TEXT-S&P revises Swift Energy recovery rating to '4' from '3'
Nov 16 - Standard & Poor's Ratings Services said today that it revised its recovery rating on Houston-based Swift Energy Co.'s senior unsecured debt to '4', indicating our expectation of average (30% to 50%) recovery in the event of a payment default, from '3'. The issue-level rating on Swift's unsecured debt remains 'B+' (same as the corporate credit rating). The lower recovery expectation reflects the company's increased borrowing base and commitment amounts, which were raised in October 2012 to $450 million and $450 million, respectively, from $375 million and $300 million. The recovery analysis also incorporates an updated PV10 valuation of proved reserves based on our revised recovery price deck assumptions of $50 per barrel (bbl) for West Texas Intermediate crude oil and $3.50 per million British thermal unit (mmBtu) for Henry Hub natural gas (previously $45/bbl and $4/mmBtu, respectively). The 'B+' corporate credit rating and stable outlook on Swift incorporate the company's small and geographically concentrated reserve base with a high proportion of proved undeveloped reserves (65%), along with above-average finding and development costs. Our ratings also reflect Swift's balanced production mix between natural gas and oil/natural gas liquids, long proved reserve life, and moderate debt leverage for the rating category. RELATED RESEARCH AND CRITERIA -- Revised Assumptions For Assigning Recovery Ratings To The Debt Of Oil And Gas Exploration And Production Companies, Sept. 14, 2012 -- Recovery Price Deck For Exploration And Production Companies Revised, Sept. 14, 2012 Temporary telephone contact information: Carin Dehne-Kiley (917) 496-8208; Vishal Merani (347) 844-2274 RATINGS LIST Swift Energy Co. Corporate credit rating B+/Stable/-- Recovery Rating Revised To From Senior unsecured debt B+ B+ Recovery rating 4 3 Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.