8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): November 9, 2007

SOUTHWESTERN ENERGY COMPANY

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of incorporation)

1-08246	71-0205415
(Commission File Number)	(IRS Employer Identification No.)

2350 N. Sam Houston Pkwy. E., Suite 125, Houston, Texas	77032
(Address of principal executive offices)	(Zip Code)

(281) 618-4700

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

       o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 1 - Registrant's Business and Operations

Item 1.01 Entry into a Material Definitive Agreement.

On November 9, 2007, Southwestern Energy Company (“Southwestern”) and SourceGas LLC (“SourceGas”), entered into a definitive Stock Sale and Purchase Agreement (the “Stock Purchase Agreement”) pursuant to which SourceGas will purchase Southwestern’s wholly-owned subsidiary, Arkansas Western Gas Company (“AWG”) for $224 million in cash (the “Purchase Price”) plus working capital, subject to possible adjustment as described below.

The transaction has been approved by the respective boards of directors of Southwestern and SourceGas, and is expected to close in the middle of 2008.  Closing is subject to regulatory approval, including the expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the satisfaction of other customary closing conditions.  

The Purchase Price is subject to possible adjustment based on (i) a “seasonality factor” that could reduce the Purchase Price by up to 2.5% depending upon when the transaction closes and (ii) changes in “Net Working Capital”, which is to be calculated in accordance with the methods and assumptions set forth in the Stock Purchase Agreement.  If Net Working Capital is a positive amount, SourceGas is obligated under the Stock Purchase Agreement to pay that amount as an adjustment to the Purchase Price.  If Net Working Capital is a negative amount, the Purchase Price will be reduced by that amount.

Southwestern and SourceGas each have made customary representations, warranties and covenants in the Stock Purchase Agreement.  These include, among others, a covenant by Southwestern to conduct AWG’s business in the ordinary course until closing; covenants by the parties to enter into certain ancillary agreements as of closing; Southwestern’s and SourceGas’ agreement to adhere to certain non-solicitation obligations with respect to the Company and the other’s employees; and customary indemnification obligations subject to customary limitations.  

The foregoing description of the material terms and conditions of the Stock Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Stock Purchase Agreement, which will be included in a subsequent filing with the Securities and Exchange Commission.

Section 8 - Other Events

Item 8.01  Other Events.

On November 14, 2007, Southwestern issued a press release announcing its entry into the Stock Purchase Agreement referred to in Item 1.01 above. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Section 9 - Financial Statements and Exhibits

Item 9.01  Financial Statements and Exhibits.

(d) Exhibits.

Exhibits.  The following exhibit is being furnished as part of this Report.

Exhibit Number	Description
99.1	Press release issued by Southwestern Energy Company on November 14, 2007.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	SOUTHWESTERN ENERGY COMPANY
Dated: November 14, 2007	By:	/s/ GREG D. KERLEY
	Name:	Greg D. Kerley
	Title:	Executive Vice President and
		Chief Financial Officer

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press release issued by Southwestern Energy Company on November 14, 2007.

EX-99

2350 N. Sam Houston Parkway East Suite 125 Houston, Texas  77032 (281) 618-4700     Fax: (281) 618-4820

NEWS RELEASE

SOUTHWESTERN ENERGY ANNOUNCES AGREEMENT

TO SELL GAS UTILITY OPERATIONS

Houston, Texas – November 14, 2007…Southwestern Energy Company (NYSE: SWN) announced today that it has signed a Stock Sale and Purchase Agreement for the sale of all capital stock of its natural gas distribution business, Arkansas Western Gas Company, to SourceGas LLC, an affiliate of GE Energy Financial Services and Alinda Investments LLC for $224 million plus working capital. The transaction is subject to certain closing conditions and regulatory approvals and is expected to close by mid-year 2008.

Arkansas Western Gas Company serves approximately 151,000 residential, commercial, and industrial customers in northern Arkansas. It owns more than 5,700 miles of gathering, distribution and transmission pipelines, an underground storage facility and related gas distribution assets and has approximately 375 employees.

“We believe that this is the right direction for Southwestern Energy and its shareholders,” stated Harold M. Korell, President and Chief Executive Officer of Southwestern Energy. “We have provided the communities of northern Arkansas with clean and safe natural gas since 1929. We are leaving this legacy business in very capable hands and our customers should expect to receive the same quality service that they have experienced over the past 78 years.”

“In line with our strategy to expand existing operations and grow through acquisitions, this purchase is the first significant expansion of our service footprint and an important step to providing SourceGas quality to more consumers,” said Dan Watson, President and CEO of SourceGas.  “We expect the acquisition and ensuing transition to be seamless to customers, who will continue to receive great service from the experienced team of employees serving them today with the added benefits of being part of the SourceGas system.”

SourceGas, Inc. is a natural gas local distribution company headquartered in Lakewood, Colorado with operations in Colorado, Nebraska, Wyoming, and Hermosillo, Mexico. It serves more than 266,000 customers and operates 12,000 miles of distribution and transmission pipelines, as well as storage facilities. GE Energy Financial Services and Alinda Investments LLC each are 50 percent owners of SourceGas. With $16 billion in assets, GE Energy Financial Services invests more than $5 billion annually in two of the world’s most capital-intensive industries, energy and water. Alinda Investments LLC is an affiliate of Alinda Capital Partners LLC; Alinda Infrastructure Fund (“Alinda”) is a leading independent infrastructure fund with $3 billion of capital commitments. Alinda invests in

- MORE -

infrastructure assets, which provide essential services to communities, governments and businesses. 

Southwestern Energy Company is an integrated company whose wholly-owned subsidiaries are engaged in oil and gas exploration and production, and natural gas gathering and marketing. Additional information on the company can be found on the Internet at http://www.swn.com.

Contacts:	Greg D. Kerley	Brad D. Sylvester, CFA
	Executive Vice President	Manager, Investor Relations
	and Chief Financial Officer	(281) 618-4897
	(281) 618-4803