Buffalo Bills and Sabres co-owner Terry Pegula told reporters Tuesday that he is not facing a "negative financial situation" in light of potential upcoming extensions for Bills head coach Sean McDermott and general manager Brandon Beane.
"There is no financial situation," Terry Pegula said in a video conference alongside wife and co-owner Kim Pegula, per Matt Parrino of syracuse.com. "I don't know where that rumor started. If you look at every oil and gas company, which is our core business outside sports, they're all—you might use the word—hurting. But we don't have any debt on our oil and gas business."
The question came amid an April 20 report from Tim Graham of The Athletic, which said the following:
"Natural gas closed Friday at $1.76 per unit, up 23 cents compared to just two weeks earlier. The increase, nevertheless, leaves the Pegulas far behind where they were when they began amassing their [Pegula Sports and Entertainment] portfolio.
"Natural gas sold for $4.21 per unit the day he bought the Sabres and for $3.89 the morning the NFL unanimously approved Terry and Kim as the next Bills owners. They funded their Bills acquisition by selling off $1.7 billion in oil-drilling acreage.
"The Pegulas can't go to that well now."
Graham also cited a source who said that the Sabres "have been losing between $40 million and $60 million the past few seasons."
Beane and McDermott are signed with the team through 2021, per Parrino. They have guided the Bills to playoff appearances in two of the past three years after the team failed to make the postseason from 2000-2016.
McDermott and Beane appear to be building a team that could be successful for years to come.
The Bills are in the driver's seat to potentially win the AFC East for the first time since 1995 after a 10-6 season that resulted in a wild-card berth. They have a young core featuring quarterback Josh Allen, linebackers Tremaine Edmunds and Matt Milano and a new wideout in Stefon Diggs.
But there has been some reported concern from McDermott about what was described to Graham as a "toxic culture" within Pegula Sports and Entertainment.
"Two sources close to Bills head coach Sean McDermott say the January meetings left him concerned about low morale eroding the culture he and general manager Brandon Beane have cultivated over the past three years with a meticulous, holistic attitude," Graham wrote.
The Sabres are one PSE property that hasn't fared well in recent years, both on and off the ice. The team hasn't made the playoffs since 2010-11 in addition to losing tens of millions of dollars in recent years.
The firing of general manager Jason Botterill was also announced, and Terry Pegula mentioned the need to get "leaner" in a discussion of that move, per Matthew Fairburn of The Athletic:
"I mentioned three words: effective, efficient and economic. I'm the last guy to know anything about technology. I can't even mute this thing (Zoom) we're talking on here. But I can tell you this, with all the existing technology that exists in the world of sports today, we can move forward much leaner than we operated in the past and much more efficient. We have all the tools to look at and fine tune over and over, slow it down in slow motion, back it up, look at it again of a player and what he does in a split second. You're right, we're going to get leaner. It's just the way the world is heading. Any business today, you look at the things they do. They're more efficient. They do things quicker. They use this technology that we all have at our finger tips."
Kim Pegula added these remarks: "There's been a lot of things going on in this world right now. We're not the only club having to take some deep looks about how we move forward. That's really what this was all about."
For his part, McDermott said that any concerns he's had have been addressed directly with the Pegulas and that he's "encouraged by where things are going" overall.
"And I'm focused on the Bills and I'm focused on leading a football team and an organization along with Brandon Beane to the best of my ability, and I'm excited about the future, I really am," McDermott added.
Retaining Beane and McDermott may not come cheap, especially if they continue their success in 2020. Of note, ESPN's Adam Schefter reported that the Carolina Panthers gave Matt Rhule, who will begin his first NFL head-coaching stint this year, a seven-year deal worth up to $70 million.
Given the work McDermott and Beane have done, they're likely in line for big paydays. For now, they're focused on returning the Bills to the playoffs, beginning on Sunday, Sept. 13 when they host the New York Jets.