UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
December 19, 2011
Date of report (Date of earliest event reported)
STONE ENERGY CORPORATION
(Exact Name of Registrant as Specified in Charter)
| Delaware | 1-12074 | 72-1235413 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) | ||
| 625 E. Kaliste Saloom Road Lafayette, Louisiana |
70508 | |||
| (Address of Principal Executive Offices) | (Zip Code) | |||
Registrant’s telephone number, including area code: (337) 237-0410
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:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e 4(c)) |
| Item 7.01. | Regulation FD Disclosure. |
On December 19, 2011, we issued a press release announcing an update for our Appalachian operations. The press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 7.01.
In accordance with General Instruction B.2 of Form 8-K, the information in this report, including Exhibit 99.1, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (“Exchange Act”) or otherwise subject to the liabilities of that section, nor shall such information, including Exhibit 99.1, be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits:
| 99.1 | Press release dated December 19, 2011, “Stone Energy Corporation Announces Appalachian Operational Update.” | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, Stone Energy Corporation has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| STONE ENERGY CORPORATION | ||||||
| Date: December 20, 2011 | By: | /s/ J. Kent Pierret | ||||
| J. Kent Pierret | ||||||
| Senior Vice President, | ||||||
| Chief Accounting Officer and Treasurer | ||||||
EXHIBIT INDEX
| Exhibit |
Description | |
| 99.1 | Press release dated December 19, 2011, “Stone Energy Corporation Announces Appalachian Operational Update.” | |
Exhibit 99.1
STONE ENERGY CORPORATION
Announces Appalachian Operational Update
LAFAYETTE, LA. December 19, 2011
Stone Energy Corporation (NYSE: SGY) announced today that 11 wells in its Mary field in Wetzel County, West Virginia have all flow tested into the Caiman pipeline at rates ranging from 3 to 5 million cubic feet (MMcf) of gas per day. The wells also had an initial condensate production rate ranging from 70 barrels to in excess of 100 barrels of condensate per MMcf of gas produced, which Stone expects will significantly enhance the economics of the field. In addition, the initial natural gas liquids (NGL) volumes from the wet gas stream were estimated to be over 40 barrels per MMcf of gas produced, which Stone believes will further enhance the value of the gas stream. Due to the higher than expected volume of condensate and NGLs, the pipeline facilities will require additional equipment to allow all 11 wells to flow continuously into the pipeline. Accordingly, production from the field has been intermittent over the past several weeks as pipeline solutions are reviewed.
There are another 13 wells in the Mary field that have been drilled, but not completed, which are expected to be fractured and produced during 2012. Outside of the Mary field, Marcellus production from Stone’s other Appalachian fields remains at approximately 15 MMcf per day.
Stone added approximately 10,000 net acres to its West Virginia leasehold position during the second half of 2011, including the acquisition of over 6,700 net acres from a single entity. The remainder has been bolt-on acreage to enhance the current land position in the area. This brings the total Appalachian leasehold position for Stone up to approximately 90,000 net acres, with over 26,000 net acres in the condensate-rich Mary field.
Due to efficiencies gained during the year, Stone now expects to drill 27 horizontal wells in 2011 using one horizontal rig and one smaller vertical rig. Stone has recently extended its bundled service arrangement with Schlumberger for the Appalachian and Gulf of Mexico regions, which will satisfy the expected fracturing requirements for 2012. Separately, Stone entered into a Joint Operating Agreement with Magnum Hunter Resources encompassing 1,925 acres in the Heather field in Wetzel County to provide for more efficient development of the area. Stone will serve as operator in this 50%/50% arrangement, with volumes from this development expected to flow into the Eureka Hunter pipeline.
Stone Energy is an independent oil and natural gas exploration and production company headquartered in Lafayette, Louisiana with additional offices in New Orleans, Houston and Morgantown, West Virginia. Our business strategy is to leverage cash flow generated from existing assets to maintain relatively stable GOM shelf production, profitably grow gas reserves and production in price-advantaged basins such as Appalachia and the Gulf Coast Basin, and profitably grow oil reserves and production in material impact areas such as the deep water GOM and the Rocky Mountain region. For additional information, contact Kenneth H. Beer, Chief Financial Officer, at 337-521-2210 phone, 337-521-9880 fax or via e-mail at CFO@StoneEnergy.com.
Forward Looking Statements
Certain statements in this press release are forward-looking and are based upon Stone’s current belief as to the outcome and timing of future events. All statements, other than statements of historical facts, that address activities that Stone plans, expects, believes, projects, estimates or anticipates will, should or may occur in the future, including future production of oil and gas, future capital expenditures and drilling of wells and future financial or operating results are forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include the timing and extent of changes in commodity prices for oil and gas, operating risks, liquidity risks, political and regulatory developments and legislation, including developments and legislation relating to our operations in the Gulf of Mexico and Appalachia, and other risk factors and known trends and uncertainties as described in Stone’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q as filed with the SEC. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, Stone’s actual results and plans could differ materially from those expressed in the forward-looking statements.