exploratory and development drilling results, engineering and geologic information and changes in market conditions.