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Southwestern Energy Management Discusses Q2 2012 Results - Earnings Call Transcript

Also, I'd like to point out that many of the comments during this teleconference are forward-looking statements that involve risks and uncertainties affecting outcomes, many of which are beyond our control and are discussed in more detail in the risk factors and the forward-looking statement section of our annual and quarterly filings with the Securities and Exchange Commission. Although we believe that expectations expressed are based on reasonable assumptions, they are not guarantees of future performance, and actual results or developments may differ materially.

Now let's begin. Bill and Greg will talk about SWN second quarter performance and will compare several important numbers. I want to take just 1 minute and talk about the one number that was foremost in our minds during the quarter. The average second quarter NYMEX price of $2.22 per Mcf. That is 26% reduction from the year end 2011 price. The swift and rapid decrease in gas price has caused the 49% year-over-year decrease in total industry rigs drilling for gas in United States. SWN has also rapidly adjusting to the price changes, but rather than retrenching like the rig count, our emphasis on Value+ allowed us to continue our strong progress in every investment area in the second quarter. As we mentioned last quarter, investing in the best wells in the Fayetteville Shale has increased the initial rates and more importantly, the quality of the completed wells.

In addition, we continue to decrease days to drill below our recent year end 2011 estimates. The Marcellus production is ramping up and we're encouraged by what we're seeing in our New Ventures projects. Record production, faster times and lower costs are products of the culture of this focus on Value+.

I will now turn the call over to Bill for more details on the results of that focus in the second quarter.

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