10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2013

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                  to                 

Commission File Number: 1-12074

STONE ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	72-1235413
(State or other jurisdiction of incorporation or organization)	(I.R.S. 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

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, Par Value $.01 Per Share	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities

Act.     x  Yes    ¨  No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the

Act.     ¨  Yes    x  No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    x  Yes    ¨  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    x  Yes    ¨  No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  x

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨  (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    ¨  Yes    x  No

The aggregate market value of the voting stock held by non-affiliates of the registrant was approximately $961.6 million as of June 30, 2013 (based on the last reported sale price of such stock on the New York Stock Exchange Composite Tape on that day).

As of February 25, 2014, the registrant had outstanding 49,790,620 shares of Common Stock, par value $.01 per share.

Documents incorporated by reference: Portions of the Definitive Proxy Statement of Stone Energy Corporation relating to the Annual Meeting of Stockholders to be held on May 22, 2014 are incorporated by reference into Part III of this Form 10-K.

TABLE OF CONTENTS

		Page No.
PART I
Item 1.	Business		3
Item 1A.	Risk Factors		10
Item 1B.	Unresolved Staff Comments		20
Item 2.	Properties		20
Item 3.	Legal Proceedings		25
Item 4.	Mine Safety Disclosures		25
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities		26
Item 6.	Selected Financial Data		29
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		30
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk		39
Item 8.	Financial Statements and Supplementary Data		40
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure		41
Item 9A.	Controls and Procedures		41
Item 9B.	Other Information		43
PART III
Item 10.	Directors, Executive Officers and Corporate Governance		43
Item 11.	Executive Compensation		44
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters		44
Item 13.	Certain Relationships and Related Transactions, and Director Independence		44
Item 14.	Principal Accountant Fees and Services		44
PART IV
Item 15.	Exhibits and Financial Statement Schedules		45
	Index to Financial Statements		F-1
	Glossary of Certain Industry Terms		G-1

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PART I

This section highlights information that is discussed in more detail in the remainder of the document. Throughout this document, we make statements that are classified as “forward-looking.” Please refer to the “Forward-Looking Statements” section of this document for an explanation of these types of statements. We use the terms “Stone,” “Stone Energy,” “company,” “we,” “us” and “our” to refer to Stone Energy Corporation and its consolidated subsidiaries. Certain terms relating to the oil and gas industry are defined in “Glossary of Certain Industry Terms,” which begins on page G-1 of this Form 10-K.

ITEM 1. BUSINESS

The Company

Stone Energy is an independent oil and natural gas company engaged in the acquisition, exploration, exploitation, development and operation of oil and gas properties. We have been operating in the Gulf Coast Basin since our incorporation in 1993 and have established a technical and operational expertise in this area. We have expanded our reserve base outside of the conventional shelf of the Gulf of Mexico (the “GOM”) and into the more prolific reserve basins of the GOM deep water and GOM deep gas, as well as onshore oil and gas shale opportunities, including the Marcellus Shale in Appalachia. As of December 31, 2013, our estimated proved oil and natural gas reserves were approximately 864 Bcfe. We were incorporated in 1993 as a Delaware corporation. Our corporate headquarters are located at 625 E. Kaliste Saloom Road, Lafayette, Louisiana 70508. We have additional offices in New Orleans, Louisiana, Houston, Texas and Morgantown, West Virginia.

Operational Overview

Gulf of Mexico — Deep Water. We believe that the deep water of the GOM is an attractive area to explore and operate with high potential exploration opportunities, even though it involves high risk, high costs and substantial lead time to develop infrastructure. Since 2006, we have made two significant acquisitions that included two deep water platforms, producing reserves and numerous leases. We have also utilized subsea tie-backs in the deep water on new drill wells that require less capital than a deep water facility. We have made a significant investment in seismic data and leasehold interests and have assembled a technical team with prior geological, geophysical and engineering experience in the deep water arena to evaluate potential exploration, development and acquisition opportunities. Our deep water properties accounted for approximately 29% of our estimated proved oil and natural gas reserves at December 31, 2013 on a volume equivalent basis.

Appalachia. The Marcellus Shale play provides us with fairly predictable and repeatable results as there is minimal exploration risk. During 2006, we began securing leasehold interests in the Appalachia regions of Pennsylvania and West Virginia and as of December 31, 2013, we had leasehold interests in approximately 94,000 net acres. During 2013, we drilled a total of 30 horizontal Marcellus Shale wells and had 103 wells on production at year end 2013. We expect to add leasehold interests and drill additional wells to further expand our interests in Appalachia, including evaluating the Utica and Upper Devonian formations. Our Appalachian properties accounted for approximately 55% of our estimated proved oil and natural gas reserves at December 31, 2013 on a volume equivalent basis.

Gulf of Mexico — Deep Gas. The deep gas play provides us with high potential exploration opportunities with existing infrastructure nearby, which shortens the lead time to production. We have made two onshore south Louisiana deep gas discoveries and a GOM shelf deep gas discovery. Additionally, we have identified other deep gas opportunities in south Louisiana and the GOM shelf, which are defined as prospects below 15,000 feet. Our deep gas properties accounted for approximately 3% of our estimated proved oil and natural gas reserves at December 31, 2013 on a volume equivalent basis.

Gulf of Mexico — Conventional Shelf. We seek to generate cash flows from existing reserves through workovers and recompletions of existing wells and the application of other techniques designed to add production to help mitigate some of the natural decline of the GOM conventional shelf. Our GOM conventional shelf properties accounted for approximately 13% of our estimated proved oil and natural gas reserves at December 31, 2013 on a volume equivalent basis.

We have engaged a financial advisor to market certain of our properties in the GOM conventional shelf, state waters and onshore Louisiana. The sale of these properties would allow for more focus on our targeted growth areas, specifically the GOM deep water, deep gas and Appalachia. In October 2013, we completed the sale of our interest in the Weeks Island field, representing less than 1% of our total estimated proved reserves at December 31, 2012. Production volumes at the Weeks Island field represented approximately 2% of our total production volumes and 3% of our total production revenue for the year ended December 31, 2013. In January 2014, we completed the sale of our interest in the Cut Off and Clovelly fields, representing less than 1% of our total estimated proved reserves at December 31, 2013. Production volumes at the Cut Off and Clovelly fields

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represented approximately 2% of our total production volumes and 3% of our total production revenue for the year ended December 31, 2013. The remainder of our shelf properties that are subject to sale represented approximately 22% of our total production volumes and 18% of our total production revenue for the year ended December 31, 2013 and 9% of our total estimated proved reserves at December 31, 2013. The future sale of some or all of our shelf properties would be subject to an acceptable offer or offers and other market conditions.

Onshore Oil. We maintain working interests in several undeveloped plays, which totaled approximately 118,000 net acres (including 31,000 undeveloped acres in Canada) as of December 31, 2013. In January 2014, we sold our interest in the Hatch Point field in Utah, representing approximately 35,000 net acres. We have budgeted minimal funds in 2014 for onshore exploration projects and new venture opportunities. Our onshore oil properties accounted for less than 1% of our estimated proved oil and natural gas reserves at December 31, 2013 on a volume equivalent basis.

Oil and Gas Marketing

Our oil and natural gas production is sold at current market prices under short-term contracts. Phillips 66 Company and Shell Trading (US) Company accounted for approximately 35% and 33%, respectively, of our oil and natural gas revenue generated during the year ended December 31, 2013. We do not believe that the loss of any of our major purchasers would result in a material adverse effect on our ability to market future oil and natural gas production. From time to time, we may enter into transactions that hedge the price of oil and natural gas. See Item 7A. Quantitative and Qualitative Disclosures About Market Risk – Commodity Price Risk.

Competition and Markets

Competition in the Gulf Coast Basin, the Appalachia region and other onshore oil plays is intense, particularly with respect to the acquisition of producing properties and undeveloped acreage. We compete with major oil and gas companies and other independent producers of varying sizes, all of which are engaged in the acquisition of properties and the exploration and development of such properties. Many of our competitors have financial resources and exploration and development budgets that are substantially greater than ours, which may adversely affect our ability to compete. See Item 1A. Risk Factors – Competition within our industry may adversely affect our operations.

The availability of a ready market for and the price of any hydrocarbons produced will depend on many factors beyond our control, including, but not limited to, the amount of domestic production and imports of foreign oil and exports of liquefied natural gas, the marketing of competitive fuels, the proximity and capacity of oil and natural gas pipelines, the availability of transportation and other market facilities, the demand for hydrocarbons, the effect of federal and state regulation of allowable rates of production, taxation and the conduct of drilling operations and federal regulation of oil and natural gas. All of these factors, together with economic factors in the marketing arena, generally may affect the supply of and/or demand for oil and natural gas and thus the prices available for sales of oil and natural gas.

Regulation

Our oil and gas operations are subject to various U.S. federal, state and local laws and regulations.

Various aspects of our oil and natural gas operations are regulated by administrative agencies of the states where we conduct operations and by certain agencies of the federal government for operations on federal leases. All of the jurisdictions in which we own or operate producing oil and natural gas properties have statutory provisions regulating the exploration for and production of oil and natural gas, including provisions requiring permits for the drilling of wells and maintaining bonding requirements in order to drill or operate wells, and provisions relating to the location of wells, the method of drilling and casing wells, the surface use and restoration of properties upon which wells are drilled and the abandonment of wells. Our operations are also subject to various conservation laws and regulations. These include the regulation of the size of drilling and spacing units or proration units, the number of wells that may be drilled in an area and the unitization or pooling of oil and natural gas properties. In this regard, some states can order the pooling or integration of tracts to facilitate exploration while other states rely on voluntary pooling of lands and leases. In addition, state conservation laws establish maximum rates of production from oil and natural gas wells, generally prohibit the venting or flaring of natural gas and impose certain requirements regarding the ratability or fair apportionment of production from fields and individual wells.

Certain operations that we conduct are on U.S. federal oil and gas leases, which are administered by the Bureau of Land Management (the “BLM”) and the Bureau of Ocean Energy Management (the “BOEM”). These leases contain relatively standardized terms and require compliance with detailed BLM and BOEM regulations and orders pursuant to various federal laws, including the Outer Continental Shelf Lands Act, which are subject to change by the applicable agency. Many onshore leases

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contain stipulations limiting activities that may be conducted on the lease. Some stipulations are unique to particular geographic areas and may limit the times during which activities on the lease may be conducted or the manner in which certain activities may be conducted or, in some cases, may ban any surface activity. For offshore operations, lessees must obtain BOEM approval for exploration, development and production plans prior to the commencement of such operations. In addition to permits required from other agencies (such as the U.S. Environmental Protection Agency (the “EPA”)), lessees must obtain a permit from the BLM or the BOEM, as applicable, prior to the commencement of drilling, and comply with regulations governing, among other things, engineering and construction specifications for production facilities, safety procedures, plugging and abandonment of wells on the Outer Continental Shelf (the “OCS”) of the GOM, calculation of royalty payments and the valuation of production for this purpose, and removal of facilities. To cover the various obligations of lessees on the OCS, the BOEM generally requires that lessees post substantial bonds or other acceptable assurances that such obligations will be met, unless the BOEM exempts the lessee from such obligations. The cost of such bonds or other surety can be substantial, and we can provide no assurance that we can continue to obtain bonds or other surety in all cases. Under certain circumstances, the BLM or the Bureau of Safety and Environmental Enforcement (the “BSEE”), a federal agency created to enforce compliance with safety and environmental rules of the OCS, as applicable, may require our operations on federal leases to be suspended or terminated. Any such suspension or termination could materially and adversely affect our financial condition and operations.

Natural Gas. In 2005, the United States Congress enacted the Energy Policy Act of 2005 (“EPAct 2005”). Among other matters, EPAct 2005 amends the Natural Gas Act (the “NGA”) to make it unlawful for “any entity”, including otherwise non-jurisdictional producers such as Stone Energy, to use any deceptive or manipulative device or contrivance in connection with the purchase or sale of natural gas or the purchase or sale of transportation services subject to regulation by the Federal Energy Regulatory Commission (the “FERC”), in contravention of rules prescribed by the FERC. In 2006, the FERC issued rules implementing this provision. The rules make it unlawful in connection with the purchase or sale of natural gas subject to the jurisdiction of the FERC, or the purchase or sale of transportation services subject to the jurisdiction of the FERC, for any entity, directly or indirectly, to use or employ any device, scheme or artifice to defraud, to make any untrue statement of material fact or omit to make any such statement necessary to make the statements made not misleading or to engage in any act or practice that operates as a fraud or deceit upon any person. EPAct 2005 also gives the FERC authority to impose civil penalties for violations of the NGA up to $1 million per day per violation. The anti-manipulation rule does not apply to activities that relate only to intrastate or other non-jurisdictional sales or gathering but does apply to activities of otherwise non-jurisdictional entities to the extent the activities are conducted “in connection with” gas sales, purchases or transportation subject to FERC jurisdiction. It therefore reflects a significant expansion of the FERC’s enforcement authority. The U.S. Commodity Futures Trading Commission (the “CFTC”) has similar authority with respect to energy futures commodity markets. Stone Energy does not anticipate it will be affected any differently by these requirements than other producers of natural gas.

In 2007, the FERC issued Order No. 704 requiring that any market participant, including a producer such as Stone Energy, that engages in sales for resale or purchases for resale of natural gas that equal or exceed 2.2 million MMBtus during a calendar year to annually report such sales or purchases to the FERC, beginning on May 1, 2009. These rules are intended to increase the transparency of the wholesale natural gas markets and to assist the FERC in monitoring such markets and in detecting market manipulation. The monitoring and reporting required by these rules have increased our administrative costs. Stone Energy does not anticipate it will be affected any differently by these requirements than other producers of natural gas.

Our sales of natural gas are affected by the availability, terms and cost of transportation. The price and terms for access to pipeline transportation are subject to extensive regulation. The FERC has undertaken various initiatives to increase competition within the natural gas industry. As a result of initiatives such as FERC Order No. 636, issued in April 1992, the interstate natural gas transportation and marketing system has been substantially restructured to remove various barriers and practices that historically limited non-pipeline natural gas sellers, including producers, from effectively competing with interstate pipelines for sales to local distribution companies and large industrial and commercial customers. The most significant provisions of FERC Order No. 636 require that interstate pipelines provide firm and interruptible transportation service on an open access basis that is equal for all natural gas supplies. In many instances, the results of FERC Order No. 636 and related initiatives have been to substantially reduce or eliminate the interstate pipelines’ traditional role as wholesalers of natural gas in favor of providing only storage and transportation services. Similarly, the natural gas pipeline industry is also subject to state regulations, which may change from time to time in ways that affect the availability, terms and cost of transportation. However, we do not believe that any such changes would affect our business in a way that would be materially different from the way such changes would affect our competitors.

Oil. Effective November 4, 2009, pursuant to the Energy Independence and Security Act of 2007, the Federal Trade Commission (the “FTC”) issued a rule prohibiting market manipulation in the petroleum industry. The FTC rule prohibits any person, directly or indirectly, in connection with the purchase or sale of crude oil, gasoline or petroleum distillates at wholesale, from knowingly engaging in any act, practice or course of business, including the making of any untrue statement of material fact, that operates or would operate as a fraud or deceit upon any person or intentionally failing to state a material fact that under the circumstances renders a statement made by such person misleading, provided that such omission distorts or is likely to distort market conditions for any such product. A violation of this rule may result in civil penalties of up to $1 million per day per violation, in addition to any applicable penalty under the FTC Act.

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Our sales of crude oil, condensate and natural gas liquids (“NGLs”) are not currently regulated and are transacted at market prices. In a number of instances, however, the ability to transport and sell such products is dependent on pipelines whose rates, terms and conditions of service are subject to FERC jurisdiction under the Interstate Commerce Act. The price we receive from the sale of oil and NGLs is affected by the cost of transporting those products to market. Interstate transportation rates for oil, NGLs and other products are regulated by the FERC. The FERC has established an indexing system for such transportation, which allows such pipelines to take an annual inflation-based rate increase.

In other instances, the ability to transport and sell such products is dependent on pipelines whose rates, terms and conditions of service are subject to regulation by state regulatory bodies under state statutes. As it relates to intrastate crude oil, condensate and NGL pipelines, state regulation is generally less rigorous than the federal regulation of interstate pipelines. State agencies have generally not investigated or challenged existing or proposed rates in the absence of shipper complaints or protests, which are infrequent and are usually resolved informally.

We do not believe that the regulatory decisions or activities relating to interstate or intrastate crude oil, condensate and NGL pipelines will affect us in a way that materially differs from the way it affects other crude oil, condensate and NGL producers or marketers.

Miscellaneous. Additional proposals and proceedings that might affect the oil and gas industry are regularly considered by the United States Congress, state regulatory bodies, the BOEM, the BSEE, the FERC and other federal regulatory bodies and the courts. We cannot predict when or whether any such proposals may become effective. In the past, the oil and natural gas industry has been heavily regulated. We can give no assurance that the regulatory approach currently pursued by the BOEM, the BSEE, the FERC or any other state or federal agency will continue indefinitely. We do not anticipate, however, that compliance with existing federal, state and local laws, rules and regulations will have a material or significantly adverse effect on our financial condition, results of operations or competitive position.

Environmental Regulation

As a lessee and operator of onshore and offshore oil and gas properties in the United States, we are subject to stringent federal, state and local laws and regulations relating to environmental protection, as well as controlling the manner in which various substances, including wastes generated in connection with oil and gas industry operations, are released into the environment. Compliance with these laws and regulations may require us to obtain permits authorizing air emissions and wastewater discharge from operations and can affect the location or size of wells and facilities, limit or prohibit the extent to which exploration and development may be allowed, and require proper closure of wells and restoration of properties that are being abandoned. Failure to comply with these laws and regulations may result in the assessment of administrative, civil or criminal penalties, imposition of remedial obligations, incurrence of capital costs to comply with governmental standards, and even injunctions that limit or prohibit exploration and production operations or the disposal of substances generated in connection with oil and gas industry operation. The following is a summary of some of the existing laws, rules and regulations to which our business is subject.

Waste handling. The Resource Conservation and Recovery Act (the “RCRA”) and comparable state statutes, regulate the generation, transportation, treatment, storage, disposal and cleanup of hazardous and non-hazardous wastes. Pursuant to regulatory guidance issued by the federal EPA, the individual states administer some or all of the provisions of RCRA, sometimes in conjunction with their own, more stringent requirements. Drilling fluids, produced waters, and most of the other wastes associated with the exploration, development, and production of oil or natural gas are currently regulated under RCRA’s non-hazardous waste provisions. However, it is possible that certain oil and natural gas exploration and production wastes now classified as non-hazardous could be classified as hazardous wastes in the future. Any such change could result in an increase in our costs to manage and dispose of wastes, which could have a material adverse effect on our results of operations and financial position.

Comprehensive Environmental Response, Compensation and Liability Act. The Comprehensive Environmental Response, Compensation and Liability Act (the “CERCLA”), also known as the Superfund law, imposes joint and several liability, without regard to fault or legality of conduct, on classes of persons who are considered to be responsible for the release of a hazardous substance into the environment. These persons include the owner or operator of the site where the release occurred, and anyone who disposed or arranged for the disposal of a hazardous substance released at the site. Under CERCLA, such persons may be subject to joint and several liability for the costs of cleaning up the hazardous substances that have been released into the environment, for damages to natural resources and for the costs of certain health studies. In addition, it is not uncommon for neighboring landowners and other third-parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment.

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We currently operate or lease, and have in the past operated or leased, a number of properties that for many years have been used for the exploration and production of oil and gas. Although we have utilized operating and disposal practices that were standard in the industry at the time, hydrocarbons or wastes may have been disposed of or released on or under the properties operated or leased by us or on or under other locations where such substances have been taken for recycling or disposal. In addition, many of these properties have been operated by third parties whose treatment and disposal or release of hydrocarbons or wastes was not under our control. These properties and the hydrocarbons and wastes disposed thereon may be subject to laws and regulations imposing strict, joint and several liability, without regard to fault or the legality of the original conduct, that could require us to remove or remediate previously disposed wastes or environmental contamination, or to perform remedial plugging or pit closure to prevent future contamination.

Oil Pollution Act. The Oil Pollution Act of 1990 (the “OPA”) and regulations adopted pursuant thereto impose a variety of requirements related to the prevention of and response to oil spills into waters of the United States, including the OCS. The OPA subjects owners of oil handling facilities to strict, joint and several liability for all containment and cleanup costs and certain other damages arising from a spill, including, but not limited to, the costs of responding to a release of oil to surface waters and natural resource damages. Although defenses exist to the liability imposed by the OPA, they are limited. The OPA also requires owners and operators of offshore oil production facilities to establish and maintain evidence of financial responsibility to cover costs that could be incurred in responding to an oil spill. The OPA currently requires a minimum financial responsibility demonstration of $35 million for companies operating on the OCS, although the Secretary of the Interior may increase this amount up to $150 million in certain situations. We cannot predict at this time whether the OPA will be amended or whether the level of financial responsibility required for companies operating on the OCS will be increased. In any event, if an oil discharge or substantial threat of discharge were to occur, we could be liable for costs and damages, which costs and damages could be material to our results of operations and financial position.

Climate Change. In December 2009, the EPA determined that emissions of carbon dioxide, methane and other “greenhouse gases” present an endangerment to public health and the environment because emissions of such gases are, according to the EPA, contributing to warming of the Earth’s atmosphere and other climatic changes. Based on these findings, the EPA began adopting and implementing regulations to restrict emissions of greenhouse gases under existing provisions of the Clean Air Act (the “CAA”). The EPA adopted two sets of rules regulating greenhouse gas emissions under the CAA, one of which requires a reduction in emissions of greenhouse gases from motor vehicles and the other of which regulates emissions of greenhouse gases from certain large stationary sources, effective as of January 2, 2011. The EPA has also adopted rules requiring the reporting of greenhouse gas emissions from specified large greenhouse gas emission sources in the United States, on an annual basis, beginning in 2011 for emissions occurring in 2010, as well as certain onshore oil and natural gas production facilities, on an annual basis, beginning in 2012 for emissions occurring in 2011. We believe that we are in compliance with all greenhouse gas emissions reporting requirements applicable to our operations.

In addition, the United States Congress has from time to time considered adopting legislation to reduce emissions of greenhouse gases, and almost one-half of the states have already taken legal measures to reduce emissions of greenhouse gases primarily through the planned development of greenhouse gas emission inventories and/or regional greenhouse gas cap and trade programs. Most of these cap and trade programs work by requiring major sources of emissions, such as electric power plants, or major producers of fuels, such as refineries and gas processing plants, to acquire and surrender emission allowances. The number of allowances available for purchase is reduced each year in an effort to achieve the overall greenhouse gas emission reduction goal.

The adoption of legislation or regulatory programs to reduce emissions of greenhouse gases could require us to incur increased operating costs, such as costs to purchase and operate emissions control systems, to acquire emissions allowances or to comply with new regulatory or reporting requirements. Any such legislation or regulatory programs could also increase the cost of consuming, and thereby reduce demand for, the oil and natural gas we produce. Consequently, legislation and regulatory programs to reduce emissions of greenhouse gases could have an adverse effect on our business, financial condition and results of operations. Finally, it should be noted that some scientists have concluded that increasing concentrations of greenhouse gases in the Earth’s atmosphere may produce climate changes that have significant physical effects, such as increased frequency and severity of storms, droughts, floods and other climatic events. If any such climate changes were to occur, they could have an adverse effect on our financial condition and results of operations.

Hydraulic fracturing. Hydraulic fracturing is an important and common practice that is used to stimulate production of hydrocarbons, particularly natural gas, from tight formations. The process involves the injection of water, sand and chemicals under pressure into the formation to fracture the surrounding rock and stimulate production. We routinely use hydraulic fracturing in our onshore operations. The process is typically regulated by state oil and gas commissions. However, the EPA recently asserted federal regulatory authority over hydraulic fracturing involving diesel additives under the Safe Drinking Water Act’s (“SDWA”) Underground Injection Control Program. Also, the BLM released proposed rules regarding well stimulation and

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hydraulic fracturing activities in May 2013 that would require the disclosure of chemicals used during the fracturing process and addresses drilling plans, water management, and wastewater disposal on federal and tribal lands. The BLM expects to issue a final rule mid-2014. The EPA has also commenced a study of the potential environmental impacts of hydraulic fracturing activities on water resources. The EPA has indicated that it expects to issue its study report in late 2014. In addition, a number of other federal agencies, including the U.S. Department of Energy, the U.S. Department of the Interior, and the White House Council on Environmental Quality, are studying various aspects of hydraulic fracturing. In addition, from time to time legislation has been introduced before the United States Congress to provide for federal regulation of hydraulic fracturing and to require disclosure of the chemicals used in the fracturing process; although no actions have been taken to date. Some states have adopted, and other states are considering adopting, regulations that could impose more stringent permitting, disclosure and well construction requirements on hydraulic fracturing operations. For example, Pennsylvania, Texas, Colorado and Wyoming have each adopted a variety of well construction, set back and disclosure regulations limiting how fracturing can be performed and requiring various degrees of chemical disclosure. If new laws or regulations that significantly restrict hydraulic fracturing are adopted, such laws could make it more difficult or costly for us to perform fracturing to stimulate production from tight formations. In addition, if hydraulic fracturing becomes regulated at the federal level as a result of federal legislation or regulatory initiatives by the EPA, our fracturing activities could become subject to additional permitting requirements, and also to attendant permitting delays and potential increases in costs. Restrictions on hydraulic fracturing could impact the timing of production and may also reduce the amount of oil and natural gas that we are ultimately able to produce from our reserves.

Water discharges. The federal Water Pollution Control Act (the “Clean Water Act”) and analogous state laws, impose restrictions and strict controls with respect to the monitoring and discharge of pollutants, including spills and leaks of oil and other substances, into waters of the United States. The discharge of pollutants into regulated waters is prohibited, except in accordance with the terms of a permit issued by the EPA or an analogous state agency. Spill prevention, control and countermeasure requirements under federal law require appropriate containment berms and similar structures to help prevent the contamination of navigable waters in the event of a petroleum hydrocarbon tank spill, rupture or leak. Federal and state regulatory agencies can impose administrative, civil and criminal penalties for non-compliance with discharge permits or other requirements of the Clean Water Act and analogous state laws and regulations.

Air emissions. In August 2012, the EPA adopted new rules that establish air emission controls for oil and natural gas production and natural gas processing operations. Specifically, the EPA established New Source Performance Standards to address emissions of sulfur dioxide and volatile organic compounds (“VOCs”) and a separate set of emission standards to address hazardous air pollutants frequently associated with oil and natural gas production and processing activities. The EPA’s rules require the reduction of VOC emissions from oil and natural gas production facilities by mandating the use of “green completions” for hydraulic fracturing, which requires the operator to recover rather than vent the gas and NGLs that come to the surface during completion of the fracturing process. The requirement for flaring of gas not sent to a gathering line became effective in October 2012, and all operators are required to use “green completions” drilling equipment beginning January 1, 2015. The rules also establish specific requirements regarding emissions from compressors, dehydrators, storage tanks and other production equipment. In addition, the rules establish new leak detection requirements for natural gas processing plants. These rules may require a number of modifications to our operations including the installation of new equipment. Compliance with such rules could result in significant costs, including increased capital expenditures and operating costs, and could adversely impact our business.

We have made, and will continue to make, expenditures in our effort to comply with environmental laws and regulations. We believe that we are in substantial compliance with applicable environmental laws and regulations in effect and that continued compliance with existing requirements will not have a material adverse impact on us. However, we also believe that it is reasonably likely that the trend in environmental legislation and regulation will continue toward stricter standards and, thus, we cannot give any assurance that we will not be adversely affected in the future.

We have established internal guidelines to be followed in order to comply with environmental laws and regulations in the United States. We employ a safety, environmental and regulatory department whose responsibilities include providing assurance that our operations are carried out in accordance with applicable environmental guidelines and safety precautions. Although we maintain pollution insurance to cover a portion of the costs of cleanup operations, public liability and physical damage, there is no assurance that such insurance will be adequate to cover all such costs or that such insurance will continue to be available in the future. To date, we believe that compliance with existing requirements of such governmental bodies has not had a material effect on our operations.

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Employees

On February 25, 2014, we had 409 full-time employees. We believe that our relationships with our employees are satisfactory. None of our employees are covered by a collective bargaining agreement. We utilize the services of independent contractors to perform various daily operational duties.

Available Information

We make available free of charge on our Internet website (www.stoneenergy.com) our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (“Exchange Act”), and amendments to such filings, as soon as reasonably practicable after each are electronically filed with, or furnished to, the Securities and Exchange Commission (“SEC”). We also make available on our Internet website our Code of Business Conduct and Ethics, Corporate Governance Guidelines and Audit, Compensation and Nominating and Governance Committee Charters, which have been approved by our board of directors. We will make timely disclosure on our website of any change to, or waiver from, the Code of Business Conduct and Ethics for our principal executive and senior financial officers. A copy of our Code of Business Conduct and Ethics is also available free of charge by writing us at: Chief Financial Officer, Stone Energy Corporation, P.O. Box 52807, Lafayette, LA 70505. The annual CEO certification required by Section 303A.12 of the New York Stock Exchange Listed Company Manual was submitted on May 29, 2013.

Financial Information

Our financial information is included in the consolidated financial statements and the related notes beginning on page F-1.

Forward-Looking Statements

The information in this Form 10-K includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act. All statements, other than statements of historical or current facts, that address activities, events, outcomes and other matters that we plan, expect, intend, assume, believe, budget, predict, forecast, project, estimate or anticipate (and other similar expressions) will, should or may occur in the future are forward-looking statements. These forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements in this Form 10-K.

Forward-looking statements appear in a number of places in this Form 10-K and include statements with respect to, among other things:

• any expected results or benefits associated with our acquisitions;

• expected results from risked weighted drilling success;

• estimates of our future oil and natural gas production, including estimates of any increases in oil and gas production;

• planned capital expenditures and the availability of capital resources to fund capital expenditures;

• our outlook on oil and gas prices;

• estimates of our oil and natural gas reserves;

• any estimates of future earnings growth;

• the impact of political and regulatory developments;

• our outlook on the resolution of pending litigation and government inquiry;

• estimates of the impact of new accounting pronouncements on earnings in future periods;

• our future financial condition or results of operations and our future revenues and expenses;

• the amount, nature and timing of any potential divestiture transactions;

• our access to capital and our anticipated liquidity;

• estimates of future income taxes; and

• our business strategy and other plans and objectives for future operations.

We caution you that these forward-looking statements are subject to all of the risks and uncertainties, many of which are beyond our control, incident to the exploration for and development, production and marketing of oil and natural gas. These risks include, among other things:

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• commodity price volatility;

• consequences of a catastrophic event like the Deepwater Horizon oil spill;

• domestic and worldwide economic conditions;

• the availability of capital on economic terms to fund our capital expenditures and acquisitions;

• our level of indebtedness;

• declines in the value of our oil and gas properties resulting in a decrease in our borrowing base under our bank credit facility and impairments;

• our ability to replace and sustain production;

• the impact of a financial crisis on our business operations, financial condition and ability to raise capital;

• the ability of financial counterparties to perform or fulfill their obligations under existing agreements;

• third-party interruption of sales to market;

• inflation;

• lack of availability and cost of goods and services;

• market conditions relating to potential acquisition and divestiture transactions;

• regulatory and environmental risks associated with drilling and production activities;

• drilling and other operating risks;

• unsuccessful exploration and development drilling activities;

• hurricanes and other weather conditions;

• adverse effects of changes in applicable tax, environmental, derivatives and other regulatory legislation, including changes affecting our offshore and Appalachian operations;

• uncertainty inherent in estimating proved oil and natural gas reserves and in projecting future rates of production and timing of development expenditures; and

• other risks described in this Form 10-K.

Should one or more of the risks or uncertainties described above or elsewhere in this Form 10-K occur, or should underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements. We specifically disclaim all responsibility to publicly update any information contained in a forward-looking statement or any forward-looking statement in its entirety and therefore disclaim any resulting liability for potentially related damages. All forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.

ITEM 1A. RISK FACTORS

Our business is subject to a number of risks including, but not limited to, those described below:

Regulatory requirements and permitting procedures imposed by the BOEM could significantly delay our ability to obtain permits to drill new wells in offshore waters.

Subsequent to the Deepwater Horizon incident in the GOM in April 2010, the BOEM issued a series of “Notice to Lessees” (“NTLs”) imposing regulatory requirements and permitting procedures for new wells to be drilled in federal waters of the OCS. These regulatory requirements include the following:

• The Environmental NTL, which imposes new and more stringent requirements for documenting the environmental impacts potentially associated with the drilling of a new offshore well and significantly increases oil spill response requirements.

• The Compliance and Review NTL, which imposes requirements for operators to secure independent reviews of well design, construction and flow intervention processes and also requires certifications of compliance from senior corporate officers.

• The Drilling Safety Rule, which prescribes tighter cementing and casing practices, imposes standards for the use of drilling fluids to maintain well bore integrity and stiffens oversight requirements relating to blowout preventers and their components, including shear and pipe rams.

• The Workplace Safety Rule, which requires operators to employ a comprehensive safety and environmental management system (“SEMS”) to reduce human and organizational errors as root causes of work-related accidents and offshore spills, develop protocols as to whom at the facility has the ultimate operational safety and decision-making authority, establish procedures to provide all personnel with “stop work” authority, and to have their SEMS periodically audited by an independent third party auditor approved by the BSEE.

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Since the adoption of these new regulatory requirements, the BOEM has been taking longer to review and approve permits for new wells than was common prior to the Deepwater Horizon incident. The rules also increase the cost of preparing each permit application and increase the cost of each new well, particularly for wells drilled in deeper waters on the OCS. We could become subject to fines, penalties or orders requiring us to modify or suspend our operations in the GOM if we fail to comply with the BOEM’s NTLs or other regulatory requirements.

Oil and natural gas prices are volatile. Declines in commodity prices have adversely affected, and in the future may adversely affect, our financial condition and results of operations, cash flows, access to the capital markets and ability to grow.

Our revenues, cash flows, profitability and future rate of growth substantially depend upon the market prices of oil and natural gas. Prices affect our cash flows available for capital expenditures and our ability to access funds under our bank credit facility and through the capital markets. The amount available for borrowing under our bank credit facility is subject to a borrowing base, which is determined by our lenders taking into account our estimated proved reserves, and is subject to periodic redeterminations based on pricing models determined by the lenders at such time. If commodity prices decline in the future, the decline could have adverse effects on our reserves and borrowing base.

The prices we receive for our oil and natural gas depend upon factors beyond our control, including, among others:

• changes in the supply of and demand for oil and natural gas;

• market uncertainty;

• level of consumer product demands;

• hurricanes and other weather conditions;

• domestic and foreign governmental regulations and taxes;

• price and availability of alternative fuels;

• political and economic conditions in oil producing countries, particularly those in the Middle East, Russia, South America and Africa;

• actions by the Organization of Petroleum Exporting Countries;

• foreign supply of oil and natural gas;

• price of oil and natural gas imports; and

• overall domestic and foreign economic conditions.

These factors make it very difficult to predict future commodity price movements with any certainty. Substantially all of our oil and natural gas sales are made in the spot market or pursuant to contracts based on spot market prices and are not long-term fixed price contracts. Further, oil prices and natural gas prices do not necessarily fluctuate in direct relation to each other.

We may not be able to replace production with new reserves.

In general, the volume of production from oil and gas properties declines as reserves are depleted. The decline rates depend on reservoir characteristics. GOM reservoirs tend to be recovered quickly through production with associated steep declines, while declines in other regions after initial flush production tend to be relatively low. Approximately 16% of our estimated proved reserves at December 31, 2013 (by volume) and 49% of our production during 2013 were associated with our Gulf Coast Basin conventional shelf and deep gas properties, and approximately 29% of our estimated proved reserves at December 31, 2013 (by volume) and 25% of our production during 2013 were associated with our deep water properties. Our reserves will decline as they are produced unless we acquire properties with proved reserves or conduct successful development and exploration drilling activities. Our future oil and natural gas production is highly dependent upon our level of success in finding or acquiring additional reserves at a unit cost that is sustainable at prevailing commodity prices.

Exploring for, developing or acquiring reserves is capital intensive and uncertain. We may not be able to economically find, develop or acquire additional reserves or make the necessary capital investments if our cash flows from operations decline or external sources of capital become limited or unavailable. We cannot assure you that our future exploitation, exploration, development and acquisition activities will result in additional proved reserves or that we will be able to drill productive wells at acceptable costs.

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Our actual recovery of reserves may substantially differ from our proved reserve estimates.

This Form 10-K contains estimates of our proved oil and natural gas reserves and the estimated future net cash flows from such reserves. These estimates are based upon various assumptions, including assumptions required by the SEC relating to oil and natural gas prices, drilling and operating expenses, capital expenditures, taxes and availability of funds. The process of estimating oil and natural gas reserves is complex. This process requires significant decisions and assumptions in the evaluation of available geological, geophysical, engineering and economic data for each reservoir and is therefore inherently imprecise. Additionally, our interpretations of the rules governing the estimation of proved reserves could differ from the interpretation of staff members of regulatory authorities resulting in estimates that could be challenged by these authorities.

Actual future production, oil and natural gas prices, revenues, taxes, development expenditures, operating expenses and quantities of recoverable oil and natural gas reserves will most likely vary from those estimated. Any significant variance could materially affect the estimated quantities and present value of reserves set forth in this Form 10-K and the information incorporated by reference. Our properties may also be susceptible to hydrocarbon drainage from production by other operators on adjacent properties. In addition, we may adjust estimates of proved reserves to reflect production history, results of exploration and development, prevailing oil and natural gas prices and other factors, many of which are beyond our control.

You should not assume that any present value of future net cash flows from our proved reserves contained in this Form 10-K represents the market value of our estimated oil and natural gas reserves. We base the estimated discounted future net cash flows from our proved reserves at December 31, 2013 on historical 12-month average prices and costs as of the date of the estimate. Actual future prices and costs may be materially higher or lower. Further, actual future net revenues will be affected by factors such as the amount and timing of actual development expenditures, the rate and timing of production and changes in governmental regulations or taxes. At December 31, 2013, approximately 44% of our estimated proved reserves (by volume) were undeveloped. Recovery of undeveloped reserves generally requires significant capital expenditures and successful drilling operations. Our reserve estimates include the assumptions that we will make significant capital expenditures to develop these undeveloped reserves and the actual costs, development schedule and results associated with these properties may not be as estimated. In addition, the 10% discount factor that we use to calculate the net present value of future net revenues and cash flows may not necessarily be the most appropriate discount factor based on our cost of capital in effect from time to time and the risks associated with our business and the oil and gas industry in general.

We require substantial capital expenditures to conduct our operations and replace our production, and we may be unable to obtain needed financing on satisfactory terms necessary to fund our planned capital expenditures.

We spend and will continue to spend a substantial amount of capital for the acquisition, exploration, exploitation, development and production of oil and natural gas reserves. If low oil and natural gas prices, operating difficulties or other factors, many of which are beyond our control, cause our revenues and cash flows from operating activities to decrease, we may be limited in our ability to fund the capital necessary to complete our capital expenditures program. In addition, if our borrowing base under our bank credit facility is redetermined to a lower amount, this could adversely affect our ability to fund our planned capital expenditures. After utilizing our available sources of financing, we may be forced to raise additional debt or equity proceeds to fund such capital expenditures. We cannot be sure that additional debt or equity financing will be available or cash flows provided by operations will be sufficient to meet these requirements.

Our estimates of future asset retirement obligations may vary significantly from period to period.

We are required to record a liability for the discounted present value of our asset retirement obligations to plug and abandon inactive, non-producing wells, to remove inactive or damaged platforms, facilities and equipment, and to restore the land or seabed at the end of oil and natural gas operations. These costs are typically considerably more expensive for offshore operations as compared to most land-based operations due to increased regulatory scrutiny and the logistical issues associated with working in waters of various depths. Estimating future restoration and removal costs in the GOM is especially difficult because most of the removal obligations may be many years in the future, regulatory requirements are subject to change or more restrictive interpretation and asset removal technologies are constantly evolving, which may result in additional or increased or decreased costs. As a result, we may make significant increases or decreases to our estimated asset retirement obligations in future periods. For example, because we operate in the GOM, platforms, facilities and equipment are subject to damage or destruction as a result of hurricanes. The estimated costs to plug and abandon a well or dismantle a platform can change dramatically if the host platform from which the work was anticipated to be performed is damaged or toppled rather than structurally intact. Accordingly, our estimates of future asset retirement obligations could differ dramatically from what we may ultimately incur as a result of damage from a hurricane.

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A financial crisis may impact our business and financial condition. A financial crisis may adversely impact our ability to obtain funding under our current bank credit facility or in the capital markets.

An economic crisis could reduce the demand for oil and natural gas and put downward pressure on the prices for oil and natural gas. Historically, we have used our cash flows from operating activities and borrowings under our bank credit facility to fund our capital expenditures and have relied on the capital markets and asset monetization transactions to provide us with additional capital for large or exceptional transactions. In the future, we may not be able to access adequate funding under our bank credit facility as a result of (i) a decrease in our borrowing base due to the outcome of a borrowing base redetermination or (ii) an unwillingness or inability on the part of our lending counterparties to meet their funding obligations. In addition, we may face limitations on our ability to access the debt and equity capital markets and complete asset sales, an increased counterparty credit risk on our derivatives contracts and the requirement by contractual counterparties of us to post collateral guaranteeing performance.

Our debt level and the covenants in the current and any future agreements governing our debt could negatively impact our financial condition, results of operations and business prospects.

The terms of the current agreements governing our debt impose significant restrictions on our ability to take a number of actions that we may otherwise desire to take, including:

• incurring additional debt;

• paying dividends on stock, redeeming stock or redeeming subordinated debt;

• making investments;

• creating liens on our assets;

• selling assets;

• guaranteeing other indebtedness;

• entering into agreements that restrict dividends from our subsidiary to us;

• merging, consolidating or transferring all or substantially all of our assets; and

• entering into transactions with affiliates.

Our level of indebtedness, and the covenants contained in current and future agreements governing our debt, could have important consequences on our operations, including:

• making it more difficult for us to satisfy our obligations under the indentures or other debt and increasing the risk that we may default on our debt obligations;

• requiring us to dedicate a substantial portion of our cash flow from operating activities to required payments on debt, thereby reducing the availability of cash flow for working capital, capital expenditures and other general business activities;

• limiting our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions and other general business activities;

• limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

• detracting from our ability to successfully withstand a downturn in our business or the economy generally;

• placing us at a competitive disadvantage against other less leveraged competitors; and

• making us vulnerable to increases in interest rates because debt under our bank credit facility is at variable rates.

We may be required to repay all or a portion of our debt on an accelerated basis in certain circumstances. If we fail to comply with the covenants and other restrictions in the agreements governing our debt, it could lead to an event of default and the acceleration of our repayment of outstanding debt. Our ability to comply with these covenants and other restrictions may be affected by events beyond our control, including prevailing economic and financial conditions. Our borrowing base under our bank credit facility, which is redetermined semi-annually, is based on an amount established by the lenders after their evaluation of our proved oil and natural gas reserve values. Our borrowing base is scheduled to be redetermined by May 2014. Upon a redetermination, if borrowings in excess of the revised borrowing capacity are outstanding, we could be forced to repay a portion of our bank debt.

         We may not have sufficient funds to make such repayments. If we are unable to repay our debt out of cash on hand, we could attempt to refinance such debt, sell assets or repay such debt with the proceeds from an equity offering. We cannot assure you that we will be able to generate sufficient cash flows from operating activities to pay the interest on our debt or that future borrowings, equity financings or proceeds from the sale of assets will be available to pay or refinance such debt. The terms of our debt, including our bank credit facility and our indentures, may also prohibit us from taking such actions. Factors that will affect our ability to raise cash through offerings of our capital stock, a refinancing of our debt or a sale of assets include financial market conditions and our market value and operating performance at the time of such offerings, refinancing or sale of assets. We cannot assure you that any such offerings, refinancing or sale of assets will be successfully completed.

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We have experienced significant shut-ins and losses of production due to the effects of hurricanes in the GOM.

Approximately 16% of our estimated proved reserves at December 31, 2013 (by volume) and 49% of our production during 2013 were associated with our Gulf Coast Basin conventional shelf and deep gas properties. Approximately 29% of our estimated proved reserves at December 31, 2013 (by volume) and 25% of our production during 2013 were associated with our GOM deep water properties. Accordingly, if the level of production from these properties substantially declines, it could have a material adverse effect on our overall production level and our revenue. We are particularly vulnerable to significant risk from hurricanes and tropical storms in the GOM. In past years, we have experienced shut-ins and losses of production due to the effects of hurricanes in the GOM. We are unable to predict what impact future hurricanes and tropical storms might have on our future results of operations and production.

Our acreage must be drilled before lease expiration in order to hold the acreage by production. If commodity prices become depressed for an extended period of time, it might not be economical for us to drill sufficient wells in order to hold acreage, which could result in the expiry of a portion of our acreage, which could have an adverse effect on our business.

Unless production is established within the spacing units covering the undeveloped acres on which some of the locations are identified, the leases for such acreage may expire. See Item 2. Properties – Productive Well and Acreage Data.

The marketability of our production depends mostly upon the availability, proximity and capacity of oil and natural gas gathering systems, pipelines and processing facilities.

The marketability of our production depends upon the availability, proximity, operation and capacity of oil and natural gas gathering systems, pipelines and processing facilities. The unavailability or lack of capacity of these gathering systems, pipelines and processing facilities could result in the shut-in of producing wells or the delay or discontinuance of development plans for properties. The disruption of these gathering systems, pipelines and processing facilities due to maintenance and/or weather could negatively impact our ability to market and deliver our products. Federal, state and local regulation of oil and gas production and transportation, general economic conditions and changes in supply and demand could adversely affect our ability to produce and market our oil and natural gas. If market factors changed dramatically, the financial impact on us could be substantial. The availability of markets and the volatility of product prices are beyond our control and represent a significant risk.

We may not receive payment for a portion of our future production.

We may not receive payment for a portion of our future production. We have attempted to diversify our sales and obtain credit protections such as parental guarantees from certain of our purchasers. The tightening of credit in the financial markets may make it more difficult for customers to obtain financing and, depending on the degree to which this occurs, there may be a material increase in the nonpayment and nonperformance by customers. We are unable to predict what impact the financial difficulties of certain purchasers may have on our future results of operations and liquidity.

Our actual production could differ materially from our forecasts.

From time to time, we provide forecasts of expected quantities of future oil and gas production. These forecasts are based on a number of estimates, including expectations of production from existing wells. In addition, our forecasts may assume that none of the risks associated with our oil and gas operations summarized in this Item 1A occur, such as facility or equipment malfunctions, adverse weather effects, or significant declines in commodity prices or material increases in costs, which could make certain production uneconomical.

Lower oil and natural gas prices and other factors have resulted, and in the future may result, in ceiling test write-downs and other impairments of our asset carrying values.

We use the full cost method of accounting for our oil and gas operations. Accordingly, we capitalize the costs to acquire, explore for and develop oil and gas properties. Under the full cost method of accounting, we compare, at the end of each financial reporting period for each cost center, the present value of estimated future net cash flows from proved reserves (based on a 12-month average hedge adjusted commodity price and excluding cash flows related to estimated abandonment costs), to the net capitalized costs of proved oil and gas properties, net of related deferred taxes. We refer to this comparison as a “ceiling test.” If the net capitalized costs of proved oil and gas properties exceed the estimated discounted future net cash flows from proved

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reserves, we are required to write-down the value of our oil and gas properties to the value of the estimated discounted future net cash flows. A write-down of oil and gas properties does not impact cash flows from operating activities, but does reduce net income. The risk that we will be required to write-down the carrying value of oil and gas properties increases when oil and natural gas prices are low or volatile. In addition, write-downs may occur if we experience substantial downward adjustments to our estimated proved reserves or our undeveloped property values, or if estimated future development costs increase. Volatility in commodity prices, poor conditions in the global economic markets and other factors could cause us to record additional write-downs of our oil and natural gas properties and other assets in the future and incur additional charges against future earnings.

There are uncertainties in successfully integrating our acquisitions.

Integrating acquired businesses and properties involves a number of special risks. These risks include the possibility that management may be distracted from regular business concerns by the need to integrate operations and that unforeseen difficulties can arise in integrating operations and systems and in retaining and assimilating employees. Any of these or other similar risks could lead to potential adverse short-term or long-term effects on our operating results.

Part of our strategy includes drilling in new or emerging plays. As a result, our drilling in these areas is subject to greater risk and uncertainty.

We have made initial investments in acreage in untested regions. These activities are more uncertain than drilling in areas that are developed and have established production. Because emerging plays and new formations have limited or no production history, we are less able to use past drilling results to help predict future results. The lack of historical information may result in us not being able to fully execute our expected drilling programs in these areas or the return on investment in these areas may turn out not to be as attractive as anticipated. We cannot assure you that our future drilling activities in these emerging plays will be successful, or if successful, will achieve the resource potential levels that we currently anticipate based on the drilling activities that have been completed or will achieve the anticipated economic returns based on our current cost models.

Our operations are subject to numerous risks of oil and gas drilling and production activities.

Oil and gas drilling and production activities are subject to numerous risks, including the risk that no commercially productive oil or natural gas reserves will be found. The cost of drilling and completing wells is often uncertain. To the extent we drill additional wells in the GOM deep water and/or in the GOM deep gas, our drilling activities could become more expensive. In addition, the geological complexity of GOM deep water, GOM deep gas and various onshore formations may make it more difficult for us to sustain our historical rates of drilling success. Oil and gas drilling and production activities may be shortened, delayed or canceled as a result of a variety of factors, many of which are beyond our control. These factors include:

• unexpected drilling conditions;

• pressure or irregularities in formations;

• equipment failures or accidents;

• hurricanes and other weather conditions;

• shortages in experienced labor; and

• shortages or delays in the delivery of equipment.

The prevailing prices of oil and natural gas also affect the cost of and the demand for drilling rigs, production equipment and related services. We cannot assure you that the wells we drill will be productive or that we will recover all or any portion of our investment. Drilling for oil and natural gas may be unprofitable. Drilling activities can result in dry wells and wells that are productive but do not produce sufficient cash flows to recoup drilling costs.

Our industry experiences numerous operating risks.

The exploration, development and production of oil and gas properties involves a variety of operating risks including the risk of fire, explosions, blowouts, pipe failure, abnormally pressured formations and environmental hazards. Environmental hazards include oil spills, gas leaks, pipeline ruptures or discharges of toxic gases. We are also involved in drilling operations that utilize hydraulic fracturing, which may potentially present additional operational and environmental risks. Additionally, our offshore operations are subject to the additional hazards of marine operations, such as capsizing, collision and adverse weather and sea conditions, including the effects of hurricanes.

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We have begun to explore for oil and natural gas in the deep waters of the GOM (water depths greater than 2,000 feet) where operations are more difficult and more expensive than in shallower waters. The deep waters of the GOM often lack the physical infrastructure and availability of services present in the shallower waters. As a result, deep water operations may require a significant amount of time between a discovery and the time that we can market the oil and natural gas, increasing the risks involved with these operations.

If any of these industry operating risks occur, we could have substantial losses. Substantial losses may be caused by injury or loss of life, severe damage to or destruction of property, natural resources and equipment, pollution or other environmental damage, clean-up responsibilities, regulatory investigation and penalties and suspension of operations.

We may not be insured against all of the operating risks to which our business is exposed.

In accordance with industry practice, we maintain insurance against some, but not all, of the operating risks to which our business is exposed. We insure some, but not all, of our properties from operational loss-related events. We currently have insurance policies that include coverage for general liability, physical damage to our oil and gas properties, operational control of wells, oil pollution, workers’ compensation and employers’ liability and other coverage. Our insurance coverage includes deductibles that must be met prior to recovery, as well as sub-limits and/or self-insurance. Additionally, our insurance is subject to exclusions and limitations, and there is no assurance that such coverage will adequately protect us against liability from all potential consequences, damages and/or losses.

Currently, we have general liability insurance coverage with an annual aggregate limit of $725 million on a 100% working interest basis. Effective May 1, 2013, we no longer purchase physical damage insurance coverage for our platforms for losses resulting from named windstorms. Additionally, we now purchase physical damage insurance coverage for losses resulting from operational activities for only our Amberjack and Pompano platforms. We have continued purchasing physical damage insurance coverage for operational losses for a selected group of pipelines including the pipelines and umbilicals associated with our Amberjack and Pompano facilities.

Our operational control of well coverage provides limits that vary by well location and depth and range from a combined single limit of $20 million to $300 million per occurrence. Exploratory deep water wells have a coverage limit of $600 million per occurrence. Additionally, we maintain $150 million in oil pollution liability coverage, including $70 million of self-insurance. Our general liability, operational control of well and physical damage policy limits are scaled proportionately to our working interests, and all of our policies described above are subject to deductibles, sub-limits and/or self-insurance. Under our service agreements, including drilling contracts, generally we are indemnified for injuries and death of the service provider’s employees as well as contractors and subcontractors hired by the service provider.

An operational or a hurricane-related event may cause damage or liability in excess of our coverage that might severely impact our financial position. We may be liable for damages from an event relating to a project in which we are a non-operator, but have a working interest in such project. Such an event may also cause a significant interruption to our business, which might also severely impact our financial position. In past years, we have experienced production interruptions for which we had no production interruption insurance.

We reevaluate the purchase of insurance, policy limits and terms annually each May. Future insurance coverage for our industry could increase in cost and may include higher deductibles or retentions. In addition, some forms of insurance may become unavailable in the future or unavailable on terms that we believe are economically acceptable. No assurance can be given that we will be able to maintain insurance in the future at rates that we consider reasonable, and we may elect to maintain minimal or no insurance coverage. We may not be able to secure additional insurance or bonding that might be required by new governmental regulations. This may cause us to restrict our operations in the GOM, which might severely impact our financial position. The occurrence of a significant event, not fully insured against, could have a material adverse effect on our financial condition and results of operations.

Terrorist attacks aimed at our facilities could adversely affect our business.

The U.S. government has issued warnings that U.S. energy assets may be the future targets of terrorist organizations. These developments have subjected our operations to increased risks. Any future terrorist attack at our facilities, or those of our purchasers, could have a material adverse effect on our financial condition and operations.

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Competition within our industry may adversely affect our operations.

Competition within our industry is intense, particularly with respect to the acquisition of producing properties and undeveloped acreage. We compete with major oil and gas companies and other independent producers of varying sizes, all of which are engaged in the acquisition of properties and the exploration and development of such properties. Many of our competitors have financial resources and exploration and development budgets that are substantially greater than ours, which may adversely affect our ability to compete.

Our oil and gas operations are subject to various U.S. federal, state and local governmental regulations that materially affect our operations.

Our oil and gas operations are subject to various U.S. federal, state and local laws and regulations. These laws and regulations may be changed in response to economic or political conditions. Regulated matters include: permits for exploration, development and production operations; limitations on our drilling activities in environmentally sensitive areas, such as wetlands, and restrictions on the way we can release materials into the environment; bonds or other financial responsibility requirements to cover drilling contingencies and well plugging and abandonment and other decommissioning costs; reports concerning operations, the spacing of wells and unitization and pooling of properties; and taxation. Failure to comply with these laws and regulations can result in the assessment of administrative, civil or criminal penalties, the issuance of remedial obligations and the imposition of injunctions limiting or prohibiting certain of our operations. At various times, regulatory agencies have imposed price controls and limitations on oil and gas production. In order to conserve supplies of oil and natural gas, these agencies have restricted the rates of flow of oil and natural gas wells below actual production capacity. In addition, the OPA requires operators of offshore facilities such as us to prove that they have the financial capability to respond to costs that may be incurred in connection with potential oil spills. Under the OPA and other environmental statutes such as CERCLA and RCRA and analogous state laws, owners and operators of certain defined onshore and offshore facilities are strictly liable for spills of oil and other regulated substances, subject to certain limitations. Consequently, a substantial spill from one of our facilities subject to laws such as the OPA, CERCLA and RCRA could require the expenditure of additional, and potentially significant, amounts of capital, or could have a material adverse effect on our earnings, results of operations, competitive position or financial condition. Federal, state and local laws regulate production, handling, storage, transportation and disposal of oil and natural gas, by-products from oil and natural gas and other substances, and materials produced or used in connection with oil and gas operations. We cannot predict the ultimate cost of compliance with these requirements or their impact on our earnings, operations or competitive position.

The loss of key personnel could adversely affect our ability to operate.

Our operations are dependent upon key management and technical personnel. We cannot assure you that individuals will remain with us for the immediate or foreseeable future. The unexpected loss of the services of one or more of these individuals could have an adverse effect on us.

Hedging transactions may limit our potential gains or become ineffective.

In order to manage our exposure to price risks in the marketing of our oil and natural gas, we periodically enter into oil and natural gas price hedging arrangements with respect to a portion of our expected production. Our hedging policy provides that, without prior approval of our board of directors, generally not more than 50% of our estimated production quantities may be hedged. These arrangements may include futures contracts on the New York Mercantile Exchange (“NYMEX”) or the Intercontinental Exchange (“ICE”). While intended to reduce the effects of volatile oil and natural gas prices, such transactions, depending on the hedging instrument used, may limit our potential gains if oil and natural gas prices were to rise substantially over the price established by the hedge. In addition, such transactions may expose us to the risk of financial loss in certain circumstances, including instances in which:

• our production is less than expected or is shut-in for extended periods due to hurricanes or other factors;

• there is a widening of price differentials between delivery points for our production and the delivery point assumed in the hedge arrangement;

• the counterparties to our futures contracts fail to perform the contracts;

• a sudden, unexpected event materially impacts oil or natural gas prices; or

• we are unable to market our production in a manner contemplated when entering into the hedge contract.

Currently, some of our outstanding commodity derivative instruments are with certain lenders or affiliates of the lenders under our bank credit facility. Our existing derivative agreements with our lenders are secured by the security documents executed by the parties under our bank credit facility. Future collateral requirements for our commodity hedging activities are uncertain and will depend on the arrangements we negotiate with the counterparty and the volatility of oil and natural gas prices and market conditions.

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Our Certificate of Incorporation and Bylaws have provisions that discourage corporate takeovers and could prevent stockholders from realizing a premium on their investment.

Certain provisions of our Certificate of Incorporation and Bylaws and the provisions of the Delaware General Corporation Law may encourage persons considering unsolicited tender offers or other unilateral takeover proposals to negotiate with our board of directors rather than pursue non-negotiated takeover attempts. Our Certificate of Incorporation authorizes our board of directors to issue preferred stock without stockholder approval and to set the rights, preferences and other designations, including voting rights of those shares, as our board of directors may determine. Additional provisions include restrictions on business combinations and the availability of authorized but unissued common stock. These provisions, alone or in combination with each other, may discourage transactions involving actual or potential changes of control, including transactions that otherwise could involve payment of a premium over prevailing market prices to stockholders for their common stock.

Resolution of litigation could materially affect our financial position and results of operations.

We have been named as a defendant in certain lawsuits. See Item 3. Legal Proceedings. In some of these suits, our liability for potential loss upon resolution may be mitigated by insurance coverage. To the extent that potential exposure to liability is not covered by insurance or insurance coverage is inadequate, we could incur losses that could be material to our financial position or results of operations in future periods.

Certain U.S. federal income tax deductions currently available with respect to oil and natural gas exploration and development may be eliminated as a result of future legislation.

Potential legislation, if enacted into law, could make significant changes to U.S. federal income tax laws, including the elimination of certain key U.S. federal income tax incentives currently available to oil and gas exploration and production companies. These changes include, but are not limited to, (i) the repeal of the percentage depletion allowance for oil and natural gas properties; (ii) the elimination of current deductions for intangible drilling and development costs; (iii) the elimination of the deduction for certain U.S. production activities; and (iv) an extension of the amortization period for certain geological and geophysical expenditures. It is unclear whether these or similar changes will be enacted and, if enacted, how soon any such changes could become effective. The passage of this legislation or any other similar changes in U.S. federal income tax laws could eliminate or postpone certain tax deductions that are currently available with respect to oil and natural gas exploration and development, and any such change could negatively impact the value of an investment in our common stock.

Climate change legislation or regulations restricting emissions of “greenhouse gases” could result in increased operating costs and reduced demand for the crude oil and natural gas that we produce.

In December 2009, the EPA determined that emissions of carbon dioxide, methane and other “greenhouse gases” present an endangerment to public health and the environment because emissions of such gases are, according to the EPA, contributing to warming of the Earth’s atmosphere and other climatic changes. Based on these findings, the EPA began adopting and implementing regulations to restrict emissions of greenhouse gases under existing provisions of the CAA. The EPA adopted two sets of rules regulating greenhouse gas emissions under the CAA, one of which requires a reduction in emissions of greenhouse gases from motor vehicles and the other of which regulates emissions of greenhouse gases from certain large stationary sources, effective as of January 2, 2011. The EPA’s rules relating to emissions of greenhouse gases from large stationary sources of emissions are currently subject to a number of legal challenges, but the federal courts have thus far declined to issue any injunctions to prevent the EPA from implementing, or requiring state environmental agencies to implement, the rules. The EPA has also adopted rules requiring the reporting of greenhouse gas emissions from specified large greenhouse gas emission sources in the United States, on an annual basis, beginning in 2011 for emissions occurring in 2010, as well as certain onshore oil and natural gas production facilities, on an annual basis, beginning in 2012 for emissions occurring in 2011.

In addition, the United States Congress has from time to time considered adopting legislation to reduce emissions of greenhouse gases and almost one-half of the states have already taken legal measures to reduce emissions of greenhouse gases primarily through the planned development of greenhouse gas emission inventories and/or regional greenhouse gas cap and trade programs. Most of these cap and trade programs work by requiring major sources of emissions, such as electric power plants, or major producers of fuels, such as refineries and gas processing plants, to acquire and surrender emission allowances. The number of allowances available for purchase is reduced each year in an effort to achieve the overall greenhouse gas emission reduction goal.

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The adoption of legislation or regulatory programs to reduce emissions of greenhouse gases could require us to incur increased operating costs, such as costs to purchase and operate emissions control systems, to acquire emissions allowances or to comply with new regulatory or reporting requirements. Any such legislation or regulatory programs could also increase the cost of consuming, and thereby reduce demand for, the oil and natural gas we produce. Consequently, legislation and regulatory programs to reduce emissions of greenhouse gases could have an adverse effect on our business, financial condition and results of operations. Finally, it should be noted that some scientists have concluded that increasing concentrations of greenhouse gases in the Earth’s atmosphere may produce climate changes that have significant physical effects, such as increased frequency and severity of storms, droughts, floods and other climatic events. If any such effects were to occur, they could have an adverse effect on our financial condition and results of operations.

The enactment of derivatives legislation could have an adverse effect on our ability to use derivative instruments to reduce the effect of commodity price, interest rate and other risks associated with our business.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”), enacted on July 21, 2010, established federal oversight and regulation of the over-the-counter derivatives market and entities, such as us, that participate in that market. The Act requires the CFTC and the SEC to promulgate rules and regulations implementing the Act. Although the CFTC has finalized certain regulations, others remain to be finalized or implemented and it is not possible at this time to predict when this will be accomplished.

In October 2011, the CFTC issued regulations to set position limits for certain futures and option contracts in the major energy markets and for swaps that are their economic equivalents. The initial position limits rule was vacated by the United States District Court for the District of Colombia in September 2012. However, in November 2013, the CFTC proposed new rules that would place limits on positions in certain core functions and equivalent swaps contracts for or linked to certain physical commodities, subject to exceptions for certain bona fide hedging transactions. As these new position limit rules are not yet final, the impact of those provisions on us is uncertain at this time.

The CFTC has designated certain interest rate swaps and credit default swaps for mandatory clearing and the associated rules also will require us, in connection with covered derivative activities, to comply with clearing and trade-execution requirements or to take steps to qualify for an exemption to such requirements. Although we expect to qualify for the end-user exception from the mandatory clearing requirements for swaps entered into to hedge our commercial risks, the application of the mandatory clearing and trade execution requirements to other market participants, such as swap dealers, may change the cost and availability of the swaps that we use for hedging. In addition, for uncleared swaps, the CFTC or federal banking regulators may require end-users to enter into credit support documentation and/or post initial and variation margin. Posting of collateral could impact liquidity and reduce cash available to us for capital expenditures, therefore reducing our ability to execute hedges to reduce risk and protect cash flows. The proposed margin rules are not yet final, and therefore the impact of those provisions to us is uncertain at this time. The Act also may require the counterparties to our derivative instruments to spin off some of their derivatives activities to a separate entity, which may not be as creditworthy as the current counterparty.

The full impact of the Act and related regulatory requirements upon our business will not be known until the regulations are implemented and the market for derivatives contracts has adjusted. The Act and any new regulations could significantly increase the cost of derivative contracts, materially alter the terms of derivative contracts, reduce the availability of derivatives to protect against risks we encounter, reduce our ability to monetize or restructure our existing derivative contracts or increase our exposure to less creditworthy counterparties. If we reduce our use of derivatives as a result of the Act and regulations implementing the Act, our results of operations may become more volatile and our cash flows may be less predictable, which could adversely affect our ability to plan for and fund capital expenditures. Finally, the Act was intended, in part, to reduce the volatility of oil and gas prices, which some legislators attributed to speculative trading in derivatives and commodity instruments related to oil and natural gas. Our revenues could therefore be adversely affected if a consequence of the Act and implementing regulations is to lower commodity prices. Any of these consequences could have a material adverse effect on us, our financial condition and our results of operations.

Federal and state legislation and regulatory initiatives relating to hydraulic fracturing could cause us to incur increased costs and experience additional operating restrictions or delays.

Hydraulic fracturing is an important and common practice that is used to stimulate production of hydrocarbons from tight formations. We routinely utilize hydraulic fracturing techniques in many of our drilling and completion programs. The process involves the injection of water, sand and chemicals under pressure into the formation to fracture the surrounding rock and stimulate production. The process is typically regulated by state oil and gas commissions. However, the EPA recently asserted

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federal regulatory authority over certain hydraulic fracturing activities involving diesel fuel under the SDWA’s Underground Injection Control Program. In addition, the BLM released proposed rules regarding well stimulation and hydraulic fracturing activities in May 2013 that would require the disclosure of chemicals used during the fracturing process and addresses drilling plans, water management, and wastewater disposal on federal and tribal lands. The BLM expects to issue a final rule mid-2014. The White House Council on Environmental Quality is also coordinating an administration-wide review of hydraulic fracturing practices, and a number of federal agencies, including the Department of Energy and the Department of the Interior, are analyzing a number of environmental issues associated with hydraulic fracturing. The EPA has similarly commenced a comprehensive study of the potential environmental effects of hydraulic fracturing activities on water resources. The EPA has indicated that it expects to issue its study report in late 2014. These studies, depending on their results, could spur initiatives to regulate hydraulic fracturing under the SDWA or other federal programs. In addition, some states have adopted, and other states are considering adopting, regulations that could impose more stringent permitting, disclosure and well construction requirements on hydraulic fracturing operations, including states in which we operate. For example, Pennsylvania, Texas, Colorado and Wyoming have each adopted a variety of well construction, set back and disclosure regulations limiting how fracturing can be performed and requiring various degrees of chemical disclosure. The disclosure of proprietary information regarding chemicals or formulas used in hydraulic fracturing could diminish the value of such information and could result in competitive harm to us. If new laws or regulations that significantly restrict hydraulic fracturing are adopted, such laws could make it more difficult or costly for us to perform fracturing to stimulate production from tight formations. In addition, if hydraulic fracturing becomes regulated at the federal level as a result of federal legislation or regulatory initiatives by the EPA, our fracturing activities could become subject to additional permitting requirements and also to attendant permitting delays and potential increases in costs. Restrictions on hydraulic fracturing could impact the timing of production and may also reduce the amount of oil and natural gas that we are ultimately able to produce from our reserves.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

As of February 25, 2014, our property portfolio consisted of 47 active properties and 123 primary term leases in the Gulf Coast Basin (onshore and offshore), four active properties in the Appalachia region, one active property in the Eagle Ford Shale formation and undeveloped acreage in Canada and the Rocky Mountain region. We serve as operator on 75% of our active properties. The properties that we operate accounted for 95% of our year-end 2013 estimated proved reserves. This high operating percentage allows us to better control the timing, selection and costs of our drilling and production activities.

Oil and Natural Gas Reserves

Our Reserves Committee Charter provides that the reserves committee has the sole authority to recommend to our board of directors appointments or replacements of one or more firms of independent reservoir engineers and geoscientists. The reserves committee reviews annually the arrangements of the independent reservoir engineers and geoscientists with management, including the scope and general extent of the examination of our reserves, the reports to be rendered, the services and fees and consideration of the independence of such independent reservoir engineers and geoscientists. The reserves committee may consult with management but may not delegate these responsibilities. The reserves committee provides oversight in regards to the reserve estimation process but not the actual determination of estimated proved reserves. Our Reserves Committee Charter provides that it is the duty of management and not the duty of the reserves committee to plan or conduct reviews or to determine that our reserve estimates are complete and accurate and are in accordance with generally accepted engineering standards and applicable rules and regulations of the SEC. Our Director of Strategic Planning is the in-house person designated as primarily responsible for the process of reserve preparation. He is a petroleum engineer with over twenty years of experience in reservoir engineering and analysis. His duties include oversight of the preparation of non year-end quarterly reserve estimates and coordination with the outside engineering consultants on the preparation of year-end reserve estimates. The year-end reserve estimates prepared by our outside engineering firm are independent of any oversight of the Director of Strategic Planning or the reserves committee.

Estimates of our proved reserves at December 31, 2013 were prepared by Netherland, Sewell & Associates, Inc. (“NSA”), a nationally recognized engineering firm. NSA provides a complete range of geological, geophysical, petrophysical and engineering services and has the technical experience and ability to perform these services in any of the onshore and offshore oil and gas producing areas of the world. NSA has a technical staff of over 150 professionals who are intimately familiar with recognized industry reserve and resource definitions, specifically those set forth by the SEC. NSA’s letter is filed as an exhibit to this Form 10-K.

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The following table sets forth our estimated proved oil and natural gas reserves (approximately 55% of which are located in the Appalachian region, 29% are located in the GOM deep water and 16% are located in the conventional shelf/deep gas) as of December 31, 2013. The 2013 average 12-month oil and gas prices net of differentials were $102.21 per Bbl of oil, $37.59 per Bbl of NGLs and $3.66 per Mcf of gas.

Summary of Oil, Natural Gas and NGL Reserves as of December 31, 2013
	Oil (MBbls)		NGLs (MBbls)		Natural Gas (MMcf)		Oil, Natural Gas and NGL’s (MMcfe)
Reserves Category:
PROVED
Developed		27,920		11,569		246,946		483,885
Undeveloped		15,907		11,728		213,820		379,628
TOTAL PROVED		43,827		23,297		460,766		863,513

At December 31, 2013, we reported estimated proved undeveloped reserves (“PUDs”) of 379.6 Bcfe, which accounted for 44% of our total estimated proved oil and natural gas reserves. This figure ties to a projected 99 new wells (362.1 Bcfe) and eight sidetrack wells from existing wellbores (17.5 Bcfe). Our timetable for the eight sidetrack wells is totally dependent on the life of the currently producing zones. After the current zones have been depleted, we would utilize the existing wellbore to sidetrack to the PUD objective. Regarding the remaining 99 PUD locations, we project 21 wells to be drilled in 2014 (70.0 Bcfe); 38 wells in 2015 (175.2 Bcfe); 21 wells in 2016 (66.8 Bcfe); eight wells in 2017 (25.4 Bcfe), and eleven wells in 2018 (24.7 Bcfe). None of these 99 PUD wells will have been on our books in excess of five years at the time of their scheduled drilling. The following table discloses our progress toward the conversion of PUDs during 2013.

	Oil, Natural Gas and NGLs (MMcfe)			Future Development Costs (in thousands)
PUDs beginning of year		336,745		$	665,236
Revisions of previous estimates		547			83,255
Conversions to proved developed reserves		(68,286	)		(83,800	)
Additional PUDs added		110,622			161,840
PUDs end of year		379,628		$	826,531

During 2013 we invested approximately $83.8 million to convert 68.3 Bcfe of PUDs to proved developed reserves, mainly in the Appalachian region.

The following represents additional information on our significant properties:

Field Name	Location	2013 Production (MMcfe)		December 31, 2013 Estimated Proved Reserves (MMcfe)		Nature of Interest
Mary	Appalachia		19,774		396,685		Working
Pompano	GOM Deep Water		12,375		169,110		Working
Mississippi Canyon Block 109	GOM Deep Water		8,433		71,474		Working
Heather	Appalachia		5,071		56,531		Working
Bayou Hebert	GOM Deep Gas		8,181		25,113		Working
Ewing Bank Block 305	GOM Shelf		2,227		21,250		Working
Ship Shoal Block 113	GOM Shelf		10,044		20,755		Working
Katie	Appalachia		814		16,725		Working
Main Pass Block 288	GOM Shelf		2,992		12,525		Working

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There are numerous uncertainties inherent in estimating quantities of proved reserves and in projecting future rates of production and the timing of development expenditures, including many factors beyond the control of the producer. The reserve data set forth herein only represents estimates. Reserve engineering is a subjective process of estimating underground accumulations of oil and natural gas that cannot be measured in an exact way. The accuracy of any reserve estimate depends on the quality of available data and the interpretation of that data by geological engineers. In addition, the results of drilling, testing and production activities may justify revisions of estimates that were made previously. If significant, these revisions would change the schedule of any further production and development drilling. Accordingly, reserve estimates are generally different from the quantities of oil and natural gas that are ultimately recovered. Further, the estimated future net revenues from proved reserves and the present value thereof are based upon certain assumptions, including geological success, prices, future production levels, operating costs, development costs and income taxes that may not prove to be correct. Predictions about prices and future production levels are subject to great uncertainty, and the meaningfulness of these estimates depends on the accuracy of the assumptions upon which they are based.

As an operator of domestic oil and gas properties, we have filed U.S. Department of Energy Form EIA-23, “Annual Survey of Oil and Gas Reserves,” as required by Public Law 93-275. There are differences between the reserves as reported on Form EIA-23 and as reported herein. The differences are attributable to the fact that Form EIA-23 requires that an operator report the total reserves attributable to wells that it operates, without regard to percentage ownership (i.e., reserves are reported on a gross operated basis, rather than on a net interest basis) or non-operated wells in which it owns an interest.

Acquisition, Production and Drilling Activity

Acquisition and Development Costs. The following table sets forth certain information regarding the costs incurred in our acquisition, development and exploratory activities in the United States and Canada during the periods indicated.

	Year Ended December 31,
	2013		2012		2011
	(In thousands)
Acquisition costs, net of sales of unevaluated properties	$	79,667	$	102,807	$	270,354
Development costs (1)		378,242		395,555		426,355
Exploratory costs		298,932		81,458		84,199
Subtotal		756,841		579,820		780,908
Capitalized salaries, general and administrative costs and interest, net of fees and reimbursements		79,354		62,664		66,111
Total additions to oil and gas properties, net	$	836,195	$	642,484	$	847,019

(1) Includes capitalized asset retirement costs of $54,737, $95,293 and $96,386 for the years ended December 31, 2013, 2012 and 2011, respectively.

Production Volumes, Sales Price and Cost Data. The following table sets forth certain information regarding our production volumes, sales prices and average production costs for the periods indicated.

	Year Ended December 31,
	2013		2012		2011
Production:
Oil (MBbls)		6,894		7,135		6,427
Natural gas (MMcf)		50,129		42,569		38,466
NGLs (MBbls)		1,603		1,163		506
Oil, natural gas and NGLs (MMcfe)		101,111		92,357		80,064
Average sales prices: (1)
Oil (per Bbl)	$	103.73	$	106.70	$	103.31
Natural gas (per Mcf)		3.80		3.17		4.44
NGLs (per Bbl)		37.86		41.70		59.28
Oil, natural gas and NGLs (per Mcfe)		9.56		10.23		10.80
Expenses (per Mcfe):
Lease operating expenses (2)	$	1.99	$	2.33	$	2.20

(1) Includes the cash settlement of effective hedging contracts.

(2) Includes oil and gas operating costs and major maintenance expense and excludes production and ad valorem taxes.

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Production Volumes, Sales Price and Cost Data for Individually Significant Fields. The following table sets forth certain information regarding our production volumes, sales prices and average production costs for the periods indicated for any field(s) containing 15% or more of our total estimated proved reserves at December 31, 2013.

	Year Ended December 31,
	2013		2012		2011
FIELD: Mary
Production:
Oil (MBbls)		472		340		25
Natural gas (MMcf)		12,448		6,815		977
NGLs (MBbls)		749		448		—
Oil, natural gas and NGLs (MMcfe)		19,774		11,544		1,125
Average sales prices:
Oil (per Bbl)	$	53.76	$	54.19	$	75.60
Natural gas (per Mcf)		3.97		3.27		6.08
NGLs (per Bbl)		35.44		33.94		—
Oil, natural gas and NGLs (per Mcfe)		5.13		4.84		6.94
Expenses (per Mcfe):
Lease operating expenses (1)	$	0.42	$	1.14	$	1.40

	Year Ended December 31,
	2013		2012		2011(a)
FIELD: Pompano
Production:
Oil (MBbls)		1,420		1,266		—
Natural gas (MMcf)		2,887		1,980		—
NGLs (MBbls)		162		122		—
Oil, natural gas and NGLs (MMcfe)		12,375		10,310		—
Average sales prices:
Oil (per Bbl)	$	107.99	$	108.65	$	—
Natural gas (per Mcf)		2.49		2.02		—
NGLs (per Bbl)		40.65		45.70		—
Oil, natural gas and NGLs (per Mcfe)		13.50		14.28		—
Expenses (per Mcfe):
Lease operating expenses (1)	$	1.98	$	2.01	$	—

(a) Amounts for 2011 are immaterial. We completed the acquisition of the Pompano field on December 28, 2011.

(1) Includes oil and gas operating costs and major maintenance expense and excludes production and ad valorem taxes.

Drilling Activity. The following table sets forth our drilling activity for the periods indicated.

	Year Ended December 31,
	2013				2012				2011
	Gross		Net		Gross		Net		Gross		Net
Exploratory Wells:
Productive		2.00		0.60		1.00		0.43		6.00		3.00
Dry		2.00		0.65		—		—		1.00		0.64
Development Wells:
Productive		44.00		28.13		33.00		23.16		37.00		32.92
Dry		1.00		0.94		3.00		3.00		—		—

During the period beginning January 1, 2014 and ending February 25, 2014, we participated in the drilling of 4.00 gross (3.31 net) exploratory wells and 4.00 gross (3.33 net) development wells.

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Productive Well and Acreage Data. The following table sets forth certain statistics regarding the number of productive wells and developed and undeveloped acreage as of December 31, 2013.

	Gross		Net
Productive Wells:
Oil (1):
Conventional Shelf		92		76
Deep Gas		—		—
Deep Water		54		44
Appalachia		—		—
Canada		—		—
Other		11		3
		157		123
Gas (2):
Conventional Shelf		57		39
Deep Gas		4		1
Deep Water		7		4
Appalachia		103		66
Canada		—		—
Other		—		—
		171		110
Total		328		233
Developed Acres:
Conventional Shelf		201,799		201,319
Deep Gas		12,031		11,909
Deep Water		56,153		56,153
Appalachia		29,186		28,609
Canada		—		—
Other		32,536		32,350
		331,705		330,340
Undeveloped Acres (3):
Conventional Shelf		98,117		24,338
Deep Gas		26,508		26,220
Deep Water		678,845		448,528
Appalachia		74,014		65,189
Canada		37,680		30,655
Other		69,394		55,401
		984,558		650,331
Total		1,316,263		980,671

(1) 12 gross wells each have dual completions.

(2) 5 gross wells each have dual completions.

(3) Leases covering approximately 15% of our undeveloped gross acreage will expire in 2014, 11% in 2015, 11% in 2016, 6% in 2017, 15% in 2018, 9% in 2019, 2% in 2020, 1% in 2021 and 30% thereafter.

Title to Properties

We believe that we have satisfactory title to substantially all of our active properties in accordance with standards generally accepted in the oil and gas industry. Our properties are subject to customary royalty interests, liens for current taxes and other burdens, which we believe do not materially interfere with the use of or affect the value of such properties. Prior to acquiring undeveloped properties, we perform a title investigation that is thorough but less vigorous than that conducted prior to drilling, which is consistent with standard practice in the oil and gas industry. Before we commence drilling operations, we conduct a thorough title examination and perform curative work with respect to significant defects before proceeding with operations. We have performed a thorough title examination with respect to substantially all of our active properties.

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ITEM 3. LEGAL PROCEEDINGS

We are named as a defendant in certain lawsuits and are a party to certain regulatory proceedings arising in the ordinary course of business. We do not expect that these matters, individually or in the aggregate, will have a material adverse effect on our financial condition.

Since 2003, we have been involved in disputes with the Louisiana Department of Revenue (the “LDR”), which resulted in several petitions being filed by the LDR in Louisiana state court, claiming additional franchise taxes due. In addition, we received preliminary assessments from the LDR of additional franchise and income taxes resulting from audits of Stone and its subsidiaries. These petitions and assessments primarily related to the LDR’s assertion that sales of crude oil and natural gas from properties located on the OCS that are transported through the state should be sourced to the state for purposes of computing the Louisiana franchise tax and income tax apportionment ratios. By agreement dated November 22, 2013, Stone executed a settlement with the state in the amount of $13 million, resolving all claims asserted in litigation, as well as assessments proposed by the LDR for franchise and income taxes alleged to be due by Stone for the tax years 1999 through 2009, including claims for interest thereon. The agreement was reached under an amnesty program pursuant to Act 421 of the 2013 Regular Session of the Louisiana Legislature. The settlement amount, less income tax and interest amounts previously accrued, has been recorded as an expense in the accompanying consolidated statement of income. The tax years 2011 through 2013 remain subject to examination, but the exposure to additional assessments is immaterial.

On November 11, 2013, two lawsuits were filed, and on November 12, 2013, a third lawsuit was filed, against Stone and other named co-defendants, by the Parish of Jefferson (“Jefferson Parish”), on behalf of Jefferson Parish and the State of Louisiana, in the 24^th Judicial District Court for the Parish of Jefferson, State of Louisiana, alleging violations of the State and Local Coastal Resources Management Act of 1978, as amended, and the applicable regulations, rules, orders and ordinances thereunder (collectively, “the CRMA”), relating to certain of the defendants’ alleged oil and gas operations in Jefferson Parish, and seeking to recover alleged unspecified damages to the Jefferson Parish Coastal Zone and remedies, including unspecified monetary damages and declaratory relief, restoration of the Jefferson Parish Coastal Zone and related costs and attorney’s fees. In addition, on November 8, 2013, a lawsuit was filed against Stone and other named co-defendants by the Parish of Plaquemines (“Plaquemines Parish”), on behalf of Plaquemines Parish and the State of Louisiana, in the 25^th Judicial District Court for the Parish of Plaquemines, State of Louisiana, alleging violations of the CRMA, relating to certain of the defendants’ alleged oil and gas operations in Plaquemines Parish, and seeking to recover alleged unspecified damages to the Plaquemines Parish Coastal Zone and remedies, including unspecified monetary damages and declaratory relief, restoration of the Plaquemines Parish Coastal Zone and related costs and attorney’s fees. The lawsuits are at an early stage and, while Stone has engaged counsel to represent it in these lawsuits, it is in the beginning stages of investigating and evaluating the allegations.

In October 2012, we received a notice from BSEE that it was initiating an enforcement proceeding with respect to an Incident of Non-Compliance observed at our Vermillion Block 255 Platform H in April 2012. We believe that the conditions observed were not actually violations of applicable rules and accordingly initiated discussions with BSEE to resolve the matter. Notwithstanding these discussions, by “Reviewing Officer’s Final Decision” dated July 9, 2013, BSEE assessed a penalty against Stone of $200,000 based on $25,000 per day for eight days of alleged improper venting of gas at the platform. We are pursuing an administrative appeal of this decision. We do not believe that this proceeding will have a material adverse effect on our financial condition or results of operations.

In December 2011, a slope failure occurred adjacent to a well pad where we were drilling a well in Wetzel County, West Virginia. The slope failure was near a stream, and an estimated 250 to 300 cubic yards of soil and debris entered the stream. We responded to the incident by removing the discharged material from the stream and stabilizing the area in which the slope failure occurred. In October 2013, we received notice from the West Virginia Department of Environmental Protection that it was proposing to impose a penalty on us for an unauthorized discharge of pollutants into the affected stream. On January 9, 2014, Stone and the West Virginia Department of Environmental Protection, Office of Oil and Gas, agreed to a Consent Order resolving this matter, providing for a total payment of $284,190, with $170,515 payable within 30 days of entry of the Consent Order and the balance of $113,675 to be applied to a Supplemental Environmental Project within one year of entry of the Consent Order.

Litigation is subject to substantial uncertainties concerning the outcome of material factual and legal issues relating to the litigation. Accordingly, we cannot currently predict the manner and timing of the resolution of these matters and are unable to estimate a range of possible losses or any minimum loss from such matters.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Since July 9, 1993, our common stock has been listed on the New York Stock Exchange under the symbol “SGY.” The following table sets forth, for the periods indicated, the high and low sales prices per share of our common stock.

	High		Low
2012
First Quarter	$	35.47	$	25.61
Second Quarter		29.83		20.80
Third Quarter		27.87		22.07
Fourth Quarter		25.71		19.27
2013
First Quarter	$	23.40	$	19.44
Second Quarter		24.50		17.34
Third Quarter		33.49		21.95
Fourth Quarter		37.96		30.61
2014
First Quarter (through February 25, 2014)	$	37.06	$	29.13

On February 25, 2014, the last reported sales price of our common stock on the New York Stock Exchange Composite Tape was $35.08 per share. As of that date, there were 375 holders of record of our common stock.

Dividend Restrictions

In the past, we have not paid cash dividends on our common stock, and we do not intend to pay cash dividends on our common stock in the foreseeable future. We currently intend to retain earnings, if any, for the future operation and development of our business. The restrictions on our present or future ability to pay dividends are included in the provisions of the Delaware General Corporation Law and in certain restrictive provisions in the indentures executed in connection with our 1 ³⁄₄% Senior Convertible Notes due 2017 (the “2017 Convertible Notes”) and our 7 ¹⁄₂% Senior Notes due 2022 (the “2022 Notes”). In addition, our bank credit facility contains provisions that may have the effect of limiting or prohibiting the payment of dividends.

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Issuer Purchases of Equity Securities

On September 24, 2007, our board of directors authorized a share repurchase program for an aggregate amount of up to $100 million. The shares may be repurchased from time to time in the open market or through privately negotiated transactions. The repurchase program is subject to business and market conditions and may be suspended or discontinued at any time. Additionally, shares are sometimes withheld from certain employees and nonemployee directors to pay taxes associated with the vesting of restricted stock. These withheld shares are not issued or considered common stock repurchases under our authorized share repurchase program. The following table sets forth information regarding our repurchases or acquisitions of our common stock during the fourth quarter of 2013:

Period	Total Number of Shares Purchased (1)		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)		Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
October 1 – October 31, 2013		—	$	—		—
November 1 – November 30, 2013		—		—		—
December 1 – December 31, 2013		—		—		—
		—	$	—		—	$	92,928,632

(1) There were no repurchases of our common stock under our share repurchase program and no shares withheld from employees or nonemployee directors to pay taxes associated with any vesting of restricted stock during the fourth quarter of 2013.

Equity Compensation Plan Information

Please refer to Item 12 of this Annual Report on Form 10-K for information concerning securities authorized under our equity compensation plan.

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Stock Performance Graph

As required by applicable rules of the SEC, the performance graph shown below was prepared based upon the following assumptions:

1. $100 was invested in the company’s common stock, the Standard & Poor’s 500 Stock Index (“S&P 500 Index”) and the Peer Group (as defined below) on December 31, 2008 at $11.02 per share for the company’s common stock and at the closing price of the stocks comprising the S&P 500 Index and the Peer Group, respectively, on such date.

2. Peer Group investment is weighted based upon the market capitalization of each individual company within the Peer Group at the beginning of the period.

3. Dividends are reinvested on the ex-dividend dates.

Measurement Period (Fiscal Year Covered)	SGY		2013 Peer Group		2012 Peer Group		S&P 500 Index
12/31/09		163.79		158.66		159.70		126.46
12/31/10		202.27		191.85		202.58		145.51
12/31/11		239.38		172.27		187.61		148.59
12/31/12		186.21		159.32		185.19		172.37
12/31/13		313.88		210.37		250.06		228.19

The companies that comprised our Peer Group in 2013 were: Cabot Oil & Gas Corporation, Callon Petroleum Company, Carrizo Oil & Gas, Inc., Cimarex Energy Company, Comstock Resources, Inc., Contango Oil & Gas Company, Denbury Resources Inc., Energy XXI (Bermuda) Limited, EPL Oil & Gas, Exco Resources Inc., Newfield Exploration Company, PDC Energy, PetroQuest Energy, Inc., Range Resources Corporation, SandRidge Energy, Inc., SM Energy Company, Swift Energy Company, Ultra Petroleum Corporation, W&T Offshore, Inc. and Whiting Petroleum Corporation. ATP Oil & Gas Corporation, McMoRan Exploration Company, and Plains Exploration & Production Company were replaced in the Peer Group by Ultra Petroleum Corporation, SandRidge Energy, Inc., and Contango Oil & Gas Company because McMoRan Exploration Company and Plains Exploration & Production Company announced they were merging into another company and ATP Oil & Gas Corporation filed for bankruptcy protection.

The information in this Form 10-K appearing under the heading “Stock Performance Graph” is being “furnished” pursuant to Item 2.01(e) of Regulation S-K under the Securities Act and shall not be deemed to be “soliciting material” or “filed” with the SEC or subject to Regulation 14A or 14C, other than as provided in Item 2.01(e) of Regulation S-K, or to the liabilities of Section 18 of the Exchange Act.

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ITEM 6. SELECTED FINANCIAL DATA

The following table sets forth a summary of selected historical financial information for each of the years in the five-year period ended December 31, 2013. This information is derived from our Consolidated Financial Statements and the notes thereto. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and Item 8. Financial Statements and Supplementary Data.

	Year Ended December 31,
	2013			2012			2011			2010			2009
	(In thousands, except per share amounts)
Income Statement Data:
Operating revenue:
Oil production	$	715,104		$	761,304		$	663,958		$	417,948		$	438,942
Gas production		190,580			134,739			170,611			210,686			272,353
Natural gas liquids production		60,687			48,498			29,996			27,473			—
Other operational income		7,808			3,520			3,938			5,916			4,326
Derivative income, net		—			3,428			1,418			3,265			3,061
Total operating revenue		974,179			951,489			869,921			665,288			718,682
Operating expenses:
Lease operating expenses		201,153			215,003			175,881			150,212			156,786
Transportation, processing and gathering expenses		42,172			21,782			8,958			7,218			—
Production taxes		15,029			10,015			9,380			5,808			7,920
Depreciation, depletion and amortization		350,574			344,365			280,020			248,201			259,639
Write-down of oil and gas properties		—			—			—			—			508,989
Accretion expense		33,575			33,331			30,764			34,469			39,306
Salaries, general and administrative expenses		59,524			54,648			40,169			42,759			41,367
Franchise tax settlement		12,590			—			—			—			—
Incentive compensation expense		15,340			8,113			11,600			5,888			6,402
Other operational expenses		151			267			2,149			5,579			11,798
Derivative expense, net		2,090			—			—			—			—
Total operating expenses		732,198			687,524			558,921			500,134			1,032,207
Income (loss) from operations		241,981			263,965			311,000			165,154			(313,525	)
Other (income) expenses:
Interest expense		32,837			30,375			9,289			12,192			21,361
Interest income		(1,695	)		(600	)		(420	)		(1,464	)		(528	)
Other income		(2,799	)		(1,805	)		(1,942	)		(776	)		(36	)
Loss on early extinguishment of debt		27,279			1,972			607			1,820			—
Other expense		—			—			—			671			508
Total other expenses		55,622			29,942			7,534			12,443			21,305
Income (loss) before income taxes		186,359			234,023			303,466			152,711			(334,830	)
Income tax provision (benefit)		68,725			84,597			109,134			56,282			(116,559	)
Net income (loss)		117,634			149,426			194,332			96,429			(218,271	)
Net income (loss) attributable to non-controlling interest		—			—			—			—			27
Net income (loss) attributable to Stone Energy Corp.	$	117,634		$	149,426		$	194,332		$	96,429			($218,298	)
Earnings and dividends per common share:
Basic earnings (loss) per share	$	2.36		$	3.03		$	3.97		$	1.99			($4.97	)
Diluted earnings (loss) per share	$	2.36		$	3.03		$	3.97		$	1.99			($4.97	)
Cash dividends declared per share		—			—			—			—			—
Cash Flow Data:
Net cash provided by operating activities	$	594,205		$	509,749		$	570,850		$	424,794		$	507,787
Net cash used in investing activities		(623,036	)		(568,688	)		(679,250	)		(374,088	)		(316,079	)
Net cash provided by (used in) financing activities		80,594			300,014			39,895			(13,043	)		(190,552	)
Balance Sheet Data (at end of period):
Working capital (deficit)	$	181,255		$	300,348			($13,282	)	$	30,382		$	26,137
Oil and gas properties, net		2,619,696			2,182,095			1,875,048			1,397,809			1,185,709
Total assets		3,248,556			2,776,431			2,165,751			1,679,090			1,454,242
Long-term debt, less current portion		1,027,084			914,126			620,000			575,000			575,000
Stone Energy Corporation stockholders’ equity		970,286			872,133			667,829			430,357			325,659

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion is intended to assist in understanding our financial position and results of operations for each of the years in the three-year period ended December 31, 2013. Our Consolidated Financial Statements and the notes thereto, which are found elsewhere in this Form 10-K, contain detailed information that should be referred to in conjunction with the following discussion. See Item 1A. Risk Factors and Item 8. Financial Statements and Supplementary Data – Note 1.

Executive Overview

We are an independent oil and natural gas company engaged in the acquisition, exploration, exploitation, development and operation of oil and gas properties. We have been operating in the Gulf Coast Basin since our incorporation in 1993 and have established a technical and operational expertise in this area. We have expanded our reserve base outside of the conventional shelf of the GOM and into the more prolific reserve basins of the GOM deep water and GOM deep gas as well as onshore oil and gas shale opportunities, including the Marcellus Shale in Appalachia. See Item 1. Business – Operational Overview.

2013 Significant Events.

Reserve and Production Growth – 2013 represented our fourth consecutive year of growth in production and reserves. We had continued progress in our diversification strategy, resulting in a reserve mix of 55% Appalachia, 29% deep water, and 16% conventional shelf/deep gas on a volume equivalent basis. Our year-end 2013 total estimated proved reserves were 864 Bcfe, a 12% increase from 2012 year-end estimated proved reserves. Production volumes for 2013 averaged approximately 277 MMcfe per day, representing a 10% increase over 2012 production volumes.

Issuance of 2022 Senior Notes – On November 27, 2013, we completed the public offering of an additional $475 million aggregate principal amount of our 7 ¹⁄₂% Senior Notes due 2022 at a 3% premium. The net proceeds from the offering after deducting fees and expenses totaled $480.2 million. Approximately $396.0 million of the net proceeds from the offering were used to fund the tender offer and consent solicitation and redemption of our outstanding 8 ⁵⁄₈% Senior Notes due 2017 (the “2017 Notes”) and approximately $11.0 million of the net proceeds were used to pay the accrued and unpaid interest on the 2017 Notes. The remaining proceeds were used for general corporate purposes. As of December 31, 2013, we had approximately $331 million of cash on hand.

Franchise Tax Settlement – On November 22, 2013, we executed a settlement with the LDR in the amount of $13 million, resolving all claims asserted in litigation, as well as assessments proposed by the LDR for franchise and income taxes alleged to be due by Stone for the tax years 1999 through 2009, including claims for interest thereon. The settlement amount, less income tax and interest amounts previously accrued, has been recorded as an expense in the accompanying consolidated statement of income. The tax years 2011 through 2013 remain subject to examination, but the exposure to additional assessments is immaterial.

Sale of Shelf Properties – In 2013, we engaged a financial advisor to market certain of our properties in the GOM conventional shelf, state waters and onshore Louisiana. In October 2013, we completed the sale of our interest in the Weeks Island field, representing less than 1% of our total estimated proved reserves at December 31, 2012. In January 2014, we completed the sale of our interest in the Cut Off and Clovelly fields, representing less than 1% of our total estimated proved reserves at December 31, 2013. The remainder of our shelf properties that are subject to sale represented approximately 22% of our total production volumes and 18% of our total production revenue for the year ended December 31, 2013 and 9% of our total estimated proved reserves at December 31, 2013. The future sale of some or all of our shelf properties would be subject to an acceptable offer or offers and other market conditions.

2014 Outlook.

Our 2014 capital expenditure budget is approximately $825 million. This figure compares with a $710 million capital expenditure budget for 2013 and excludes material acquisitions and capitalized salaries, general and administrative expenses (“SG&A”) and interest. The budget is spread across our major areas of investment, with approximately 58% allocated to the deep water, 26% allocated to Appalachia, 10% allocated to the GOM conventional shelf, 3% allocated to deep gas projects, and 3% allocated to onshore exploration projects. The allocation of capital across the various areas is subject to change based on several factors, including permitting times, rig availability, non-operator decisions, farm-in opportunities and commodity pricing.

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Known Trends and Uncertainties.

Hurricanes – Since the majority of our production originates in the GOM, we are particularly vulnerable to the effects of hurricanes on production. Additionally, affordable and practical insurance coverage for property damage to our facilities for hurricanes has been difficult to obtain for some time so we have eliminated our hurricane insurance coverage. Significant hurricane impacts could include reductions and/or deferrals of future oil and natural gas production and revenues, increased lease operating expenses for evacuations and repairs and possible acceleration of plugging and abandonment costs.

Deep Water Operations – We are currently operating two significant properties in the deep water of the GOM. Additionally, we are engaged in deep water drilling operations. Operations in the deep water can result in increased operational risks as has been demonstrated by the Deepwater Horizon disaster in 2010. Despite technological advances since this disaster, liabilities for environmental losses, personal injury and loss of life and significant regulatory fines in the event of a disaster could be well in excess of insured amounts and result in significant current losses on our statement of income as well as going concern issues.

Non-U.S. Operations – In April 2013, we entered into an agreement to participate in the drilling of exploratory wells in Canada. Included in unevaluated oil and gas property costs at December 31, 2013 are $10.6 million of capital expenditures related to our oil and gas property investments in Canada. Under full cost accounting, investments in individual countries represent separate cost centers for computation of depreciation, depletion and amortization (“DD&A”) as well as for full cost ceiling test evaluations. Given that this is our sole investment in Canada, it is possible that upon a more complete evaluation of this project that some or all of this investment could be recognized as a charge to expense on our statement of income.

Earnings Per Share – On March 6, 2012, we issued $300 million of 2017 Convertible Notes. These notes are convertible into cash, shares of our common stock or a combination thereof at our election. Current accounting standards require us to use the treasury method for determining potential dilution in our diluted earnings per share computation since it is management’s intention to settle the principal in cash. However, if due to changes in facts and circumstances beyond our control such intention were to change, or it becomes probable that we will be unable to settle the principal in cash, we could be required to change our methodology for determining diluted earnings per share to the if-converted method. The if-converted method would result in a substantial dilutive effect on diluted earnings per share when compared to the treasury method.

Sale of Shelf Properties – In 2013, we engaged a financial advisor to market certain of our properties in the GOM conventional shelf, state waters and onshore Louisiana, and to date have completed the sales of our interests in the Weeks Island, Cut Off and Clovelly fields. Sales of oil and natural gas properties under the full cost method are accounted for as an adjustment to capitalized costs unless such adjustment would significantly alter the relationship between capitalized costs and proved reserves of oil and gas attributable to the applicable cost center. If such relationship would be altered significantly, we would be required to allocate the cost center between the properties sold and the properties retained and to recognize a gain or loss on the sale in the period in which the transaction is consummated. The Weeks Island, Cut Off and Clovelly sales did not result in a significant alteration of this relationship and, consequently, no gain or loss will be recognized. Whether a significant alteration would occur on future transactions, and therefore a gain or loss recognized, cannot be determined at this time.

Liquidity and Capital Resources

As of February 25, 2014, we had $378.6 million of availability under our bank credit facility and cash on hand of approximately $312 million. Our capital expenditure budget for 2014 has been set at $825 million, which excludes material acquisitions and capitalized SG&A expenses and interest. Based on our outlook of commodity prices and our estimated production, we expect our 2014 capital expenditures to exceed our cash flows from operating activities. We intend to finance a portion of our capital expenditure budget with cash flows from operating activities, cash on hand and our bank credit facility. However, a portion of our capital expenditure budget will likely need to be financed from other sources. We are considering accessing the public or private markets or monetizing other assets as a source of financing.

Cash Flow and Working Capital. Net cash flows from operating activities totaled $594.2 million during the year ended December 31, 2013 compared to $509.7 million and $570.9 million during the years ended December 31, 2012 and 2011, respectively.

Net cash used in investing activities totaled $623.0 million during the year ended December 31, 2013, which primarily represents our investment in oil and natural gas properties of $663.3 million and our investment in fixed and other assets of $6.8 million offset by proceeds from the sale of oil and natural gas properties of $48.8 million. Net cash used in investing activities totaled $568.7 million during the year ended December 31, 2012, which primarily represents our investment in oil and natural gas properties of $555.9 million and our investment in fixed and other assets of $13.4 million. Net cash used in investing activities totaled $679.3 million during the year ended December 31, 2011, which primarily represents our investment in oil and natural gas properties of $764.9 million offset by proceeds from the sale of oil and natural gas properties of $87.9 million. Approximately $270.4 million of the investment in oil and natural gas properties in 2011 related to leasehold acquisitions and the acquisition of producing properties.

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Net cash provided by financing activities totaled $80.6 million for the year ended December 31, 2013, which primarily represents $480.2 million of net proceeds from the issuance of the 2022 Notes, less $396.0 million used for the redemption of our 2017 Notes. Net cash provided by financing activities totaled $300.0 million during the year ended December 31, 2012. In 2012, we received $291.1 million of net proceeds from the issuance of the 2017 Convertible Notes and $40.1 million of proceeds from the Sold Warrants, and used $70.8 million for the cost of the Purchased Call Options (see Notes to Consolidated Financial Statements – NOTE 11 – Long-Term Debt). Additionally, we received $293.2 million of net proceeds from the issuance of the 2022 Notes. During 2012, we used $200.7 million for the redemption of our 2014 Notes. During the year ended December 31, 2012, we had $25.0 million of borrowings and $70.0 million of repayments of borrowings under our bank credit facility. Net cash provided by financing activities totaled $39.9 million for the year ended December 31, 2011, which primarily represents borrowings net of repayments under our bank credit facility of $45.0 million, less $4.0 million of deferred financing costs associated with our new bank credit facility and $2.6 million of net payments for share-based compensation.

We had working capital at December 31, 2013 of $181.3 million.

Capital Expenditures. During the year ended December 31, 2013, additions to oil and gas property costs of $836.2 million included $86.2 million of lease and property acquisition costs, $32.5 million of capitalized SG&A expenses (inclusive of incentive compensation) and $46.9 million of capitalized interest. These investments were financed with cash on hand and cash flows from operations.

Bank Credit Facility. On April 26, 2011, we entered into an amended and restated revolving credit facility totaling $700 million (subject to borrowing base limitations) through a syndicated bank group, replacing our previous facility. Our bank credit facility matures on April 26, 2015. On December 18, 2013, our borrowing base under our bank credit facility was reaffirmed at $400 million. As of December 31, 2013 and February 25, 2014, we had no outstanding borrowings under our bank credit facility and letters of credit totaling $21.4 million had been issued pursuant to our bank credit facility, leaving $378.6 million of availability under our bank credit facility. Our bank credit facility is guaranteed by our only significant subsidiary, Stone Energy Offshore, L.L.C. (“Stone Offshore”).

The borrowing base under our bank credit facility is redetermined semi-annually, in May and November, by the lenders, taking into consideration the estimated value of our oil and gas properties and those of our direct and indirect material subsidiaries in accordance with the lenders’ customary practices for oil and gas loans. In addition, we and the lenders each have discretion at any time, but not more than two additional times in any calendar year, to have the borrowing base redetermined. Our bank credit facility is collateralized by substantially all of Stone’s and Stone Offshore’s assets. Stone and Stone Offshore are required to mortgage, and grant a security interest in, their oil and natural gas reserves representing at least 80% of the discounted present value of the future net cash flows from their oil and natural gas reserves reviewed in determining the borrowing base. At our option, loans under our bank credit facility will bear interest at a rate based on the adjusted London Interbank Offering Rate plus an applicable margin, or a rate based on the prime rate or Federal funds rate plus an applicable margin.

Under the financial covenants of our bank credit facility, we must (1) maintain a ratio of consolidated debt to consolidated EBITDA, as defined in the credit agreement, for the preceding four quarterly periods of not greater than 3.25 to 1 and (2) maintain a ratio of consolidated EBITDA to consolidated Net Interest Expense, as defined in the credit agreement, for the preceding four quarterly periods of not less than 3.0 to 1. As of December 31, 2013, our debt to EBITDA ratio was 1.73 to 1 and our EBITDA to consolidated Net Interest Expense ratio was approximately 18.40 to 1. In addition, our bank credit facility includes certain customary restrictions or requirements with respect to disposition of properties, incurrence of additional debt, change of ownership and reporting responsibilities. These covenants may limit or prohibit us from paying cash dividends but do allow for limited stock repurchases. These covenants also restrict our ability to prepay other indebtedness under certain circumstances. We were in compliance with all covenants as of December 31, 2013.

7 ¹⁄₂% Senior Notes due 2022. On November 27, 2013, we completed the public offering of an additional $475 million aggregate principal amount of our 2022 Notes at a 3% premium. The net proceeds from the offering after deducting underwriting discounts, commissions, fees and expenses totaled $480.2 million. Approximately $396.0 million of the net proceeds from the offering were used to fund the tender offer and consent solicitation and redemption of our outstanding 2017 Notes and approximately $11.0 million of the net proceeds were used to pay the accrued and unpaid interest on the 2017 Notes. The remaining proceeds were used for general corporate purposes.

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8 ⁵⁄₈% Senior Notes due 2017. In November 2013, we used proceeds from the 2022 Notes offering to purchase a portion of our 2017 Notes pursuant to a tender offer and consent solicitation. In December 2013, the remaining 2017 Notes were redeemed in full. The total cost of the redemption was $407.0 million, which included $396.0 million to redeem the notes plus accrued and unpaid interest of $11.0 million. The transaction resulted in a charge to earnings of $27.3 million in 2013.

Share Repurchase Program. On September 24, 2007, our board of directors authorized a share repurchase program for an aggregate amount of up to $100 million. The shares may be repurchased from time to time in the open market or through privately negotiated transactions. The repurchase program is subject to business and market conditions and may be suspended or discontinued at any time. Through December 31, 2013, 300,000 shares had been repurchased under this program at a total cost of approximately $7.1 million, or an average price of $23.57 per share. No shares were repurchased during the years ended December 31, 2013, 2012 or 2011.

Hedging. See Item 7A. Quantitative and Qualitative Disclosures About Market Risk – Commodity Price Risk.

Contractual Obligations and Other Commitments

The following table summarizes our significant contractual obligations and commitments, other than hedging contracts, by maturity as of December 31, 2013 (in thousands):

	Total		Less than 1 Year		1-3 Years		4-5 Years		More than 5 Years
Contractual Obligations and Commitments:
1 3⁄4% Senior Convertible Notes due 2017	$	300,000	$	—	$	—	$	300,000	$	—
7 1⁄2% Senior Notes due 2022		775,000		—		—		—		775,000
Interest and commitment fees (1)		536,763		65,294		127,360		118,875		225,234
Asset retirement obligations including accretion		898,874		69,270		202,187		84,524		542,893
Rig commitments		142,291		142,291		—		—		—
Seismic data commitments		74,436		28,297		30,759		15,380		—
Operating lease obligations		2,179		736		995		448		—
Total Contractual Obligations and Commitments	$	2,729,543	$	305,888	$	361,301	$	519,227	$	1,543,127

(1) Includes interest payable on the 2022 Notes and 2017 Convertible Notes. Assumes 0.5% fee on unused commitments under the bank credit facility.

Safety Performance

We measure our safety performance based on the total recordable incident rate (“TRIR”), which is the number of safety incidents per 200,000 man-hours worked for employees and certain contractors. All onshore safety incidents are reported to the Occupational Safety and Health Administration (“OSHA”) and are tracked on OSHA Form 301. All offshore safety incidents are reported to the BOEM. Our TRIR is provided to the BOEM as part of a voluntary program for safety monitoring in the GOM. Our TRIR for the last three calendar years was as follows:

Year Ended December 31,	TRIR Performance		TRIR Goal
2013		0.47		0.50
2012		0.45		0.55
2011		0.33		0.65

Our safety initiative includes formal programs for observation and reporting of at-risk and safe behavior in and away from the work place, employee awards for results and observations, employee participation in training programs and internal safety audits. We have an annual cash incentive compensation plan that includes a safety component based on our annual TRIR.

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Results of Operations

2013 Compared to 2012. The following table sets forth certain information with respect to our oil and gas operations and summary information with respect to our estimated proved oil and natural gas reserves. See Item 2. Properties – Oil and Natural Gas Reserves.

	Year Ended December 31,
	2013		2012		Variance			% Change
Production:
Oil (MBbls)		6,894		7,135		(241	)		(3	%)
Natural gas (MMcf)		50,129		42,569		7,560			18	%
NGLs (MBbls)		1,603		1,163		440			38	%
Oil, natural gas and NGLs (MMcfe)		101,111		92,357		8,754			10	%
Revenue data (in thousands): (1)
Oil revenue	$	715,104	$	761,304	($	46,200	)		(6	%)
Natural gas revenue		190,580		134,739		55,841			41	%
NGL revenue		60,687		48,498		12,189			25	%
Total oil, natural gas and NGL revenue	$	966,371	$	944,541	$	21,830			2	%
Average prices: (1)
Oil (per Bbl)	$	103.73	$	106.70		($2.97	)		(3	%)
Natural gas (per Mcf)		3.80		3.17		0.63			20	%
NGLs (per Bbl)		37.86		41.70		(3.84	)		(9	%)
Oil, natural gas and NGLs (per Mcfe)		9.56		10.23		(0.67	)		(7	%)
Expenses (per Mcfe):
Lease operating expenses	$	1.99	$	2.33		($0.34	)		(15	%)
Salaries, general and administrative expenses (2)		0.59		0.59		—			N/A
DD&A expense on oil and gas properties		3.43		3.69		(0.26	)		(7	%)
Estimated Proved Reserves at December 31:
Oil (MBbls)		43,827		44,918		(1,091	)		(2	%)
Natural gas (MMcf)		460,766		395,374		65,392			17	%
NGLs (MBbls)		23,297		18,066		5,231			29	%
Oil, natural gas and NGLs (MMcfe)		863,513		773,285		90,228			12	%

(1) Includes the cash settlement of effective hedging contracts.

(2) Excludes incentive compensation expense.

Net Income. For the year ended December 31, 2013, we reported net income totaling $117.6 million, or $2.36 per share, compared to net income for the year ended December 31, 2012 of $149.4 million, or $3.03 per share. All per share amounts are on a diluted basis.

The variance in annual results was due to the following components:

Production. During the year ended December 31, 2013, total production volumes increased to 101.1 Bcfe compared to 92.4 Bcfe produced during the comparable 2012 period, representing a 10% increase. Oil production during the year ended December 31, 2013 totaled approximately 6,894,000 Bbls compared to 7,135,000 Bbls produced during the year ended December 31, 2012. Natural gas production totaled 50.1 Bcf during the year ended December 31, 2013 compared to 42.6 Bcf produced during the comparable 2012 period. NGL production during the year ended December 31, 2013 totaled approximately 1,603,000 Bbls compared to 1,163,000 Bbls produced during the comparable 2012 period. During the fourth quarter of 2013, ten new wells in the Mary field and two new wells in the Heather field were brought online. The third well in the La Cantera field was placed on production during the second quarter of 2013.

Prices. Prices realized during the year ended December 31, 2013 averaged $103.73 per Bbl of oil, $3.80 per Mcf of natural gas and $37.86 per Bbl of NGLs, or 7% lower, on an Mcfe basis, than 2012 average realized prices of $106.70 per Bbl of oil, $3.17 per Mcf of natural gas and $41.70 per Bbl of NGLs. All unit pricing amounts include the cash settlement of effective hedging contracts.

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We enter into various hedging contracts in order to reduce our exposure to the possibility of declining oil and gas prices. During the year ended December 31, 2013, effective hedging transactions increased our average realized natural gas price by $0.33 per Mcf and increased our average realized oil price by $0.51 per Bbl. During the year ended December 31, 2012, effective hedging transactions increased our average realized natural gas price by $0.52 per Mcf and increased our average realized oil price by $1.20 per Bbl.

Revenue. Oil, natural gas and NGL revenue increased 2% to $966.4 million during the year ended December 31, 2013 from $944.5 million during the year ended December 31, 2012. The increase was attributable to a 10% increase in production quantities on a gas equivalent basis, which was partially offset by a 7% decrease in average realized prices.

Expenses. Lease operating expenses for the years ended December 31, 2013 and 2012 totaled $201.2 million and $215.0 million, respectively. On a unit of production basis, lease operating expenses were $1.99 per Mcfe and $2.33 per Mcfe for the years ended December 31, 2013 and 2012, respectively. The decrease in lease operating expenses in 2013 was primarily attributable to a decrease in insurance and major maintenance expenses.

Transportation, processing and gathering expenses during the years ended December 31, 2013 and 2012 totaled $42.2 million and $21.8 million, respectively. The increase is attributable to higher gas and NGL volumes and short term blending fees in Appalachia, as well as higher GOM pipeline fees.

DD&A expense on oil and gas properties for the year ended December 31, 2013 totaled $346.8 million, or $3.43 per Mcfe, compared to DD&A expense of $341.1 million, or $3.69 per Mcfe, for the year ended December 31, 2012.

For the years ended December 31, 2013 and 2012, SG&A expenses (exclusive of incentive compensation) totaled $59.5 million and $54.6 million, respectively. The increase in SG&A expenses in 2013 was primarily the result of increased staffing and compensation adjustments (including share-based compensation). Partially offsetting this increase was a reimbursement of $1.6 million of legal fees relating to the settlement of litigation in prior periods. Included in SG&A expenses in 2012 was a $1.0 million management fee for transition services related to the Pompano field acquisition.

For the years ended December 31, 2013 and 2012, incentive compensation expense totaled $15.3 million and $8.1 million, respectively. These amounts related to incentive compensation bonuses calculated based on the achievement of certain strategic objectives for each fiscal year.

During the year ended December 31, 2013, we executed a settlement with the LDR in the amount of $13 million relating to claims asserted in litigation, as well as assessments proposed by the LDR for franchise and income taxes alleged to be due by Stone for the tax years 1999 through 2009, including claims for interest thereon.

Interest expense for the year ended December 31, 2013 totaled $32.8 million, net of $46.9 million of capitalized interest, compared to interest expense of $30.4 million, net of $37.7 million of capitalized interest, during the year ended December 31, 2012. The increase in interest expense was primarily the result of interest associated with the 2022 Notes issued in November 2012 and November 2013, and the 2017 Convertible Notes issued in March 2012. Partially offsetting these increases was a decrease in interest expense as a result of the redemption in December 2012 of our 6  ³⁄₄% Senior Subordinated Notes due 2014.

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2012 Compared to 2011. The following table sets forth certain information with respect to our oil and gas operations and summary information with respect to our estimated proved oil and natural gas reserves. See Item 2. Properties – Oil and Natural Gas Reserves.

	Year Ended December 31,
	2012		2011		Variance			% Change
Production:
Oil (MBbls)		7,135		6,427		708			11	%
Natural gas (MMcf)		42,569		38,466		4,103			11	%
NGLs (MBbls)		1,163		506		657			130	%
Oil, natural gas and NGLs (MMcfe)		92,357		80,064		12,293			15	%
Revenue data (in thousands): (1)
Oil revenue	$	761,304	$	663,958	$	97,346			15	%
Natural gas revenue		134,739		170,611		(35,872	)		(21	%)
NGL revenue		48,498		29,996		18,502			62	%
Total oil, natural gas and NGL revenue	$	944,541	$	864,565	$	79,976			9	%
Average prices: (1)
Oil (per Bbl)	$	106.70	$	103.31	$	3.39			3	%
Natural gas (per Mcf)		3.17		4.44		(1.27	)		(29	%)
NGLs (per Bbl)		41.70		59.28		(17.58	)		(30	%)
Oil, natural gas and NGLs (per Mcfe)		10.23		10.80		(0.57	)		(5	%)
Expenses (per Mcfe):
Lease operating expenses	$	2.33	$	2.20	$	0.13			6	%
Salaries, general and administrative expenses (2)		0.59		0.50		0.09			18	%
DD&A expense on oil and gas properties		3.69		3.45		0.24			7	%
Estimated Proved Reserves at December 31:
Oil (MBbls)		44,918		45,655		(737	)		(2	%)
Natural gas (MMcf)		395,374		325,479		69,895			22	%
NGLs (MBbls)		18,066		4,405		13,661			310	%
Oil, natural gas and NGLs (MMcfe)		773,285		625,839		147,446			24	%

(1) Includes the cash settlement of effective hedging contracts.

(2) Excludes incentive compensation expense.

Net Income. For the year ended December 31, 2012, we reported net income totaling $149.4 million, or $3.03 per share, compared to net income for the year ended December 31, 2011 of $194.3 million, or $3.97 per share. All per share amounts are on a diluted basis.

The variance in annual results was due to the following components:

Production. During the year ended December 31, 2012, total production volumes increased to 92.4 Bcfe compared to 80.1 Bcfe produced during the comparable 2011 period, representing a 15% increase. Oil production during the year ended December 31, 2012 totaled approximately 7,135,000 Bbls compared to 6,427,000 Bbls produced during the year ended December 31, 2011. Natural gas production totaled 42.6 Bcf during the year ended December 31, 2012 compared to 38.5 Bcf produced during the comparable 2011 period. NGL production during the year ended December 31, 2012 totaled approximately 1,163,000 Bbls compared to 506,000 Bbls produced during the comparable 2011 period. The increase in NGL production resulted from our liquids rich Pompano and Appalachia gas streams coming on line. Production commenced from the deep water Pyrenees well at Garden Banks 293 during the first quarter of 2012. Included in production for the year ended December 31, 2012 is production from the Pompano field, which was acquired in December 2011.

Prices. Prices realized during the year ended December 31, 2012 averaged $106.70 per Bbl of oil, $3.17 per Mcf of natural gas and $41.70 per Bbl of NGLs, or 5% lower, on an Mcfe basis, than 2011 average realized prices of $103.31 per Bbl of oil, $4.44 per Mcf of natural gas and $59.28 per Bbl of NGLs. All unit pricing amounts include the cash settlement of effective hedging contracts.

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We enter into various hedging contracts in order to reduce our exposure to the possibility of declining oil and gas prices. During the year ended December 31, 2012, effective hedging transactions increased our average realized natural gas price by $0.52 per Mcf and increased our average realized oil price by $1.20 per Bbl. During the year ended December 31, 2011, effective hedging transactions increased our average realized natural gas price by $0.51 per Mcf and decreased our average realized oil price by $5.09 per Bbl.

Revenue. Oil, natural gas and NGL revenue increased 9% to $944.5 million during the year ended December 31, 2012 from $864.6 million during the year ended December 31, 2011. The increase was primarily due to a 15% increase in production quantities on a gas equivalent basis, which was partially offset by a 5% decrease in average realized prices.

Expenses. Lease operating expenses for the years ended December 31, 2012 and 2011 totaled $215.0 million and $175.9 million, respectively. The increase in lease operating expenses in 2012 was primarily attributable to the impact of expenses at the Pompano field, which was acquired in December 2011, as well as seasonal major maintenance projects.

Transportation, processing and gathering expenses during the years ended December 31, 2012 and 2011 totaled $21.8 million and $9.0 million, respectively. The increase resulted from our liquids rich Pompano and Appalachia gas streams coming on line in early 2012.

For the year ended December 31, 2011, other operational expenses of $2.1 million included $0.7 million for the settlement of litigation associated with an expensed operation in the first quarter of 2011, a $0.3 million loss on the sale of non-dedicated tubular inventory and $1.1 million of miscellaneous inventory charges.

DD&A expense on oil and gas properties for the year ended December 31, 2012 totaled $341.1 million, or $3.69 per Mcfe, compared to DD&A expense of $276.5 million, or $3.45 per Mcfe, for the year ended December 31, 2011. The increase in DD&A expense on a unit basis in 2012 was attributable to the unit cost of current year net reserve additions (including future development costs) exceeding the per unit amortizable base as of the beginning of the year.

For the years ended December 31, 2012 and 2011, SG&A expenses (exclusive of incentive compensation) totaled $54.6 million and $40.2 million, respectively. The increase in SG&A expenses in 2012 was primarily the result of increased staffing and compensation adjustments (including share-based compensation) and a management fee of $1.0 million for transition services related to the Pompano field acquisition. In 2011, there was a $3.9 million credit to SG&A expenses, including previously unaccrued insurance proceeds.

For the years ended December 31, 2012 and 2011, incentive compensation expense totaled $8.1 million and $11.6 million, respectively. These amounts related to incentive compensation bonuses calculated based on the achievement of certain strategic objectives for each fiscal year.

Interest expense for the year ended December 31, 2012 totaled $30.4 million, net of $37.7 million of capitalized interest, compared to interest expense of $9.3 million, net of $42.0 million of capitalized interest, during the year ended December 31, 2011. The increase in interest expense was primarily the result of interest associated with the 2017 Convertible Notes issued on March 6, 2012.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Forward-Looking Statements

Certain of the statements set forth under this item and elsewhere in this Form 10-K are forward-looking and are based upon assumptions and anticipated results that are subject to numerous risks and uncertainties. See Item 1. Business — Forward-Looking Statements and Item 1A. Risk Factors.

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Accounting Matters and Critical Accounting Estimates

Fair Value Measurements. U.S. Generally Accepted Accounting Principles (“GAAP”), as codified, establish a framework for measuring fair value and require certain disclosures about fair value measurements. There is an established fair value hierarchy that has three levels based on the reliability of the inputs used to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions.

As of December 31, 2013 and 2012, we held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. Additionally, fair value concepts were applied in recording the acquisition of various deep water assets in June 2012 and the acquisition of an office building in December 2012.

Business Combinations. Our acquisition in 2012 of various deep water assets was accounted for according to the guidance provided in Accounting Standards Codification 805, Business Combinations, which requires application of the acquisition method. This methodology requires the recordation of net assets acquired and consideration transferred at fair value. Differences between the net fair value of net assets acquired and consideration transferred are recorded as goodwill or a bargain purchase gain.

Asset Retirement Obligations. We are required to record our estimate of the fair value of liabilities related to future asset retirement obligations in the period the obligation is incurred. Asset retirement obligations relate to the removal of facilities and tangible equipment at the end of an oil and gas property’s useful life. The guidance regarding asset retirement obligations requires the use of management’s estimates with respect to future abandonment costs, inflation, market risk premiums, useful life and cost of capital. Our estimate of our asset retirement obligations does not give consideration to the value the related assets could have to other parties.

Full Cost Method. We follow the full cost method of accounting for our oil and gas properties. Under this method, all acquisition, exploration, development and estimated abandonment costs, including certain related employee and general and administrative costs (less any reimbursements for such costs) and interest incurred for the purpose of acquiring and finding oil and gas are capitalized. Unevaluated property costs are excluded from the amortization base until we have made a determination as to the existence of proved reserves on the respective property or impairment. We review our unevaluated properties at the end of each quarter to determine whether the costs should be reclassified to evaluated properties and thereby subject to amortization. Sales of oil and gas properties are accounted for as adjustments to the net full cost pool with no gain or loss recognized, unless the adjustment would significantly alter the relationship between capitalized costs and proved reserves.

We amortize our investment in oil and gas properties through DD&A expense using the units of production (the “UOP”) method. Under the UOP method, the quarterly provision for DD&A expense is computed by dividing production volumes for the period by the total proved reserves as of the beginning of the period (beginning of the period reserves being determined by adding back production to end of the period reserves), and applying the respective rate to the net cost of proved oil and gas properties, including future development costs.

We capitalize a portion of the interest costs incurred on our debt based upon the balance of our unevaluated property costs and our weighted-average borrowing rate. We also capitalize the portion of SG&A expenses that are attributable to our acquisition, exploration and development activities.

U.S. GAAP allows the option of two acceptable methods for accounting for oil and gas properties. The successful efforts method is the allowable alternative to the full cost method. The primary differences between the two methods are in the treatment of exploration costs and in the computation of DD&A expense. Under the full cost method, all exploratory costs are capitalized while under the successful efforts method exploratory costs associated with unsuccessful exploratory wells and all geological and geophysical costs are expensed. Under the full cost method, DD&A expense is computed on cost centers represented by entire countries while under the successful efforts method cost centers are represented by properties, or some reasonable aggregation of properties with common geological structural features or stratigraphic condition, such as fields or reservoirs.

Under the full cost method, we compare, at the end of each financial reporting period, the present value of estimated future net cash flows from proved reserves (excluding cash flows related to estimated abandonment costs), to the net capitalized costs of proved oil and gas properties net of related deferred taxes. We refer to this comparison as a “ceiling test.” If the net capitalized costs of proved oil and gas properties exceed the estimated discounted future net cash flows from proved reserves, we are required to write-down the value of our oil and gas properties to the value of the discounted cash flows. Estimated future net cash flows from proved reserves are calculated based on a 12-month average pricing assumption.

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Derivative Instruments and Hedging Activities. The nature of a derivative instrument must be evaluated to determine if it qualifies for hedge accounting treatment. Instruments that qualify for cash flow hedge accounting treatment with contemporaneous documentation are recorded as either an asset or liability measured at fair value, and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Additionally, monthly settlements of effective hedges are reflected in revenue from oil and gas production and cash flows from operations. Instruments not qualifying for hedge accounting treatment are recorded in our balance sheet at fair value, and changes in fair value are recognized in earnings through derivative expense (income).

Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Our most significant estimates are:

• remaining proved oil and natural gas reserve volumes and the timing of their production;

• estimated costs to develop and produce proved oil and natural gas reserves;

• accruals of exploration costs, development costs, operating costs and production revenue;

• timing and future costs to abandon our oil and gas properties;

• effectiveness and estimated fair value of derivative positions;

• classification of unevaluated property costs;

• capitalized general and administrative costs and interest;

• estimates of fair value in business combinations;

• current and deferred income taxes; and

• contingencies.

For a more complete discussion of our accounting policies and procedures see our “Notes to Consolidated Financial Statements” beginning on page F-8.

Recent Accounting Developments

None.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Commodity Price Risk. Our major market risk exposure continues to be the pricing applicable to our oil and natural gas production. Our revenues, profitability and future rate of growth depend substantially upon the market prices of oil and natural gas, which fluctuate widely. Oil and natural gas price declines and volatility could adversely affect our revenues, cash flows and profitability. Price volatility is expected to continue. Assuming a 10% decline in realized oil and natural gas prices, including the effects of hedging contracts, we estimate our diluted net income per share for 2013 would have decreased approximately $1.22 per share. In order to manage our exposure to oil and natural gas price declines, we occasionally enter into oil and natural gas price hedging arrangements to secure a price for a portion of our expected future production. Our hedging policy provides that not more than 50% of our estimated production quantities can be hedged without the consent of our board of directors.

We have entered into fixed-price swaps with various counterparties for a portion of our expected 2014, 2015 and 2016 oil and natural gas production from the Gulf Coast Basin. Some of our fixed-price oil swap settlements are based on an average of the NYMEX closing price for West Texas Intermediate crude oil during the entire calendar month, and some are based on the average of the ICE closing price for Brent crude oil during the entire calendar month. Our fixed-price gas swap settlements are based on the NYMEX price for the last day of a respective contract month. Swaps typically provide for monthly payments by us if prices rise above the swap price or monthly payments to us if prices fall below the swap price. Our fixed-price swap contracts are with The Toronto-Dominion Bank, Barclays Bank PLC, BNP Paribas, The Bank of Nova Scotia, Bank of America, Natixis and Regions Bank.

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The following table illustrates our hedging positions for calendar years 2014, 2015 and 2016 as of February 25, 2014:

	Fixed-Price Swaps NYMEX (except where noted)
	Natural Gas					Oil
	Daily Volume (MMBtus/d)			Swap Price ($)		Daily Volume (Bbls/d)			Swap Price ($)
2014		10,000			4.000		1,000			90.06
2014		10,000			4.040		1,000			92.25
2014		10,000			4.105		1,000			93.55
2014		10,000			4.190		1,000			94.00
2014		10,000	(a)		4.250		1,000			98.00
2014		10,000			4.250		1,000			98.30
2014		10,000			4.350		2,000	(b)		98.85
2014							1,000			99.65
2014							1,000	(c)		103.30
2015		10,000			4.005		1,000			89.00
2015		10,000			4.120		1,000			90.00
2015		10,000			4.150
2015		10,000			4.165
2015		10,000			4.220
2015		10,000			4.255
2016		10,000			4.110
2016		10,000			4.120

(a) February through December

(b) January through June

(c) Brent crude oil contract

We believe these positions have hedged approximately 46% of our estimated 2014 production from estimated proved reserves, 30% of our estimated 2015 production from estimated proved reserves and 8% of our estimated 2016 production from estimated proved reserves.

Interest Rate Risk. We had total debt outstanding of $1,075 million at December 31, 2013, all of which bears interest at fixed rates. The $1,075 million of fixed-rate debt is comprised of $300 million face value of the 2017 Convertible Notes and $775 million of the 2022 Notes.

Our bank credit facility is subject to an adjustable interest rate. See Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources. We had no outstanding borrowings under our bank credit facility as of December 31, 2013. If we borrow funds under our bank credit facility, we may be subject to increased sensitivity to interest rate movements.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Information concerning this Item begins on Page F-1.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

There have been no disagreements with our independent registered public accounting firm on our accounting or financial reporting that would require our independent registered public accounting firm to qualify or disclaim its report on our financial statements or otherwise require disclosure in this Annual Report on Form 10-K.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(b) of the Exchange Act, we have evaluated, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act) as of the end of the period covered by this Annual Report on Form 10-K. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. Based upon the evaluation, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures were effective as of December 31, 2013 at the reasonable assurance level.

Changes in Internal Controls Over Financial Reporting

There has not been any change in our internal control over financial reporting that occurred during the quarter ended December 31, 2013 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined by the Exchange Act. Under the supervision and with the participation of our management, including the principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2013. In making this assessment, we used the criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) (1992 framework). Based on our evaluation, we have concluded that our internal controls over financial reporting were effective as of December 31, 2013. Ernst and Young LLP, an independent public accounting firm, has issued its report on the company’s internal control over financial reporting as of December 31, 2013.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Stockholders and Board of Directors

Stone Energy Corporation

We have audited Stone Energy Corporation’s internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (1992 framework) (the COSO criteria). Stone Energy Corporation’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Stone Energy Corporation maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Stone Energy Corporation as of December 31, 2013 and 2012, and the related consolidated statements of income, comprehensive income, cash flows and changes in stockholders’ equity for each of the three years in the period ended December 31, 2013 and our report dated February 27, 2014 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

New Orleans, Louisiana

February 27, 2014

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ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following table sets forth information regarding the names, ages (as of February 25, 2014) and positions held by each of our executive officers, followed by biographies describing the business experience of our executive officers for at least the past five years. Our executive officers serve at the discretion of our board of directors.

Name	Age		Position
David H. Welch		65	President, Chief Executive Officer and Chairman of the Board
Kenneth H. Beer		56	Executive Vice President and Chief Financial Officer
Kevin G. Hurst		54	Vice President – GOM Shelf/Deep Gas
Lisa S. Jaubert		58	Senior Vice President, General Counsel and Secretary
John J. Leonard		54	Vice President – Exploration
E. J. Louviere		65	Senior Vice President – Land
J. Kent Pierret		58	Senior Vice President, Chief Accounting Officer and Treasurer
Keith A. Seilhan		47	Vice President – Deep Water
Richard L. Toothman, Jr.		49	Senior Vice President – Appalachia
Florence M. Ziegler		53	Vice President – Human Resources, Communications and Administration

David H. Welch was appointed President, Chief Executive Officer and a director of the Company effective April 1, 2004 and he has served as Chairman of the Board since May 2012. Prior to joining Stone, Mr. Welch served as Senior Vice President of BP America, Inc. since 2003, and Vice President of BP, Inc. since 1999.

Kenneth H. Beer was named Executive Vice President and Chief Financial Officer in January 2011. Previously, he served as Senior Vice President and Chief Financial Officer since August 2005. Prior to joining Stone, he served as a director of research and a senior energy analyst at the investment banking firm of Johnson Rice & Company. Prior to joining Johnson Rice & Company in 1992, he was an energy analyst and investment banker at Howard Weil Incorporated.

Kevin G. Hurst was named Vice President – GOM Shelf/Deep Gas on February 1, 2013. He previously served as General Manager of Operations/GOM Production from January 2012 through February 1, 2013. He served as Operations Manager – GOM Production from January 2011 through January 2012 and Production Manager from December 2007 through January 2011. Prior to joining Stone in 2007, he worked for MODEC, LLC as the General Manager for FPSO/FSO Operations. Mr. Hurst has also worked for Southern Natural Gas Company/El Paso Energy Company and worked for 16 years for Arco serving in various capacities.

Lisa S. Jaubert was named Senior Vice President, General Counsel and Secretary on May 23, 2013. She previously served as Assistant General Counsel since joining Stone in July 2012. Prior to joining Stone, she worked as Counsel with Latham & Watkins, LLP where she was a specialist in M&A, finance and other energy related transactions. Mrs. Jaubert also served over five years as Assistant General Counsel and Assistant Corporate Secretary for Mariner Energy, was a founding shareholder and ultimately Chairman of Schully Roberts Slattery Jaubert & Marino PLC, and also served as an outsourced general counsel for many smaller E&P companies and partner or associate in two other energy law firms.

John J. Leonard was named Vice President – Exploration on January 1, 2014. He previously served as General Manager of Deepwater Development from February 2013 through January 1, 2014, Director of Reservoir Engineering from January 2012 through February 2013, Asset Manager Conventional Shelf from July 2011 through January 2012, Asset Manager GOM Shelf East from January 2010 through July 2011, Eastern GOM Asset Manager from January 2007 through January 2010, Chief Reservoir Engineer from February 2006 through January 2007, and also Reservoir Engineer from August 2005 through February 2006. Prior to joining Stone in August 2005, he was employed by Object Reservoir as a Project Manager and Service Engineer, by Expro Americas as an Engineering Manager, and by Pro Tech as an Engineering Manager.

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E. J. Louviere was named Senior Vice President – Land in April 2004. Previously, he served as Vice President – Land since June 1995. He has been employed by Stone since its inception in 1993.

J. Kent Pierret was named Senior Vice President, Chief Accounting Officer and Treasurer in April 2004. Mr. Pierret previously served as Vice President and Chief Accounting Officer since June 1999 and Treasurer since February 2004.

Keith A. Seilhan was named Vice President – Deep Water on February 1, 2013. He previously served as Deep Water Projects Manager since joining Stone in July 2012. Prior to joining Stone, Mr. Seilhan filled various senior leadership roles for Amoco and BP over his 21 year career. In his final year with BP, he filled the role as BP’s Incident Commander on the Deepwater Horizon Incident in 2010 and also worked as an Emergency Response Consultant with The Response Group for 1-1/2 years. He has been an Asset Manager and Operations Manager for Deep Water Assets, Operations Director for Gulf of Mexico and the Organizational Capability Manager. Mr. Seilhan received a “Wells Notice,” dated January 25, 2013, from the Staff of the SEC indicating its intent to recommend to the SEC that it bring a civil injunctive action against Mr. Seilhan alleging that he violated Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. We have been advised that the Department of Justice does not intend to bring a criminal action against Mr. Seilhan. The SEC’s inquiry relates to activities prior to Mr. Seilhan’s employment with the Company and is not directed at, and does not concern, the Company or any other member of management or any member of our board.

Richard L. Toothman, Jr. was named Senior Vice President – Appalachia in February 2013 and Vice President – Appalachia in May 2010. Prior to joining Stone in May 2010, he was employed by CNX Gas Company in Bluefield, Virginia since August 2005 where he held two executive positions, VP Engineering and Technical Services and VP International Business. He also worked for Consol Energy and Conoco in prior years.

Florence M. Ziegler was named Vice President – Human Resources, Communications and Administration in September 2005. She has been employed by Stone since its inception in 1993 and served as the Director of Human Resources from 1997 to 2004.

Additional information required by Item 10, including information regarding our audit committee financial experts, is incorporated herein by reference to such information as set forth in our definitive Proxy Statement for our 2014 Annual Meeting of Stockholders to be held on May 22, 2014. The Company has made available free of charge on its Internet website (www.stoneenergy.com) the Code of Business Conduct and Ethics applicable to all employees of the Company including the Chief Executive Officer, Chief Financial Officer and Principal Accounting Officer.

ITEM 11. EXECUTIVE COMPENSATION

The information required by Item 11 is incorporated herein by reference to such information as set forth in our definitive Proxy Statement for our 2014 Annual Meeting of Stockholders to be held on May 22, 2014.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by Item 12 is incorporated herein by reference to such information as set forth in our definitive Proxy Statement for our 2014 Annual Meeting of Stockholders to be held on May 22, 2014.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by Item 13 is incorporated herein by reference to such information as set forth in our definitive Proxy Statement for our 2014 Annual Meeting of Stockholders to be held on May 22, 2014.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by Item 14 is incorporated herein by reference to such information as set forth in our definitive Proxy Statement for our 2014 Annual Meeting of Stockholders to be held on May 22, 2014.

44

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) 1. Financial Statements:

The following Consolidated Financial Statements, notes to the Consolidated Financial Statements and the Report of Independent Registered Public Accounting Firm thereon are included beginning on page F-1 of this Form 10-K:

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheet as of December 31, 2013 and 2012

Consolidated Statement of Income for the three years in the period ended December 31, 2013

Consolidated Statement of Comprehensive Income for the three years in the period ended December 31, 2013

Consolidated Statement of Cash Flows for the three years in the period ended December 31, 2013

Consolidated Statement of Changes in Stockholders’ Equity for the three years in the period ended December 31, 2013

Notes to the Consolidated Financial Statements

2. Financial Statement Schedules:

All schedules are omitted because the required information is inapplicable or the information is presented in the Consolidated Financial Statements or the notes thereto.

3. Exhibits:

3.1	Certificate of Incorporation of the Registrant, as amended on June 4, 1993, February 1, 2001 and February 19, 2002 (incorporated by reference to Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q filed August 7, 2012 (File No.001-12074)).
*3.2	Amended & Restated Bylaws of Stone Energy Corporation, dated December 19, 2013.
4.1	Indenture between Stone Energy Corporation and JPMorgan Chase Bank, National Association, as trustee, dated December 15, 2004 (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed December 17, 2004 (File No. 001-12074)).
4.2	First Supplemental Indenture, dated August 28, 2008, to the Indenture between Stone Energy Corporation and JPMorgan Chase Bank, National Association, as trustee, dated December 15, 2004 (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed August 29, 2008 (File No. 001-12074)).
4.3	Second Supplemental Indenture, dated January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., successor to JPMorgan Chase Bank, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed January 29, 2010 (File No. 001-12074)).
4.4	Indenture, dated January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed January 29, 2010 (File No. 001-12074)).
4.5	First Supplemental Indenture, dated January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed January 29, 2010 (File No. 001-12074)).

45

4.6	Indenture related to the 1 3⁄4% Senior Convertible Notes due 2017, dated as of March 6, 2012, among Stone Energy Corporation, Stone Energy Offshore, L.L.C. and The Bank of New York Mellon Trust Company, N.A., as trustee (including form of 1 3⁄4% Senior Convertible Senior Note due 2017) (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
4.7	Second Supplemental Indenture, dated as of November 6, 2012, to the Indenture, dated as of December 15, 2004, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed November 8, 2012 (File No. 001-12074)).
4.8	Second Supplemental Indenture, dated as of November 8, 2012, to the Indenture, dated as of January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed November 8, 2012 (File No. 001-12074)).
4.9	Third Supplemental Indenture, dated as of November 26, 2013, to the Indenture, dated as of January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed November 27, 2013 (File No. 001-12074)).
†10.1	Deferred Compensation and Disability Agreement between TSPC and E. J. Louviere dated July 16, 1981 (incorporated by reference to Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 1995 (File No. 001-12074)).
†10.2	Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan (incorporated by reference to Appendix A to the Registrant’s Definitive Proxy Statement on Schedule 14A for Stone’s 2009 Annual Meeting of Stockholders (File No. 001-12074)).
†10.3	First Amendment to Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan (incorporated by reference to Exhibit 4.6 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 (File No. 001-12074)).
†10.4	Stone Energy Corporation Revised (2005) Annual Incentive Compensation Plan (incorporated by reference to Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-12074)).
†10.5	Stone Energy Corporation Amended and Restated Revised Annual Incentive Compensation Plan, dated November 14, 2007 (incorporated by reference to Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-12074)).
†10.6	Stone Energy Corporation Deferred Compensation Plan (incorporated by reference to Exhibit 4.5 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-12074)).
†10.7	Adoption Agreement between Fidelity Management Trust Company and Stone Energy Corporation for the Stone Energy Corporation Deferred Compensation Plan dated December 1, 2004 (incorporated by reference to Exhibit 4.6 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-12074)).
†10.8	Letter Agreement dated May 19, 2005 between Stone Energy Corporation and Kenneth H. Beer (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed May 24, 2005 (File No. 001-12074)).
†10.9	Letter Agreement dated December 2, 2008 between Stone Energy Corporation and David H. Welch (incorporated by reference to Exhibit 10.8 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-12074)).

46

†10.10	Stone Energy Corporation Executive Change of Control and Severance Plan (as amended and restated effective December 31, 2008) (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed April 8, 2009 (File No. 001-12074)).
†10.11	Stone Energy Corporation Employee Change of Control Severance Plan (as amended and restated) dated December 7, 2007 (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed December 12, 2007 (File No. 001-12074)).
10.12	Form of Indemnification Agreement between Stone Energy Corporation and each of its directors and executive officers (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed March 27, 2009 (File No. 001-12074)).
10.13	$700,000,000 Third Amended and Restated Credit Agreement among Stone Energy Corporation as Borrower, Bank of America, N.A. as Administrative Agent and Issuing Bank, and the financial institutions named therein, dated April 26, 2011 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2011 (File No. 001-12074)).
10.14	Amendment No. 1 and Consent dated as of February 28, 2012 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed March 5, 2012 (File No. 001-12074)).
10.15	Amendment No. 2 and Consent dated as of October 22, 2012 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed October 22, 2012 (File No. 001-12074)).
10.16	Amendment No. 3 dated as of April 30, 2013 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q filed May 8, 2013 (File No. 001-12074)).
10.17	Consent Agreement dated as of November 8, 2013 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed November 13, 2013 (File No. 001-12074)).
*10.18	Waiver Agreement dated as of December 18, 2013 to the Third Amended and Restated Credit Agreement.
10.19	Amended and Restated Security Agreement, dated as of August 28, 2008, among Stone Energy Corporation and the other Debtors parties hereto in favor of Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 4.5 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (File No. 001-12074)).
10.20	Base Bond Hedge Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.21	Base Bond Hedge Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.22	Additional Bond Hedge Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.23	Additional Bond Hedge Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).

47

10.24	Base Warrant Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.25	Base Warrant Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.26	Additional Warrant Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.27	Additional Warrant Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.28	Amendment to Base Warrant Confirmation and Additional Warrant Confirmation dated March 5, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.9 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.29	Amendment to Base Warrant Confirmation and Additional Warrant Confirmation dated March 5, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.10 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
*21.1	Subsidiaries of the Registrant.
*23.1	Consent of Independent Registered Public Accounting Firm.
*23.2	Consent of Netherland, Sewell & Associates, Inc.
*31.1	Certification of Principal Executive Officer of Stone Energy Corporation as required by Rule 13a-14(a) of the Securities Exchange Act of 1934.
*31.2	Certification of Principal Financial Officer of Stone Energy Corporation as required by Rule 13a-14(a) of the Securities Exchange Act of 1934.
*#32.1	Certification of Chief Executive Officer and Chief Financial Officer of Stone Energy Corporation pursuant to 18 U.S.C. § 1350.
*101.INS	XBRL Instance Document
*101.SCH	XBRL Schema Document
*101.CAL	XBRL Calculation Linkbase Document
*101.DEF	XBRL Definition Linkbase Document
*101.LAB	XBRL Label Linkbase Document
*101.PRE	XBRL Presentation Linkbase Document
*99.1	Report of Netherland, Sewell & Associates, Inc.

* Filed or furnished herewith.

# Not considered to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section.

† Identifies management contracts and compensatory plans or arrangements.

48

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	STONE ENERGY CORPORATION
Date: February 27, 2014	By:	/s/ David H. Welch
		David H. Welch
		President,
		Chief Executive Officer and Chairman of the Board

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature	Title	Date
/s/ David H. Welch David H. Welch	President, Chief Executive Officer and Chairman of the Board (principal executive officer)	February 27, 2014
/s/ Kenneth H. Beer Kenneth H. Beer	Executive Vice President and Chief Financial Officer (principal financial officer)	February 27, 2014
/s/ J. Kent Pierret J. Kent Pierret	Senior Vice President, Chief Accounting Officer and Treasurer (principal accounting officer)	February 27, 2014
/s/ George R. Christmas George R. Christmas	Director	February 27, 2014
/s/ B.J. Duplantis B.J. Duplantis	Director	February 27, 2014
/s/ Peter D. Kinnear Peter D. Kinnear	Director	February 27, 2014
/s/ David T. Lawrence David T. Lawrence	Director	February 27, 2014
/s/ Robert S. Murley Robert S. Murley	Director	February 27, 2014
/s/ Richard A. Pattarozzi Richard A. Pattarozzi	Director	February 27, 2014
/s/ Donald E. Powell Donald E. Powell	Director	February 27, 2014
/s/ Kay G. Priestly Kay G. Priestly	Director	February 27, 2014
/s/ Phyllis M. Taylor Phyllis M. Taylor	Director	February 27, 2014

49

INDEX TO FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheet as of December 31, 2013 and 2012	F-3
Consolidated Statement of Income for the years ended December 31, 2013, 2012 and 2011	F-4
Consolidated Statement of Comprehensive Income for the years ended December 31, 2013, 2012 and 2011	F-5
Consolidated Statement of Cash Flows for the years ended December 31, 2013, 2012 and 2011	F-6
Consolidated Statement of Changes in Stockholders’ Equity for the years ended December  31, 2013, 2012 and 2011	F-7
Notes to Consolidated Financial Statements	F-8

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Stockholders and Board of Directors

Stone Energy Corporation

We have audited the accompanying consolidated balance sheets of Stone Energy Corporation as of December 31, 2013 and 2012, and the related consolidated statements of income, comprehensive income, cash flows, and changes in stockholders’ equity for each of the three years in the period ended December 31, 2013. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Stone Energy Corporation as of December 31, 2013 and 2012, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2013, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Stone Energy Corporation’s internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (1992 framework) and our report dated February 27, 2014 expressed an unqualified opinion thereon.

/s/ Ernst & Young LLP

New Orleans, Louisiana

February 27, 2014

F-2

STONE ENERGY CORPORATION

CONSOLIDATED BALANCE SHEET

(In thousands)

	December 31,
	2013			2012
Assets
Current assets:
Cash and cash equivalents	$	331,224		$	279,526
Accounts receivable		171,971			167,288
Fair value of hedging contracts		4,549			39,655
Current income tax receivable		7,366			10,027
Deferred taxes		31,710			15,514
Inventory		3,723			4,207
Other current assets		1,874			3,626
Total current assets		552,417			519,843
Oil and gas properties, full cost method of accounting:
Proved		7,804,117			7,244,466
Less: accumulated depreciation, depletion and amortization		(5,908,760	)		(5,510,166	)
Net proved oil and gas properties		1,895,357			1,734,300
Unevaluated		724,339			447,795
Other property and equipment, net of accumulated depreciation of $21,748 and $26,429, respectively		26,178			22,115
Fair value of hedging contracts		1,378			9,199
Other assets, net of accumulated depreciation and amortization of $5,768 and $6,438, respectively		48,887			43,179
Total assets	$	3,248,556		$	2,776,431
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	195,677		$	94,361
Undistributed oil and gas proceeds		37,029			23,414
Accrued interest		9,022			18,546
Fair value of hedging contracts		7,753			149
Asset retirement obligations		67,161			66,260
Other current liabilities		54,520			16,765
Total current liabilities		371,162			219,495
Long-term debt		1,027,084			914,126
Deferred taxes		390,693			310,830
Asset retirement obligations		435,352			422,042
Fair value of hedging contracts		470			1,530
Other long-term liabilities		53,509			36,275
Total liabilities		2,278,270			1,904,298
Commitments and contingencies
Stockholders’ equity:
Common stock, $.01 par value; authorized 100,000,000 shares; issued 48,750,533 and 48,392,552 shares, respectively		488			484
Treasury stock (16,582 shares, at cost)		(860	)		(860	)
Additional paid-in capital		1,397,885			1,386,475
Accumulated deficit		(425,165	)		(542,799	)
Accumulated other comprehensive income (loss)		(2,062	)		28,833
Total stockholders’ equity		970,286			872,133
Total liabilities and stockholders’ equity	$	3,248,556		$	2,776,431

The accompanying notes are an integral part of this balance sheet.

F-3

STONE ENERGY CORPORATION

CONSOLIDATED STATEMENT OF INCOME

(In thousands, except per share amounts)

	Year Ended December 31,
	2013			2012			2011
Operating revenue:
Oil production	$	715,104		$	761,304		$	663,958
Gas production		190,580			134,739			170,611
Natural gas liquids production		60,687			48,498			29,996
Other operational income		7,808			3,520			3,938
Derivative income, net		—			3,428			1,418
Total operating revenue		974,179			951,489			869,921
Operating expenses:
Lease operating expenses		201,153			215,003			175,881
Transportation, processing and gathering expenses		42,172			21,782			8,958
Production taxes		15,029			10,015			9,380
Depreciation, depletion and amortization		350,574			344,365			280,020
Accretion expense		33,575			33,331			30,764
Salaries, general and administrative expenses		59,524			54,648			40,169
Franchise tax settlement		12,590			—			—
Incentive compensation expense		15,340			8,113			11,600
Other operational expenses		151			267			2,149
Derivative expense, net		2,090			—			—
Total operating expenses		732,198			687,524			558,921
Income from operations		241,981			263,965			311,000
Other (income) expenses:
Interest expense		32,837			30,375			9,289
Interest income		(1,695	)		(600	)		(420	)
Other income		(2,799	)		(1,805	)		(1,942	)
Loss on early extinguishment of debt		27,279			1,972			607
Total other expenses		55,622			29,942			7,534
Income before income taxes		186,359			234,023			303,466
Provision (benefit) for income taxes:
Current		(10,904	)		15,022			(20,386	)
Deferred		79,629			69,575			129,520
Total income taxes		68,725			84,597			109,134
Net income	$	117,634		$	149,426		$	194,332
Basic earnings per share	$	2.36		$	3.03		$	3.97
Diluted earnings per share	$	2.36		$	3.03		$	3.97
Average shares outstanding		48,693			48,319			47,988
Average shares outstanding assuming dilution		48,735			48,361			48,030

The accompanying notes are an integral part of this statement.

F-4

STONE ENERGY CORPORATION

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(In thousands)

	Year Ended December 31,
	2013			2012		2011
Net income	$	117,634		$	149,426	$	194,332
Other comprehensive income (loss) net of tax effect:
Derivatives		(30,228	)		6,965		36,072
Foreign currency translation		(667	)		—		—
Comprehensive income	$	86,739		$	156,391	$	230,404

The accompanying notes are an integral part of this statement.

F-5

STONE ENERGY CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS

(In thousands)

	Year Ended December 31,
	2013			2012			2011
Cash flows from operating activities:
Net income	$	117,634		$	149,426		$	194,332
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization		350,574			344,365			280,020
Accretion expense		33,575			33,331			30,764
Deferred income tax provision		79,629			69,575			129,520
Settlement of asset retirement obligations		(83,854	)		(65,567	)		(63,391	)
Non-cash stock compensation expense		10,347			8,699			5,905
Excess tax benefits		(156	)		(949	)		(1,493	)
Non-cash derivative expense (income)		2,239			(509	)		(2,216	)
Loss on early extinguishment of debt		27,279			1,972			607
Non-cash interest expense		16,219			13,085			1,908
Other non-cash income		—			—			(1,602	)
Change in current income taxes		2,767			10,618			(19,451	)
Increase in accounts receivable		(4,683	)		(55,871	)		(19,600	)
(Increase) decrease in other current assets		1,752			(2,836	)		(66	)
Decrease in inventory		583			436			1,619
Increase in accounts payable		402			5,101			6,039
Increase (decrease) in other current liabilities		42,451			(10,426	)		29,583
Other		(2,553	)		9,299			(1,628	)
Net cash provided by operating activities		594,205			509,749			570,850
Cash flows from investing activities:
Investment in oil and gas properties		(663,299	)		(555,855	)		(764,933	)
Proceeds from sale of oil and gas properties, net of expenses		48,821			403			87,930
Sale of fixed assets		—			134			—
Investment in fixed and other assets		(6,816	)		(13,370	)		(2,247	)
Change in restricted funds		(1,742	)		—			—
Net cash used in investing activities		(623,036	)		(568,688	)		(679,250	)
Cash flows from financing activities:
Proceeds from bank borrowings		—			25,000			75,000
Repayments of bank borrowings		—			(70,000	)		(30,000	)
Proceeds from issuance of senior convertible notes		—			300,000			—
Deferred financing costs of senior convertible notes		—			(8,855	)		—
Proceeds from sold warrants		—			40,170			—
Payments for purchased call options		—			(70,830	)		—
Proceeds from issuance of senior notes		489,250			300,000			—
Deferred financing costs		(9,065	)		(11,966	)		(4,017	)
Redemption of senior notes		(396,014	)		—			—
Redemption of senior subordinated notes		—			(200,681	)		—
Excess tax benefits		156			949			1,493
Net payments for share-based compensation		(3,733	)		(3,773	)		(2,581	)
Net cash provided by financing activities		80,594			300,014			39,895
Effect of exchange rate changes on cash		(65	)		—			—
Net change in cash and cash equivalents		51,698			241,075			(68,505	)
Cash and cash equivalents, beginning of year		279,526			38,451			106,956
Cash and cash equivalents, end of year	$	331,224		$	279,526		$	38,451
Supplemental cash flow information:
Cash paid for interest, net of amount capitalized		($29,883	)		($20,150	)		($9,808	)
Cash (paid) refunded for income taxes		13,670			(4,405	)		935

The accompanying notes are an integral part of this statement.

F-6

STONE ENERGY CORPORATION

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

(In thousands)

	Common Stock		Treasury Stock			Additional Paid-In Capital			Accumulated Deficit			Accumulated Other Comprehensive Income (Loss)			Total Stockholders’ Equity
Balance, December 31, 2010	$	478		($860	)	$	1,331,500			($886,557	)		($14,204	)	$	430,357
Net income		—		—			—			194,332			—			194,332
Adjustment for fair value accounting of derivatives, net of tax		—		—			—			—			36,072			36,072
Exercise of stock options and vesting of restricted stock		3		—			(2,584	)		—			—			(2,581	)
Amortization of stock compensation expense		—		—			8,914			—			—			8,914
Net tax impact from stock option exercises and restricted stock vesting		—		—			735			—			—			735
Balance, December 31, 2011		481		(860	)		1,338,565			(692,225	)		21,868			667,829
Net income		—		—			—			149,426			—			149,426
Adjustment for fair value accounting of derivatives, net of tax		—		—			—			—			6,965			6,965
Exercise of stock options and vesting of restricted stock		3		—			(3,776	)		—			—			(3,773	)
Amortization of stock compensation expense		—		—			12,792			—			—			12,792
Net tax impact from stock option exercises and restricted stock vesting		—		—			814			—			—			814
Convertible notes offering		—		—			38,080			—			—			38,080
Balance, December 31, 2012		484		(860	)		1,386,475			(542,799	)		28,833			872,133
Net income		—		—			—			117,634			—			117,634
Adjustment for fair value accounting of derivatives, net of tax		—		—			—			—			(30,228	)		(30,228	)
Adjustment for foreign currency translation, net of tax		—		—			—			—			(667	)		(667	)
Exercise of stock options and vesting of restricted stock		4		—			(3,130	)		—			—			(3,126	)
Amortization of stock compensation expense		—		—			15,424			—			—			15,424
Net tax impact from stock option exercises and restricted stock vesting		—		—			(884	)		—			—			(884	)
Balance, December 31, 2013	$	488		($860	)	$	1,397,885			($425,165	)		($2,062	)	$	970,286

The accompanying notes are an integral part of this statement.

F-7

STONE ENERGY CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(In thousands, except per share and price amounts)

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Stone Energy Corporation (“Stone”) is an independent oil and natural gas company engaged in the acquisition, exploration, exploitation, development and operation of oil and gas properties. We have been operating in the Gulf Coast Basin since our incorporation in 1993 and have established a technical and operational expertise in this area. We have expanded our reserve base outside of the conventional shelf of the Gulf of Mexico (the “GOM”) and into the more prolific reserve basins of the GOM deep water and GOM deep gas, as well as onshore oil and gas shale opportunities, including the Marcellus Shale in Appalachia. We were incorporated in 1993 as a Delaware corporation. Our corporate headquarters are located at 625 E. Kaliste Saloom Road, Lafayette, Louisiana 70508. We have additional offices in New Orleans, Louisiana, Houston, Texas and Morgantown, West Virginia.

A summary of significant accounting policies followed in the preparation of the accompanying consolidated financial statements is set forth below.

Basis of Presentation:

The financial statements include our accounts and the accounts of our wholly owned subsidiaries, Stone Energy Offshore, L.L.C. (“Stone Offshore”), Stone Energy Holding, L.L.C., Stone Energy Canada, U.L.C. and Caillou Boca Gathering, LLC (“Caillou Boca”). On September 6, 2012, Caillou Boca was merged into Stone Offshore. All intercompany balances have been eliminated.

Use of Estimates:

The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates are used primarily when accounting for depreciation, depletion and amortization (“DD&A”) expense, unevaluated property costs, estimated future net cash flows from proved reserves, costs to abandon oil and gas properties, taxes, accruals of capitalized costs, operating costs and production revenue, capitalized general and administrative costs and interest, insurance recoveries, effectiveness and estimated fair value of derivative positions, the purchase price allocation on properties acquired, estimates of fair value in business combinations and contingencies.

Fair Value Measurements:

U.S. GAAP establishes a framework for measuring fair value and requires certain disclosures about fair value measurements. As of December 31, 2013 and 2012, we held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. Additionally, fair value concepts were applied in recording the acquisition of various deep water assets in June 2012 and the acquisition of an office building in December 2012.

Hybrid Debt Instruments:

In 2012, we issued $300,000 in aggregate principal amount of 1 ³⁄₄% Senior Convertible Notes due 2017 (the “2017 Convertible Notes”). See Note 11 – Long-Term Debt. On that same day we entered into convertible note hedging transactions which are expected to reduce the potential dilution to our common stock upon conversion of the notes. In accordance with Accounting Standards Codification (“ASC”) 480-20 and ASC 470, we accounted for the debt and equity portions of the notes in a manner that will reflect our nonconvertible borrowing rate when interest is recognized in subsequent periods. This results in the separation of the debt component, classification of the remaining component in stockholders’ equity, and accretion of the resulting discount as part of interest expense. Additionally, the hedging transactions meet the criteria for classification as equity transactions and were recorded as such.

F-8

ASC 260 provides that for contracts that may be settled in common stock or in cash at the election of the entity or the holder, the determination of whether the contract shall be reflected in the computation of diluted earnings per share should be made based on the facts available each period. It is presumed that the contract will be settled in common stock and therefore potential dilution be determined using the if-converted method. However, this presumption may be overcome if past experience or a stated policy provides a reasonable basis to believe that the contract will be settled partially or wholly in cash. Because it is management’s stated intent to redeem the principal amount of the notes in cash, we have used the treasury stock method for determining potential dilution of the notes in our diluted earnings per share computation in accordance with ASC 260.

Business Combinations:

Our acquisition in 2012 of various deep water assets was accounted for according to the guidance provided in ASC 805, Business Combinations, which requires application of the acquisition method. This methodology requires the recordation of net assets acquired and consideration transferred at fair value. Differences between the net fair value of net assets acquired and consideration transferred are recorded as goodwill or a bargain purchase gain.

Cash and Cash Equivalents:

We consider all money market funds and highly liquid investments in overnight securities through our commercial bank accounts, which result in available funds on the next business day, to be cash and cash equivalents.

Oil and Gas Properties:

We follow the full cost method of accounting for oil and gas properties. Under this method, all acquisition, exploration, development and estimated abandonment costs, including certain related employee and general and administrative costs (less any reimbursements for such costs) and interest incurred for the purpose of finding oil and gas are capitalized. Such amounts include the cost of drilling and equipping productive wells, dry hole costs, lease acquisition costs, delay rentals and other costs related to such activities. Employee, general and administrative costs that are capitalized include salaries and all related fringe benefits paid to employees directly engaged in the acquisition, exploration and development of oil and gas properties, as well as all other directly identifiable general and administrative costs associated with such activities, such as rentals, utilities and insurance. We capitalize a portion of the interest costs incurred on our debt based upon the balance of our unevaluated property costs and our weighted-average borrowing rate. Employee, general and administrative costs associated with production operations and general corporate activities are expensed in the period incurred. Additionally, workover and maintenance costs incurred solely to maintain or increase levels of production from an existing completion interval are charged to lease operating expense in the period incurred.

U.S. GAAP allows the option of two acceptable methods for accounting for oil and gas properties. The successful efforts method is the allowable alternative to the full cost method. The primary differences between the two methods are in the treatment of exploration costs and in the computation of DD&A expense. Under the full cost method, all exploratory costs are capitalized while under the successful efforts method exploratory costs associated with unsuccessful exploratory wells and all geological and geophysical costs are expensed. Under the full cost method, DD&A expense is computed on cost centers represented by entire countries while under the successful efforts method cost centers are represented by properties, or some reasonable aggregation of properties with common geological structural features or stratigraphic condition, such as fields or reservoirs.

We amortize our investment in oil and gas properties through DD&A expense using the units of production (the “UOP”) method. Under the UOP method, the quarterly provision for DD&A expense is computed by dividing production volumes for the period by the total proved reserves as of the beginning of the period (beginning of the period reserves being determined by adding back production to end of the period reserves), and applying the respective rate to the net cost of proved oil and gas properties, including future development costs.

Under the full cost method, we compare, at the end of each financial reporting period, the present value of estimated future net cash flows from proved reserves (excluding cash flows related to estimated abandonment costs), to the net capitalized costs of proved oil and gas properties net of related deferred taxes. We refer to this comparison as a “ceiling test.” If the net capitalized costs of proved oil and gas properties exceed the estimated discounted future net cash flows from proved reserves, we are required to write-down the value of our oil and gas properties to the value of the discounted cash flows.

Sales of oil and gas properties are accounted for as adjustments to the net full cost pool with no gain or loss recognized, unless the adjustment would significantly alter the relationship between capitalized costs and proved reserves.

F-9

Asset Retirement Obligations:

U.S. GAAP requires us to record our estimate of the fair value of liabilities related to future asset retirement obligations in the period the obligation is incurred. Asset retirement obligations relate to the removal of facilities and tangible equipment at the end of an oil and gas property’s useful life. The application of this rule requires the use of management’s estimates with respect to future abandonment costs, inflation, market risk premiums, useful life and cost of capital. U.S. GAAP requires that our estimate of our asset retirement obligations does not give consideration to the value the related assets could have to other parties.

Other Property and Equipment:

Our office buildings in Lafayette, Louisiana are being depreciated on the straight-line method over their estimated useful life of 39 years.

Inventory:

We maintain an inventory of tubular goods. Items remain in inventory until dedicated to specific projects, at which time they are transferred to oil and gas properties. Items are carried at the lower of cost or market based on the specific identification method.

Earnings Per Common Share:

Under U.S. GAAP, certain instruments granted in share-based payment transactions are participating securities prior to vesting and are therefore required to be included in the earnings allocation in calculating earnings per share under the two-class method. Companies are required to treat unvested share-based payment awards with a right to receive non-forfeitable dividends as a separate class of securities in calculating earnings per share.

Production Revenue:

We recognize production revenue under the entitlement method of accounting. Under this method, revenue is deferred for deliveries in excess of our net revenue interest, while revenue is accrued for undelivered volumes. Production imbalances are generally recorded at the estimated sales price in effect at the time of production.

Income Taxes:

Provisions for income taxes include deferred taxes resulting primarily from temporary differences due to different reporting methods for oil and gas properties for financial reporting purposes and income tax purposes. For financial reporting purposes, all exploratory and development expenditures, including future abandonment costs, related to evaluated projects are capitalized and depreciated, depleted and amortized on the UOP method. For income tax purposes, only the equipment and leasehold costs relative to successful wells are capitalized and recovered through depreciation or depletion, although for 2011, 2012 and 2013, special provisions allowed for current deductions for the cost of certain equipment. Generally, most other exploratory and development costs are charged to expense as incurred; however, we follow certain provisions of the Internal Revenue Code that allow capitalization of intangible drilling costs where management deems appropriate. Other financial and income tax reporting differences occur as a result of statutory depletion, different reporting methods for sales of oil and gas reserves in place, different reporting methods used in the capitalization of employee, general and administrative and interest expense, and different reporting methods for employee compensation.

Derivative Instruments and Hedging Activities:

The nature of a derivative instrument must be evaluated to determine if it qualifies for hedge accounting treatment. Instruments that qualify for cash flow hedge accounting treatment with contemporaneous documentation are recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Additionally, monthly settlements of effective hedges are reflected in revenue from oil and gas production and cash flows from operations. Instruments not qualifying for hedge accounting treatment are recorded in our balance sheet at fair value, and changes in fair value are recognized in earnings through derivative expense (income).

F-10

Share-Based Compensation:

We record share-based compensation based on the grant date fair value of issued stock options and restricted stock over the vesting period of the instrument. We utilize the Black-Scholes option pricing model to measure the fair value of stock options. The fair value of restricted shares is typically determined based on the average of our high and low stock prices on the grant date.

NOTE 2 — EARNINGS PER SHARE:

The following table sets forth the calculation of basic and diluted weighted average shares outstanding and earnings per share for the indicated periods:

	Year Ended December 31,
	2013			2012			2011
Income (numerator):
Basic:
Net income	$	117,634		$	149,426		$	194,332
Net income attributable to participating securities		(2,817	)		(2,984	)		(3,670	)
Net income attributable to common stock—basic	$	114,817		$	146,422		$	190,662
Diluted:
Net income	$	117,634		$	149,426		$	194,332
Net income attributable to participating securities		(2,815	)		(2,982	)		(3,667	)
Net income attributable to common stock—diluted	$	114,819		$	146,444		$	190,665
Weighted average shares (denominator):
Weighted average shares—basic		48,693			48,319			47,988
Dilutive effect of stock options		42			42			42
Weighted average shares—diluted		48,735			48,361			48,030
Basic earnings per share	$	2.36		$	3.03		$	3.97
Diluted earnings per share	$	2.36		$	3.03		$	3.97

Stock options that were considered antidilutive because the exercise price of the options exceeded the average price of our common stock for the applicable period totaled approximately 242,000, 347,000 and 374,000 shares during the years ended December 31, 2013, 2012 and 2011, respectively.

During the years ended December 31, 2013, 2012 and 2011, approximately 358,000, 316,000 and 312,000 shares of our common stock, respectively, were issued from authorized shares upon the vesting (lapse of forfeiture restrictions) of restricted stock by employees and nonemployee directors.

Because it is management’s stated intention to redeem the principal amount of our 2017 Convertible Notes (see Note 11 – Long-Term Debt) in cash, we have used the treasury method for determining potential dilution in the diluted earnings per share computation. Since the average price of our common stock was less than the effective conversion price for such notes during the years ended December 31, 2013 and 2012, the 2017 Convertible Notes were not dilutive for such periods. Additionally, since the average price of our common stock was less than the strike price of the Sold Warrants (as defined in Note 11 – Long-Term Debt) for the years ended December 31, 2013 and 2012, such warrants were also not dilutive for such periods.

F-11

NOTE 3 — ACCOUNTS RECEIVABLE:

In our capacity as operator for our co-venturers, we incur drilling and other costs that we bill to the respective parties based on their working interests. We also receive payments for these billings and, in some cases, for billings in advance of incurring costs. Our accounts receivable are comprised of the following amounts:

	As of December 31,
	2013		2012
Other co-venturers	$	13,904	$	16,735
Trade		134,622		130,448
Unbilled accounts receivable		22,001		20,053
Other		1,444		52
Total accounts receivable	$	171,971	$	167,288

NOTE 4 — CONCENTRATIONS:

Sales to Major Customers

Our production is sold on month-to-month contracts at prevailing prices. We obtain credit protections such as parental guarantees from certain of our purchasers. The following table identifies customers from whom we derived 10% or more of our total oil and gas revenue during the years ended:

	December 31,
	2013			2012			2011
Conoco, Inc.		(a	)		13	%		28	%
Phillips 66 Company		35	%		18	%		(a	)
Shell Trading (US) Company		33	%		41	%		46	%

(a) Less than 10 percent.

The maximum amount of credit risk exposure at December 31, 2013 relating to these customers amounted to $74,273.

We believe that the loss of any of these purchasers would not result in a material adverse effect on our ability to market future oil and gas production.

Production and Reserve Volumes- Unaudited

Approximately 16% of our estimated proved reserves at December 31, 2013 and 49% of our production during 2013 were associated with our Gulf Coast Basin conventional shelf and deep gas properties. Approximately 29% of our estimated proved reserves at December 31, 2013 and 25% of our production during 2013 were associated with our deep water properties. Approximately 55% of our estimated proved reserves at December 31, 2013 and 26% of our production during 2013 were associated with our Appalachian properties.

Cash and Cash Equivalents

A substantial portion of our cash balances are not federally insured.

NOTE 5 — ACQUISITIONS AND DIVESTITURES:

Acquisitions

In December 2012, we closed on the acquisition of an office building. The acquisition was accounted for according to the guidance provided in ASC 805, Business Combinations, which requires application of the acquisition method. This methodology requires the recordation of net assets acquired and consideration transferred at fair value. Differences between the net fair value of net assets acquired and consideration transferred are recorded as goodwill or a bargain purchase gain. The building and land were recorded at fair value of $8,539. Consideration transferred in the transaction was $8,539 in cash, resulting in no goodwill or bargain purchase gain.

F-12

On June 18, 2012, we completed the acquisition of a 25% working interest in the five block deep water Pompano field in Mississippi Canyon, an approximate 14% working interest in Mississippi Canyon Block 29 and a 10% working interest in certain aliquots of Mississippi Canyon Block 72. The acquisition was also accounted for according to the guidance provided in ASC 805, Business Combinations. Consideration transferred in the transaction was $26,398 in cash, resulting in no goodwill or bargain purchase gain. The following represents the allocation of the recorded value of net assets acquired in the transaction:

Proved oil and gas properties	$	39,221
Unevaluated oil and gas properties		1,637
Asset retirement obligations		(14,460	)
Total fair value of net assets	$	26,398

Divestitures

In October 2013, we completed the sale of our interest in the Weeks Island field for cash consideration of approximately $42,957 and the assumption of the associated asset retirement obligation of approximately $9,245. The sale was accounted for as an adjustment to the full cost pool with no gain or loss recognized.

NOTE 6 — INVESTMENT IN OIL AND GAS PROPERTIES — UNAUDITED:

The following table discloses certain financial data relative to our oil and gas producing activities located onshore and offshore in the continental United States:

	Year Ended December 31,
	2013			2012			2011
Oil and gas properties – United States, proved and unevaluated:
Balance, beginning of year	$	7,692,261		$	7,049,777		$	6,202,758
Costs incurred during the year (capitalized):
Acquisition costs, net of sales of unevaluated properties		70,903			102,807			270,354
Exploratory costs		297,113			81,458			84,199
Development costs (1)		378,242			395,555			426,355
Salaries, general and administrative costs		32,815			25,318			24,430
Interest		46,860			37,656			42,033
Less: overhead reimbursements		(321	)		(310	)		(352	)
Total costs incurred during the year, net of divestitures		825,612			642,484			847,019
Balance, end of year	$	8,517,873		$	7,692,261		$	7,049,777
Accumulated DD&A:
Balance, beginning of year	($	5,510,166	)	($	5,174,729	)	($	4,804,949	)
Provision for DD&A		(346,827	)		(341,096	)		(276,480	)
Sale of proved properties		(51,767	)		5,659			(93,300	)
Balance, end of year	($	5,908,760	)	($	5,510,166	)	($	5,174,729	)
Net capitalized costs – United States, proved and unevaluated	$	2,609,113		$	2,182,095		$	1,875,048
DD&A per Mcfe	$	3.43		$	3.69		$	3.45

(1) Includes capitalized asset retirement costs of $54,737, $95,293 and $96,386, respectively.

Costs incurred during the year (expensed):
Lease operating expenses	$	201,153	$	215,003	$	175,881
Transportation, processing and gathering expenses		42,172		21,782		8,958
Production taxes		15,029		10,015		9,380
Accretion expense		33,575		33,331		30,764
Expensed costs – United States	$	291,929	$	280,131	$	224,983

F-13

The following table discloses net costs incurred (evaluated) on our unevaluated properties located in the United States for the years indicated:

	Year Ended December 31,
	2013		2012			2011
Unevaluated oil and gas properties – United States:
Net costs incurred (evaluated) during year:
Acquisition costs	$	30,271	$	9,739			($2,397	)
Exploration costs		188,830		(1,209	)		(51,207	)
Capitalized interest		46,860		37,656			42,033
	$	265,961	$	46,186			($11,571	)

During 2013, we entered into an agreement to participate in the drilling of exploratory wells in Canada. The following table discloses certain financial data relative to our oil and gas producing activities located in Canada:

	Year Ended December 31,
	2013
Oil and gas properties – Canada, unevaluated:
Balance, beginning of year	$	—
Costs incurred during the year (capitalized):
Acquisition costs		8,764
Exploratory costs		1,819
Total costs incurred during the year		10,583
Balance, end of year, unevaluated	$	10,583

The following table discloses financial data associated with unevaluated costs (United States and Canada) at December 31, 2013:

	Balance as of December 31, 2013		Net Costs Incurred During the Year Ended December 31,
			2013		2012		2011		2010 and prior
Acquisition costs	$	306,793	$	78,555	$	29,959	$	41,442	$	156,837
Exploration costs		305,422		248,846		56,033		499		44
Capitalized interest		112,124		39,846		32,755		20,501		19,022
Total unevaluated costs	$	724,339	$	367,247	$	118,747	$	62,442	$	175,903

Approximately 140 specifically identified drilling projects are included in unevaluated costs at December 31, 2013 and are expected to be evaluated in the next four years. The excluded costs will be included in the amortization base as the properties are evaluated and proved reserves are established or impairment is determined. Interest costs capitalized on unevaluated properties during the years ended December 31, 2013, 2012 and 2011 totaled $46,860, $37,656 and $42,033, respectively.

F-14

NOTE 7 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES:

Our hedging strategy is designed to protect our near and intermediate term cash flows from future declines in oil and natural gas prices. This protection is essential to capital budget planning, which is sensitive to expenditures that must be committed to in advance, such as rig contracts and the purchase of tubular goods. We enter into hedging transactions to secure a commodity price for a portion of future production that is acceptable at the time of the transaction. These hedges are designated as cash flow hedges upon entering into the contract. We do not enter into hedging transactions for trading purposes. We have no fair value hedges.

The nature of a derivative instrument must be evaluated to determine if it qualifies for hedge accounting treatment. If the instrument qualifies for hedge accounting treatment, it is recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Additionally, monthly settlements of effective hedges are reflected in revenue from oil and gas production and cash flows from operations. Instruments not qualifying for hedge accounting treatment are recorded in our balance sheet at fair value, and changes in fair value are recognized in earnings through derivative expense (income). Monthly settlements of ineffective hedges are recognized in earnings through derivative expense (income) and cash flows from operations. Typically, a small portion of our derivative contracts are determined to be ineffective. This is because oil and natural gas price changes in the markets in which we sell our products are not 100% correlative to changes in the underlying price basis indicative in the derivative contract.

We have entered into fixed-price swaps with various counterparties for a portion of our expected 2014, 2015 and 2016 oil and natural gas production from the Gulf Coast Basin. Some of our fixed-price oil swap settlements are based on an average of the New York Mercantile Exchange (“NYMEX”) closing price for West Texas Intermediate crude oil during the entire calendar month, and some are based on the average of the Intercontinental Exchange closing price for Brent crude oil during the entire calendar month. Our fixed-price gas swap settlements are based on the NYMEX price for the last day of a respective contract month. Swaps typically provide for monthly payments by us if prices rise above the swap price or monthly payments to us if prices fall below the swap price. Our fixed-price swap contracts are with The Toronto-Dominion Bank, Barclays Bank PLC, BNP Paribas, The Bank of Nova Scotia, Bank of America, Natixis and Regions Bank.

All of our derivative instruments at December 31, 2013, 2012 and 2011 were designated as effective cash flow hedges. However, during the years ended December 31, 2013, 2012 and 2011, certain of our derivative contracts were determined to be partially ineffective. The following tables disclose the location and fair value amounts of derivative instruments reported in our balance sheet at December 31, 2013 and December 31, 2012.

Fair Value of Derivative Instruments at December 31, 2013
	Asset Derivatives			Liability Derivatives
Description	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Commodity contracts	Current assets: Fair value of hedging contracts	$	4,549	Current liabilities: Fair value of hedging contracts	$	7,753
	Long-term assets: Fair value of hedging contracts		1,378	Long-term liabilities: Fair value of hedging contracts		470
		$	5,927		$	8,223
Fair Value of Derivative Instruments at December 31, 2012
	Asset Derivatives			Liability Derivatives
Description	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Commodity contracts	Current assets: Fair value of hedging contracts	$	39,655	Current liabilities: Fair value of hedging contracts	$	149
	Long-term assets: Fair value of hedging contracts		9,199	Long-term liabilities: Fair value of hedging contracts		1,530
		$	48,854		$	1,679

F-15

The following table discloses the before tax effect of derivative instruments in the statement of income for the years ended December 31, 2013, 2012 and 2011.

Effect of Derivative Instruments on the Statement of Income for the Years Ended December 31, 2013, 2012 and 2011
Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives			Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion) (a)				Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion)
				Location				Location
	2013				2013				2013
Commodity contracts		($26,945	)	Operating revenue—oil/gas production	$	20,289		Derivative expense, net		($2,090	)
Total		($26,945	)		$	20,289				($2,090	)
	2012				2012				2012
Commodity contracts	$	41,209		Operating revenue—oil/gas production	$	30,326		Derivative income, net	$	3,428
Total	$	41,209			$	30,326			$	3,428
	2011				2011				2011
Commodity contracts	$	43,089		Operating revenue—oil/gas production		($13,274	)	Derivative income, net	$	1,418
Total	$	43,089				($13,274	)		$	1,418

(a) For the year ended December 31, 2013, effective hedging contracts increased oil revenue by $3,520 and increased gas revenue by $16,769. For the year ended December 31, 2012, effective hedging contracts increased oil revenue by $8,546 and increased gas revenue by $21,780. For the year ended December 31, 2011, effective hedging contracts decreased oil revenue by $32,706 and increased gas revenue by $19,432.

At December 31, 2013, we had an accumulated other comprehensive loss of $1,395, net of tax, which related to the fair value of our swap contracts that were outstanding as of December 31, 2013, the majority of which will be reclassified into earnings in the next 12 months.

Our derivative contracts are subject to netting arrangements. It is our policy not to offset our derivative contracts in presenting the fair value of these contracts as assets and liabilities in our balance sheet. The following presents the potential impact of the rights of offset associated with our recognized assets and liabilities at December 31, 2013:

	As Presented Without Netting			Effects of Netting			With Effects of Netting
Current assets: Fair value of hedging contracts	$	4,549		($	4,043	)	$	506
Long-term assets: Fair value of hedging contracts		1,378			(274	)		1,104
Current liabilities: Fair value of hedging contracts		(7,753	)		4,043			(3,710	)
Long-term liabilities: Fair value of hedging contracts		(470	)		274			(196	)

F-16

The following table illustrates our hedging positions for calendar years 2014, 2015 and 2016 as of February 25, 2014:

	Fixed-Price Swaps NYMEX (except where noted)
	Natural Gas					Oil
	Daily Volume (MMBtus/d)			Swap Price ($)		Daily Volume (Bbls/d)			Swap Price ($)
2014		10,000			4.000		1,000			90.06
2014		10,000			4.040		1,000			92.25
2014		10,000			4.105		1,000			93.55
2014		10,000			4.190		1,000			94.00
2014		10,000	(a)		4.250		1,000			98.00
2014		10,000			4.250		1,000			98.30
2014		10,000			4.350		2,000	(b)		98.85
2014							1,000			99.65
2014							1,000	(c)		103.30
2015		10,000			4.005		1,000			89.00
2015		10,000			4.120		1,000			90.00
2015		10,000			4.150
2015		10,000			4.165
2015		10,000			4.220
2015		10,000			4.255
2016		10,000			4.110
2016		10,000			4.120

(a) February through December

(b) January through June

(c) Brent crude oil contract

NOTE 8 – FAIR VALUE MEASUREMENTS:

U.S. GAAP establishes a fair value hierarchy that has three levels based on the reliability of the inputs used to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions.

As of December 31, 2013 and December 31, 2012, we held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. We utilize the services of an independent third party to assist us in valuing our derivative instruments. We used the income approach in determining the fair value of our derivative instruments utilizing a proprietary pricing model. The model accounts for our credit risk and the credit risk of our counterparties in the discount rate applied to estimated future cash inflows and outflows. Our swap contracts are included within the Level 2 fair value hierarchy. For a more detailed description of our derivative instruments, see Note 7 – Derivative Instruments and Hedging Activities. We used the market approach in determining the fair value of our investments in marketable securities, which are included within the Level 1 fair value hierarchy.

F-17

The following tables present our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2013:

	Fair Value Measurements at December 31, 2013
Assets	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Marketable securities	$	8,248	$	8,248	$	—	$	—
Hedging contracts		5,927		—		5,927		—
Total	$	14,175	$	8,248	$	5,927	$	—
	Fair Value Measurements at December 31, 2013
Liabilities	Total		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Hedging contracts	$	8,223	$	—	$	8,223	$	—
Total	$	8,223	$	—	$	8,223	$	—

The following tables present our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2012:

	Fair Value Measurements at December 31, 2012
Assets	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Marketable securities	$	13,492	$	13,492	$	—	$	—
Hedging contracts		48,854		—		48,854		—
Total	$	62,346	$	13,492	$	48,854	$	—
	Fair Value Measurements at December 31, 2012
Liabilities	Total		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Hedging contracts	$	1,679	$	—	$	1,679	$	—
Total	$	1,679	$	—	$	1,679	$	—

The fair value of cash and cash equivalents and our variable-rate bank debt approximated book value at December 31, 2013 and 2012. As of December 31, 2012, the fair value of the 8 ⁵⁄₈% Senior Notes due 2017 (the “2017 Notes”) was approximately $401,250. On December 13, 2013, our 2017 Notes were fully redeemed. As of December 31, 2013 and 2012, the fair value of the liability component of the 2017 Convertible Notes was approximately $260,377 and $249,601, respectively. On November 27, 2013, we completed the public offering of $475,000 aggregate principal amount of additional 7 ¹⁄₂% Senior Notes due 2022 (the “2022 Notes”). See Note 11 – Long-Term Debt. As of December 31, 2013 and 2012, the fair value of the 2022 Notes was approximately $814,719 and $314,250, respectively.

The fair value of the 2017 Notes and the fair value of the 2022 Notes were determined based upon quotes obtained from brokers, which represent Level 1 inputs. We applied fair value concepts in determining the liability component of the 2017 Convertible Notes (see Note 11 – Long-Term Debt) at inception, at December 31, 2013 and at December 31, 2012. The fair value of the liability was estimated using an income approach. The significant inputs in these determinations were market interest rates based on quotes obtained from brokers and represent Level 2 inputs.

F-18

NOTE 9 — ASSET RETIREMENT OBLIGATIONS:

The change in our asset retirement obligations during the years ended December 31, 2013, 2012 and 2011 is set forth below:

	Year Ended December 31,
	2013			2012			2011
Asset retirement obligations as of the beginning of the year, including current portion	$	488,302		$	425,779		$	373,920
Liabilities incurred		19,043			3,869			7,993
Liabilities settled		(79,695	)		(67,641	)		(63,226	)
Liabilities assumed		—			15,263			59,441
Divestment of properties		(9,245	)		(7,563	)		(10,900	)
Accretion expense		33,575			33,331			30,764
Revision of estimates		50,533			85,264			27,787
Asset retirement obligations as of the end of the year, including current portion	$	502,513		$	488,302		$	425,779

NOTE 10 — INCOME TAXES:

An analysis of our deferred taxes follows:

	As of December 31,
	2013			2012
Tax effect of temporary differences:
Net operating loss carryforwards	$	24,437		$	—
Oil and gas properties – full cost		(576,393	)		(465,862	)
Asset retirement obligations		180,905			175,788
Stock compensation		5,537			5,588
Hedges		826			(16,983	)
Accrued incentive compensation		9,189			4,762
Other		(3,484	)		1,391
		($358,983	)		($295,316	)

We estimate that we have approximately ($10,904), $15,022 and ($20,386) of current federal income tax expense (benefit) for the years ended December 31, 2013, 2012 and 2011, respectively. We have a $7,366 and $10,027 current income tax receivable at December 31, 2013 and 2012, respectively.

For tax reporting purposes, operating loss carryforwards totaled approximately $67,882 at December 31, 2013. If not utilized, such carryforwards would completely expire by the year 2033. In addition, we had approximately $1,453 in statutory depletion deductions available for tax reporting purposes that may be carried forward indefinitely. Recognition of a deferred tax asset associated with these carryforwards is dependent upon our evaluation that it is more likely than not that the asset will ultimately be realized.

A reconciliation between the statutory federal income tax rate and our effective income tax rate as a percentage of income before income taxes follows:

	Year Ended December 31,
	2013			2012			2011
Income tax expense computed at the statutory federal income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.0			1.0			1.0
IRC Sec. 162(m) limitation		0.8			0.6			0.3
Other		0.1			(0.5	)		(0.3	)
Effective income tax rate		36.9	%		36.1	%		36.0	%

Income taxes allocated to accumulated other comprehensive income related to oil and gas hedges amounted to ($17,003), $3,918 and $20,290 for the years ended December 31, 2013, 2012 and 2011, respectively.

F-19

As of December 31, 2013 and 2012, we had unrecognized tax benefits of $0 and $385, respectively. A reconciliation of the total amounts of unrecognized tax benefits follows:

Total unrecognized tax benefits as of December 31, 2012	$	385
Increases (decreases) in unrecognized tax benefits as a result of:		—
Tax positions taken during a prior period		—
Tax positions taken during the current period		—
Settlements with taxing authorities		(385	)
Lapse of applicable statute of limitations		—
Total unrecognized tax benefits as of December 31, 2013	$	—

Our unrecognized tax benefits pertained to proposed state income tax audit adjustments which were settled during 2013. See Note 15 – Commitments and Contingencies for additional information. It is our policy to classify interest and penalties associated with underpayment of income taxes as interest expense and general and administrative expenses, respectively. The liabilities for unrecognized tax benefits and accrued interest payable are components of other current liabilities on our balance sheet.

The tax years 2010 through 2012 remain subject to examination by major tax jurisdictions.

NOTE 11 — LONG-TERM DEBT:

Long-term debt consisted of the following:

	As of December 31,
	2013		2012
8 5⁄8% Senior Notes due 2017	$	—	$	375,000
1 3⁄4% Senior Convertible Notes due 2017		252,084		239,126
7 1⁄2% Senior Notes due 2022		775,000		300,000
Bank debt		—		—
Total long-term debt	$	1,027,084	$	914,126

Bank Debt

On April 26, 2011, we entered into an amended and restated revolving credit facility with commitments totaling $700,000 (subject to borrowing base limitations) through a syndicated bank group, replacing our previous facility. Our bank credit facility matures on April 26, 2015. On December 18, 2013, our borrowing base was reaffirmed at $400,000. As of December 31, 2013 and February 25, 2014, we had no outstanding borrowings under our bank credit facility and letters of credit totaling $21,406 had been issued pursuant to our bank credit facility, leaving $378,594 of availability under our bank credit facility.

The borrowing base under our bank credit facility is redetermined semi-annually, in May and November, by the lenders, taking into consideration the estimated value of our oil and gas properties and those of our direct and indirect material subsidiaries in accordance with the lenders’ customary practices for oil and gas loans. In addition, we and the lenders each have discretion at any time, but not more than two additional times in any calendar year, to have the borrowing base redetermined. If a reduction in our borrowing base were to fall below any outstanding balances under the bank credit facility plus any outstanding letters of credit, our agreement with the banks allows us one or more of three options to cure the borrowing base deficiency: (1) repay amounts outstanding sufficient to cure the deficiency within 10 days after our written election to do so; (2) add additional oil and gas properties acceptable to the banks to the borrowing base and take such actions necessary to grant the banks a mortgage in the properties within 30 days after our written election to do so or (3) arrange to pay the deficiency in five equal monthly installments.

Our bank credit facility is guaranteed by our only significant subsidiary, Stone Offshore. Our bank credit facility is collateralized by substantially all of Stone’s and Stone Offshore’s assets. Stone and Stone Offshore are required to mortgage, and grant a security interest in, their oil and natural gas reserves representing at least 80% of the discounted present value of the future net cash flows from their oil and natural gas reserves reviewed in determining the borrowing base. At Stone’s option, loans under our bank credit facility will bear interest at a rate based on the adjusted London Interbank Offering (“Libor”) Rate plus an applicable margin, or a rate based on the prime rate or federal funds rate plus an applicable margin.

F-20

Under the financial covenants of our bank credit facility, we must (1) maintain a ratio of consolidated debt to consolidated EBITDA, as defined in the credit agreement, for the preceding four quarterly periods of not greater than 3.25 to 1 and (2) maintain a ratio of consolidated EBITDA to consolidated Net Interest Expense, as defined in the credit agreement, for the preceding four quarterly periods of not less than 3.0 to 1. As of December 31, 2013, our debt to EBITDA ratio was 1.73 to 1 and our EBITDA to consolidated Net Interest Expense ratio was approximately 18.40 to 1. In addition, our bank credit facility includes certain customary restrictions or requirements with respect to disposition of properties, incurrence of additional debt, change of ownership and reporting responsibilities. These covenants may limit or prohibit us from paying cash dividends but do allow for limited stock repurchases. These covenants also restrict our ability to prepay other indebtedness under certain circumstances. We were in compliance with all covenants as of December 31, 2013.

2017 Convertible Notes

On March 6, 2012, we issued in a private offering $300,000 in aggregate principal amount of the 2017 Convertible Notes to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The 2017 Convertible Notes are convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, based on an initial conversion rate of 23.4449 shares of our common stock per $1 principal amount of 2017 Convertible Notes, which corresponds to an initial conversion price of approximately $42.65 per share of our common stock. On December 31, 2013, our closing share price was $34.59. The conversion rate, and thus the conversion price, may be adjusted under certain circumstances as described in the indenture related to the 2017 Convertible Notes.

The 2017 Convertible Notes may be converted by the holder, in multiples of $1 principal amount, only under the following circumstances:

• prior to December 1, 2016, on any date during any calendar quarter beginning after June 30, 2012 (and only during such calendar quarter) if the closing sale price of our common stock was more than 130% of the then current conversion price for at least 20 trading days in the period of the 30 consecutive trading days ending on the last trading day of the previous calendar quarter;

• prior to December 1, 2016, if we distribute to all or substantially all holders of our common stock rights, options or warrants entitling them to purchase, for a period of 45 calendar days or less from the declaration date for such distribution, shares of our common stock at a price per share less than the average closing sale price of our common stock for the 10 consecutive trading days immediately preceding, but excluding, the declaration date for such distribution;

• prior to December 1, 2016, if we distribute to all or substantially all holders of our common stock cash, other assets, securities or rights to purchase our securities, which distribution has a per share value exceeding 10% of the closing sale price of our common stock on the trading day immediately preceding the declaration date for such distribution, or if we engage in certain corporate transactions described in the indenture related to the 2017 Convertible Notes;

• prior to December 1, 2016, during the five consecutive business-day period following any five consecutive trading-day period in which the trading price per $1 principal amount of 2017 Convertible Notes for each trading day during such five trading-day period was less than 98% of the closing sale price of our common stock for each trading day during such five trading-day period multiplied by the then current conversion rate; or

• on or after December 1, 2016, and prior to the close of business on the second scheduled trading day immediately preceding the maturity date of the 2017 Convertible Notes, which is March 1, 2017, without regard to the foregoing conditions.

Upon conversion, we will be obligated to pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. If we satisfy our conversion obligation solely in cash or through payment and delivery, as the case may be, of a combination of cash and shares of our common stock, the amount of cash and shares of common stock, if any, due upon conversion will be based on a daily conversion value (as described in the indenture related to the 2017 Convertible Notes) calculated on a proportionate basis for each trading day in a 25 consecutive trading-day conversion period (as described in the indenture related to the 2017 Convertible Notes). Upon any conversion, subject to certain exceptions, holders of the 2017 Convertible Notes will not receive any cash payment representing accrued and unpaid interest. Instead, interest will be deemed to be paid by the cash, shares of our common stock or a combination of cash and shares of our common stock paid or delivered, as the case may be, upon conversion of a 2017 Convertible Note.

F-21

In connection with the offering, we entered into convertible note hedge transactions with respect to our common stock (the “Purchased Call Options”) with Barclays Capital Inc., acting as agent for Barclays Bank PLC and Bank of America, N.A. (the “Dealers”). We paid an aggregate amount of approximately $70,830 to the Dealers for the Purchased Call Options. The Purchased Call Options cover, subject to customary antidilution adjustments, approximately 7,033,470 shares of our common stock at a strike price that corresponds to the initial conversion price of the 2017 Convertible Notes, also subject to adjustment, and are exercisable upon conversion of the 2017 Convertible Notes.

We also entered into separate warrant transactions whereby, in reliance upon the exemption from registration provided by Section 4(2) of the Securities Act, we sold to the Dealers warrants to acquire, subject to customary antidilution adjustments, approximately 7,033,470 shares of our common stock (the “Sold Warrants”) at a strike price of $55.91 per share of our common stock. We received aggregate proceeds of approximately $40,170 from the sale of the Sold Warrants to the Dealers. If, upon expiration of the Sold Warrants, the price per share of our common stock, as measured under the Sold Warrants, is greater than the strike price of the Sold Warrants, we will be required to issue, without further consideration, under each Sold Warrant a number of shares of our common stock with a value equal to the amount of such difference.

As of December 31, 2013, the carrying amount of the liability component of the 2017 Convertible Notes was $252,084 and $1,750 had been accrued in connection with the March 1, 2014 interest payment. During the year ended December 31, 2013, we recognized $12,959 of interest expense for the amortization of the discount and $1,238 of interest expense for the amortization of deferred financing costs related to the 2017 Convertible Notes. During the year ended December 31, 2012, we recognized $9,956 of interest expense for the amortization of the discount and $951 of interest expense for the amortization of deferred financing costs related to the 2017 Convertible Notes. During the years ended December 31, 2013 and 2012, we recognized $5,250 and $4,302, respectively, of interest expense related to the contractual interest coupon on the 2017 Convertible Notes.

2022 Notes

On November 8, 2012, we completed the public offering of $300,000 aggregate principal amount of our 2022 Notes, which are fully and unconditionally guaranteed on a senior unsecured basis by Stone Offshore and by certain future restricted subsidiaries of Stone. The net proceeds from the offering after deducting underwriting discounts, commissions, fees and expenses totaled $293,203. On November 27, 2013, we completed the public offering of an additional $475,000 aggregate principal amount of our 2022 Notes at a 3% premium. The net proceeds from this offering after deducting underwriting discounts, commissions, fees and expenses totaled $480,195. The 2022 Notes rank equally in right of payment with all of our existing and future senior debt, and rank senior in right of payment to all of our existing and future subordinated debt. The 2022 Notes mature on November 15, 2022, and interest is payable on the 2022 Notes on each May 15 and November 15. We may redeem some or all of the 2022 Notes at any time on or after November 15, 2017 at the redemption prices specified in the indenture, and we may redeem some or all of the 2022 Notes prior to November 15, 2017 at a make-whole redemption price as specified in the indenture. We also may redeem up to 35% of the 2022 Notes prior to November 15, 2015 with cash proceeds from certain equity offerings at a redemption price of 107.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date. If we sell certain assets and do not reinvest the proceeds or repay senior indebtedness, or we experience certain changes of control, each as described in the indenture, we must offer to repurchase the 2022 Notes. The 2022 Notes provide for certain covenants, which include, without limitation, restrictions on liens, indebtedness, asset sales, dividend payments and other restricted payments. The violation of any of these covenants could give rise to a default, which if not cured could give the holder of the 2022 Notes a right to accelerate payment. At December 31, 2013, $7,266 had been accrued in connection with the May 15, 2014 interest payment.

2017 Notes

On January 26, 2010, we issued $275,000 aggregate principal amount of our 2017 Notes. On November 17, 2010, we completed a public offering of an additional $100,000 aggregate principal amount of our 2017 Notes. In November 2013, we used proceeds from the 2022 Notes offering to purchase a portion of our 2017 Notes pursuant to a tender offer and consent solicitation. In December 2013, the remaining 2017 Notes were redeemed in full. The total cost of the redemption was $406,967, which included $396,014 to redeem the notes plus accrued and unpaid interest of $10,953. The transaction resulted in a charge to earnings of $27,279 in the fourth quarter of 2013, which represented the premium paid for the repurchase and redemption of $21,014 and the write off of the remaining deferred financing costs related to the 2017 Notes of $6,265.

F-22

Deferred Financing Cost and Interest Cost

Other assets at December 31, 2013 and 2012 included approximately $11,754 and $27,753, respectively, of deferred financing costs, net of accumulated amortization. These costs related primarily to the issuance of the 2017 Convertible Notes, the 2022 Notes and our bank credit facility. The costs associated with the 2017 Convertible Notes are being amortized over the life of the notes using a method that applies an effective interest rate of 7.51%. The costs associated with the November 2012 issuance and November 2013 issuance of the 2022 Notes are being amortized over the life of the notes using a method that applies effective interest rates of 7.75% and 7.04%, respectively. The costs associated with our bank credit facility are being amortized over the term of our bank credit facility.

Total interest cost incurred, before capitalization, on all obligations for the years ended December 31, 2013, 2012 and 2011 was $79,697, $68,031 and $51,322 respectively.

NOTE 12 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS):

Changes in accumulated other comprehensive income (loss) by component for the year ended December 31, 2013 were as follows:

	Cash Flow Hedges			Foreign Currency Items			Total
For the Year Ended December 31, 2013
Beginning balance, net of tax	$	28,833		$	—		$	28,833
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		(26,945	)		—			(26,945	)
Foreign currency translations		—			(667	)		(667	)
Income tax effect		9,701			—			9,701
Net of tax		(17,244	)		(667	)		(17,911	)
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		20,289			—			20,289
Income tax effect		(7,305	)		—			(7,305	)
Net of tax		12,984			—			12,984
Other comprehensive income (loss), net of tax		(30,228	)		(667	)		(30,895	)
Ending balance, net of tax		($1,395	)		($667	)		($2,062	)

In 2012 and 2011, the only component of accumulated other comprehensive income (loss) related to our cash flow hedges. Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2012 and 2011 were as follows:

	Cash Flow Hedges
For the Year Ended December 31, 2012
Beginning balance, net of tax	$	21,868
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		41,209
Income tax effect		(14,836	)
Net of tax		26,373
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		30,326
Income tax effect		(10,918	)
Net of tax		19,408
Other comprehensive income, net of tax		6,965
Ending balance, net of tax	$	28,833

F-23

	Cash Flow Hedges
For the Year Ended December 31, 2011
Beginning balance, net of tax		($14,204	)
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		43,089
Income tax effect		(15,512	)
Net of tax		27,577
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		(13,274	)
Income tax effect		4,779
Net of tax		(8,495	)
Other comprehensive income, net of tax		36,072
Ending balance, net of tax	$	21,868

NOTE 13 — SHARE-BASED COMPENSATION:

Under the Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan (the “2009 Plan”), we may grant both incentive stock options qualifying under Section 422 of the Internal Revenue Code and options that are not qualified as incentive stock options to all employees and directors. All such options must have an exercise price of not less than the fair market value of our common stock on the date of grant and may not be re-priced without stockholder approval. Stock options to all employees vest ratably over a five-year service-vesting period and expire 10 years subsequent to award. Stock options issued to non-employee directors vest ratably over a three-year service-vesting period and expire 10 years subsequent to award. In addition, the 2009 Plan provides that shares available under the 2009 Plan may be granted as restricted stock. Restricted stock typically vests over a one- to three-year period.

We record share-based compensation expense under U.S. GAAP for equity-based compensation awards based on the fair value on the date of grant. Compensation expense for equity-based compensation awards is recognized in our financial statements over the vesting period of the award.

For the year ended December 31, 2013, we incurred $15,425 of share-based compensation, of which $15,405 related to restricted stock issuances and $20 related to stock option grants, and of which a total of approximately $5,078 was capitalized into oil and gas properties. For the year ended December 31, 2012, we incurred $13,399 of share-based compensation, of which $13,308 related to restricted stock issuances and $91 related to stock option grants, and of which a total of approximately $4,288 was capitalized into oil and gas properties. For the year ended December 31, 2011, we incurred $8,914 of share-based compensation, of which $8,796 related to restricted stock issuances and $118 related to stock option grants, and of which a total of approximately $3,010 was capitalized into oil and gas properties. Because of the non-cash nature of share-based compensation, the expensed portion of share-based compensation is added back to net income in arriving at net cash provided by operating activities in our statement of cash flows. The capitalized portion is not included in net cash used in investing activities.

F-24

Stock Options. There were no stock option grants during the years ended December 31, 2013, 2012 or 2011.

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2013 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		411,794		$	39.04
Granted		—			—
Exercised		—			—
Forfeited		(15,250	)		42.45
Expired		(65,370	)		36.56
Options outstanding, end of period		331,174			39.37	2.2 years	$	1,708
Options exercisable, end of period		318,279			40.62	2.1 years		1,373
Options unvested, end of period		12,895			8.64	5.0 years		335

Exercise prices for stock options outstanding at December 31, 2013 range from $6.97 to $53.20.

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2012 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		438,394		$	38.76
Granted		—			—
Exercised		—			—
Forfeited		(4,200	)		35.54
Expired		(22,400	)		34.25
Options outstanding, end of period		411,794			39.04	2.8 years	$	766
Options exercisable, end of period		378,004			41.00	2.5 years		459
Options unvested, end of period		33,790			17.17	5.4 years		307

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2011 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		484,694		$	39.43
Granted		—			—
Exercised		—			—
Forfeited		(13,300	)		37.98
Expired		(33,000	)		48.85
Options outstanding, end of period		438,394			38.76	3.6 years	$	1,143
Options exercisable, end of period		378,710			41.66	3.1 years		457
Options unvested, end of period		59,684			20.36	6.1 years		686

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Restricted Stock. The fair value of restricted shares is typically determined based on the average of our high and low stock prices on the grant date. During the year ended December 31, 2013, we issued 848,498 shares of restricted stock valued at $17,487. During the year ended December 31, 2012, we issued 670,818 shares of restricted stock valued at $21,085. During the year ended December 31, 2011, we issued 597,062 shares of restricted stock valued at $14,100.

A summary of the restricted stock activity under the 2009 Plan for the years ended December 31, 2013, 2012 and 2011 is as follows (amounts in table represent actual values):

	2013					2012					2011
	Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share		Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share		Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share
Restricted stock outstanding, beginning of period		1,108,874		$	27.56		923,740		$	20.08		783,606		$	17.24
Issuances		848,498			20.61		670,818			31.43		597,062			23.62
Lapse of restrictions		(534,041	)		25.45		(462,141	)		18.29		(419,543	)		19.91
Forfeitures		(165,278	)		26.43		(23,543	)		26.10		(37,385	)		18.92
Restricted stock outstanding, end of period		1,258,053		$	23.92		1,108,874		$	27.56		923,740		$	20.08

As of December 31, 2013, there was $17,004 of unrecognized compensation cost related to all non-vested share-based compensation arrangements under the 2009 Plan. That cost is being amortized on a straight-line basis over the vesting period and is expected to be recognized over a weighted-average period of 1.7 years.

Under U.S. GAAP, if tax deductions exceed book compensation expense, then excess tax benefits are credited to additional paid-in capital to the extent realized. If book compensation expense exceeds tax deductions, the tax deficit results in either a reduction in additional paid-in capital or an increase in income tax expense depending on the pool of available excess tax benefits to offset such deficit. Adjustments to additional paid-in capital related to the net tax effect of stock option exercises and restricted stock vesting were ($884), $814 and $735 in 2013, 2012 and 2011, respectively.

NOTE 14 — SHARE REPURCHASE PROGRAM:

On September 24, 2007, our board of directors authorized a share repurchase program for an aggregate amount of up to $100,000. The shares may be repurchased from time to time in the open market or through privately negotiated transactions. The repurchase program is subject to business and market conditions and may be suspended or discontinued at any time. Through December 31, 2013, 300,000 shares had been repurchased under this program at a total cost of $7,071, or an average price of $23.57 per share. No shares were repurchased during the years ended December 31, 2013, 2012 and 2011.

NOTE 15 — COMMITMENTS AND CONTINGENCIES:

Leases

We lease office facilities in Lafayette and New Orleans, Louisiana, Houston, Texas and Morgantown, West Virginia under the terms of long-term, non-cancelable leases expiring on various dates through 2018. We also lease certain equipment on our oil and gas properties typically on a month-to-month basis. The minimum net annual commitments under all leases, subleases and contracts with non-cancelable terms in excess of 12 months at December 31, 2013 were as follows:

2014	$	736
2015		637
2016		358
2017		301
2018		147

Payments related to our lease obligations for the years ended December 31, 2013, 2012 and 2011 were approximately $597, $894 and $446, respectively.

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Other Commitments

We are contingently liable to surety insurance companies in the amount of $81,878 relative to bonds issued on our behalf to the Bureau of Ocean Energy Management (the “BOEM”), federal and state agencies and certain third parties from which we purchased oil and gas working interests. The bonds represent guarantees by the surety insurance companies that we will operate in accordance with applicable rules and regulations and perform certain plugging and abandonment obligations as specified by applicable working interest purchase and sale agreements.

In connection with our exploration and development efforts, we are contractually committed to the use of drilling rigs and the acquisition of seismic data in the aggregate amount of $216,726 to be incurred over the next four years. We have placed $22,350 on deposit to guarantee these obligations.

The Oil Pollution Act (the “OPA”) imposes ongoing requirements on a responsible party, including the preparation of oil spill response plans and proof of financial responsibility to cover environmental cleanup and restoration costs that could be incurred in connection with an oil spill. Under the OPA and a final rule adopted by the BOEM in August 1998, responsible parties of covered offshore facilities that have a worst case oil spill of more than 1,000 barrels must demonstrate financial responsibility in amounts ranging from at least $10,000 in specified state waters to at least $35,000 in Outer Continental Shelf (the “OCS”) waters, with higher amounts of up to $150,000 in certain limited circumstances where the BOEM believes such a level is justified by the risks posed by the operations, or if the worst case oil-spill discharge volume possible at the facility may exceed the applicable threshold volumes specified under the BOEM’s final rule. We do not anticipate that we will experience any difficulty in continuing to satisfy the BOEM’s requirements for demonstrating financial responsibility under the OPA and the BOEM’s regulations.

Litigation

We are named as a defendant in certain lawsuits and are a party to certain regulatory proceedings arising in the ordinary course of business. We do not expect that these matters, individually or in the aggregate, will have a material adverse effect on our financial condition.

Since 2003, we have been involved in disputes with the Louisiana Department of Revenue (the “LDR”), which resulted in several petitions being filed by the LDR in Louisiana state court, claiming additional franchise taxes due. In addition, we received preliminary assessments from the LDR of additional franchise and income taxes resulting from audits of Stone and its subsidiaries. These petitions and assessments primarily related to the LDR’s assertion that sales of crude oil and natural gas from properties located on the OCS that are transported through the state should be sourced to the state for purposes of computing the Louisiana franchise tax and income tax apportionment ratios. By agreement dated November 22, 2013, Stone executed a settlement with the state in the amount of $13,000, resolving all claims asserted in litigation, as well as assessments proposed by the LDR for franchise and income taxes alleged to be due by Stone for the tax years 1999 through 2009, including claims for interest thereon. The agreement was reached under an amnesty program pursuant to Act 421 of the 2013 Regular Session of the Louisiana Legislature. The settlement amount, less income tax and interest amounts previously accrued, has been recorded as an expense in the accompanying consolidated statement of income. The tax years 2011 through 2013 remain subject to examination but the exposure to additional assessments is immaterial.

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NOTE 16 — EMPLOYEE BENEFIT PLANS:

We have entered into deferred compensation and disability agreements with certain of our officers and former officers. The benefits under the deferred compensation agreements vest after certain periods of employment, and at December 31, 2013, the liability for such vested benefits was approximately $1,062 and is recorded in current and other long-term liabilities.

The following is a brief description of each incentive compensation plan applicable to our employees:

Annual Cash Incentive Compensation Plan

The Amended and Restated Revised Annual Incentive Compensation Plan, which was adopted in November 2007, provides for annual cash incentive bonuses that are tied to the achievement of certain strategic objectives as defined by our board of directors on an annual basis. Stone incurred expenses of $15,340, $8,113, and $11,600, net of amounts capitalized, for each of the years ended December 31, 2013, 2012 and 2011, respectively, related to incentive compensation bonuses to be paid under the revised plan.

Stock Incentive Plans

At the 2011 Annual Meeting of Stockholders, the stockholders approved the First Amendment (the “First Amendment”) to the 2009 Plan. The First Amendment increases the number of shares of our common stock that Stone may issue under the 2009 Plan, and the number of shares of our common stock that may be issued under the 2009 Plan through incentive stock options by 2,800,000 shares, effective May 20, 2011. The 2009 Plan is an amendment and restatement of the company’s 2004 Amended and Restated Stock Incentive Plan (the “2004 Plan”), and it supersedes and replaces in its entirety the 2004 Plan. The 2009 Plan provides for the granting of incentive stock options and restricted stock awards or any combination as is best suited to the circumstances of the particular employee or nonemployee director. The 2009 Plan eliminates the automatic grant of stock options or restricted stock awards to nonemployee directors that was provided for in the 2004 Plan so that awards under the 2009 Plan are entirely at the discretion of our board of directors. Under the 2009 Plan, we may grant both incentive stock options qualifying under Section 422 of the Internal Revenue Code and options that are not qualified as incentive stock options to all employees and directors. All such options must have an exercise price of not less than the fair market value of our common stock on the date of grant and may not be re-priced without stockholder approval. Stock options to all employees vest ratably over a five-year service-vesting period and expire 10 years subsequent to award. Stock options issued to non-employee directors vest ratably over a three-year service-vesting period and expire 10 years subsequent to award. In addition, the 2009 Plan provides that shares available under the 2009 Plan may be granted as restricted stock. Restricted stock grants typically vest in one to three years at the discretion of the Compensation Committee of our board of directors. At December 31, 2013, we had approximately 2,081,866 additional shares available for issuance pursuant to the Plan.

401(k) and Deferred Compensation Plans

The Stone Energy 401(k) Profit Sharing Plan provides eligible employees with the option to defer receipt of a portion of their compensation and we may, at our discretion, match a portion or all of the employee’s deferral. The amounts held under the plan are invested in various investment funds maintained by a third party in accordance with the directions of each employee. An employee is 20% vested in matching contributions (if any) for each year of service and is fully vested upon five years of service. For the years ended December 31, 2013, 2012 and 2011, Stone contributed $1,793, $1,759 and $1,435, respectively, to the plan.

The Stone Energy Corporation Deferred Compensation Plan provides eligible executives and employees with the option to defer up to 100% of their compensation for a calendar year and we may, at our discretion, match a portion or all of the participant’s deferral based upon a percentage determined by our board of directors. To date there have been no matching contributions made by Stone. The amounts held under the plan are invested in various investment funds maintained by a third party in accordance with the direction of each participant. At December 31, 2013 and 2012, plan assets of $8,248 and $7,498, respectively, were included in other assets. An equal amount of plan liabilities were included in other long-term liabilities.

Change of Control and Severance Plans

On April 7, 2009, we amended and restated our Executive Change of Control and Severance Plan effective as of December 31, 2008 (as so amended and restated, the “Executive Plan”). The Executive Plan also replaced and superseded our Executive Change in Control and Severance Policy that was maintained for certain designated executives (specifically, the CEO and CFO). The Executive Plan will provide the company’s officers that are terminated in the event of a change of control and upon certain other terminations of employment with change of control and severance benefits as defined in the Executive Plan. Executives who are

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terminated within the scope of the Executive Plan will be entitled to certain payments and benefits including the following: a base salary up to the date of termination; in the case of the CEO and CFO, a lump sum severance payment of 2.99 times the sum of his annual pay and any target bonus at the one hundred percent level; a lump sum amount representing a pro rata share of the bonus opportunity up to the date of termination at the then projected rate of payout; in the case of officers other than the CEO and CFO and an involuntary termination occurring outside a change of control period, a lump sum severance payment in an amount equal to the executive’s annual base salary; in the case of officers other than the CEO and CFO and an involuntary termination occurring during a change of control period, a lump sum severance payment in an amount equal to 2.99 times the executive’s annual base salary; continued health plan coverage for six months and outplacement services. In the case of the CEO and CFO, if the payments would be “excess parachute payments,” they will be reduced as necessary to avoid the 20% excise tax under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), but only if the executive is in a better net after-tax position after such reduction. Also, if a payment would be to a “key employee” for purposes of Section 409A of the Code, payment will be delayed until six months after his termination if required to comply with Section 409A. Benefits paid upon a change of control, without regard to whether there is a termination of employment, include the following: lapse of restrictions on restricted stock, accelerated vesting and cash-out of all in-the-money stock options, a 401(k) plan employer matching contribution at the rate of 50%, and a pro-rated portion of the projected bonus, if any, for the year of change of control.

On December 7, 2007, our board of directors approved and adopted the Stone Energy Corporation Employee Change of Control Severance Plan (“Employee Severance Plan”), as amended and restated to comply with the final regulations under Section 409A of the Internal Revenue Code and to provide that said plan will remain in force and effect unless and until terminated by our board of directors. The Employee Severance Plan amended and restated the company’s previous Employee Change of Control Severance Plan dated November 16, 2006. The Employee Severance Plan covers all full-time employees other than officers. Severance is triggered by an involuntary termination of employment on and during the six-month period following a change of control, including a resignation by the employee relating to a change in duties. Employees who are terminated within the scope of the Employee Severance Plan will be entitled to certain payments and benefits including the following: a lump sum equal to (1) weekly pay times full years of service, plus (2) one week’s pay for each full $10,000 of annual pay, but the sum of (1) and (2) cannot be less than 12 weeks of pay or greater than 52 weeks of pay; continued health plan coverage for six months; and a pro-rated portion of the employee’s targeted bonus for the year. Benefits paid upon a change of control, without regard to whether there is a termination of employment, include the following: lapse of restrictions on restricted stock, accelerated vesting and cash-out of all in-the-money stock options, a 401(k) plan employer matching contribution at the rate of 50%, and a lump sum cash payment equal to the product of (i) the number of “restricted shares” of company stock that the employee would have received under the company’s stock plan but did not receive for the time-vested portion of his long-term stock incentive award, if any, for the calendar year in which the change of control occurs times (ii) the price per share of the company’s common stock utilized in effecting the change of control, provided that such amount shall be pro-rated by multiplying such amount by the number of full months that have elapsed from January 1 of that calendar year to the effective date of the change of control and then dividing the result by 12.

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NOTE 17 — OIL AND GAS RESERVE INFORMATION – UNAUDITED:

Our estimated net proved oil and natural gas reserves at December 31, 2013 have been prepared in accordance with guidelines established by the Securities and Exchange Commission (“SEC”). Accordingly, the following reserve estimates are based upon existing economic and operating conditions at the respective dates. There are numerous uncertainties inherent in estimating quantities of proved reserves and in providing the future rates of production and timing of development expenditures. The following reserve data represents estimates only and should not be construed as being exact. In addition, the present values should not be construed as the market value of the oil and gas properties or the cost that would be incurred to obtain equivalent reserves.

The following table sets forth an analysis of the estimated quantities of net proved and proved developed oil (including condensate), natural gas and natural gas liquids (“NGL”) reserves, all of which are located onshore and offshore the continental United States. Estimated proved oil, natural gas and NGL reserves at December 31, 2013, 2012 and 2011 are prepared in accordance with the SEC’s rule, “Modernization of Oil and Gas Reporting,” using a historical 12-month average pricing assumption. In the first quarter of 2012, we began reporting NGL volumes and revenues separately from gas volumes. Historically, we reported “wet” gas volumes, which included entrained liquids. We now report NGLs and “dry” gas (shrunk for removal of liquids) volumes. Reserve volumes for the year ended December 31, 2011 have been reclassified to conform to the current presentation. Reserve volumes for the year ended December 31, 2010 have not been reclassified to conform to the current presentation given the immateriality of NGL volumes in such period.

	Oil (MBbls)			NGLs (MBbls)			Natural Gas (MMcf)			Oil, Natural Gas and NGLs (MMcfe)
Estimated proved reserves as of December 31, 2010		33,203			—			274,705			473,923
Revisions of previous estimates		2,889			4,911			(26,725	)		20,075
Extensions, discoveries and other additions		3,544			—			93,520			114,784
Purchase of producing properties		14,396			—			24,595			110,971
Sale of reserves		(1,950	)		—			(2,150	)		(13,850	)
Production		(6,427	)		(506	)		(38,466	)		(80,064	)
Estimated proved reserves as of December 31, 2011		45,655			4,405			325,479			625,839
Revisions of previous estimates		(1,559	)		9,349			(26,694	)		20,050
Extensions, discoveries and other additions		3,681			4,856			131,408			182,633
Purchase of producing properties		4,336			619			8,168			37,895
Sale of reserves		(60	)		—			(418	)		(775	)
Production		(7,135	)		(1,163	)		(42,569	)		(92,357	)
Estimated proved reserves as of December 31, 2012		44,918			18,066			395,374			773,285
Revisions of previous estimates		3,606			2,439			36,006			72,275
Extensions, discoveries and other additions		2,367			4,395			79,729			120,299
Sale of reserves		(170	)		—			(214	)		(1,235	)
Production		(6,894	)		(1,603	)		(50,129	)		(101,111	)
Estimated proved reserves as of December 31, 2013		43,827			23,297			460,766			863,513
Estimated proved developed reserves:
as of December 31, 2011		30,914			3,195			171,871			376,528
as of December 31, 2012		29,005			8,593			210,956			436,540
as of December 31, 2013		27,920			11,569			246,946			483,885

The following narrative provides the reasons for the significant changes in the quantities of our estimated proved reserves by year.

Year Ended December 31, 2013. Extensions, discoveries and other additions were primarily the result of our Appalachia drilling program (117 Bcfe). Revisions of previous estimates were primarily the result of positive reserve report pricing changes extending the economic limits of reservoirs (17.8 Bcfe) and well performance (54.5 Bcfe).

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Year Ended December 31, 2012. Extensions, discoveries and other additions were primarily the result of our Appalachia drilling program (162 Bcfe) and our deep gas development project at LaCantera (17 Bcfe). Purchase of producing properties relates to our acquisition of an additional interest in the Pompano field.

Year Ended December 31, 2011. Extensions, discoveries and other additions were primarily the result of our Appalachia drilling program (94 Bcfe), our deep gas development project at LaPosada (11 Bcfe) and our GOM drilling program at Mississippi Canyon Block 109 (6 Bcfe). Purchase of producing properties primarily relates to our acquisition of the Pompano and Mica fields (102 Bcfe) and our acquisition of an additional 15% working interest in the Pyrenees project (6 Bcfe). Sale of reserves primarily relates to the sale of our non-operated interest in the Main Pass Block 296 and 311 fields (13 Bcfe).

The following tables present the standardized measure of discounted future net cash flows related to estimated proved oil, natural gas and NGL reserves together with changes therein, including a reduction for estimated plugging and abandonment costs that are also reflected as a liability on the balance sheet at December 31, 2013. You should not assume that the future net cash flows or the discounted future net cash flows, referred to in the tables below, represent the fair value of our estimated oil, natural gas and NGL reserves. Prices are based on either the historical 12-month average price based on closing prices on the first day of each month, or prices defined by existing contractual arrangements. The 2013 average historical 12-month oil and gas prices, net of applicable differentials, were $102.21 per Bbl of oil, $37.59 per Bbl of NGLs and $3.66 per Mcf of gas. The 2012 average 12-month oil and gas prices, net of applicable differentials, were $101.20 per Bbl of oil, $38.23 per Bbl of NGLs and $2.68 per Mcf of gas. The 2011 average 12-month oil and gas prices, net of applicable differentials, were $100.97 per Bbl of oil, $58.26 per Bbl of NGLs and $4.74 per Mcf of gas. Future production and development costs are based on current costs with no escalations. Estimated future cash flows net of future income taxes have been discounted to their present values based on a 10% annual discount rate.

	Standardized Measure Year Ended December 31,
	2013			2012			2011
Future cash inflows	$	7,040,928		$	6,295,455		$	6,171,279
Future production costs		(2,062,657	)		(1,946,426	)		(1,747,806	)
Future development costs		(1,431,101	)		(1,241,531	)		(1,219,214	)
Future income taxes		(884,637	)		(799,007	)		(852,364	)
Future net cash flows		2,662,533			2,308,491			2,351,895
10% annual discount		(977,531	)		(794,632	)		(808,933	)
Standardized measure of discounted future net cash flows	$	1,685,002		$	1,513,859		$	1,542,962
	Changes in Standardized Measure Year Ended December 31,
	2013			2012			2011
Standardized measure at beginning of year	$	1,513,859		$	1,542,962		$	957,629
Sales and transfers of oil, gas and NGLs produced, net of production costs		(708,017	)		(697,741	)		(670,347	)
Changes in price, net of future production costs		229,425			(380,841	)		502,324
Extensions and discoveries, net of future production and development costs		155,592			178,272			293,168
Changes in estimated future development costs, net of development costs incurred during the period		28,684			212,329			97,852
Revisions of quantity estimates		281,558			76,450			(27,854	)
Accretion of discount		202,087			207,292			118,722
Net change in income taxes		(28,084	)		22,947			(300,363	)
Purchases of reserves in-place		—			276,389			567,286
Sales of reserves in-place		15,531			2,480			(36,278	)
Changes in production rates due to timing and other		(5,633	)		73,320			40,823
Net increase (decrease) in standardized measure		171,143			(29,103	)		585,333
Standardized measure at end of year	$	1,685,002		$	1,513,859		$	1,542,962

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NOTE 18 — SUMMARIZED QUARTERLY FINANCIAL INFORMATION – UNAUDITED:

The results of operations by quarter are as follows:

	2013 Quarter Ended
	March 31		June 30		September 30		December 31
Operating revenue	$	233,732	$	245,877	$	256,685	$	239,253
Income from operations		72,828		69,525		62,422		37,206	(a)
Net income		40,758		39,022		36,102		1,752	(a) (b)
Basic earnings per share	$	0.82	$	0.78	$	0.72	$	0.04
Diluted earnings per share	$	0.82	$	0.78	$	0.72	$	0.04
	2012 Quarter Ended
	March 31		June 30		September 30		December 31
Operating revenue	$	244,957	$	226,561	$	227,397	$	254,871
Income from operations		84,927		56,156		44,485		78,397
Net income		50,974		30,547		23,659		44,246
Basic earnings per share	$	1.04	$	0.62	$	0.48	$	0.89
Diluted earnings per share	$	1.04	$	0.62	$	0.48	$	0.89

(a) Includes franchise tax settlement of $12,590 before income tax effect ($8,058 net of income tax effect).

(b) Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

NOTE 19 — SUBSEQUENT EVENTS:

On January 16, 2014, we completed the sale of our interests in the Cut Off and Clovelly fields for cash consideration of approximately $41,575. On January 31, 2014, we completed the sale of our interest in the Hatch Point field for cash consideration of approximately $9,720. These sales will be accounted for as an adjustment to capitalized costs with no gain or loss recognized.

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NOTE 20 – GUARANTOR FINANCIAL STATEMENTS:

Stone Offshore is an unconditional guarantor (the “Guarantor Subsidiary”) of the 2017 Convertible Notes and 2022 Notes. Our other subsidiaries (the “Non-Guarantor Subsidiaries”) have not provided guarantees. The following presents consolidating financial information as of December 31, 2013 and 2012 and for the years ended December 31, 2013, 2012 and 2011 on an issuer (parent company), Guarantor Subsidiary, Non-Guarantor Subsidiaries, and consolidated basis. Elimination entries presented are necessary to combine the entities.

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	246,294		$	84,290		$	640		$	—		$	331,224
Accounts receivable		74,887			97,128			—			(44	)		171,971
Fair value of hedging contracts		—			4,549			—			—			4,549
Current income tax receivable		7,366			—			—			—			7,366
Deferred taxes *		8,659			23,051			—			—			31,710
Inventory		3,440			283			—			—			3,723
Other current assets		1,874			—			—			—			1,874
Total current assets		342,520			209,301			640			(44	)		552,417
Oil and gas properties, full cost method:
Proved		1,309,527			6,494,590			—			—			7,804,117
Less: accumulated DD&A		(459,932	)		(5,448,828	)		—			—			(5,908,760	)
Net proved oil and gas properties		849,595			1,045,762			—			—			1,895,357
Unevaluated		325,113			388,643			10,583			—			724,339
Other property and equipment, net		26,178			—			—			—			26,178
Fair value of hedging contracts		—			1,378			—			—			1,378
Other assets, net		45,410			1,349			2,128			—			48,887
Investment in subsidiary		747,472			—			12,711			(760,183	)		—
Total assets	$	2,336,288		$	1,646,433		$	26,062			($760,227	)	$	3,248,556
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	173,147		$	22,530		$	44			($44	)	$	195,677
Undistributed oil and gas proceeds		34,386			2,643			—			—			37,029
Accrued interest		9,022			—			—			—			9,022
Fair value of hedging contracts		—			7,753			—			—			7,753
Asset retirement obligations		—			67,161			—			—			67,161
Other current liabilities		53,682			838			—			—			54,520
Total current liabilities		270,237			100,925			44			(44	)		371,162
Long-term debt		1,027,084			—			—			—			1,027,084
Deferred taxes *		10,227			380,466			—			—			390,693
Asset retirement obligations		4,945			430,407			—			—			435,352
Fair value of hedging contracts		—			470			—			—			470
Other long-term liabilities		53,509			—			—			—			53,509
Total liabilities		1,366,002			912,268			44			(44	)		2,278,270
Commitments and contingencies Stockholders’ equity:
Common stock		488			—			—			—			488
Treasury stock		(860	)		—			—			—			(860	)
Additional paid-in capital		1,397,885			1,309,563			27,403			(1,336,966	)		1,397,885
Accumulated deficit		(425,165	)		(574,003	)		(52	)		574,055			(425,165	)
Accumulated other comprehensive loss		(2,062	)		(1,395	)		(1,333	)		2,728			(2,062	)
Total stockholders’ equity		970,286			734,165			26,018			(760,183	)		970,286
Total liabilities and stockholders’ equity	$	2,336,288		$	1,646,433		$	26,062			($760,227	)	$	3,248,556

* Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

F-33

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	228,398		$	51,128		$	—	$	—		$	279,526
Accounts receivable		59,213			108,075			—		—			167,288
Fair value of hedging contracts		—			39,655			—		—			39,655
Current income tax receivable		10,027			—			—		—			10,027
Deferred taxes *		5,947			9,567			—		—			15,514
Inventory		3,924			283			—		—			4,207
Other current assets		3,626			—			—		—			3,626
Total current assets		311,135			208,708			—		—			519,843
Oil and gas properties, full cost method:
Proved		1,004,808			6,239,658			—		—			7,244,466
Less: accumulated DD&A		(370,111	)		(5,140,055	)		—		—			(5,510,166	)
Net proved oil and gas properties		634,697			1,099,603			—		—			1,734,300
Unevaluated		254,757			193,038			—		—			447,795
Other property and equipment, net		22,115			—			—		—			22,115
Fair value of hedging contracts		—			9,199			—		—			9,199
Other assets, net		41,679			1,500			—		—			43,179
Investment in subsidiary		736,331			—			—		(736,331	)		—
Total assets	$	2,000,714		$	1,512,048		$	—		($736,331	)	$	2,776,431
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	74,503		$	19,858		$	—	$	—		$	94,361
Undistributed oil and gas proceeds		21,841			1,573			—		—			23,414
Accrued interest		18,546			—			—		—			18,546
Fair value of hedging contracts		—			149			—		—			149
Asset retirement obligations		—			66,260			—		—			66,260
Other current liabilities		16,765			—			—		—			16,765
Total current liabilities		131,655			87,840			—		—			219,495
Long-term debt		914,126			—			—		—			914,126
Deferred taxes *		47,758			263,072			—		—			310,830
Asset retirement obligations		5,479			416,563			—		—			422,042
Fair value of hedging contracts		—			1,530			—		—			1,530
Other long-term liabilities		29,563			6,712			—		—			36,275
Total liabilities		1,128,581			775,717			—		—			1,904,298
Commitments and contingencies Stockholders’ equity:
Common stock		484			—			—		—			484
Treasury stock		(860	)		—			—		—			(860	)
Additional paid-in capital		1,386,475			1,496,510			—		(1,496,510	)		1,386,475
Accumulated deficit		(542,799	)		(789,012	)		—		789,012			(542,799	)
Accumulated other comprehensive income		28,833			28,833			—		(28,833	)		28,833
Total stockholders’ equity		872,133			736,331			—		(736,331	)		872,133
Total liabilities and stockholders’ equity	$	2,000,714		$	1,512,048		$	—		($736,331	)	$	2,776,431

* Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

F-34

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	30,475		$	684,629		$	—		$	—		$	715,104
Gas production		68,895			121,685			—			—			190,580
Natural gas liquids production		32,293			28,394			—			—			60,687
Other operational income		7,163			645			—			—			7,808
Total operating revenue		138,826			835,353			—			—			974,179
Operating expenses:
Lease operating expenses		14,680			186,473			—			—			201,153
Transportation, processing, and gathering expenses		28,322			13,850			—			—			42,172
Production taxes		6,229			8,800			—			—			15,029
Depreciation, depletion, amortization		93,579			256,995			—			—			350,574
Accretion expense		372			33,203			—			—			33,575
Salaries, general and administrative		59,473			5			46			—			59,524
Franchise tax settlement		12,590			—			—			—			12,590
Incentive compensation expense		15,340			—			—			—			15,340
Other operational expenses		38			113			—			—			151
Derivative expense, net		—			2,090			—			—			2,090
Total operating expenses		230,623			501,529			46			—			732,198
Income (loss) from operations		(91,797	)		333,824			(46	)		—			241,981
Other (income) expenses:
Interest expense		32,816			21			—			—			32,837
Interest income		(1,480	)		(195	)		(20	)		—			(1,695	)
Other income		(875	)		(1,924	)		—			—			(2,799	)
Loss on early extinguishment of debt		27,279			—			—			—			27,279
(Income) loss from investment in subsidiaries		(214,983	)		—			26			214,957			—
Total other (income) expenses		(157,243	)		(2,098	)		6			214,957			55,622
Income (loss) before taxes		65,446			335,922			(52	)		(214,957	)		186,359
Provision (benefit) for income taxes:
Current		(10,904	)		—			—			—			(10,904	)
Deferred		(41,284	)		120,913			—			—			79,629
Total income taxes		(52,188	)		120,913			—			—			68,725
Net income (loss)	$	117,634		$	215,009			($52	)		($214,957	)	$	117,634
Comprehensive income (loss)	$	86,739		$	215,009			($52	)		($214,957	)	$	86,739

F-35

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	26,149		$	735,155		$	—		$	—		$	761,304
Gas production		34,331			100,408			—			—			134,739
Natural gas liquids production		15,264			33,234			—			—			48,498
Other operational income		2,766			397			357			—			3,520
Derivative income, net		—			3,428			—			—			3,428
Total operating revenue		78,510			872,622			357			—			951,489
Operating expenses:
Lease operating expenses		19,914			195,105			(16	)		—			215,003
Transportation, processing and gathering expenses		12,049			9,733			—			—			21,782
Production taxes		3,330			6,685			—			—			10,015
Depreciation, depletion, amortization		63,022			281,152			191			—			344,365
Accretion expense		561			32,513			257			—			33,331
Salaries, general and administrative		54,641			7			—			—			54,648
Incentive compensation expense		8,113			—			—			—			8,113
Other operational expenses		173			94			—			—			267
Total operating expenses		161,803			525,289			432			—			687,524
Income (loss) from operations		(83,293	)		347,333			(75	)		—			263,965
Other (income) expenses:
Interest expense		30,446			(71	)		—			—			30,375
Interest income		(285	)		(315	)		—			—			(600	)
Other income		(144	)		(1,661	)		—			—			(1,805	)
Loss on early extinguishment of debt		1,972			—			—			—			1,972
(Income) loss from investment in subsidiaries		(223,555	)		75			—			223,480			—
Total other (income) expenses		(191,566	)		(1,972	)		—			223,480			29,942
Income (loss) before taxes		108,273			349,305			(75	)		(223,480	)		234,023
Provision (benefit) for income taxes:
Current		15,022			—			—			—			15,022
Deferred		(56,175	)		125,750			—			—			69,575
Total income taxes		(41,153	)		125,750			—			—			84,597
Net income (loss)	$	149,426		$	223,555			($75	)		($223,480	)	$	149,426
Comprehensive income (loss)	$	156,391		$	223,555			($75	)		($223,480	)	$	156,391

F-36

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2011

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	5,675		$	658,283		$	—		$	—		$	663,958
Gas production		19,470			151,141			—			—			170,611
Natural gas liquids production		—			29,996			—			—			29,996
Other operational income		3,085			249			604			—			3,938
Derivative income, net		—			1,418			—			—			1,418
Total operating revenue		28,230			841,087			604			—			869,921
Operating expenses:
Lease operating expenses		6,632			169,018			231			—			175,881
Transportation, processing and gathering expenses		—			8,958			—			—			8,958
Production taxes		1,434			7,946			—			—			9,380
Depreciation, depletion, amortization		17,860			261,326			834			—			280,020
Accretion expense		15			30,385			364			—			30,764
Salaries, general and administrative		40,073			94			2			—			40,169
Incentive compensation expense		11,600			—			—			—			11,600
Other operational expenses		1,404			745			—			—			2,149
Total operating expenses		79,018			478,472			1,431			—			558,921
Income (loss) from operations		(50,788	)		362,615			(827	)		—			311,000
Other (income) expenses:
Interest expense		9,043			246			—			—			9,289
Interest income		(178	)		(242	)		—			—			(420	)
Other income		(52	)		(1,890	)		—			—			(1,942	)
Loss on early extinguishment of debt		607			—			—			—			607
(Income) loss from investment in subsidiary		(232,751	)		827			—			231,924			—
Total other (income) expenses		(223,331	)		(1,059	)		—			231,924			7,534
Income (loss) before taxes		172,543			363,674			(827	)		(231,924	)		303,466
Provision (benefit) for income taxes:
Current		(20,386	)		—			—			—			(20,386	)
Deferred		(1,403	)		130,923			—			—			129,520
Total income taxes		(21,789	)		130,923			—			—			109,134
Net income (loss)	$	194,332		$	232,751			($827	)		($231,924	)	$	194,332
Comprehensive income (loss)	$	230,404		$	232,751			($827	)		($231,924	)	$	230,404

F-37

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	117,634		$	215,009			($52	)		($214,957	)	$	117,634
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		93,579			256,995			—			—			350,574
Accretion expense		372			33,203			—			—			33,575
Deferred income tax provision (benefit)		(41,284	)		120,913			—			—			79,629
Settlement of asset retirement obligations		—			(83,854	)		—			—			(83,854	)
Non-cash stock compensation expense		10,347			—			—			—			10,347
Excess tax benefits		(156	)		—			—			—			(156	)
Non-cash derivative expense		—			2,239			—			—			2,239
Loss on early extinguishment of debt		27,279			—			—			—			27,279
Non-cash interest expense		16,219			—			—			—			16,219
Non-cash (income) loss from investment in subsidiaries		(214,983	)		—			26			214,957			—
Change in current income taxes		2,767			—			—			—			2,767
Change in intercompany receivables/payables		186,903			(186,947	)		44			—			—
(Increase) decrease in accounts receivable		(15,630	)		10,947			—			—			(4,683	)
Decrease in other current assets		1,752			—			—			—			1,752
Decrease in inventory		583			—			—			—			583
Increase (decrease) in accounts payable		(1,052	)		1,454			—			—			402
Increase in other current liabilities		40,543			1,908			—			—			42,451
Other		419			(2,972	)		—			—			(2,553	)
Net cash provided by operating activities		225,292			368,895			18			—			594,205
Cash flows from investing activities:
Investment in oil and gas properties		(273,474	)		(378,254	)		(11,571	)		—			(663,299	)
Proceeds from sale of oil and gas properties, net of expenses		6,300			42,521			—			—			48,821
Investment in fixed and other assets		(6,816	)		—			—			—			(6,816	)
Change in restricted funds		—			—			(1,742	)		—			(1,742	)
Investment in subsidiaries		(14,000	)		—			(13,404	)		27,404			—
Net cash used in investing activities		(287,990	)		(335,733	)		(26,717	)		27,404			(623,036	)
Cash flows from financing activities:
Proceeds from issuance of senior notes		489,250			—			—			—			489,250
Deferred financing costs		(9,065	)		—			—			—			(9,065	)
Redemption of senior notes		(396,014	)		—			—			—			(396,014	)
Excess tax benefits		156			—			—			—			156
Equity proceeds from parent		—			—			27,404			(27,404	)		—
Net payments for share-based compensation		(3,733	)		—			—			—			(3,733	)
Net cash provided by financing activities		80,594			—			27,404			(27,404	)		80,594
Effect of exchange rate changes on cash		—			—			(65	)		—			(65	)
Net change in cash and cash equivalents		17,896			33,162			640			—			51,698
Cash and cash equivalents, beginning of period		228,398			51,128			—			—			279,526
Cash and cash equivalents, end of period	$	246,294		$	84,290		$	640		$	—		$	331,224

F-38

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	149,426		$	223,555			($75	)		($223,480	)	$	149,426
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		63,022			281,152			191			—			344,365
Accretion expense		561			32,513			257			—			33,331
Deferred income tax provision (benefit)		(56,175	)		125,750			—			—			69,575
Settlement of asset retirement obligations		—			(65,567	)		—			—			(65,567	)
Non-cash stock compensation expense		8,699			—			—			—			8,699
Excess tax benefits		(949	)		—			—			—			(949	)
Non-cash derivative income		—			(509	)		—			—			(509	)
Loss on early extinguishment of debt		1,972			—			—			—			1,972
Non-cash interest expense		13,085			—			—			—			13,085
Non-cash (income) loss from investment in subsidiaries		(223,555	)		75			—			223,480			—
Change in current income taxes		10,618			—			—			—			10,618
Change in intercompany receivables/payables		275,819			(275,125	)		(694	)		—			—
(Increase) decrease in accounts receivable		(22,750	)		(33,345	)		224			—			(55,871	)
Increase in other current assets		(2,836	)		—			—			—			(2,836	)
Decrease in inventory		436			—			—			—			436
Increase (decrease) in accounts payable		5,348			(208	)		(39	)		—			5,101
Decrease in other current liabilities		(5,311	)		(5,115	)		—			—			(10,426	)
Other		10,960			(1,661	)		—			—			9,299
Net cash provided by (used in) operating activities		228,370			281,515			(136	)		—			509,749
Cash flows from investing activities:
Investment in oil and gas properties		(324,542	)		(231,313	)		—			—			(555,855	)
Proceeds from sale of oil and gas properties, net of expenses		403			—			—			—			403
Sale of fixed assets		134			—			—			—			134
Investment in fixed and other assets		(13,370	)		—			—			—			(13,370	)
Net cash used in investing activities		(337,375	)		(231,313	)		—			—			(568,688	)
Cash flows from financing activities:
Proceeds from bank borrowings		25,000			—			—			—			25,000
Repayment of bank borrowings		(70,000	)		—			—			—			(70,000	)
Proceeds from issuance of senior convertible notes		300,000			—			—			—			300,000
Deferred financing costs of senior convertible notes		(8,855	)		—			—			—			(8,855	)
Proceeds from sold warrants		40,170			—			—			—			40,170
Payments for purchased call options		(70,830	)		—			—			—			(70,830	)
Proceeds from issuance of senior notes		300,000			—			—			—			300,000
Deferred financing costs		(11,966	)		—			—			—			(11,966	)
Redemption of senior subordinated notes		(200,681	)		—			—			—			(200,681	)
Excess tax benefits		949			—			—			—			949
Net payments for share-based compensation		(3,773	)		—			—			—			(3,773	)
Net cash provided by financing activities		300,014			—			—			—			300,014
Net change in cash and cash equivalents		191,009			50,202			(136	)		—			241,075
Cash and cash equivalents, beginning of period		37,389			926			136			—			38,451
Cash and cash equivalents, end of period	$	228,398		$	51,128		$	—		$	—		$	279,526

F-39

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2011

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	194,332		$	232,751			($827	)		($231,924	)	$	194,332
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		17,860			261,326			834			—			280,020
Accretion expense		15			30,385			364			—			30,764
Deferred income tax provision (benefit)		(1,403	)		130,923			—			—			129,520
Settlement of asset retirement obligations		—			(63,391	)		—			—			(63,391	)
Non-cash stock compensation expense		5,905			—			—			—			5,905
Excess tax benefits		(1,493	)		—			—			—			(1,493	)
Non-cash derivative income		—			(2,216	)		—			—			(2,216	)
Loss on early extinguishment of debt		607			—			—			—			607
Non-cash interest expense		1,908			—			—			—			1,908
Other non-cash income		(1,602	)		—			—			—			(1,602	)
Non-cash income from investment in subsidiaries		(230,861	)		(1,063	)		—			231,924			—
Change in current income taxes		(19,451	)		—			—			—			(19,451	)
Change in intercompany receivables/payables		217,287			(217,724	)		437			—			—
Increase in accounts receivable		(11,022	)		(7,688	)		(890	)		—			(19,600	)
(Increase) decrease in other current assets		(80	)		14			—			—			(66	)
Decrease in inventory		1,605			14			—			—			1,619
Increase in accounts payable		2,658			3,341			40			—			6,039
Increase in other current liabilities		23,440			6,143			—			—			29,583
Other		(1,628	)		—			—			—			(1,628	)
Net cash provided by (used in) operating activities		198,077			372,815			(42	)		—			570,850
Cash flows from investing activities:
Investment in oil and gas properties		(309,026	)		(455,903	)		(4	)		—			(764,933	)
Proceeds from sale of oil and gas properties, net of expenses		5,575			82,355			—			—			87,930
Investment in fixed and other assets		(2,247	)		—			—			—			(2,247	)
Net cash used in investing activities		(305,698	)		(373,548	)		(4	)		—			(679,250	)
Cash flows from financing activities:
Proceeds from bank borrowings		75,000			—			—			—			75,000
Repayment of bank borrowings		(30,000	)		—			—			—			(30,000	)
Deferred financing costs		(4,017	)		—			—			—			(4,017	)
Excess tax benefits		1,493			—			—			—			1,493
Net payments for share-based compensation		(2,581	)		—			—			—			(2,581	)
Net cash provided by financing activities		39,895			—			—			—			39,895
Net change in cash and cash equivalents		(67,726	)		(733	)		(46	)		—			(68,505	)
Cash and cash equivalents, beginning of period		105,115			1,659			182			—			106,956
Cash and cash equivalents, end of period	$	37,389		$	926		$	136		$	—		$	38,451

F-40

GLOSSARY OF CERTAIN INDUSTRY TERMS

The following is a description of the meanings of some of the oil and gas industry terms used in this Form 10-K. The revisions and additions to the definition section in Rule 4-10(a) of Regulation S-X contained in the SEC’s rule, “Modernization of Oil and Gas Reporting”, are included. The definitions of proved developed reserves, proved reserves and proved undeveloped reserves have been abbreviated from the rule.

Bbl. One stock tank barrel, or 42 U.S. gallons of liquid volume, used herein in reference to crude oil or other liquid hydrocarbons.

Bcf. One billion cubic feet of gas.

Bcfe. One billion cubic feet of gas equivalent. Determined using the ratio of one barrel of crude oil to six mcf of natural gas.

Btu. British thermal unit, which is the heat required to raise the temperature of a one-pound mass of water from 58.5 to 59.5 degrees Fahrenheit.

Development well. A well drilled within the proved area of an oil or gas reservoir to the depth of a stratigraphic horizon known to be productive.

Exploratory well. A well drilled to find a new field or to find a new reservoir in a field previously found to be productive of oil or gas in another reservoir.

Field. An area consisting of a single reservoir or multiple reservoirs all grouped on or related to the same individual geological structural feature and/or stratigraphic condition. There may be two or more reservoirs in a field that are separated vertically by intervening impervious, strata, or laterally by local geologic barriers, or by both. Reservoirs that are associated by being in overlapping or adjacent fields may be treated as a single or common operational field. The geological terms structural feature and stratigraphic condition are intended to identify localized geological features as opposed to the broader terms of basins, trends, provinces, plays, areas-of-interest, etc.

Gross acreage or gross wells. The total acres or wells, as the case may be, in which a working interest is owned.

Liquidity. The ability to obtain cash quickly either through the conversion of assets or the incurrence of liabilities.

MBbls. One thousand barrels of crude oil or other liquid hydrocarbons.

Mcf. One thousand cubic feet of gas.

Mcfe. One thousand cubic feet of gas equivalent. Determined using the ratio of one barrel of crude oil to six Mcf of natural gas.

MMBbls. One million barrels of crude oil or other liquid hydrocarbons.

MMBtu. One million Btus.

MMcf. One million cubic feet of gas.

MMcfe. One million cubic feet of gas equivalent. Determined using the ratio of one barrel of crude oil to six mcf of natural gas.

Net acres or net wells. The sum of the fractional working interests owned in gross acres or gross wells expressed as whole numbers and fractions of whole numbers.

Primary term lease. An oil and gas property with no existing production, in which Stone has a specific time frame to establish production without losing the rights to explore the property.

Productive well. A well that is found to be mechanically capable of producing hydrocarbons in sufficient quantities that proceeds from the sale of such production exceeds production expenses and taxes.

Proved developed reserves. Proved reserves that can be expected to be recovered (i) through existing wells with existing equipment and operating methods or in which the cost of the required equipment is relatively minor compared to the cost of a new well; and (ii) through installed extraction technology equipment and infrastructure operational at the time of the reserves estimate if the extraction is by means not involving a well.

G-1

Proved oil and natural gas reserves. Those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible—from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations—prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. The project to extract hydrocarbons must have commenced or the operator must be reasonably certain that it will commence the project within a reasonable time. Reasonable certainty is defined as “much more likely to be achieved than not”.

Proved undeveloped reserves. Proved reserves that are expected to be recovered from new wells on undrilled acreage, or from existing wells where a relatively major expenditure is required for recompletion.

Standardized measure of discounted future net cash flows. The standardized measure represents value-based information about an enterprise’s proved oil and natural gas reserves based on estimates of future cash flows, including income taxes, from production of proved reserves assuming continuation of certain economic and operating conditions. Future cash flows are based on a 12-month average price, calculated as the unweighted arithmetic average of the first-day-of-the-month price for each month within the 12-month period prior to the end of the reporting period.

Undeveloped acreage. Lease acreage on which wells have not been drilled or completed to a point that would permit the production of economic quantities of oil and gas regardless of whether such acreage contains proved reserves.

Working interest. An operating interest that gives the owner the right to drill, produce and conduct operating activities on the property and to receive a share of production.

G-2

EXHIBIT INDEX

Exhibit Number	Description
3.1	Certificate of Incorporation of the Registrant, as amended on June 4, 1993, February 1, 2001 and February 19, 2002 (incorporated by reference to Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q filed August 7, 2012 (File No.001-12074)).
*3.2	Amended & Restated Bylaws of Stone Energy Corporation, dated December 19, 2013.
4.1	Indenture between Stone Energy Corporation and JPMorgan Chase Bank, National Association, as trustee, dated December 15, 2004 (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed December 17, 2004 (File No. 001-12074)).
4.2	First Supplemental Indenture, dated August 28, 2008, to the Indenture between Stone Energy Corporation and JPMorgan Chase Bank, National Association, as trustee, dated December 15, 2004 (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed August 29, 2008 (File No. 001-12074)).
4.3	Second Supplemental Indenture, dated January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., successor to JPMorgan Chase Bank, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed January 29, 2010 (File No. 001-12074)).
4.4	Indenture, dated January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed January 29, 2010 (File No. 001-12074)).
4.5	First Supplemental Indenture, dated January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.3 to the Registrant’s Current Report on Form 8-K filed January 29, 2010 (File No. 001-12074)).
4.6	Indenture related to the 1 3⁄4% Senior Convertible Notes due 2017, dated as of March 6, 2012, among Stone Energy Corporation, Stone Energy Offshore, L.L.C. and The Bank of New York Mellon Trust Company, N.A., as trustee (including form of 1 3⁄4% Senior Convertible Senior Note due 2017) (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
4.7	Second Supplemental Indenture, dated as of November 6, 2012, to the Indenture, dated as of December 15, 2004, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed November 8, 2012 (File No. 001-12074)).
4.8	Second Supplemental Indenture, dated as of November 8, 2012, to the Indenture, dated as of January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed November 8, 2012 (File No. 001-12074)).
4.9	Third Supplemental Indenture, dated as of November 26, 2013, to the Indenture, dated as of January 26, 2010, among Stone Energy Corporation, Stone Energy Offshore, L.L.C., and The Bank of New York Mellon Trust Company, N.A, as trustee (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed November 27, 2013 (File No. 001-12074)).

†10.1	Deferred Compensation and Disability Agreement between TSPC and E. J. Louviere dated July 16, 1981 (incorporated by reference to Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 1995 (File No. 001-12074)).
†10.2	Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan (incorporated by reference to Appendix A to the Registrant’s Definitive Proxy Statement on Schedule 14A for Stone’s 2009 Annual Meeting of Stockholders (File No. 001-12074)).
†10.3	First Amendment to Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan (incorporated by reference to Exhibit 4.6 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 (File No. 001-12074)).
†10.4	Stone Energy Corporation Revised (2005) Annual Incentive Compensation Plan (incorporated by reference to Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-12074)).
†10.5	Stone Energy Corporation Amended and Restated Revised Annual Incentive Compensation Plan, dated November 14, 2007 (incorporated by reference to Exhibit 10.10 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-12074)).
†10.6	Stone Energy Corporation Deferred Compensation Plan (incorporated by reference to Exhibit 4.5 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-12074)).
†10.7	Adoption Agreement between Fidelity Management Trust Company and Stone Energy Corporation for the Stone Energy Corporation Deferred Compensation Plan dated December 1, 2004 (incorporated by reference to Exhibit 4.6 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2004 (File No. 001-12074)).
†10.8	Letter Agreement dated May 19, 2005 between Stone Energy Corporation and Kenneth H. Beer (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed May 24, 2005 (File No. 001-12074)).
†10.9	Letter Agreement dated December 2, 2008 between Stone Energy Corporation and David H. Welch (incorporated by reference to Exhibit 10.8 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2008 (File No. 001-12074)).
†10.10	Stone Energy Corporation Executive Change of Control and Severance Plan (as amended and restated effective December 31, 2008) (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed April 8, 2009 (File No. 001-12074)).
†10.11	Stone Energy Corporation Employee Change of Control Severance Plan (as amended and restated) dated December 7, 2007 (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed December 12, 2007 (File No. 001-12074)).
10.12	Form of Indemnification Agreement between Stone Energy Corporation and each of its directors and executive officers (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed March 27, 2009 (File No. 001-12074)).
10.13	$700,000,000 Third Amended and Restated Credit Agreement among Stone Energy Corporation as Borrower, Bank of America, N.A. as Administrative Agent and Issuing Bank, and the financial institutions named therein, dated April 26, 2011 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2011 (File No. 001-12074)).
10.14	Amendment No. 1 and Consent dated as of February 28, 2012 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed March 5, 2012 (File No. 001-12074)).

10.15	Amendment No. 2 and Consent dated as of October 22, 2012 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed October 22, 2012 (File No. 001-12074)).
10.16	Amendment No. 3 dated as of April 30, 2013 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q filed May 8, 2013 (File No. 001-12074)).
10.17	Consent Agreement dated as of November 8, 2013 to the Third Amended and Restated Credit Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed November 13, 2013 (File No. 001-12074)).
*10.18	Waiver Agreement dated as of December 18, 2013 to the Third Amended and Restated Credit Agreement.
10.19	Amended and Restated Security Agreement, dated as of August 28, 2008, among Stone Energy Corporation and the other Debtors parties hereto in favor of Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 4.5 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2008 (File No. 001-12074)).
10.20	Base Bond Hedge Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.21	Base Bond Hedge Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.22	Additional Bond Hedge Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.23	Additional Bond Hedge Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.24	Base Warrant Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.25	Base Warrant Confirmation dated as of February 29, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.26	Additional Warrant Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.27	Additional Warrant Confirmation dated as of March 2, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
10.28	Amendment to Base Warrant Confirmation and Additional Warrant Confirmation dated March 5, 2012, by and between Stone Energy Corporation and Barclays Capital Inc., acting as agent for Barclays Bank PLC (incorporated by reference to Exhibit 10.9 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).

10.29	Amendment to Base Warrant Confirmation and Additional Warrant Confirmation dated March 5, 2012, by and between Stone Energy Corporation and Bank of America N.A. (incorporated by reference to Exhibit 10.10 to the Registrant’s Current Report on Form 8-K filed March 6, 2012 (File No. 001-12074)).
*21.1	Subsidiaries of the Registrant.
*23.1	Consent of Independent Registered Public Accounting Firm.
*23.2	Consent of Netherland, Sewell & Associates, Inc.
*31.1	Certification of Principal Executive Officer of Stone Energy Corporation as required by Rule 13a-14(a) of the Securities Exchange Act of 1934.
*31.2	Certification of Principal Financial Officer of Stone Energy Corporation as required by Rule 13a-14(a) of the Securities Exchange Act of 1934.
*#32.1	Certification of Chief Executive Officer and Chief Financial Officer of Stone Energy Corporation pursuant to 18 U.S.C. § 1350.
*101.INS	XBRL Instance Document
*101.SCH	XBRL Schema Document
*101.CAL	XBRL Calculation Linkbase Document
*101.DEF	XBRL Definition Linkbase Document
*101.LAB	XBRL Label Linkbase Document
*101.PRE	XBRL Presentation Linkbase Document
*99.1	Report of Netherland, Sewell & Associates, Inc.

* Filed or furnished herewith.

# Not considered to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section.

† Identifies management contracts and compensatory plans or arrangements.

EX-3.2

Exhibit 3.2

AMENDED & RESTATED BYLAWS

OF

STONE ENERGY CORPORATION

A Delaware Corporation

As of May 15, 2008

As Amended December 19, 2013

TABLE OF CONTENTS

ARTICLE I OFFICES		1
Section 1.	Registered Office	1
Section 2.	Other Offices	1
ARTICLE II STOCKHOLDERS		1
Section 1.	Place of Meetings	1
Section 2.	Quorum; Required Vote for Stockholder Action; Withdrawal During Meeting; Adjournment	1
Section 3.	Annual Meetings	2
Section 4.	Special Meetings	2
Section 5.	Record Date	2
Section 6.	Notice of Meetings	3
Section 7.	List of Stockholders	4
Section 8.	Proxies	4
Section 9.	Voting; Elections; Inspectors	4
Section 10.	Conduct of Meetings	6
Section 11.	Treasury Stock	6
Section 12.	Action Without Meeting	6
Section 13.	Business to be Brought Before Annual or Special Meetings	7
ARTICLE III BOARD OF DIRECTORS		12
Section 1.	Power; Number; Term of Office	12
Section 2.	Classification of Directors	12
Section 3.	Quorum; Required Vote for Director Action	13
Section 4.	Place of Meetings; Order of Business	13
Section 5.	First Meeting	13
Section 6.	Regular Meetings	14
Section 7.	Special Meetings	14
Section 8.	Removal	14
Section 9.	Vacancies; Increases in the Number of Directors	14
Section 10.	Compensation	15
Section 11.	Action Without a Meeting; Telephone Conference Meeting	15
Section 12.	Approval or Ratification of Acts or Contracts by Stockholders	15
ARTICLE IV COMMITTEES		15
Section 1.	Designation; Powers	15
Section 2.	Procedure; Meetings; Quorum	16
Section 3.	Substitution of Members	16
ARTICLE V OFFICERS		16
Section 1.	Number, Titles and Term of Office	16
Section 2.	Compensation	17
Section 3.	Removal	17
Section 4.	Vacancies	17
Section 5.	Powers and Duties of the Chief Executive Officer	17

i

Section 6.	Powers and Duties of the Chairman of the Board	17
Section 7.	Powers and Duties of the President	17
Section 8.	Vice Presidents	18
Section 9.	Secretary	18
Section 10.	Assistant Secretaries	18
Section 11.	Action with Respect to Securities of Other Corporations	18
ARTICLE VI INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS		19
Section 1.	Right to Indemnification	19
Section 2.	Advance Payment	19
Section 3.	Indemnification of Employees and Agents	20
Section 4.	Appearance as a Witness	20
Section 5.	Right of Claimant to Bring Suit	20
Section 6.	Nonexclusivity of Rights	20
Section 7.	Insurance	21
Section 8.	Savings Clause	21
Section 9.	Definitions	21
ARTICLE VII CAPITAL STOCK		21
Section 1.	Certificates of Stock	21
Section 2.	Transfer of Shares	22
Section 3.	Ownership of Shares	22
Section 4.	Regulations Regarding Certificates	22
Section 5.	Lost, Stolen	22
ARTICLE VIII MISCELLANEOUS PROVISIONS		23
Section 1.	Fiscal Year	23
Section 2.	Corporate Seal	23
Section 3.	Notice and Waiver of Notice	23
Section 4.	Resignations	23
Section 5.	Facsimile Signatures	24
Section 6.	Reliance upon Books, Reports and Records	24
ARTICLE IX AMENDMENTS		24

ii

AMENDED & RESTATED BYLAWS

OF

STONE ENERGY CORPORATION

A DELAWARE CORPORATION

ARTICLE I

OFFICES

Section 1. Registered Office.

The registered office of the Corporation required by the General Corporation Law of the State of Delaware to be maintained in the State of Delaware shall be the registered office named in the original Certificate of Incorporation of the Corporation, or such other office as may be designated from time to time by the Board of Directors in the manner provided by law. If the Corporation maintains a principal office within the State of Delaware, the registered office need not be identical to such principal office of the Corporation.

Section 2. Other Offices.

The Corporation may have other offices at such places both within and without the State of Delaware as the Board of Directors may from time to time determine or as the business of the Corporation may require.

ARTICLE II

STOCKHOLDERS

Section 1. Place of Meetings.

All meetings of the stockholders shall be held at the principal office of the Corporation, or at such other place either within or without the State of Delaware as shall be specified or fixed in the notices or waivers of notice thereof.

Section 2. Quorum; Required Vote for Stockholder Action; Withdrawal During Meeting; Adjournment.

Unless otherwise required by law, the Certificate of Incorporation or these bylaws, the holders of a majority of the stock issued and outstanding and entitled to vote at any meeting of stockholders, present in person or represented by proxy, shall constitute a quorum at any such meeting of stockholders. Where there is a required quorum present when any duly organized meeting convenes, the stockholders present may continue to transact business until adjournment, notwithstanding the subsequent withdrawal of sufficient stockholders or proxies to reduce the total number of voting shares below the number of shares required for a quorum.

Notwithstanding other provisions of the Certificate of Incorporation or these bylaws, the chairman of the meeting of stockholders or the holders of a majority of the issued and outstanding stock entitled to vote at such meeting, present in person or represented by proxy, at any meeting of stockholders, whether or not a quorum is present, shall have the power to adjourn such meeting from time to time, without any notice other than announcement at the meeting of the time and place of the holding of the adjourned meeting. If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at such meeting. At such adjourned meeting at which a quorum shall be present or represented by proxy, any business may be transacted which might have been transacted at the meeting as originally called. If a quorum is present at the original duly organized meeting of stockholders, it is also present at an adjourned session of such meeting.

Section 3. Annual Meetings.

An annual meeting of the stockholders, for the election of directors to succeed those whose terms expire and for the transaction of such other business as may properly be considered at the meeting, shall be held at such place, within or without the State of Delaware, on such date and at such time as the Board of Directors shall fix and set forth in the notice of the meeting. If the Board of Directors has not fixed a place for the holding of the annual meeting of stockholders in accordance with this Article II, Section 3, such annual meeting shall be held at the principal place of business of the Corporation. No business may be conducted at the annual meeting of stockholders except in accordance with the procedures set forth in Section 13 of this Article II

Section 4. Special Meetings.

Unless otherwise provided in the Certificate of Incorporation, special meetings of the stockholders for any proper purpose or purposes may be called at any time by the Chairman of the Board (if any), by the President or by a majority of the Board of Directors, or by a majority of the executive committee (if any), and special meetings may not be called by any other person or persons. Only business within the proper purpose or purposes described in the notice required by these bylaws may be conducted at a special meeting of the stockholders.

Section 5. Record Date.

For the purpose of determining stockholders entitled to notice of or to vote at any meeting of stockholders, or any adjournment thereof, or entitled to consent to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in connection with any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a date as the record date for any such determination of stockholders entitled to notice of or to vote at a meeting, which date shall not be more than 60 nor less than 10 days prior to the date of such meeting.

If the Board of Directors does not fix a record date for any meeting of the stockholders, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the close of business on the day next preceding the day on which notice of such meeting is given, or, if notice is waived in accordance with Article VIII, Section 3 of these bylaws, the close of business on the day next preceding the day on which the meeting is held.

2

If, in accordance with Article II, Section 12 hereof, corporate action without a meeting of stockholders is to be taken, the Board of Directors may fix a record date for determining stockholders entitled to consent in writing to such corporate action, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than 10 days subsequent to the date upon which the resolution fixing the record date is adopted by the Board of Directors.

If no record date has been fixed by the Board of Directors, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office, its principal place of business, or to an officer or to agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights, or the stockholders entitled to exercise any rights in connection with any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall not be more than 60 days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

Section 6. Notice of Meetings.

Written notice stating the place, day and hour of all meetings, and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered by or at the direction of the President, the Secretary or the other person(s) calling the meeting not less than 10 nor more than 60 days before the date of the meeting to each stockholder entitled to vote at such meeting. Such notice may be delivered either personally or by mail. If mailed, notice shall be deemed to have been given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the Corporation. An affidavit of the Secretary, an Assistant Secretary or the transfer agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima fade evidence of the facts stated therein.

3

Section 7. List of Stockholders.

The officer or agent having charge of the share transfer records of the Corporation shall prepare and make, at least 10 days prior to each meeting of stockholders, a complete list of the stockholders entitled to vote at such meeting or any adjournment thereof, arranged in alphabetical order, with the address of and the number of shares held by each, which list, for a period of 10 days prior to such meeting, shall be kept on file at the registered office or principal place of business of the Corporation and shall be subject to inspection by any stockholder at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting and shall be subject to inspection by any stockholder during the course of the meeting. The original share transfer records shall be prima facie evidence as to the identity of those stockholders entitled to examine such voting list or transfer records or to vote at any meeting of stockholders. Failure to comply with the requirements of this Article II, Section 7 shall not affect the validity of any action taken at such meeting.

Section 8. Proxies.

Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for him by proxy. Proxies for use at any meeting of stockholders shall be filed with the Secretary, or such other officer as the Board of Directors may from time to time determine by resolution, before or at the time of such meeting. All proxies shall be received and taken charge of and all ballots shall be received and canvassed by the secretary of the meeting who shall decide all questions with respect to the qualification of voters, the validity of the proxies, and the acceptance or rejection of votes, unless an inspector or inspectors shall have been appointed by the chairman of the meeting, in which event such inspector or inspectors shall decide all such questions.

No proxy shall be valid after 3 years from the date of its execution, unless such proxy provides for a longer period. Each proxy shall be revocable unless expressly provided therein to be irrevocable and only as long as it is coupled with an interest sufficient in law to support an irrevocable power.

If a proxy designates two or more persons to act as proxies, unless such instrument shall expressly provide to the contrary, a majority of such persons present at any meeting at which their powers thereunder are to be exercised shall have and may exercise all the powers of voting or consent thereby conferred, or if only one be present, then such powers may be exercised by that one; or, if an even number attend and a majority cannot agree on any particular issue, the Corporation shall not be required to recognize such proxy with respect to such issue, if such proxy does not specify how the shares that are the subject of such proxy are to be voted with respect to such issue.

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Section 9. Voting; Elections; Inspectors.

Unless otherwise required by law or provided in the Certificate of Incorporation, each stockholder shall, on each matter submitted to a vote at a meeting of stockholders, have one vote for each share of capital stock entitled to vote thereon that is registered in his name on the record date for such meeting. Shares registered in the name of another corporation, domestic or foreign, may be voted by such officer, agent or proxy as the bylaws (or comparable instrument) of such corporation may prescribe, or in the absence of such provision, as the Board of Directors (or comparable body) of such corporation may determine. Shares registered in the name of a deceased person may be voted by his executor or administrator, either in person or by proxy.

All voting, except as otherwise required by law or the Certificate of Incorporation, may be by a voice vote; provided, however, that upon demand therefor by stockholders holding a majority of the issued and outstanding stock present in person or by proxy at any meeting of stockholders, a stock vote shall be taken. Every stock vote shall be taken by written ballot, and each ballot shall state the name of the stockholder or proxy voting and such other information as may be required under the procedure established for the meeting. All elections of directors shall be by stock vote, unless otherwise provided in the Certificate of Incorporation.

At any meeting of stockholders at which a vote is to be taken by ballot, the chairman of the meeting shall appoint one or more inspectors, each of whom shall sign an oath or affirmation to faithfully to execute the duties of inspector with strict impartiality and according to the best of his ability. The inspectors shall receive the ballots, count the votes and make and sign a certificate of the result thereof. The chairman of the meeting may appoint any person to serve as inspector, except that no candidate for the office of director shall be appointed as an inspector.

Except as otherwise provided by the Certificate of Incorporation or these bylaws, each director shall be elected by the vote of a majority of the votes cast with respect to that director’s election at any meeting for the election of directors at which a quorum is present; provided that if, as of the 10th day preceding the date the Corporation first mails its notice of meeting for such meeting to the stockholders of the Corporation, the number of nominees exceeds the number of directors to be elected at such meeting (a “Contested Election”), then the directors shall be elected by the vote of a plurality of the votes cast. For purposes of this paragraph, a majority of the votes cast shall mean that the number of votes cast “for” a director’s election exceeds the number of votes cast “against” the director’s election (with “abstentions” and “broker nonvotes” not counted as a vote cast either “for” or “against” that director’s election). The Corporation’s corporate governance guidelines may establish procedures with respect to the contingent resignation of any director who does not receive a majority of the votes cast in an election that is not a Contested Election.

In all matters other than the election of directors, when a quorum is present, a majority of the votes cast on the subject matter shall be the act of the stockholders, except where a larger vote is required by law, the Certificate of Incorporation or these bylaws, in which case such larger vote shall control the decision of such matter.

Unless otherwise provided in the Certificate of Incorporation, cumulative voting for the election of directors shall be prohibited.

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Section 10. Conduct of Meetings.

All meetings of the stockholders shall be presided over by the chairman of the meeting, who shall be the Chairman of the Board (if any), or if he is not present, the President, or if neither the Chairman of the Board (if any) nor President is present, a chairman elected at the meeting. The Secretary of the Corporation, if present, shall act as secretary of such meetings, or if he is not present, an Assistant Secretary (if any) shall so act; if neither the Secretary nor an Assistant Secretary (if any) is present, then a secretary shall be appointed by the chairman of the meeting.

The chairman of any meeting of stockholders shall determine the order of business and the procedure at the meeting, including such regulation of the manner of voting and the conduct of discussion, as seem to the chairman in order. Unless the chairman of the meeting shall otherwise determine, the order of business shall be as follows:

(a) Calling of meeting to order.

(b) Election of a chairman and appointment of a secretary, if necessary.

(c) Presentation of proof of the due calling of the meeting.

(d) Presentation and examination of proxies and determination of a quorum.

(e) Reading and settlement of the minutes of the previous meeting.

(f) Reports of officers and committees.

(g) Election of directors, if an annual meeting, or special election if a meeting called for such purpose.

(h) Unfinished business.

(i) New business.

(j) Adjournment.

Section 11. Treasury Stock.

Neither the Corporation nor any other person shall vote, directly or indirectly, shares of the Corporation’s own stock owned by the Corporation, shares of the Corporation’s own stock owned by another corporation the majority of the voting stock of which is owned or controlled by the Corporation, or shares of the Corporation’s own stock held by the Corporation in a fiduciary capacity and such shares shall not be counted for quorum purposes or in determining the number of outstanding shares.

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Section 12. Action Without Meeting.

Unless otherwise provided in the Certificate of Incorporation, any action permitted or required by law, the Certificate of Incorporation or these bylaws to be taken at a meeting of stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of the outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and such consent shall be delivered to the Corporation’s registered office, its principal place of business, or to an officer or agent of the Corporation having custody of the book in which the proceedings of meetings of stockholders are recorded. Delivery made to a Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested. Every written consent shall bear the date of signature thereto and no written consent shall be effective to take the corporate action referred to therein unless, within 60 days of the first consent delivered to the Corporation in the manner required by this Article II, Section 12, written consents signed by a sufficient number of holders to take action are delivered to the Corporation.

Section 13. Business to be Brought Before Annual or Special Meetings

All matters to be considered and brought before any annual or special meeting of stockholders of the Corporation, whether or not such matter is to be included in the Corporation’s proxy statement prepared pursuant to the federal securities laws, including the proxy rules set forth in the Securities Exchange Act of 1934, as amended ( the “Exchange Act”), shall be properly brought before any such meeting only if in compliance with the procedures set forth in this Section 13.

(A) Annual Meetings of Stockholders

(1) Nominations of persons for election to the board of directors and the proposal of other business to be considered by the stockholders may be made at an annual meeting of stockholders (a) pursuant to the Corporation’s notice of meeting, (b) by or at the direction of the board of directors or (c) by any stockholder of the corporation who (i) was a stockholder of record at the time of giving of notice provided for in this by-law and at the time of the annual meeting, (ii) is entitled to vote at the meeting and (iii) complies with the notice procedures set forth in this Section 13 as to such business or nomination; clause (c) shall be the exclusive means for a stockholder to make nominations or submit other business before an annual meeting of stockholders.

(2) Without qualification, for any nominations or any other business to be properly brought before an annual meeting by a stockholder pursuant to Section 13(A)(1)(c) of this Section 13, the stockholder must have given timely notice thereof in writing to the Secretary of the corporation and such other business must otherwise be a proper matter for stockholder action. To be timely, a stockholder’s notice shall be delivered to the Secretary at the principal executive offices of the corporation not earlier than the close of business on the 120th day and not later than the close of business on the 90th day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after

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the anniversary date of the preceding year’s annual meeting, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the 120th day prior to the date of such annual meeting and not later than the close of business on the later of the 100th day prior to the date of such annual meeting or, if the first public announcement of the date of such annual meeting is less than 100 days prior to the date of such annual meeting, the 10th day following the day on which public announcement of the date of such meeting is first made by the corporation. In no event shall any adjournment or postponement of an annual meeting or the announcement thereof commence a new time period for the giving of a stockholder’s notice as described above.

To be in proper form, a stockholder’s notice (whether given pursuant to this Section 13(A)(2) or Section 13(B)) to the Secretary must:

(a) set forth, as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination or proposal is made (i) the name and address of such stockholder, as they appear on the corporation’s books, and of such beneficial owner, if any, (ii) (A) the class or series and number of shares of the corporation which are, directly or indirectly, owned beneficially and of record by such stockholder and such beneficial owner, (B) any option, warrant, convertible security, stock appreciation right, or similar right with an exercise or conversion privilege or a settlement payment or mechanism at a price related to any class or series of shares of the corporation or with a value derived in whole or in part from the value of any class or series of shares of the corporation, whether or not such instrument or right shall be subject to settlement in the underlying class or series of capital stock of the corporation or otherwise (a “Derivative Instrument”) directly or indirectly owned beneficially by such stockholder and any other direct or indirect opportunity to profit or share in any profit derived from any increase or decrease in the value of shares of the corporation, (C) any proxy, contract, arrangement, understanding, or relationship pursuant to which such stockholder has a right to vote any shares of any security of the corporation, (D) any short interest in any security of the corporation (for purposes of this by-law a person shall be deemed to have a short interest in a security if such person directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise, has the opportunity to profit or share in any profit derived from any decrease in the value of the subject security), (E) any rights to dividends on the shares of the corporation owned beneficially by such stockholder that are separated or separable from the underlying shares of the corporation, (F) any proportionate interest in shares of the corporation or Derivative Instruments held, directly or indirectly, by a general or limited partnership in which such stockholder is a general partner or, directly or indirectly, beneficially owns an interest in a general partner and (G) any performance-related fees (other than an asset-based fee) that such stockholder is entitled to based on any increase or decrease in the value of shares of the corporation or Derivative

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Instruments, if any, as of the date of such notice, including without limitation any such interests held by members of such stockholder’s immediate family sharing the same household (which information shall be supplemented by such stockholder and beneficial owner, if any, not later than 10 days after the record date for the meeting to disclose such ownership as of the record date), and (iii) any other information relating to such stockholder and beneficial owner, if any, that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for, as applicable, the proposal and/or for the election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder;

(b) if the notice relates to any business other than a nomination of a director or directors that the stockholder proposes to bring before the meeting, set forth (i) a brief description of the business desired to be brought before the meeting, the reasons for conducting such business at the meeting and any material interest of such stockholder and beneficial owner, if any, in such business and (ii) a description of all agreements, arrangements and understandings between such stockholder and beneficial owner, if any, and any other person or persons (including their names) in connection with the proposal of such business by such stockholder;

(c) set forth, as to each person, if any, whom the stockholder proposes to nominate for election or reelection to the board of directors (i) all information relating to such person that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors in a contested election pursuant to Section 14 of the Exchange Act and the rules and regulations promulgated thereunder (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected) and (ii) a description of all direct and indirect compensation and other material monetary agreements, arrangements and understandings during the past three years, and any other material relationships, between or among such stockholder and beneficial owner, if any, and their respective affiliates and associates, or others acting in concert therewith, on the one hand, and each proposed nominee, and his or her respective affiliates and associates, or others acting in concert therewith, on the other hand, including, without limitation all biographical and related party transaction and other information that would be required to be disclosed pursuant to the federal and state securities laws if the stockholder making the nomination and any beneficial owner on whose behalf the nomination is made, if any, or any affiliate or associate thereof or person acting in concert therewith, were the “registrant” for purposes of such rule and the nominee were a director or executive officer of such registrant; and

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(d) with respect to each nominee for election or reelection to the board of directors, include a completed and signed questionnaire, representation and agreement required by Section 13(D) below.

The corporation may require any proposed nominee to furnish such other information as may reasonably be required by the corporation to determine the eligibility of such proposed nominee to serve as an independent director of the corporation or that could be material to a reasonable stockholder’s understanding of the independence, or lack thereof, of such nominee.

(3) Notwithstanding anything in the second sentence of Section 13(A)(2) to the contrary, in the event that the number of directors to be elected to the board of directors is increased and there is no public announcement by the corporation naming all of the nominees for director or specifying the size of the increased board of directors at least 100 days prior to the first anniversary of the preceding year’s annual meeting, a stockholder’s notice required by this Section 13 shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the Secretary at the principal executive offices of the corporation not later than the close of business on the 10th day following the day on which such public announcement is first made by the corporation.

(B) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the corporation’s notice of meeting. Nominations of persons for election to the board of directors may be made at a special meeting of stockholders at which directors are to be elected pursuant to the corporation’s notice of meeting (i) by or at the direction of the Board of Directors or (ii) provided that the Board of Directors has determined that directors shall be elected at such meeting, by any stockholder of the corporation who (a) is a stockholder of record at the time of giving of notice provided for in this by-law and at the time of the special meeting, (b) is entitled to vote at the meeting, and (c) complies with the notice procedures set forth in this Section 13 as to such nomination. In the event the corporation calls a special meeting of stockholders for the purpose of electing one or more directors to the board of directors, any such stockholder may nominate a person or persons (as the case may be) for election to such position(s) as specified in the corporation’s notice of meeting, if the stockholder’s notice required by Section 13(A)(2) with respect to any nomination (including the completed and signed questionnaire, representation and agreement required by Section 13(D) below) shall be delivered to the Secretary at the principal executive offices of the corporation not earlier than the close of business on the 120th day prior to the date of such special meeting and not later than the close of business on the later of the 100th day prior to the date of such special meeting or, if the first public announcement of the date of such special meeting is less than 100 days prior to the date of such special meeting, the 10th day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the board of directors to be elected at such meeting. In no event shall any adjournment or postponement of a special meeting or the announcement thereof commence a new time period for the giving of a stockholder’s notice as described above.

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(C) General

(1) Only such persons who are nominated in accordance with the procedures set forth in this by-law shall be eligible to serve as directors and only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 13. Except as otherwise provided by law, or the corporation’s Certificate of Incorporation or its Bylaws, the Chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 13 and, if any proposed nomination or business is not in compliance with this Section 13, to declare that such defective proposal or nomination shall be disregarded.

(2) For purposes of this Section 13, “public announcement” shall mean disclosure in a press release reported by a national news service or in a document publicly filed by the corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act and the rules and regulations promulgated thereunder.

(3) Notwithstanding the foregoing provisions of this Section 13, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Section 13; provided, however, that any references in the corporation’s Bylaws to the Exchange Act or the rules promulgated thereunder are not intended to and shall not limit the requirements applicable to nominations or proposals as to any other business to be considered pursuant to Section 13(A)(1)(c) or Section 13(B) above. Nothing in this Section 13 shall eliminate or limit any obligations of any stockholder pursuant to Rule 14a-8 under the Exchange Act or any other applicable federal or state securities law with respect to that stockholder’s request to include proposals in the corporation’s proxy statement.

(D) Submission of Questionnaire, Representation and Agreement. To be eligible to be a nominee for election or reelection as a director of the corporation, a person must deliver (in accordance with the time periods prescribed for delivery of notice under this Section 13) to the Secretary at the principal executive offices of the corporation a written questionnaire with respect to the background and qualification of such person and the background of any other person or entity on whose behalf the nomination is being made (which questionnaire shall be provided by the Secretary upon written request) and a written representation and agreement (in the form provided by the Secretary upon written request) that such person (i) is not and will not become a party to (a) any agreement, arrangement or understanding with, and has not given any commitment or assurance to, any person or entity as to how such person, if elected as a director of the corporation, will act or vote on any issue or question (a “Voting Commitment”) that has not been disclosed

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to the corporation or (b) any Voting Commitment that could limit or interfere with such person’s ability to comply, if elected as a director of the corporation, with such person’s fiduciary duties under applicable law, (ii) is not and will not become a party to any agreement, arrangement or understanding with any person or entity other than the corporation with respect to any direct or indirect compensation, reimbursement or indemnification in connection with service or action as a director that has not been disclosed therein, and (iii) in such person’s individual capacity and on behalf of any person or entity on whose behalf the nomination is being made, would be in compliance, if elected as a director of the corporation, and will comply with all applicable publicly disclosed corporate governance, conflict of interest, confidentiality and stock ownership and trading policies and guidelines of the corporation.

ARTICLE III

BOARD OF DIRECTORS

Section 1. Power; Number; Term of Office.

The powers of the Corporation shall be exercised by or under the authority of, and the business and affairs of the Corporation shall be managed by or under, the direction of the Board of Directors, and subject to the restrictions imposed by law or the Certificate of Incorporation, they may exercise all the powers of the Corporation.

Unless otherwise provided in the Certificate of Incorporation, the number of directors that shall constitute the Board of Directors shall be determined from time to time by resolution of the Board of Directors (provided that no decrease in the number of directors that would have the effect of shortening the term of an incumbent director may be made by the Board of Directors). If the Board of Directors does not make such determination, the number of directors shall be the number set forth in the Certificate of Incorporation as the number of directors constituting the initial Board of Directors; provided, however, that in no event shall there be more than thirteen (13) directors in the aggregate. Each director shall hold office for the term for which he is elected and thereafter until his successor shall have been elected and qualified, or until his earlier death, resignation or removal.

Unless otherwise provided in the Certificate of Incorporation, directors need not be stockholders or residents of the State of Delaware.

Section 2. Classification of Directors

(A) Classification of Directors. Effective at the time of the annual meeting of stockholders in 1993, in lieu of electing the whole number of directors annually, the directors shall be divided into three classes, Class I, Class II and Class III, each class to be as nearly equal in number as possible, and the remainder of this Section 2 shall be effective. Each

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director shall serve for a term ending on the date of the third annual meeting of stockholders following the annual meeting at which such director was elected; provided, however, that each initial director in Class I shall hold office until the first annual meeting of stockholders after his election; each initial director in Class II shall hold office until the second annual meeting of stockholders after his election; and each initial director in Class III shall hold office until the third annual meeting of stockholders after his election. In the event of any increase or decrease in the authorized number of directors, (i) each director then serving as such shall nevertheless continue as a director of the class of which he is a member until the expiration of his current term or until his prior death, retirement, resignation or removal for cause in accordance with the provisions of these bylaws, and (ii) the newly created or eliminated directorships resulting from such increase or decrease shall be apportioned by the Board among the three classes of directors so as to maintain such classes as nearly equal in number as possible. Notwithstanding the foregoing, the classes of directors shall be terminated in accordance with paragraph B below entitled “Annual Election of Directors,” and this paragraph A of Section 2 entitled “Classification of Directors” shall cease to have effect immediately prior to the annual meeting of stockholders in 2010.

(B) Annual Election of Directors. Effective at the annual meeting of stockholders in 2008, the Class III classification of directors shall terminate; effective at the annual meeting of stockholders in 2009, the Class I classification of directors shall terminate; effective at the annual meeting of stockholders in 2010, the Class II classification of directors shall terminate. Upon termination of each of the three classes of directors, each of the directors whose class has terminated may be elected to serve as a director on an annual basis. Upon termination of all three classes of directors, the whole number of directors shall be elected annually. Each director currently serving as such shall nevertheless continue as a director of the class of which he is a member until the expiration of his current term or until his prior death, retirement, resignation or removal for cause in accordance with the provisions of these bylaws.

Section 3. Quorum; Required Vote for Director Action.

Unless otherwise required by law or in the Certificate of Incorporation or these bylaws, a majority of the total number of directors shall constitute a quorum for the transaction of business of the Board of Directors and the vote of a majority of the directors present at a meeting at which a quorum is present shall be the act of the Board of Directors.

Section 4. Place of Meetings; Order of Business.

The directors may hold their meetings and may have an office and keep the books of the Corporation, except as otherwise provided by law, in such place or places, within or without the State of Delaware, as the Board of Directors may from time to time determine by resolution. At all meetings of the Board of Directors, business shall be transacted in such order as shall from time to time be determined by the Chairman of the Board (if any), or in his absence by the President (if the President is a director) or by resolution of the Board of Directors.

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Section 5. First Meeting.

Each newly elected Board of Directors may hold its first meeting for the transaction of business, if a quorum is present, immediately after and at the same place as the annual meeting of the stockholders. Notice of such meeting shall not be required. At the first meeting of the Board of Directors in each year at which a quorum shall be present, held next after the annual meeting of stockholders, the Board of Directors shall proceed to the election of the officers of the Corporation.

Section 6. Regular Meetings.

Regular meetings of the Board of Directors shall be held at such times and places as shall be designated from time to time by resolution of the Board of Directors. Notice of such regular meetings shall not be required.

Section 7. Special Meetings.

Special meetings of the Board of Directors may be called by the Chairman of the Board (if any), the President or, upon written request of any two directors, by the Secretary, in each case on at least 24 hours personal, written, telegraphic, cable or wireless notice to each director. Such notice, or any waiver thereof pursuant to Article VIII, Section 3 hereof, need not state the purpose or purposes of such meeting, except as may otherwise be required by law, the Certificate of Incorporation or these bylaws.

Section 8. Removal.

Any one or more directors or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors; provided that, unless the Certificate of Incorporation otherwise provides, if the Board of Directors is classified, the stockholders may effect such removal only for cause; and provided further that, if the Certificate of Incorporation expressly grants to stockholders the right to cumulate votes for the election of directors and if less than the entire board is to be removed, no director may be removed without cause if the votes cast against his removal would be sufficient to elect him if then cumulatively voted at an election of the entire Board of Directors or, if there be classes of directors, at an election of the class of directors of which such director is a part.

Section 9. Vacancies; Increases in the Number of Directors.

Unless otherwise provided in the Certificate of Incorporation or these bylaws, vacancies and newly created directorships resulting from any increase in the authorized number of directors elected by all of the stockholders having the right to vote as a single class may be filled only by the affirmative vote of a majority of the directors then in office, although less than a quorum, or by a sole remaining director. If the Certificate of Incorporation entitles the holders of any class or classes of stock or series thereof to elect one or more directors, vacancies and newly created directorships of such class or classes or series may be filled only by a majority of the directors elected by such class or classes or series thereof then in office, or by a sole remaining director so elected.

If the directors of the Corporation are divided into classes, any directors elected to fill vacancies or newly created directorships shall hold office until the next election of the class for which such directors shall have been chosen, and until their successors shall be duly elected and qualified.

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Section 10. Compensation.

Unless otherwise provided in the Certificate of Incorporation, the Board of Directors shall have the authority to fix the compensation, if any, of directors.

Section 11. Action Without a Meeting; Telephone Conference Meeting.

Unless otherwise provided in the Certificate of Incorporation, any action required or permitted to be taken at any meeting of the Board of Directors, or any committee designated by the Board of Directors, may be taken without a meeting if all members of the Board of Directors or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or committee. Such consent shall have the same force and effect as a unanimous vote at a meeting, and may be stated as such in any document or instrument filed with the Secretary of State of Delaware.

Unless otherwise restricted by the Certificate of Incorporation, subject to the requirement for notice of meetings, members of the Board of Directors, or members of any committee designated by the Board of Directors, may participate in a meeting of such Board of Directors or committee, as the case may be, by means of conference telephone or similar communications equipment, by means of which all persons participating in the meeting can hear each other, and participation in such a meeting shall constitute presence in person at such meeting, except where a person participates in the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.

Section 12. Approval or Ratification of Acts or Contracts by Stockholders.

The Board of Directors in its discretion may submit any act or contract for approval or ratification at any annual meeting of the stockholders, or at any special meeting of the stockholders called for the purpose of considering any such act or contract, and any act or contract that shall be approved or ratified by a majority of the votes cast at such meeting (provided that a quorum is present), shall be as valid and as binding upon the Corporation and upon all the stockholders as if it had been approved or ratified by every stockholder of the Corporation. In addition, any such act or contract may be approved or ratified by the written consent of all stockholders holding a majority of the issued and outstanding shares of capital stock of the Corporation entitled to vote thereon.

ARTICLE IV

COMMITTEES

Section 1. Designation; Powers.

The Board of Directors may, by resolution passed by a majority of the whole board, designate one or more committees, including an executive committee, each such committee to

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consist of one or more of the directors of the Corporation. Any such committee shall have and may exercise such of the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation as may be provided in such resolution, except that no such committee shall have the power or authority of the Board of Directors with regard to amending the Certificate of Incorporation, adopting an agreement of merger or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the Corporation’s property and assets, recommending to the stockholders a dissolution of the Corporation or a revocation of a dissolution of the Corporation, or amending, altering or repealing the bylaws or adopting new bylaws for the Corporation and, unless such resolution or the Certificate of Incorporation expressly so provides, no such committee shall have the power or authority to declare a dividend, to authorize the issuance of stock or to adopt a certificate of ownership and merger. Any such designated committee may authorize the seal of the Corporation to be affixed to all papers which may require it. In addition, such committee or committees shall have such other powers and limitations of authority as may be determined from time to time by resolution adopted by the Board of Directors.

Section 2. Procedure; Meetings; Quorum.

Any committee designated pursuant to Article IV, Section 1 hereof, shall choose its own chairman and secretary, shall keep regular minutes of its proceedings and report the same to the Board of Directors when requested, shall fix its own rules or procedures, and shall meet at such times and at such place or places as may be provided by such rules or procedures, or by resolution of such committee or resolution of the Board of Directors. At every meeting of any such committee, the presence of a majority of all the members thereof shall constitute a quorum and the affirmative vote of a majority of the members present shall be necessary for the adoption by it of any resolution.

Section 3. Substitution of Members.

The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of such committee. In the absence or disqualification of a member of a committee, the member or members present at any meeting and not disqualified from voting, whether or not constituting a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of the absent or disqualified member.

ARTICLE V

OFFICERS

Section 1. Number, Titles and Term of Office.

The officers of the Corporation shall be a President, one or more Vice Presidents (any one or more of whom may be designated Executive Vice President or Senior Vice President), a Secretary and, if the Board of Directors so elects, a Chairman of the Board and such other officers as the Board of Directors may from time to time elect or appoint. Each officer shall hold office until his successor shall be duly elected and shall qualify or until his death or until he shall

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resign or shall have been removed in the manner hereinafter provided. Any number of offices may be held by the same person, unless the Certificate of Incorporation provides otherwise. Except for the Chairman of the Board, if any, no officer need be a director.

Section 2. Compensation.

The salaries or other compensation, if any, of the officers and agents of the Corporation shall be fixed from time to time by the Board of Directors.

Section 3. Removal.

Any officer or agent elected or appointed by the Board of Directors may be removed, either with or without cause, by the vote of a majority of the whole Board of Directors at a special meeting called for such purpose, or at any regular meeting of the Board of Directors, provided the notice for such meeting shall specify that such proposed removal will be considered at the meeting; provided, however, that such removal shall be without prejudice to the contractual rights, if any, of the person so removed. Election or appointment of an officer or agent shall not of itself create contractual rights.

Section 4. Vacancies.

Any vacancy occurring in any office of the Corporation may be filled by the Board of Directors.

Section 5. Powers and Duties of the Chief Executive Officer.

The President shall be the chief executive officer of the Corporation unless the Board of Directors designates the Chairman of the Board or other officer as the chief executive officer. Subject to the control of the Board of Directors and the executive committee (if any), the chief executive officer shall have general executive charge, management and control of the properties, business and operations of the Corporation with all such powers as may be reasonably incident to such responsibilities; he may agree upon and execute all leases, contracts, evidences of indebtedness and other obligations in the name of the Corporation and may sign all certificates for shares of capital stock of the Corporation; and he shall have such other powers and duties as designated in accordance with these bylaws and as may be assigned to him from time to time by the Board of Directors.

Section 6. Powers and Duties of the Chairman of the Board.

The Chairman of the Board (if any) shall preside at all meetings of the stockholders and of the Board of Directors; and he shall have such other powers and duties as designated in accordance with these bylaws and as may be assigned to him from time to time by the Board of Directors.

Section 7. Powers and Duties of the President.

Unless the Board of Directors otherwise determines, the President shall have the authority to agree upon and execute all leases, contracts, evidences of indebtedness and other

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obligations in the name of the Corporation; and, unless the Board of Directors otherwise determines, he shall, in the absence of the Chairman of the Board or if there be no Chairman of the Board, preside at all meetings of the stockholders and (if he is a director) of the Board of Directors; and the President shall have such other powers and duties as designated in accordance with these bylaws and as may be assigned to him from time to time by the Board of Directors.

Section 8. Vice Presidents.

In the absence of the Chairman of the Board (if any) or the President, or in the event of their inability or refusal to act, a Vice President designated by the Board of Directors or, in the absence of such designation, the Vice President who is present and who is senior in terms of time as a Vice President of the Corporation, shall perform the duties of the Chairman of the Board (if any) or the President, as the case may be, and when so acting shall have all the powers of and be subject to all the restrictions upon the President; provided, however, that such Vice President shall not preside at meetings of the Board of Directors unless he is a director. Each Vice President shall perform such other duties and have such other powers as the Board of Directors may from time to time prescribe.

Section 9. Secretary.

The Secretary shall keep the minutes of all meetings of the Board of Directors, committees of directors and of the stockholders in books provided for such purpose; he shall attend to the giving and serving of all notices; he may in the name of the Corporation affix the seal of the Corporation to all contracts of the Corporation and attest thereto; he may sign with the other appointed officers all certificates for shares of capital stock of the Corporation; he shall have charge of the certificate books, transfer books and stock ledgers, and such other books and papers as the Board of Directors may direct, all of which shall at all reasonable times be open to inspection by any director upon application at the office of the Corporation during business hours; he shall have such other powers and duties as designated in accordance with these bylaws and as may be prescribed from time to time by the Board of Directors; and he shall in general perform all acts incident to the office of Secretary, subject to the control of the chief executive officer and the Board of Directors.

Section 10. Assistant Secretaries.

Each Assistant Secretary (if any) shall have the usual powers and duties pertaining to his office, together with such other powers and duties as designated in accordance with these bylaws and as may be prescribed from time to time by the chief executive officer, the Board of Directors or the Secretary. The Assistant Secretaries shall exercise the powers of the Secretary during the Secretary’s absence or inability or refusal to act.

Section 11. Action with Respect to Securities of Other Corporations.

Unless otherwise determined by the Board of Directors, the chief executive officer shall have the power to vote and otherwise to act on behalf of the Corporation, in person or by proxy, at any meeting of security holders of any other corporation, or with respect to any action of security holders thereof, in which the Corporation may hold securities and otherwise, to exercise any and all rights and powers which the Corporation may possess by reason of its ownership of securities in such other corporation.

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ARTICLE VI

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND AGENTS

Section 1. Right to Indemnification.

Subject to the limitations and conditions as provided in this Article VI, each person who was or is made a party to or is threatened to be made a party to or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative or investigative (other than an action by or in the right of the Corporation) (hereinafter a “proceeding”), or any appeal in such a proceeding or any inquiry or investigation that could lead to such a proceeding, by reason of the fact that he, or a person of whom he is the legal representative, is or was or has agreed to become a director or officer of the Corporation, or is or was serving or has agreed to serve at the request of the Corporation as a director, officer, partner, venturer, proprietor, trustee, employee, agent, or similar functionary of another foreign or domestic corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise, whether the basis of such proceeding is alleged action in an official capacity as a director or officer or in any other capacity while serving or having agreed to serve as a director or officer of the Corporation, shall be indemnified and held harmless by the Corporation to the fullest extent permitted by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than said law permitted the Corporation to provide prior to such amendment) against all reasonable expense, liability and loss (including without limitation, attorneys’ fees, judgments, fines, excise or similar taxes, punitive damages or penalties and amounts paid or to be paid in settlement) actually incurred or suffered by such person in connection with such proceeding, and such indemnification under this Article VI shall continue as to a person who has ceased to serve in the capacity which initially entitled such person to indemnity hereunder and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that the Corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person only if such proceeding (or part thereof) was authorized by the Board of Directors of the Corporation. The right to indemnification granted pursuant to this Article VI shall be a contractual right, and no amendment, modification or repeal of this Article VI shall have the effect of limiting or denying any such rights with respect to actions taken or proceedings arising prior to any such amendment, modification or repeal. It is expressly acknowledged that the indemnification conferred in this Article VI could involve indemnification for negligence or under theories of strict liability.

Section 2. Advance Payment.

The right to indemnification conferred in this Article VI shall include the right to be paid or reimbursed by the Corporation for the reasonable expenses incurred by a person of the type entitled to be indemnified under Section 1 who was, is or is threatened to be made a named

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defendant or respondent in a proceeding in advance of the final disposition of the proceeding and without any determination as to the person’s ultimate entitlement to indemnification; provided, however, that the payment of such expenses incurred by any such person in advance of the final disposition of a proceeding shall be made only upon delivery to the Corporation of a written affirmation by such director or officer of his good faith belief that he has met the standard of conduct necessary for indemnification under this Article VI and a written undertaking, by or on behalf of such person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified person is not entitled to be indemnified under this Article VI or otherwise.

Section 3. Indemnification of Employees and Agents.

The Corporation may, by action of its Board of Directors, provide indemnification to employees and agents of the Corporation, individually or as a group, with the same scope and effect as the indemnification of directors and officers provided for in this Article VI.

Section 4. Appearance as a Witness.

Notwithstanding any other provision of this Article VI, the Corporation may pay or reimburse expenses incurred by a director or officer in connection with his appearance as a witness or other participation in a proceeding at a time when he is not a named defendant or respondent in the proceeding.

Section 5. Right of Claimant to Bring Suit.

If a written claim received by the Corporation from or on behalf of an indemnified party under this Article VI is not paid in full by the Corporation within ninety days after such receipt, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the Corporation) that the claimant has not met the standards of conduct which make it permissible under the Delaware General Corporation Law for the Corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

Section 6. Nonexclusivity of Rights.

The right to indemnification and advancement and payment of expenses conferred in this Article VI shall not be exclusive of any other rights which a director or officer or other person indemnified pursuant to this Article VI may have or hereafter acquire under any law (common or statutory), provision of the Certificate of Incorporation, these bylaws, any agreement, vote of stockholders or disinterested directors or otherwise.

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Section 7. Insurance.

The Corporation may purchase and maintain insurance, at its expense, to protect itself and any person who is or was serving as a director, officer, employee or agent of the Corporation or is or was serving at the request of the Corporation as a director, officer, partner, venturer, proprietor, employee, agent or similar functionary of another domestic or foreign corporation, partnership, joint venture, proprietorship, employee benefit plan, trust or other enterprise against any expense, liability or loss asserted against any such person and incurred in any such capacity, or arising out of the person’s status as such, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under this Article VI.

Section 8. Savings Clause.

If this Article VI or any portion hereof shall be invalidated on any grounds by any court of competent jurisdiction, then the Corporation shall nevertheless indemnify and hold harmless each director, officer or any other person indemnified in accordance with this Article VI as to costs, charges and expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement with respect to any proceeding, to the full extent permitted by any applicable and valid portion of this Article VI to the fullest extent permitted by applicable law.

Section 9. Definitions.

For purposes of this Article, reference to the “Corporation” shall include, in addition to the Corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger prior to (or, in the case of an entity specifically designated in a resolution of the Board of Directors, after) the adoption hereof and which, if its separate existence had continued, would have had the power and authority to indemnify its directors, officers and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Article with respect to the resulting or surviving corporation as he would have with respect to such constituent corporation if its separate existence had continued.

ARTICLE VII

CAPITAL STOCK

Section 1. Certificates of Stock.

The shares of the capital stock of the Corporation shall be represented by certificates, provided, however, that the Board of Directors may determine by resolution that some or all of any or all the classes or series of the Corporation’s stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is

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surrendered to the Corporation. Notwithstanding the adoption of such a resolution by the Board of Directors, every holder of stock represented by certificates and, upon request, every holder of uncertificated shares shall be entitled to have a certificate signed by, or in the name of the Corporation by the Chairman of the Board of Directors (if any), the Chief Executive Officer (if any), the President or a Vice President, and by the Secretary or an Assistant Secretary of the Corporation representing the number of shares registered in certificate form. Any or all the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, such certificate may be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.

Section 2. Transfer of Shares.

The shares of stock of the Corporation shall only be transferable on the books of the Corporation by the holders thereof in person or by their duly authorized attorneys or legal representatives upon surrender and cancellation of certificates for a like number of shares (or upon compliance with the provisions of Article VII, Section 5 hereof, if applicable). Upon surrender to the Corporation or a transfer agent of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer (or upon compliance with the provisions of Article VII, Section 5 hereof, if applicable) and of compliance with any transfer restrictions applicable thereto contained in any agreement to which the Corporation is a party, or of which the Corporation has knowledge by reason of a legend with respect thereto placed upon any such surrendered stock certificate, it shall be the duty of the Corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books.

Section 3. Ownership of Shares.

The Corporation shall be entitled to treat the holder of record of any share or shares of capital stock of the Corporation as the owner in fact thereof at that time for purposes of voting such shares, receiving distributions thereon or notices in respect thereof, transferring such shares, exercising rights of dissent, exercising or waiving any preemptive rights, or giving proxies with respect to such shares; and, neither the Corporation nor any of its officers, directors, employees, or agents shall be liable for regarding that person as the owner of those shares at that time for those purposes, regardless of whether or not that person possesses a certificate for those shares.

Section 4. Regulations Regarding Certificates.

The Board of Directors shall have the power and authority to make all such rules and regulations as it may deem expedient concerning the issue, transfer and registration or the replacement of certificates for shares of capital stock of the Corporation.

Section 5. Lost, Stolen.

Destroyed or Mutilated Certificates. The Board of Directors may determine the conditions upon which a new certificate of stock may be issued in place of any certificate which is alleged to have been lost, stolen, destroyed or mutilated; and may, in its discretion, require the

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owner of such certificate or his legal representative to give bond, with sufficient surety, to indemnify the Corporation and each transfer agent and registrar against any and all losses or claims which may arise by reason of the issuance of a new certificate in the place of the one so lost, stolen, destroyed or mutilated.

ARTICLE VIII

MISCELLANEOUS PROVISIONS

Section 1. Fiscal Year.

The fiscal year of the Corporation shall be such as established from time to time by the Board of Directors.

Section 2. Corporate Seal.

The Board of Directors may provide a suitable seal containing the name of the Corporation. The Secretary shall have charge of the seal (if any). If and when so directed by the Board of Directors or a committee thereof, duplicates of the seal may be kept and used by an Assistant Secretary.

Section 3. Notice and Waiver of Notice.

Whenever any notice is required to be given by law, the Certificate of Incorporation or these bylaws, except with respect to notices of meetings of stockholders (with respect to which the provisions of Article II, Section 6 hereof apply) and except with respect to notices of special meetings of directors (with respect to which the provisions of Article III, Section 7 hereof apply) said notice shall be deemed to be sufficient if given (i) by telegraphic, cable or wireless transmission or (ii) by deposit of such postage prepaid notice, in a post office box addressed to the person entitled thereto at his address as it appears on the records of the Corporation. Such notice shall be deemed to have been given on the day of such transmission or mailing, as the case may be.

Whenever notice is required to be given by law, the Certificate of Incorporation or these bylaws, a written waiver thereof, signed by the person entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders, directors, or a committee of directors need be specified in any written waiver of notice unless so required by the Certificate of Incorporation or these bylaws.

Section 4. Resignations.

Any director, member of a committee or officer may resign at any time. Such resignation shall be made in writing and shall take effect at the time specified therein, or if no

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time be specified, at the time of its receipt by the chief executive officer or Secretary. The acceptance of a resignation shall not be necessary to make such resignation effective, unless expressly so provided in the resignation.

Section 5. Facsimile Signatures.

In addition to the provisions for the use of facsimile signatures elsewhere specifically authorized elsewhere in these bylaws, facsimile signatures of any officer or officers of the Corporation may be used as determined by the Board of Directors.

Section 6. Reliance upon Books, Reports and Records.

A member of the Board of Directors, or a member of any committee thereof, shall be fully protected in relying in good faith upon the records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of its officers or employees, or committees of the Board of Directors, or by any other person as to matters the director reasonably believes are within such other person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation, as to the value and amount of the assets, liabilities and/or net profits of the Corporation, or any other facts pertinent to the existence and amount of surplus or other funds from which dividends might properly be declared and paid, or with which the Corporation’s stock might properly be purchased or redeemed.

ARTICLE IX

AMENDMENTS

The original or other bylaws of the Corporation may be adopted, amended or repealed by the incorporators, by the initial directors if they are named in the Certificate of Incorporation, or, before the Corporation has received any payment for any of its stock, by its Board of Directors. After the Corporation has received any payment for any of its stock, the power to adopt, amend or repeal bylaws shall reside in the stockholders entitled to vote; provided, however, the Corporation may, in the Certificate of Incorporation, confer the power to adopt, amend or repeal bylaws upon the directors. The fact that such power has been so conferred upon the directors, shall not divest the stockholders of the power, nor limit their power to adopt, amend or repeal bylaws. Notwithstanding anything to the contrary herein, no amendment to or repeal of Article II, Section 3; Article II, Section 4; Article II, Section 13; Article III, Section 1; Article III, Section 2; Article III, Section 9; or this Article IX shall be effective, nor may any other bylaw be amended, adopted or repealed that will have the effect of modifying or permitting the circumvention of such bylaws, without the affirmative vote of (i) a majority of the Board of Directors or (ii) holders of outstanding shares of common stock representing 80% or more of the voting power of the outstanding voting securities of the Corporation.

As amended and restated through May 15, 2008, and as amended as of December 19, 2013.

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EX-10.18

Exhibit 10.18

Execution Version

WAIVER AGREEMENT

This Waiver Agreement dated as of December 18, 2013 (this “Agreement”) is among Stone Energy Corporation, a Delaware corporation (the “Borrower”), Stone Energy Offshore, L.L.C., a Delaware limited liability company (the “Guarantor”), the financial institutions party to the Credit Agreement described below as Banks (the “Banks”), and Bank of America, N.A., as Agent for the Banks (the “Agent”) and as Issuing Bank (the “Issuing Bank”).

INTRODUCTION

A. The Borrower, the Banks, the Agent, and the Issuing Bank have entered into the Third Amended and Restated Credit Agreement dated as of April 26, 2011 (as amended or otherwise modified by the Amendment No. 1 and Consent dated as of February 28, 2012, the Amendment No. 2 and Consent dated as of October 22, 2012, the Amendment No. 3 dated as of April 30, 2013, the Consent Agreement (as defined below) and as may be otherwise amended, restated, supplemented, or modified from time to time, the “Credit Agreement”).

B. The Guarantor entered into that certain Amended and Restated Guaranty dated as of April 26, 2011 (the “Stone Offshore Guaranty”).

C. The Guarantor wishes to reaffirm its guarantee of the Obligations as amended by this Agreement.

D. Prior to the effectiveness of the Consent Agreement (as defined below), Section 6.2(j) of the Credit Agreement permitted the Borrower to incur Debt under Permitted Notes in an aggregate principal amount not to exceed $1,100,000,000 (the “Original Debt Cap”).

E. In connection with the Consent Agreement dated as of November 1, 2013 among the Borrower, the Guarantor, the Banks, the Agent and the Issuing Bank (the “Consent Agreement”), the Agent, the Banks and the Issuing Bank had agreed to temporarily permit the Borrower to incur Debt permitted under Section 6.2(j) of the Credit Agreement in excess of the Original Debt Cap, but in a maximum aggregate outstanding principal amount not to exceed $1,500,000,000 at any time prior to March 31, 2014 (the “Temporary Debt Cap”).

F. The parties hereto have agreed to terminate the Temporary Debt Cap and reinstate the Original Debt Cap.

G. On or about November 27, 2013, the Borrower issued additional Debt under the 2012 Indenture Documents in an aggregate principal amount of $475,000,000 (the “Specified Issuance”), the proceeds of which were used to fund its tender offer and consent solicitation for its existing 8.625% senior notes due 2017, the redemption of any 8.625% senior notes due 2017 not tendered, and for other general corporate purposes.

H. The Borrower has requested, and the Agent and the Banks have agreed to waive the application Section 2.2(a) of the Credit Agreement to the Specified Issuance and to acknowledge and agree that at all times from the date of the Specified Issuance to the date of this Agreement, the Borrowing Base has been $400,000,000.

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THEREFORE, in fulfillment of the foregoing, the Borrower, the Guarantor, the Agent, the Issuing Bank, and the Banks hereby agree as follows:

Section 1. Definitions; References. Unless otherwise defined in this Agreement, each term used in this Agreement which is defined in the Credit Agreement has the meaning assigned to such term in the Credit Agreement.

Section 2. Waiver and Agreement.

(a) Notwithstanding anything in the Consent Agreement to the contrary, the Borrower, the Agent and the Banks hereby agree that effective as of the date hereof (i) the Temporary Debt Cap is revoked, (ii) the Original Debt Cap is reinstated, and (iii) Section 6.2(j) of the Credit Agreement is restated to read in its entirety as follows:

“(j) Permitted Notes not to exceed an amount of, on or prior to December 31, 2012, $1,250,000,000 and, at any time thereafter, $1,100,000,000 in aggregate outstanding principal at any time, provided that (i) no Default or Event of Default exists at the time of the issuance of such Permitted Notes and (ii) the obligors (including any guarantors) under any such Permitted Notes shall be limited to Credit Parties; and”

(b) The Agent and the Banks hereby waive application of Section 2.2(a) of the Credit Agreement to the Specified Issuance and agree that at all times from the date of the Specified Issuance to the date of this Agreement, the Borrowing Base has been $400,000,000. Such Borrowing Base may be redetermined or modified in accordance with the terms of the Credit Agreement.

Section 3. Reaffirmation of Liens

(a) Each of the Borrower and the Guarantor (i) is party to certain Security Documents securing and supporting the Borrower’s and Guarantor’s obligations under the Credit Documents, (ii) represents and warrants that it has no defenses to the enforcement of the Security Documents and that according to their terms the Security Documents will continue in full force and effect to secure the Borrower’s and Guarantor’s obligations under the Credit Documents, as the same may be amended, supplemented, or otherwise modified, and (iii) acknowledges, represents, and warrants that the liens and security interests created by the Security Documents are valid and subsisting and create an Acceptable Security Interest in the Collateral to secure the Borrower’s and Guarantor’s obligations under the Credit Documents, as the same may be amended, supplemented, or otherwise modified.

(b) The delivery of this Agreement does not indicate or establish a requirement that any Guaranty or Security Document requires the Borrower’s or any Guarantor’s approval of amendments to the Credit Agreement.

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Section 4. Representations and Warranties. Each of the Borrower and the Guarantor represents and warrants to the Agent and the Banks that:

(a) the representations and warranties set forth in the Credit Agreement and in the other Credit Documents are true and correct in all material respects as of the date of this Agreement (except to the extent such representations and warranties relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such earlier date); provided that such materiality qualifier shall not apply if such representation or warranty is already subject to a materiality qualifier in the Credit Agreement or such other Credit Document;

(b) (i) the execution, delivery, and performance of this Agreement are within the corporate or limited liability company power, as appropriate, and authority of the Borrower and Guarantor and have been duly authorized by appropriate proceedings and (ii) this Agreement constitutes a legal, valid, and binding obligation of the Borrower and Guarantor, enforceable against the Borrower and Guarantor in accordance with its terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the rights of creditors generally and general principles of equity; and

(c) as of the effectiveness of this Agreement and after giving effect thereto, no Default or Event of Default has occurred and is continuing.

Section 5. Reaffirmation of Guaranty. The Guarantor hereby ratifies, confirms, and acknowledges that its obligations under the Stone Offshore Guaranty are in full force and effect and that the Guarantor continues to unconditionally and irrevocably guarantee the full and punctual payment, when due, whether at stated maturity or earlier by acceleration or otherwise, of all of the Obligations (subject to the terms of the Stone Offshore Guaranty), as such Obligations may have been amended by this Agreement. The Guarantor hereby acknowledges that its execution and delivery of this Agreement do not indicate or establish an approval or consent requirement by the Guarantor under the Stone Offshore Guaranty in connection with the execution and delivery of amendments, modifications or waivers to the Credit Agreement, the Notes or any of the other Credit Documents.

Section 6. Effectiveness. This Agreement shall become effective as of the date hereof, upon the occurrence of all of the following:

(a) the Required Banks, the Borrower, and the Guarantor duly and validly executing originals of this Agreement and delivery thereof to the Agent;

(b) the representations and warranties in this Agreement being true and correct in all material respects before and after giving effect to this Agreement; and

(c) the Borrower’s having paid all costs, expenses, and fees which have been invoiced and are payable pursuant to Section 9.4 of the Credit Agreement or any other written agreement.

Section 7. Effect on Credit Documents. Except as amended herein, the Credit Agreement and the Credit Documents remain in full force and effect as originally executed, and nothing herein shall act as a waiver of any of the Agent’s or Banks’ rights under the Credit Documents, as amended. This Agreement is a Credit Document for the purposes of the provisions of the other Credit Documents. Without limiting the foregoing, any breach of representations, warranties, and covenants under this Agreement may be a Default or Event of Default under other Credit Documents.

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Section 8. Choice of Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York.

Section 9. Counterparts. This Agreement may be signed in any number of counterparts, each of which shall be an original.

[The remainder of this page has been left blank intentionally.]

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THIS WRITTEN AGREEMENT AND THE CREDIT DOCUMENTS, AS DEFINED IN THE CREDIT AGREEMENT, REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

EXECUTED as of the date first set forth above.

BORROWER: STONE ENERGY CORPORATION
By:	/s/ Kenneth H. Beer
Name: Kenneth H. Beer
Title: Executive Vice President and           Chief Financial Officer

GUARANTOR: STONE ENERGY OFFSHORE, L.L.C.
By:	/s/ Kenneth H. Beer
Name: Kenneth H. Beer
Title: Executive Vice President and           Chief Financial Officer

[Signature Page to Waiver Agreement]

AGENT AND ISSUING BANK: BANK OF AMERICA, N.A., as Agent and Issuing Bank
By:	/s/ Ronald E. McKaig
Name:   Ronald E. McKaig
Title:     Managing Director

BANKS: BANK OF AMERICA, N.A.
By:	/s/ Ronald E. McKaig
Name:   Ronald E. McKaig
Title:     Managing Director

[Signature Page to Waiver Agreement]

WELLS FARGO BANK, N.A.
By:	/s/ Patrick J. Fults
Name: Patrick J. Fults
Title: Vice President

[Signature Page to Waiver Agreement]

NATIXIS
By:	/s/ Louis P. Laville, III
Name: Louis P. Laville, III
Title: Managing Director

By:	/s/ Stuart Murray
Name: Stuart Murray
Title: Managing Director

[Signature Page to Waiver Agreement]

THE BANK OF NOVA SCOTIA
By:	/s/ Terry Donovan
Name: Terry Donovan
Title: Managing Director

[Signature Page to Waiver Agreement]

CAPITAL ONE, N.A.
By:	/s/ Christopher Kuna
Name: Christopher Kuna
Title: Vice President

[Signature Page to Waiver Agreement]

TORONTO DOMINION (NEW YORK) LLC
By:	/s/ Masood Fikree
Name: Masood Fikree
Title: Authorized Signatory

[Signature Page to Waiver Agreement]

BARCLAYS BANK PLC
By:	/s/ Vanessa A. Kurbatskiy
Name: Vanessa A. Kurbatskiy
Title: Vice President

[Signature Page to Waiver Agreement]

REGIONS BANK
By:	/s/ Michael Kutcher
Name: Michael Kutcher
Title: Assistant Vice President

[Signature Page to Waiver Agreement]

U.S. BANK NATIONAL ASSOCIATION
By:	/s/ Nicholas T. Hanford
Name: Nicholas T. Hanford
Title: Vice President

[Signature Page to Waiver Agreement]

IBERIABANK
By:	/s/ W. Bryan Chapman
Name: W. Bryan Chapman
Title: Executive Vice President

[Signature Page to Waiver Agreement]

WHITNEY BANK
By:	/s/ William Jochetz
Name: William Jochetz
Title: Vice President

[Signature Page to Waiver Agreement]

SUMITOMO MITSUI BANKING CORPORATION
By:	/s/ James D. Weinstein
Name: James D. Weinstein
Title: Managing Director

[Signature Page to Waiver Agreement]

EX-21.1

Exhibit 21.1

STONE ENERGY CORPORATION

SUBSIDIARIES AS OF DECEMBER 31, 2013

Stone Energy Offshore, L.L.C., a Delaware limited liability company

Stone Energy Holding, L.L.C., a Delaware limited liability company

Stone Energy Canada, U.L.C., a Government of Alberta unlimited liability company

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the following Registration Statements:

(1) Registration Statement (Form S-3 No. 333-161391) of Stone Energy Corporation and the related Prospectus, and

(2) Registration Statement (Form S-3 No. 333-184532) of Stone Energy Corporation and the related Prospectus, and

(3) Registration Statement (Form S-8 No. 333-67332) pertaining to the Stone Energy Corporation 2001 Amended and Restated Stock Option Plan, and

(4) Registration Statement (Form S-8 No. 333-51968) pertaining to the Basin Exploration, Inc. Equity Incentive Plan, and

(5) Registration Statement (Form S-8 No. 333-64448) pertaining to the Stone Energy Corporation 2001 Amended and Restated Stock Option Plan, and

(6) Registration Statement (Form S-8 No. 333-87849) pertaining to the Stone Energy Corporation 2001 Amended and Restated Stock Option Plan, and

(7) Registration Statement (Form S-8 No. 333-107440) pertaining to the Stone Energy Corporation 2001 Amended and Restated Stock Option Plan, and

(8) Registration Statement (Form S-8 No. 333-160424) pertaining to the Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan, and

(9) Registration Statement (Form S-8 No. 333-174992) pertaining to the Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan;

of our reports dated February 27, 2014, with respect to the consolidated financial statements of Stone Energy Corporation and the effectiveness of internal control over financial reporting of Stone Energy Corporation included in this Annual Report (Form 10-K) of Stone Energy Corporation for the year ended December 31, 2013.

/s/ Ernst & Young LLP

New Orleans, Louisiana

February 27, 2014

EX-23.2

Exhibit 23.2

CONSENT OF INDEPENDENT PETROLEUM ENGINEERS AND GEOLOGISTS

We do hereby consent to the use of our name in “Item 2. Properties” of the Annual Report on Form 10-K of Stone Energy Corporation (the “Company”) for the year ended December 31, 2013 and to the incorporation by reference thereof into the Company’s previously filed Registration Statements on Form S-8 (Registration Nos. 33-67332, 333-51968, 333-64448, 333-87849, 333-107440, 333-160424 and 333-174992) and Form S-3 (Registration Nos. 333-161391 and 333-184532) and to the inclusion of our report dated January 24, 2014 in the Company’s Annual Report on Form 10-K for the year ended December 31, 2013.

NETHERLAND, SEWELL & ASSOCIATES, INC.

By:	/s/ Danny D. Simmons, P.E.
Name:	Danny D. Simmons, P.E.
Title:	President and Chief Operating Officer

Houston, Texas

February 27, 2014

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, David H. Welch, certify that:

1. I have reviewed this Annual Report on Form 10-K of Stone Energy Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

February 27, 2014	/s/ David H. Welch
	David H. Welch
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Kenneth H. Beer, certify that:

1. I have reviewed this Annual Report on Form 10-K of Stone Energy Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

February 27, 2014	/s/ Kenneth H. Beer
	Kenneth H. Beer
	Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

Pursuant to 18 U.S.C. § 1350 and in connection with the accompanying report on Form 10-K of Stone Energy Corporation (the “Company”) for the year ended December 31, 2013 that is being filed concurrently with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company hereby certifies, to the best of his knowledge, that:

(i.) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(ii.) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

February 27, 2014	/s/ David H. Welch
	David H. Welch
	President and Chief Executive Officer

/s/ Kenneth H. Beer

Kenneth H. Beer

Executive Vice President and Chief Financial Officer

EX-99.1

Exhibit 99.1

January 24, 2014

Stone Energy Corporation

625 East Kaliste Saloom Road

Lafayette, Louisiana 70508

Ladies and Gentlemen:

In accordance with your request, we have estimated the proved reserves and future revenue, as of December 31, 2013, to the Stone Energy Corporation (Stone) interest in certain oil and gas properties located in the United States. We completed our evaluation on or about the date of this letter. It is our understanding that the proved reserves estimated in this report constitute all of the proved reserves owned by Stone. The estimates in this report have been prepared in accordance with the definitions and regulations of the U.S. Securities and Exchange Commission (SEC) and, with the exception of the exclusion of future income taxes, conform to the FASB Accounting Standards Codification Topic 932, Extractive Activities—Oil and Gas. Definitions are presented immediately following this letter. This report has been prepared for Stone’s use in filing with the SEC; in our opinion the assumptions, data, methods, and procedures used in the preparation of this report are appropriate for such purpose.

We estimate the net reserves and future net revenue to the Stone interest in these properties, as of December 31, 2013, to be:

	Net Reserves						Future Net Revenue (M$)
Category	Oil     (MBBL)		NGL     (MBBL)		Gas     (MMCF)		Total		Present Worth   at 10%
Proved Developed Producing		16,576.3		9,425.8		181,189.2		1,274,204.8		1,115,408.9
Proved Developed Non-Producing		11,344.2		2,143.6		65,756.9		755,918.6		470,630.1
Proved Undeveloped		15,906.7		11,727.9		213,819.9		1,517,047.2		634,054.9
Total Proved		43,827.2		23,297.3		460,766.0		3,547,170.5		2,220,094.0

Totals may not add because of rounding.

The oil volumes shown include crude oil and condensate. Oil and natural gas liquids (NGL) volumes are expressed in thousands of barrels (MBBL); a barrel is equivalent to 42 United States gallons. Gas volumes are expressed in millions of cubic feet (MMCF) at standard temperature and pressure bases.

The estimates shown in this report are for proved reserves. As requested, probable and possible reserves that exist for these properties have not been included. This report does not include any value that could be attributed to interests in undeveloped acreage beyond those tracts for which undeveloped reserves have been estimated. Reserves categorization conveys the relative degree of certainty; reserves subcategorization is based on development and production status. The estimates of reserves and future revenue included herein have not been adjusted for risk.

Gross revenue is Stone’s share of the gross (100 percent) revenue from the properties prior to any deductions. Future net revenue is after deductions for Stone’s share of production taxes, ad valorem taxes, capital costs, abandonment costs, and operating expenses but before consideration of any income taxes. The future net revenue has been discounted at an annual rate of 10 percent to determine its present worth, which is shown to indicate the effect of time on the value of money. Future net revenue presented in this report, whether discounted or undiscounted, should not be construed as being the fair market value of the properties.

Prices used in this report are based on the 12-month unweighted arithmetic average of the first-day-of-the-month price for each month in the period January through December 2013. For oil and NGL volumes, the average West Texas Intermediate posted price of $93.42 per barrel is adjusted by lease for quality, transportation fees, and regional price differentials. For gas volumes, the average regional spot prices are adjusted by lease for energy content, transportation fees, and local price differentials. All prices are held constant throughout the lives of the properties. The average adjusted product prices weighted by production over the remaining lives of the properties are $102.21 per barrel of oil, $37.59 per barrel of NGL, and $3.658 per MCF of gas.

Operating costs used in this report are based on operating expense records of Stone. For nonoperated properties, these costs include the per-well overhead expenses allowed under joint operating agreements along with estimates of costs to be incurred at and below the district and field levels. As requested, operating costs for the operated properties are limited to direct lease- and field-level costs and Stone’s estimate of the portion of its headquarters general and administrative overhead expenses necessary to operate the properties. Operating costs have been divided into per-well costs and per-unit-of-production costs and are not escalated for inflation.

Capital costs used in this report were provided by Stone and are based on authorizations for expenditure and actual costs from recent activity. Capital costs are included as required for workovers, new development wells, and production equipment. Based on our understanding of future development plans, a review of the records provided to us, and our knowledge of similar properties, we regard these estimated capital costs to be reasonable. Abandonment costs used in this report are Stone’s estimates of the costs to abandon the wells, platforms, and production facilities, net of any salvage value. Capital costs and abandonment costs are not escalated for inflation.

For the purposes of this report, we did not perform any field inspection of the properties, nor did we examine the mechanical operation or condition of the wells and facilities. We have not investigated possible environmental liability related to the properties; therefore, our estimates do not include any costs due to such possible liability.

We have made no investigation of potential volume and value imbalances resulting from overdelivery or underdelivery to the Stone interest. Therefore, our estimates of reserves and future revenue do not include adjustments for the settlement of any such imbalances; our projections are based on Stone receiving its net revenue interest share of estimated future gross production.

The reserves shown in this report are estimates only and should not be construed as exact quantities. Proved reserves are those quantities of oil and gas which, by analysis of engineering and geoscience data, can be estimated with reasonable certainty to be economically producible; probable and possible reserves are those additional reserves which are sequentially less certain to be recovered than proved reserves. Estimates of reserves may increase or decrease as a result of market conditions, future operations, changes in regulations, or actual reservoir performance. In addition to the primary economic assumptions discussed herein, our estimates are based on certain assumptions including, but not limited to, that the properties will be developed consistent with current development plans, that the properties will be operated in a prudent manner, that no governmental regulations or controls will be put in place that would impact the ability of the interest owner to recover the reserves, and that our projections of future production will prove consistent with actual performance. If the reserves are recovered, the revenues therefrom and the costs related thereto could be more or less than the estimated amounts. Because of governmental policies and uncertainties of supply and demand, the sales rates, prices received for the reserves, and costs incurred in recovering such reserves may vary from assumptions made while preparing this report.

For the purposes of this report, we used technical and economic data including, but not limited to, well logs, geologic maps, seismic data, well test data, production data, historical price and cost information, and property ownership interests. The reserves in this report have been estimated using deterministic methods; these

estimates have been prepared in accordance with the Standards Pertaining to the Estimating and Auditing of Oil and Gas Reserves Information promulgated by the Society of Petroleum Engineers (SPE Standards). We used standard engineering and geoscience methods, or a combination of methods, including performance analysis, volumetric analysis, analogy, and reservoir modeling, that we considered to be appropriate and necessary to categorize and estimate reserves in accordance with SEC definitions and regulations. A substantial portion of these reserves are for behind-pipe zones, non-producing zones, undeveloped locations, and producing wells that lack sufficient production history upon which performance-related estimates of reserves can be based; such reserves are based on estimates of reservoir volumes and recovery efficiencies along with analogy to properties with similar geologic and reservoir characteristics. As in all aspects of oil and gas evaluation, there are uncertainties inherent in the interpretation of engineering and geoscience data; therefore, our conclusions necessarily represent only informed professional judgment.

The data used in our estimates were obtained from Stone, public data sources, and the nonconfidential files of Netherland, Sewell & Associates, Inc. and were accepted as accurate. Supporting work data are on file in our office. We have not examined the titles to the properties or independently confirmed the actual degree or type of interest owned. The technical persons responsible for preparing the estimates presented herein meet the requirements regarding qualifications, independence, objectivity, and confidentiality set forth in the SPE Standards. We are independent petroleum engineers, geologists, geophysicists, and petrophysicists; we do not own an interest in these properties nor are we employed on a contingent basis.

		Sincerely,
		NETHERLAND, SEWELL & ASSOCIATES, INC.
		Texas Registered Engineering Firm F-2699
			/s/ C.H. (Scott) Rees III
		By:
			C.H. (Scott) Rees III, P.E. Chairman and Chief Executive Officer
	/s/ Richard B. Talley, Jr.		/s/ Patrick L. Higgs
By:		By:
	Richard B. Talley, Jr., P.E. 102425		Patrick L. Higgs, P.G. 985
	Vice President		Vice President
Date Signed:    January 24, 2014		Date Signed:    January 24, 2014

RBT:DEG

Please be advised that the digital document you are viewing is provided by Netherland, Sewell & Associates, Inc. (NSAI) as a convenience to our clients. The digital document is intended to be substantively the same as the original signed document maintained by NSAI. The digital document is subject to the parameters, limitations, and conditions stated in the original document. In the event of any differences between the digital document and the original document, the original document shall control and supersede the digital document.

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

The following definitions are set forth in U.S. Securities and Exchange Commission (SEC) Regulation S-X Section 210.4-10(a). Also included is supplemental information from (1) the 2007 Petroleum Resources Management System approved by the Society of Petroleum Engineers, (2) the FASB Accounting Standards Codification Topic 932, Extractive Activities—Oil and Gas, and (3) the SEC’s Compliance and Disclosure Interpretations.

(1)  Acquisition of properties.  Costs incurred to purchase, lease or otherwise acquire a property, including costs of lease bonuses and options to purchase or lease properties, the portion of costs applicable to minerals when land including mineral rights is purchased in fee, brokers’ fees, recording fees, legal costs, and other costs incurred in acquiring properties.

(2)  Analogous reservoir.    Analogous reservoirs, as used in resources assessments, have similar rock and fluid properties, reservoir conditions (depth, temperature, and pressure) and drive mechanisms, but are typically at a more advanced stage of development than the reservoir of interest and thus may provide concepts to assist in the interpretation of more limited data and estimation of recovery. When used to support proved reserves, an “analogous reservoir” refers to a reservoir that shares the following characteristics with the reservoir of interest:

(i) Same geological formation (but not necessarily in pressure communication with the reservoir of interest);

(ii) Same environment of deposition;

(iii) Similar geological structure; and

(iv) Same drive mechanism.

Instruction to paragraph (a)(2):  Reservoir properties must, in the aggregate, be no more favorable in the analog than in the reservoir of interest.

(3)  Bitumen.    Bitumen, sometimes referred to as natural bitumen, is petroleum in a solid or semi-solid state in natural deposits with a viscosity greater than 10,000 centipoise measured at original temperature in the deposit and atmospheric pressure, on a gas free basis. In its natural state it usually contains sulfur, metals, and other non-hydrocarbons.

(4)  Condensate.    Condensate is a mixture of hydrocarbons that exists in the gaseous phase at original reservoir temperature and pressure, but that, when produced, is in the liquid phase at surface pressure and temperature.

(5)  Deterministic estimate.    The method of estimating reserves or resources is called deterministic when a single value for each parameter (from the geoscience, engineering, or economic data) in the reserves calculation is used in the reserves estimation procedure.

(6)  Developed oil and gas reserves.    Developed oil and gas reserves are reserves of any category that can be expected to be recovered:

(i) Through existing wells with existing equipment and operating methods or in which the cost of the required equipment is relatively minor compared to the cost of a new well; and

(ii) Through installed extraction equipment and infrastructure operational at the time of the reserves estimate if the extraction is by means not involving a well.

Supplemental definitions from the 2007 Petroleum Resources Management System:

Developed Producing Reserves – Developed Producing Reserves are expected to be recovered from completion intervals that are open and producing at the time of the estimate. Improved recovery reserves are considered producing only after the improved recovery project is in operation.

Developed Non-Producing Reserves – Developed Non-Producing Reserves include shut-in and behind-pipe Reserves. Shut-in Reserves are expected to be recovered from (1) completion intervals which are open at the time of the estimate but which have not yet started producing, (2) wells which were shut-in for market conditions or pipeline connections, or (3) wells not capable of production for mechanical reasons. Behind-pipe Reserves are expected to be recovered from zones in existing wells which will require additional completion work or future recompletion prior to start of production. In all cases, production can be initiated or restored with relatively low expenditure compared to the cost of drilling a new well.

Definitions - Page 1 of 7

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

(7)  Development costs.    Costs incurred to obtain access to proved reserves and to provide facilities for extracting, treating, gathering and storing the oil and gas. More specifically, development costs, including depreciation and applicable operating costs of support equipment and facilities and other costs of development activities, are costs incurred to:

(i) Gain access to and prepare well locations for drilling, including surveying well locations for the purpose of determining specific development drilling sites, clearing ground, draining, road building, and relocating public roads, gas lines, and power lines, to the extent necessary in developing the proved reserves.

(ii) Drill and equip development wells, development-type stratigraphic test wells, and service wells, including the costs of platforms and of well equipment such as casing, tubing, pumping equipment, and the wellhead assembly.

(iii) Acquire, construct, and install production facilities such as lease flow lines, separators, treaters, heaters, manifolds, measuring devices, and production storage tanks, natural gas cycling and processing plants, and central utility and waste disposal systems.

(iv) Provide improved recovery systems.

(8)  Development project.    A development project is the means by which petroleum resources are brought to the status of economically producible. As examples, the development of a single reservoir or field, an incremental development in a producing field, or the integrated development of a group of several fields and associated facilities with a common ownership may constitute a development project.

(9)  Development well.    A well drilled within the proved area of an oil or gas reservoir to the depth of a stratigraphic horizon known to be productive.

(10)  Economically producible.    The term economically producible, as it relates to a resource, means a resource which generates revenue that exceeds, or is reasonably expected to exceed, the costs of the operation. The value of the products that generate revenue shall be determined at the terminal point of oil and gas producing activities as defined in paragraph (a)(16) of this section.

(11)  Estimated ultimate recovery (EUR).    Estimated ultimate recovery is the sum of reserves remaining as of a given date and cumulative production as of that date.

(12)  Exploration costs.    Costs incurred in identifying areas that may warrant examination and in examining specific areas that are considered to have prospects of containing oil and gas reserves, including costs of drilling exploratory wells and exploratory-type stratigraphic test wells. Exploration costs may be incurred both before acquiring the related property (sometimes referred to in part as prospecting costs) and after acquiring the property. Principal types of exploration costs, which include depreciation and applicable operating costs of support equipment and facilities and other costs of exploration activities, are:

(i) Costs of topographical, geographical and geophysical studies, rights of access to properties to conduct those studies, and salaries and other expenses of geologists, geophysical crews, and others conducting those studies. Collectively, these are sometimes referred to as geological and geophysical or “G&G” costs.

(ii) Costs of carrying and retaining undeveloped properties, such as delay rentals, ad valorem taxes on properties, legal costs for title defense, and the maintenance of land and lease records.

(iii) Dry hole contributions and bottom hole contributions.

(iv) Costs of drilling and equipping exploratory wells.

(v) Costs of drilling exploratory-type stratigraphic test wells.

(13)  Exploratory well.    An exploratory well is a well drilled to find a new field or to find a new reservoir in a field previously found to be productive of oil or gas in another reservoir. Generally, an exploratory well is any well that is not a development well, an extension well, a service well, or a stratigraphic test well as those items are defined in this section.

(14)  Extension well.     An extension well is a well drilled to extend the limits of a known reservoir.

Definitions - Page 2 of 7

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

(15)  Field.    An area consisting of a single reservoir or multiple reservoirs all grouped on or related to the same individual geological structural feature and/or stratigraphic condition. There may be two or more reservoirs in a field which are separated vertically by intervening impervious strata, or laterally by local geologic barriers, or by both. Reservoirs that are associated by being in overlapping or adjacent fields may be treated as a single or common operational field. The geological terms “structural feature” and “stratigraphic condition” are intended to identify localized geological features as opposed to the broader terms of basins, trends, provinces, plays, areas-of-interest, etc.

(16)  Oil and gas producing activities.

(i) Oil and gas producing activities include:

(A) The search for crude oil, including condensate and natural gas liquids, or natural gas (“oil and gas”) in their natural states and original locations;

(B) The acquisition of property rights or properties for the purpose of further exploration or for the purpose of removing the oil or gas from such properties;

(C) The construction, drilling, and production activities necessary to retrieve oil and gas from their natural reservoirs, including the acquisition, construction, installation, and maintenance of field gathering and storage systems, such as:

(1) Lifting the oil and gas to the surface; and

(2) Gathering, treating, and field processing (as in the case of processing gas to extract liquid hydrocarbons); and

(D) Extraction of saleable hydrocarbons, in the solid, liquid, or gaseous state, from oil sands, shale, coalbeds, or other nonrenewable natural resources which are intended to be upgraded into synthetic oil or gas, and activities undertaken with a view to such extraction.

Instruction 1 to paragraph (a)(16)(i):  The oil and gas production function shall be regarded as ending at a “terminal point”, which is the outlet valve on the lease or field storage tank. If unusual physical or operational circumstances exist, it may be appropriate to regard the terminal point for the production function as:

a. The first point at which oil, gas, or gas liquids, natural or synthetic, are delivered to a main pipeline, a common carrier, a refinery, or a marine terminal; and

b. In the case of natural resources that are intended to be upgraded into synthetic oil or gas, if those natural resources are delivered to a purchaser prior to upgrading, the first point at which the natural resources are delivered to a main pipeline, a common carrier, a refinery, a marine terminal, or a facility which upgrades such natural resources into synthetic oil or gas.

Instruction 2 to paragraph (a)(16)(i): For purposes of this paragraph (a)(16), the term saleable hydrocarbons means hydrocarbons that are saleable in the state in which the hydrocarbons are delivered.

(ii) Oil and gas producing activities do not include:

(A) Transporting, refining, or marketing oil and gas;

(B) Processing of produced oil, gas, or natural resources that can be upgraded into synthetic oil or gas by a registrant that does not have the legal right to produce or a revenue interest in such production;

(C) Activities relating to the production of natural resources other than oil, gas, or natural resources from which synthetic oil and gas can be extracted; or

(D) Production of geothermal steam.

(17) Possible reserves.  Possible reserves are those additional reserves that are less certain to be recovered than probable reserves.

(i) When deterministic methods are used, the total quantities ultimately recovered from a project have a low probability of exceeding proved plus probable plus possible reserves. When probabilistic methods are used, there should be at least a 10% probability that the total quantities ultimately recovered will equal or exceed the proved plus probable plus possible reserves estimates.

Definitions - Page 3 of 7

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

(ii) Possible reserves may be assigned to areas of a reservoir adjacent to probable reserves where data control and interpretations of available data are progressively less certain. Frequently, this will be in areas where geoscience and engineering data are unable to define clearly the area and vertical limits of commercial production from the reservoir by a defined project.

(iii) Possible reserves also include incremental quantities associated with a greater percentage recovery of the hydrocarbons in place than the recovery quantities assumed for probable reserves.

(iv) The proved plus probable and proved plus probable plus possible reserves estimates must be based on reasonable alternative technical and commercial interpretations within the reservoir or subject project that are clearly documented, including comparisons to results in successful similar projects.

(v) Possible reserves may be assigned where geoscience and engineering data identify directly adjacent portions of a reservoir within the same accumulation that may be separated from proved areas by faults with displacement less than formation thickness or other geological discontinuities and that have not been penetrated by a wellbore, and the registrant believes that such adjacent portions are in communication with the known (proved) reservoir. Possible reserves may be assigned to areas that are structurally higher or lower than the proved area if these areas are in communication with the proved reservoir.

(vi) Pursuant to paragraph (a)(22)(iii) of this section, where direct observation has defined a highest known oil (HKO) elevation and the potential exists for an associated gas cap, proved oil reserves should be assigned in the structurally higher portions of the reservoir above the HKO only if the higher contact can be established with reasonable certainty through reliable technology. Portions of the reservoir that do not meet this reasonable certainty criterion may be assigned as probable and possible oil or gas based on reservoir fluid properties and pressure gradient interpretations.

(18)  Probable reserves.    Probable reserves are those additional reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely as not to be recovered.

(i) When deterministic methods are used, it is as likely as not that actual remaining quantities recovered will exceed the sum of estimated proved plus probable reserves. When probabilistic methods are used, there should be at least a 50% probability that the actual quantities recovered will equal or exceed the proved plus probable reserves estimates.

(ii) Probable reserves may be assigned to areas of a reservoir adjacent to proved reserves where data control or interpretations of available data are less certain, even if the interpreted reservoir continuity of structure or productivity does not meet the reasonable certainty criterion. Probable reserves may be assigned to areas that are structurally higher than the proved area if these areas are in communication with the proved reservoir.

(iii) Probable reserves estimates also include potential incremental quantities associated with a greater percentage recovery of the hydrocarbons in place than assumed for proved reserves.

(iv) See also guidelines in paragraphs (a)(17)(iv) and (a)(17)(vi) of this section.

(19)  Probabilistic estimate.    The method of estimation of reserves or resources is called probabilistic when the full range of values that could reasonably occur for each unknown parameter (from the geoscience and engineering data) is used to generate a full range of possible outcomes and their associated probabilities of occurrence.

(20) Production costs.

(i) Costs incurred to operate and maintain wells and related equipment and facilities, including depreciation and applicable operating costs of support equipment and facilities and other costs of operating and maintaining those wells and related equipment and facilities. They become part of the cost of oil and gas produced. Examples of production costs (sometimes called lifting costs) are:

(A) Costs of labor to operate the wells and related equipment and facilities.

(B) Repairs and maintenance.

(C) Materials, supplies, and fuel consumed and supplies utilized in operating the wells and related equipment and facilities.

Definitions - Page 4 of 7

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

(D) Property taxes and insurance applicable to proved properties and wells and related equipment and facilities.

(E) Severance taxes.

(ii) Some support equipment or facilities may serve two or more oil and gas producing activities and may also serve transportation, refining, and marketing activities. To the extent that the support equipment and facilities are used in oil and gas producing activities, their depreciation and applicable operating costs become exploration, development or production costs, as appropriate. Depreciation, depletion, and amortization of capitalized acquisition, exploration, and development costs are not production costs but also become part of the cost of oil and gas produced along with production (lifting) costs identified above.

(21)  Proved area.    The part of a property to which proved reserves have been specifically attributed.

(22)  Proved oil and gas reserves.    Proved oil and gas reserves are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible—from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations—prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. The project to extract the hydrocarbons must have commenced or the operator must be reasonably certain that it will commence the project within a reasonable time.

(i) The area of the reservoir considered as proved includes:

(A) The area identified by drilling and limited by fluid contacts, if any, and

(B) Adjacent undrilled portions of the reservoir that can, with reasonable certainty, be judged to be continuous with it and to contain economically producible oil or gas on the basis of available geoscience and engineering data.

(ii) In the absence of data on fluid contacts, proved quantities in a reservoir are limited by the lowest known hydrocarbons (LKH) as seen in a well penetration unless geoscience, engineering, or performance data and reliable technology establishes a lower contact with reasonable certainty.

(iii) Where direct observation from well penetrations has defined a highest known oil (HKO) elevation and the potential exists for an associated gas cap, proved oil reserves may be assigned in the structurally higher portions of the reservoir only if geoscience, engineering, or performance data and reliable technology establish the higher contact with reasonable certainty.

(iv) Reserves which can be produced economically through application of improved recovery techniques (including, but not limited to, fluid injection) are included in the proved classification when:

(A) Successful testing by a pilot project in an area of the reservoir with properties no more favorable than in the reservoir as a whole, the operation of an installed program in the reservoir or an analogous reservoir, or other evidence using reliable technology establishes the reasonable certainty of the engineering analysis on which the project or program was based; and

(B) The project has been approved for development by all necessary parties and entities, including governmental entities.

(v) Existing economic conditions include prices and costs at which economic producibility from a reservoir is to be determined. The price shall be the average price during the 12-month period prior to the ending date of the period covered by the report, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions.

(23) Proved properties.  Properties with proved reserves.

(24)  Reasonable certainty.    If deterministic methods are used, reasonable certainty means a high degree of confidence that the quantities will be recovered. If probabilistic methods are used, there should be at least a 90%

Definitions - Page 5 of 7

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

probability that the quantities actually recovered will equal or exceed the estimate. A high degree of confidence exists if the quantity is much more likely to be achieved than not, and, as changes due to increased availability of geoscience (geological, geophysical, and geochemical), engineering, and economic data are made to estimated ultimate recovery (EUR) with time, reasonably certain EUR is much more likely to increase or remain constant than to decrease.

(25) Reliable technology.  Reliable technology is a grouping of one or more technologies (including computational methods) that has been field tested and has been demonstrated to provide reasonably certain results with consistency and repeatability in the formation being evaluated or in an analogous formation.

(26) Reserves.  Reserves are estimated remaining quantities of oil and gas and related substances anticipated to be economically producible, as of a given date, by application of development projects to known accumulations. In addition, there must exist, or there must be a reasonable expectation that there will exist, the legal right to produce or a revenue interest in the production, installed means of delivering oil and gas or related substances to market, and all permits and financing required to implement the project.

Note to paragraph (a)(26): Reserves should not be assigned to adjacent reservoirs isolated by major, potentially sealing, faults until those reservoirs are penetrated and evaluated as economically producible. Reserves should not be assigned to areas that are clearly separated from a known accumulation by a non-productive reservoir (i.e., absence of reservoir, structurally low reservoir, or negative test results). Such areas may contain prospective resources (i.e., potentially recoverable resources from undiscovered accumulations).

Excerpted from the FASB Accounting Standards Codification Topic 932, Extractive Activities—Oil and Gas:

932-235-50-30 A standardized measure of discounted future net cash flows relating to an entity’s interests in both of the following shall be disclosed as of the end of the year:

a. Proved oil and gas reserves (see paragraphs 932-235-50-3 through 50-11B)

b. Oil and gas subject to purchase under long-term supply, purchase, or similar agreements and contracts in which the entity participates in the operation of the properties on which the oil or gas is located or otherwise serves as the producer of those reserves (see paragraph 932-235-50-7).

The standardized measure of discounted future net cash flows relating to those two types of interests in reserves may be combined for reporting purposes.

932-235-50-31 All of the following information shall be disclosed in the aggregate and for each geographic area for which reserve quantities are disclosed in accordance with paragraphs 932-235-50-3 through 50-11B:

a. Future cash inflows. These shall be computed by applying prices used in estimating the entity’s proved oil and gas reserves to the year-end quantities of those reserves.  Future price changes shall be considered only to the extent provided by contractual arrangements in existence at year-end.

b. Future development and production costs.  These costs shall be computed by estimating the expenditures to be incurred in developing and producing the proved oil and gas reserves at the end of the year, based on year-end costs and assuming continuation of existing economic conditions. If estimated development expenditures are significant, they shall be presented separately from estimated production costs.

c. Future income tax expenses.  These expenses shall be computed by applying the appropriate year-end statutory tax rates, with consideration of future tax rates already legislated, to the future pretax net cash flows relating to the entity’s proved oil and gas reserves, less the tax basis of the properties involved. The future income tax expenses shall give effect to tax deductions and tax credits and allowances relating to the entity’s proved oil and gas reserves.

d. Future net cash flows.  These amounts are the result of subtracting future development and production costs and future income tax expenses from future cash inflows.

e. Discount.    This amount shall be derived from using a discount rate of 10 percent a year to reflect the timing of the future net cash flows relating to proved oil and gas reserves.

f.  Standardized measure of discounted future net cash flows. This amount is the future net cash flows less the computed discount.

(27) Reservoir.  A porous and permeable underground formation containing a natural accumulation of producible oil and/or gas that is confined by impermeable rock or water barriers and is individual and separate from other reservoirs.

Definitions - Page 6 of 7

DEFINITIONS OF OIL AND GAS RESERVES

Adapted from U.S. Securities and Exchange Commission Regulation S-X Section 210.4-10(a)

(28)  Resources.  Resources are quantities of oil and gas estimated to exist in naturally occurring accumulations. A portion of the resources may be estimated to be recoverable, and another portion may be considered to be unrecoverable. Resources include both discovered and undiscovered accumulations.

(29)  Service well.    A well drilled or completed for the purpose of supporting production in an existing field. Specific purposes of service wells include gas injection, water injection, steam injection, air injection, salt-water disposal, water supply for injection, observation, or injection for in-situ combustion.

(30)  Stratigraphic test well.    A stratigraphic test well is a drilling effort, geologically directed, to obtain information pertaining to a specific geologic condition. Such wells customarily are drilled without the intent of being completed for hydrocarbon production. The classification also includes tests identified as core tests and all types of expendable holes related to hydrocarbon exploration. Stratigraphic tests are classified as “exploratory type” if not drilled in a known area or “development type” if drilled in a known area.

(31)  Undeveloped oil and gas reserves.    Undeveloped oil and gas reserves are reserves of any category that are expected to be recovered from new wells on undrilled acreage, or from existing wells where a relatively major expenditure is required for recompletion.

(i) Reserves on undrilled acreage shall be limited to those directly offsetting development spacing areas that are reasonably certain of production when drilled, unless evidence using reliable technology exists that establishes reasonable certainty of economic producibility at greater distances.

(ii) Undrilled locations can be classified as having undeveloped reserves only if a development plan has been adopted indicating that they are scheduled to be drilled within five years, unless the specific circumstances, justify a longer time.

From the SEC’s Compliance and Disclosure Interpretations (October 26, 2009):

Although several types of projects — such as constructing offshore platforms and development in urban areas, remote locations or environmentally sensitive locations — by their nature customarily take a longer time to develop and therefore often do justify longer time periods, this determination must always take into consideration all of the facts and circumstances. No particular type of project per se justifies a longer time period, and any extension beyond five years should be the exception, and not the rule.

Factors that a company should consider in determining whether or not circumstances justify recognizing reserves even though development may extend past five years include, but are not limited to, the following:

•    The company’s level of ongoing significant development activities in the area to be developed (for example, drilling only the minimum number of wells necessary to maintain the lease generally would not constitute significant development activities);

•    The company’s historical record at completing development of comparable long-term projects;

•    The amount of time in which the company has maintained the leases, or booked the reserves, without significant development activities;

•    The extent to which the company has followed a previously adopted development plan (for example, if a company has changed its development plan several times without taking significant steps to implement any of those plans, recognizing proved undeveloped reserves typically would not be appropriate); and

•    The extent to which delays in development are caused by external factors related to the physical operating environment (for example, restrictions on development on Federal lands, but not obtaining government permits), rather than by internal factors (for example, shifting resources to develop properties with higher priority).

(iii)   Under no circumstances shall estimates for undeveloped reserves be attributable to any acreage for which an application of fluid injection or other improved recovery technique is contemplated, unless such techniques have been proved effective by actual projects in the same reservoir or an analogous reservoir, as defined in paragraph (a)(2) of this section, or by other evidence using reliable technology establishing reasonable certainty.

(32) Unproved properties.  Properties with no proved reserves.

Definitions - Page 7 of 7

XML

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

12 Months Ended

Dec. 31, 2013

Equity [Abstract]

Schedule of Changes In Accumulated Other Comprehensive Income Loss

Changes in accumulated other comprehensive income (loss) by component for the year ended December 31, 2013 were as follows:

	Cash Flow Hedges			Foreign Currency Items			Total
For the Year Ended December 31, 2013
Beginning balance, net of tax	$	28,833		$	—		$	28,833
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		(26,945	)		—			(26,945	)
Foreign currency translations		—			(667	)		(667	)
Income tax effect		9,701			—			9,701
Net of tax		(17,244	)		(667	)		(17,911	)
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		20,289			—			20,289
Income tax effect		(7,305	)		—			(7,305	)
Net of tax		12,984			—			12,984
Other comprehensive income (loss), net of tax		(30,228	)		(667	)		(30,895	)
Ending balance, net of tax		($1,395	)		($667	)		($2,062	)

In 2012 and 2011, the only component of accumulated other comprehensive income (loss) related to our cash flow hedges. Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2012 and 2011 were as follows:

	Cash Flow Hedges
For the Year Ended December 31, 2012
Beginning balance, net of tax	$	21,868
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		41,209
Income tax effect		(14,836	)
Net of tax		26,373
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		30,326
Income tax effect		(10,918	)
Net of tax		19,408
Other comprehensive income, net of tax		6,965
Ending balance, net of tax	$	28,833

	Cash Flow Hedges
For the Year Ended December 31, 2011
Beginning balance, net of tax		($14,204	)
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		43,089
Income tax effect		(15,512	)
Net of tax		27,577
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		(13,274	)
Income tax effect		4,779
Net of tax		(8,495	)
Other comprehensive income, net of tax		36,072
Ending balance, net of tax	$	21,868

XML

Financial Data Related to Oil and Gas Producing Activities (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Extractive Industries [Abstract]
Asset retirement costs included in development cost	$ 54,737	$ 95,293	$ 96,386

XML

Components of Accounts Receivable (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Receivables [Abstract]
Other co-venturers	$ 13,904	$ 16,735
Trade	134,622	130,448
Unbilled accounts receivable	22,001	20,053
Other	1,444	52
Total accounts receivable	$ 171,971	$ 167,288

XML

Reconciliation of Total Amounts of Unrecognized Tax Benefits (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013
Income Tax Disclosure [Abstract]
Total unrecognized tax benefits, beginning balance	$ 385
Tax positions taken during a prior period
Tax positions taken during the current period
Settlements with taxing authorities	(385)
Lapse of applicable statute of limitations
Total unrecognized tax benefits, ending balance

XML

Net Costs Incurred on Unevaluated Properties (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Extractive Industries [Abstract]
Acquisition costs evaluated during the year	$ 30,271	$ 9,739	$ (2,397)
Exploration costs evaluated during the year	188,830	(1,209)	(51,207)
Capitalized interest costs evaluated during the year	46,860	37,656	42,033
Total costs incurred during the year, net of divestitures	$ 265,961	$ 46,186	$ (11,571)

XML

Commitments and Contingencies - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 MBbls	Dec. 31, 2012	Dec. 31, 2011
Commitments And Contingencies Disclosure [Abstract]
Lease of facilities, maturity year	2018
Payments related to lease obligations	$ 597	$ 894	$ 446
Contingent liability to surety insurance company	81,878
Commitments to use drilling rigs and acquisition of seismic data, value	216,726
Commitments to use drilling rigs and acquisition of seismic data, period	4 years
Deposit to guarantee commitments	22,350
Minimum barrels of oil spill to impose financial responsibility under Oil Pollution Act	1,000
Minimum financial responsibility in amounts if oil spill exceeds minimum quantity of barrels of oil in specified state	10,000
Minimum financial responsibility in amounts if oil spill exceeds minimum quantity of barrels of oil Outer Continental	35,000
Maximum financial responsibility in amounts if oil spill exceeds minimum quantity of barrels of oil	150,000
Approximate asserted claims plus accrued interest assessed by Louisiana Department of Revenue	$ 13,000

XML

Calculation of Basic and Diluted Weighted Average Shares Outstanding and Earnings Per Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended									12 Months Ended
	Dec. 31, 2013		Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Basic:
Net income	$ 1,752	[1],[2]	$ 36,102	$ 39,022	$ 40,758	$ 44,246	$ 23,659	$ 30,547	$ 50,974	$ 117,634	$ 149,426	$ 194,332
Net income attributable to participating securities										(2,817)	(2,984)	(3,670)
Net income attributable to common stock-basic										114,817	146,422	190,662
Diluted:
Net income	1,752	[1],[2]	36,102	39,022	40,758	44,246	23,659	30,547	50,974	117,634	149,426	194,332
Net income attributable to participating securities										(2,815)	(2,982)	(3,667)
Net income attributable to common stock-diluted										$ 114,819	$ 146,444	$ 190,665
Weighted average shares (denominator):
Weighted average shares-basic										48,693	48,319	47,988
Dilutive effect of stock options										42	42	42
Weighted average shares-diluted										48,735	48,361	48,030
Basic earnings per share	$ 0.04		$ 0.72	$ 0.78	$ 0.82	$ 0.89	$ 0.48	$ 0.62	$ 1.04	$ 2.36	$ 3.03	$ 3.97
Diluted earnings per share	$ 0.04		$ 0.72	$ 0.78	$ 0.82	$ 0.89	$ 0.48	$ 0.62	$ 1.04	$ 2.36	$ 3.03	$ 3.97

[1] Includes franchise tax settlement of $12,590 before income tax effect ($8,058, net of income tax effect).

[2] Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

XML

INVESTMENT IN OIL AND GAS PROPERTIES - UNAUDITED (Tables)

12 Months Ended

Dec. 31, 2013

Net Costs Incurred on Unevaluated Properties

The following table discloses net costs incurred (evaluated) on our unevaluated properties located in the United States for the years indicated:

	Year Ended December 31,
	2013		2012			2011
Unevaluated oil and gas properties – United States:
Net costs incurred (evaluated) during year:
Acquisition costs	$	30,271	$	9,739			($2,397	)
Exploration costs		188,830		(1,209	)		(51,207	)
Capitalized interest		46,860		37,656			42,033
	$	265,961	$	46,186			($11,571	)

Oil and Gas Related Operating Costs Incurred During and Expensed

Costs incurred during the year (expensed):
Lease operating expenses	$	201,153	$	215,003	$	175,881
Transportation, processing and gathering expenses		42,172		21,782		8,958
Production taxes		15,029		10,015		9,380
Accretion expense		33,575		33,331		30,764
Expensed costs – United States	$	291,929	$	280,131	$	224,983

Financial Data Associated with Unevaluated Costs

The following table discloses financial data associated with unevaluated costs (United States and Canada) at December 31, 2013:

	Balance as of December 31, 2013		Net Costs Incurred During the Year Ended December 31,
			2013		2012		2011		2010 and prior
Acquisition costs	$	306,793	$	78,555	$	29,959	$	41,442	$	156,837
Exploration costs		305,422		248,846		56,033		499		44
Capitalized interest		112,124		39,846		32,755		20,501		19,022
Total unevaluated costs	$	724,339	$	367,247	$	118,747	$	62,442	$	175,903

United States [Member]

Financial Data Relative to Oil and Gas Producing Activities

The following table discloses certain financial data relative to our oil and gas producing activities located onshore and offshore in the continental United States:

	Year Ended December 31,
	2013			2012			2011
Oil and gas properties – United States, proved and unevaluated:
Balance, beginning of year	$	7,692,261		$	7,049,777		$	6,202,758
Costs incurred during the year (capitalized):
Acquisition costs, net of sales of unevaluated properties		70,903			102,807			270,354
Exploratory costs		297,113			81,458			84,199
Development costs (1)		378,242			395,555			426,355
Salaries, general and administrative costs		32,815			25,318			24,430
Interest		46,860			37,656			42,033
Less: overhead reimbursements		(321	)		(310	)		(352	)
Total costs incurred during the year, net of divestitures		825,612			642,484			847,019
Balance, end of year	$	8,517,873		$	7,692,261		$	7,049,777
Accumulated DD&A:
Balance, beginning of year	($	5,510,166	)	($	5,174,729	)	($	4,804,949	)
Provision for DD&A		(346,827	)		(341,096	)		(276,480	)
Sale of proved properties		(51,767	)		5,659			(93,300	)
Balance, end of year	($	5,908,760	)	($	5,510,166	)	($	5,174,729	)
Net capitalized costs – United States, proved and unevaluated	$	2,609,113		$	2,182,095		$	1,875,048
DD&A per Mcfe	$	3.43		$	3.69		$	3.45

(1) Includes capitalized asset retirement costs of $54,737, $95,293 and $96,386, respectively.

Canada [Member]

Financial Data Relative to Oil and Gas Producing Activities

The following table discloses certain financial data relative to our oil and gas producing activities located in Canada:

	Year Ended December 31,
	2013
Oil and gas properties – Canada, unevaluated:
Balance, beginning of year	$	—
Costs incurred during the year (capitalized):
Acquisition costs		8,764
Exploratory costs		1,819
Total costs incurred during the year		10,583
Balance, end of year, unevaluated	$	10,583

XML

Minimum Net Annual Commitments Under all Leases, Subleases and Contracts with Non-Cancelable Terms in Excess of 12 Months (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Operating Leases Future Minimum Payments Due [Abstract]
2014	$ 736
2015	637
2016	358
2017	301
2018	$ 147

XML

Schedule of Changes In Accumulated Other Comprehensive Income Loss (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	$ 28,833
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives	(26,945)
Foreign currency translations	(667)
Income tax effect	9,701
Net of tax	(17,911)
Amounts reclassified from accumulated other comprehensive income:
Net of tax	12,984
Other comprehensive income (loss), net of tax	(30,895)
Ending balance, net of tax	(2,062)
Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax	28,833	21,868	(14,204)
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives	(26,945)	41,209	43,089
Income tax effect	9,701	(14,836)	(15,512)
Net of tax	(17,244)	26,373	27,577
Amounts reclassified from accumulated other comprehensive income:
Net of tax	12,984	19,408	(8,495)
Other comprehensive income (loss), net of tax	(30,228)	6,965	36,072
Ending balance, net of tax	(1,395)	28,833	21,868
Foreign Currency Items [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning balance, net of tax
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives
Foreign currency translations	(667)
Income tax effect
Net of tax	(667)
Amounts reclassified from accumulated other comprehensive income:
Net of tax
Other comprehensive income (loss), net of tax	(667)
Ending balance, net of tax	(667)
Reclassification out of Accumulated Other Comprehensive Income [Member]
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production	20,289
Income tax effect	(7,305)
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash Flow Hedges [Member]
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production	20,289	30,326	(13,274)
Income tax effect	(7,305)	(10,918)	4,779
Reclassification out of Accumulated Other Comprehensive Income [Member] | Foreign Currency Items [Member]
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production
Income tax effect

XML

Condensed Consolidating Statement of Cash Flows (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Cash flows from operating activities:
Net income (loss)	$ 117,634	$ 149,426	$ 194,332
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization	350,574	344,365	280,020
Accretion expense	33,575	33,331	30,764
Deferred income tax provision (benefit)	79,629	69,575	129,520
Settlement of asset retirement obligations	(83,854)	(65,567)	(63,391)
Non-cash stock compensation expense	10,347	8,699	5,905
Excess tax benefits	(156)	(949)	(1,493)
Non-cash derivative expense (income)	2,239	(509)	(2,216)
Loss on early extinguishment of debt	27,279	1,972	607
Non-cash interest expense	16,219	13,085	1,908
Other non-cash income			(1,602)
Change in current income taxes	2,767	10,618	(19,451)
(Increase) decrease in accounts receivable	(4,683)	(55,871)	(19,600)
(Increase) decrease in other current assets	1,752	(2,836)	(66)
Decrease in inventory	583	436	1,619
Increase (decrease) in accounts payable	402	5,101	6,039
Decrease in other current liabilities	42,451	(10,426)	29,583
Other	(2,553)	9,299	(1,628)
Net cash provided by (used in) operating activities	594,205	509,749	570,850
Cash flows from investing activities:
Investment in oil and gas properties	(663,299)	(555,855)	(764,933)
Proceeds from sale of oil and gas properties, net of expenses	48,821	403	87,930
Sale of fixed assets		134
Investment in fixed and other assets	(6,816)	(13,370)	(2,247)
Change in restricted funds	(1,742)
Net cash used in investing activities	(623,036)	(568,688)	(679,250)
Cash flows from financing activities:
Proceeds from bank borrowings		25,000	75,000
Repayment of bank borrowings		(70,000)	(30,000)
Proceeds from issuance of senior convertible notes		300,000
Deferred financing costs of senior convertible notes		(8,855)
Proceeds from sold warrants		40,170
Payments for purchased call options		(70,830)
Proceeds from issuance of senior notes	489,250	300,000
Deferred financing costs	(9,065)	(11,966)	(4,017)
Redemption of senior subordinated notes		(200,681)
Redemption of senior notes	(396,014)
Excess tax benefits	156	949	1,493
Net payments for share-based compensation	(3,733)	(3,773)	(2,581)
Net cash provided by financing activities	80,594	300,014	39,895
Effect of exchange rate changes on cash	(65)
Net change in cash and cash equivalents	51,698	241,075	(68,505)
Cash and cash equivalents, beginning of period	279,526	38,451	106,956
Cash and cash equivalents, end of period	331,224	279,526	38,451
Parent [Member]
Cash flows from operating activities:
Net income (loss)	117,634	149,426	194,332
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization	93,579	63,022	17,860
Accretion expense	372	561	15
Deferred income tax provision (benefit)	(41,284)	(56,175)	(1,403)
Non-cash stock compensation expense	10,347	8,699	5,905
Excess tax benefits	(156)	(949)	(1,493)
Loss on early extinguishment of debt	27,279	1,972	607
Non-cash interest expense	16,219	13,085	1,908
Other non-cash income			(1,602)
Non-cash (income) loss from investment in subsidiaries	(214,983)	(223,555)	(230,861)
Change in current income taxes	2,767	10,618	(19,451)
Change in intercompany receivables/payables	186,903	275,819	217,287
(Increase) decrease in accounts receivable	(15,630)	(22,750)	(11,022)
(Increase) decrease in other current assets	1,752	(2,836)	(80)
Decrease in inventory	583	436	1,605
Increase (decrease) in accounts payable	(1,052)	5,348	2,658
Decrease in other current liabilities	40,543	(5,311)	23,440
Other	419	10,960	(1,628)
Net cash provided by (used in) operating activities	225,292	228,370	198,077
Cash flows from investing activities:
Investment in oil and gas properties	(273,474)	(324,542)	(309,026)
Proceeds from sale of oil and gas properties, net of expenses	6,300	403	5,575
Sale of fixed assets		134
Investment in fixed and other assets	(6,816)	(13,370)	(2,247)
Investment in subsidiaries	(14,000)
Net cash used in investing activities	(287,990)	(337,375)	(305,698)
Cash flows from financing activities:
Proceeds from bank borrowings		25,000	75,000
Repayment of bank borrowings		(70,000)	(30,000)
Proceeds from issuance of senior convertible notes		300,000
Deferred financing costs of senior convertible notes		(8,855)
Proceeds from sold warrants		40,170
Payments for purchased call options		(70,830)
Proceeds from issuance of senior notes	489,250	300,000
Deferred financing costs	(9,065)	(11,966)	(4,017)
Redemption of senior subordinated notes		(200,681)
Redemption of senior notes	(396,014)
Excess tax benefits	156	949	1,493
Net payments for share-based compensation	(3,733)	(3,773)	(2,581)
Net cash provided by financing activities	80,594	300,014	39,895
Net change in cash and cash equivalents	17,896	191,009	(67,726)
Cash and cash equivalents, beginning of period	228,398	37,389	105,115
Cash and cash equivalents, end of period	246,294	228,398	37,389
Guarantor Subsidiary [Member]
Cash flows from operating activities:
Net income (loss)	215,009	223,555	232,751
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization	256,995	281,152	261,326
Accretion expense	33,203	32,513	30,385
Deferred income tax provision (benefit)	120,913	125,750	130,923
Settlement of asset retirement obligations	(83,854)	(65,567)	(63,391)
Non-cash derivative expense (income)	2,239	(509)	(2,216)
Non-cash (income) loss from investment in subsidiaries		75	(1,063)
Change in intercompany receivables/payables	(186,947)	(275,125)	(217,724)
(Increase) decrease in accounts receivable	10,947	(33,345)	(7,688)
(Increase) decrease in other current assets			14
Decrease in inventory			14
Increase (decrease) in accounts payable	1,454	(208)	3,341
Decrease in other current liabilities	1,908	(5,115)	6,143
Other	(2,972)	(1,661)
Net cash provided by (used in) operating activities	368,895	281,515	372,815
Cash flows from investing activities:
Investment in oil and gas properties	(378,254)	(231,313)	(455,903)
Proceeds from sale of oil and gas properties, net of expenses	42,521		82,355
Net cash used in investing activities	(335,733)	(231,313)	(373,548)
Cash flows from financing activities:
Net change in cash and cash equivalents	33,162	50,202	(733)
Cash and cash equivalents, beginning of period	51,128	926	1,659
Cash and cash equivalents, end of period	84,290	51,128	926
Non-Guarantor Subsidiaries [Member]
Cash flows from operating activities:
Net income (loss)	(52)	(75)	(827)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		191	834
Accretion expense		257	364
Non-cash (income) loss from investment in subsidiaries	26
Change in intercompany receivables/payables	44	(694)	437
(Increase) decrease in accounts receivable		224	(890)
Increase (decrease) in accounts payable		(39)	40
Net cash provided by (used in) operating activities	18	(136)	(42)
Cash flows from investing activities:
Investment in oil and gas properties	(11,571)		(4)
Change in restricted funds	(1,742)
Investment in subsidiaries	(13,404)
Net cash used in investing activities	(26,717)		(4)
Cash flows from financing activities:
Equity proceeds from parent	27,404
Net cash provided by financing activities	27,404
Effect of exchange rate changes on cash	(65)
Net change in cash and cash equivalents	640	(136)	(46)
Cash and cash equivalents, beginning of period		136	182
Cash and cash equivalents, end of period	640		136
Consolidation, Eliminations [Member]
Cash flows from operating activities:
Net income (loss)	(214,957)	(223,480)	(231,924)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Non-cash (income) loss from investment in subsidiaries	214,957	223,480	231,924
Cash flows from investing activities:
Investment in subsidiaries	27,404
Net cash used in investing activities	27,404
Cash flows from financing activities:
Equity proceeds from parent	(27,404)
Net cash provided by financing activities	$ (27,404)

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Investment in Oil and Gas Properties - Unaudited - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 Project	Dec. 31, 2012	Dec. 31, 2011
Extractive Industries [Abstract]
Interest costs capitalized on unevaluated properties	$ 46,860	$ 37,656	$ 42,033
Specifically identified drilling projects	140
Projects expected to be evaluated	4 years

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Summary of Restricted Stock Activity under Plan (Detail) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Number of restricted shares
Restricted stock outstanding, beginning of period	1,108,874	923,740	783,606
Issuances	848,498	670,818	597,062
Lapse of restrictions	(534,041)	(462,141)	(419,543)
Forfeitures	(165,278)	(23,543)	(37,385)
Restricted stock outstanding, end of period	1,258,053	1,108,874	923,740
Weighted average fair value
Restricted stock outstanding, beginning of period	$ 27.56	$ 20.08	$ 17.24
Issuances	$ 20.61	$ 31.43	$ 23.62
Lapse of restrictions	$ 25.45	$ 18.29	$ 19.91
Forfeitures	$ 26.43	$ 26.10	$ 18.92
Restricted stock outstanding, end of period	$ 23.92	$ 27.56	$ 20.08

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Subsequent Events - Additional Information (Detail) (Subsequent Event [Member], USD $) In Thousands, unless otherwise specified	0 Months Ended
	Jan. 16, 2014 Cut Off and Clovelly Fields [Member]	Jan. 31, 2014 Hatch Point Field [Member]
Subsequent Event [Line Items]
Cash consideration received on sale of interest	$ 41,575	$ 9,720

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Oil Gas Reserve Information - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2013 MMcf	Dec. 31, 2012 MMcf	Dec. 31, 2011 MMcf
Reserve Quantities [Line Items]
Adoption of assumption due to revision of oil and gas reporting requirements	Using a historical 12-month average pricing assumption
Average 12-month oil prices net of differentials	102.21	101.20	100.97
Average 12-month gas prices net of differentials	3.66	2.68	4.74
Annual discount rate for discounting future cash flows	10.00%
Pyrenees project [Member]
Reserve Quantities [Line Items]
Acquisition of additional working interested in pyrenees project			15.00%
Purchase of producing properties			6
Pompano and Mica fields [Member]
Reserve Quantities [Line Items]
Purchase of producing properties			102
Appalachia drilling program [Member]
Reserve Quantities [Line Items]
Extensions, discoveries and other additions	117	162	94
Deep gas development project at LaCantera [Member]
Reserve Quantities [Line Items]
Extensions, discoveries and other additions		17	11
GOM drilling program at Mississippi Canyon Block 109 [Member]
Reserve Quantities [Line Items]
Extensions, discoveries and other additions			6
Sale of our non-operated interest in the Main Pass Block 296 and 311 fields [Member]
Reserve Quantities [Line Items]
Sale of reserves			13
Positive reserve report pricing changes [Member]
Reserve Quantities [Line Items]
Revisions of previous estimates	17.8
Well performance [Member]
Reserve Quantities [Line Items]
Revisions of previous estimates	54.5
Natural Gas Liquids (MBbls) [Member]
Reserve Quantities [Line Items]
Extensions, discoveries and other additions	4,395	4,856
Revisions of previous estimates	2,439	9,349	4,911
Purchase of producing properties		619
Average 12-month gas prices net of differentials	37.59	38.23	58.26

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Condensed Consolidating Balance Sheet (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013		Dec. 31, 2012		Dec. 31, 2011	Dec. 31, 2010
Current assets:
Cash and cash equivalents	$ 331,224		$ 279,526		$ 38,451	$ 106,956
Accounts receivable	171,971		167,288
Fair value of hedging contracts	4,549		39,655
Current income tax receivable	7,366		10,027
Deferred taxes	31,710	[1]	15,514	[1]
Inventory	3,723		4,207
Other current assets	1,874		3,626
Total current assets	552,417		519,843
Oil and gas properties, full cost method:
Proved	7,804,117		7,244,466
Less: accumulated DD&A	(5,908,760)		(5,510,166)
Net proved oil and gas properties	1,895,357		1,734,300
Unevaluated	724,339		447,795
Other property and equipment, net	26,178		22,115
Fair value of hedging contracts	1,378		9,199
Other assets, net	48,887		43,179
Total assets	3,248,556		2,776,431
Current liabilities:
Accounts payable to vendors	195,677		94,361
Undistributed oil and gas proceeds	37,029		23,414
Accrued interest	9,022		18,546
Fair value of hedging contracts	7,753		149
Asset retirement obligations	67,161		66,260
Other current liabilities	54,520		16,765
Total current liabilities	371,162		219,495
Long-term debt	1,027,084		914,126
Deferred taxes	390,693	[1]	310,830	[1]
Asset retirement obligations	435,352		422,042
Fair value of hedging contracts	470		1,530
Other long-term liabilities	53,509		36,275
Total liabilities	2,278,270		1,904,298
Commitments and contingencies
Stockholders' equity:
Common stock	488		484
Treasury stock	(860)		(860)
Additional paid-in capital	1,397,885		1,386,475
Accumulated deficit	(425,165)		(542,799)
Accumulated other comprehensive income	(2,062)		28,833
Total stockholders' equity	970,286		872,133		667,829	430,357
Total liabilities and stockholders' equity	3,248,556		2,776,431
Parent [Member]
Current assets:
Cash and cash equivalents	246,294		228,398		37,389	105,115
Accounts receivable	74,887		59,213
Current income tax receivable	7,366		10,027
Deferred taxes	8,659	[1]	5,947	[1]
Inventory	3,440		3,924
Other current assets	1,874		3,626
Total current assets	342,520		311,135
Oil and gas properties, full cost method:
Proved	1,309,527		1,004,808
Less: accumulated DD&A	(459,932)		(370,111)
Net proved oil and gas properties	849,595		634,697
Unevaluated	325,113		254,757
Other property and equipment, net	26,178		22,115
Other assets, net	45,410		41,679
Investment in subsidiary	747,472		736,331
Total assets	2,336,288		2,000,714
Current liabilities:
Accounts payable to vendors	173,147		74,503
Undistributed oil and gas proceeds	34,386		21,841
Accrued interest	9,022		18,546
Other current liabilities	53,682		16,765
Total current liabilities	270,237		131,655
Long-term debt	1,027,084		914,126
Deferred taxes	10,227	[1]	47,758	[1]
Asset retirement obligations	4,945		5,479
Other long-term liabilities	53,509		29,563
Total liabilities	1,366,002		1,128,581
Commitments and contingencies
Stockholders' equity:
Common stock	488		484
Treasury stock	(860)		(860)
Additional paid-in capital	1,397,885		1,386,475
Accumulated deficit	(425,165)		(542,799)
Accumulated other comprehensive income	(2,062)		28,833
Total stockholders' equity	970,286		872,133
Total liabilities and stockholders' equity	2,336,288		2,000,714
Guarantor Subsidiary [Member]
Current assets:
Cash and cash equivalents	84,290		51,128		926	1,659
Accounts receivable	97,128		108,075
Fair value of hedging contracts	4,549		39,655
Deferred taxes	23,051	[1]	9,567	[1]
Inventory	283		283
Total current assets	209,301		208,708
Oil and gas properties, full cost method:
Proved	6,494,590		6,239,658
Less: accumulated DD&A	(5,448,828)		(5,140,055)
Net proved oil and gas properties	1,045,762		1,099,603
Unevaluated	388,643		193,038
Fair value of hedging contracts	1,378		9,199
Other assets, net	1,349		1,500
Total assets	1,646,433		1,512,048
Current liabilities:
Accounts payable to vendors	22,530		19,858
Undistributed oil and gas proceeds	2,643		1,573
Fair value of hedging contracts	7,753		149
Asset retirement obligations	67,161		66,260
Other current liabilities	838
Total current liabilities	100,925		87,840
Deferred taxes	380,466	[1]	263,072	[1]
Asset retirement obligations	430,407		416,563
Fair value of hedging contracts	470		1,530
Other long-term liabilities			6,712
Total liabilities	912,268		775,717
Commitments and contingencies
Stockholders' equity:
Additional paid-in capital	1,309,563		1,496,510
Accumulated deficit	(574,003)		(789,012)
Accumulated other comprehensive income	(1,395)		28,833
Total stockholders' equity	734,165		736,331
Total liabilities and stockholders' equity	1,646,433		1,512,048
Non-Guarantor Subsidiaries [Member]
Current assets:
Cash and cash equivalents	640				136	182
Total current assets	640
Oil and gas properties, full cost method:
Unevaluated	10,583
Other assets, net	2,128
Investment in subsidiary	12,711
Total assets	26,062
Current liabilities:
Accounts payable to vendors	44
Total current liabilities	44
Total liabilities	44
Commitments and contingencies
Stockholders' equity:
Additional paid-in capital	27,403
Accumulated deficit	(52)
Accumulated other comprehensive income	(1,333)
Total stockholders' equity	26,018
Total liabilities and stockholders' equity	26,062
Consolidation, Eliminations [Member]
Current assets:
Accounts receivable	(44)
Total current assets	(44)
Oil and gas properties, full cost method:
Investment in subsidiary	(760,183)		(736,331)
Total assets	(760,227)		(736,331)
Current liabilities:
Accounts payable to vendors	(44)
Total current liabilities	(44)
Total liabilities	(44)
Commitments and contingencies
Stockholders' equity:
Additional paid-in capital	(1,336,966)		(1,496,510)
Accumulated deficit	574,055		789,012
Accumulated other comprehensive income	2,728		(28,833)
Total stockholders' equity	(760,183)		(736,331)
Total liabilities and stockholders' equity	$ (760,227)		$ (736,331)

[1] Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

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Share Repurchase Program - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Sep. 24, 2007
Text Block [Abstract]
Stock repurchase program authorized aggregate amount		$ 100,000
Stock repurchase program total cost	$ 7,071
Stock repurchase program average price	$ 23.57
Share repurchased under share repurchase program	300,000

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Long-Term Debt (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Debt Instrument [Line Items]
Long-term debt	$ 1,027,084	$ 914,126
8.625% Senior Notes due 2017 [Member]
Debt Instrument [Line Items]
Long-term debt		375,000
1.75% Senior Convertible Notes due 2017 [Member]
Debt Instrument [Line Items]
Long-term debt	252,084	239,126
7.5% Senior Notes due 2022 [Member]
Debt Instrument [Line Items]
Long-term debt	775,000	300,000
Bank debt [Member]
Debt Instrument [Line Items]
Long-term debt

XML

SUMMARIZED QUARTERLY FINANCIAL INFORMATION - UNAUDITED

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

SUMMARIZED QUARTERLY FINANCIAL INFORMATION - UNAUDITED

NOTE 18 — SUMMARIZED QUARTERLY FINANCIAL INFORMATION – UNAUDITED:

The results of operations by quarter are as follows:

	2013 Quarter Ended
	March 31		June 30		September 30		December 31
Operating revenue	$	233,732	$	245,877	$	256,685	$	239,253
Income from operations		72,828		69,525		62,422		37,206	(a)
Net income		40,758		39,022		36,102		1,752	(a) (b)
Basic earnings per share	$	0.82	$	0.78	$	0.72	$	0.04
Diluted earnings per share	$	0.82	$	0.78	$	0.72	$	0.04
	2012 Quarter Ended
	March 31		June 30		September 30		December 31
Operating revenue	$	244,957	$	226,561	$	227,397	$	254,871
Income from operations		84,927		56,156		44,485		78,397
Net income		50,974		30,547		23,659		44,246
Basic earnings per share	$	1.04	$	0.62	$	0.48	$	0.89
Diluted earnings per share	$	1.04	$	0.62	$	0.48	$	0.89

(a) Includes franchise tax settlement of $12,590 before income tax effect ($8,058 net of income tax effect).

(b) Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

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Concentrations - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013
Unusual Risk or Uncertainty [Line Items]
Maximum amount of credit risk exposure	$ 74,273
Gulf Coast Basin Conventional Shelf and deep gas Properties [Member]
Unusual Risk or Uncertainty [Line Items]
Production associated with properties	49.00%
Estimated proved reserves derived	16.00%
Deep Water Properties [Member]
Unusual Risk or Uncertainty [Line Items]
Production associated with properties	25.00%
Estimated proved reserves derived	29.00%
Appalachian Properties [Member]
Unusual Risk or Uncertainty [Line Items]
Production associated with properties	26.00%
Estimated proved reserves derived	55.00%

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OIL AND GAS RESERVE INFORMATION - UNAUDITED (Tables)

12 Months Ended

Dec. 31, 2013

Extractive Industries [Abstract]

Summary of Estimated Proved Oil and Natural Gas Reserve

Reserve volumes for the year ended December 31, 2010 have not been reclassified to conform to the current presentation given the immateriality of NGL volumes in such period.

	Oil (MBbls)			NGLs (MBbls)			Natural Gas (MMcf)			Oil, Natural Gas and NGLs (MMcfe)
Estimated proved reserves as of December 31, 2010		33,203			—			274,705			473,923
Revisions of previous estimates		2,889			4,911			(26,725	)		20,075
Extensions, discoveries and other additions		3,544			—			93,520			114,784
Purchase of producing properties		14,396			—			24,595			110,971
Sale of reserves		(1,950	)		—			(2,150	)		(13,850	)
Production		(6,427	)		(506	)		(38,466	)		(80,064	)
Estimated proved reserves as of December 31, 2011		45,655			4,405			325,479			625,839
Revisions of previous estimates		(1,559	)		9,349			(26,694	)		20,050
Extensions, discoveries and other additions		3,681			4,856			131,408			182,633
Purchase of producing properties		4,336			619			8,168			37,895
Sale of reserves		(60	)		—			(418	)		(775	)
Production		(7,135	)		(1,163	)		(42,569	)		(92,357	)
Estimated proved reserves as of December 31, 2012		44,918			18,066			395,374			773,285
Revisions of previous estimates		3,606			2,439			36,006			72,275
Extensions, discoveries and other additions		2,367			4,395			79,729			120,299
Sale of reserves		(170	)		—			(214	)		(1,235	)
Production		(6,894	)		(1,603	)		(50,129	)		(101,111	)
Estimated proved reserves as of December 31, 2013		43,827			23,297			460,766			863,513
Estimated proved developed reserves:
as of December 31, 2011		30,914			3,195			171,871			376,528
as of December 31, 2012		29,005			8,593			210,956			436,540
as of December 31, 2013		27,920			11,569			246,946			483,885

Summary of Standardized Measure of Discounted Future Net Cash Flows

	Standardized Measure Year Ended December 31,
	2013			2012			2011
Future cash inflows	$	7,040,928		$	6,295,455		$	6,171,279
Future production costs		(2,062,657	)		(1,946,426	)		(1,747,806	)
Future development costs		(1,431,101	)		(1,241,531	)		(1,219,214	)
Future income taxes		(884,637	)		(799,007	)		(852,364	)
Future net cash flows		2,662,533			2,308,491			2,351,895
10% annual discount		(977,531	)		(794,632	)		(808,933	)
Standardized measure of discounted future net cash flows	$	1,685,002		$	1,513,859		$	1,542,962
	Changes in Standardized Measure Year Ended December 31,
	2013			2012			2011
Standardized measure at beginning of year	$	1,513,859		$	1,542,962		$	957,629
Sales and transfers of oil, gas and NGLs produced, net of production costs		(708,017	)		(697,741	)		(670,347	)
Changes in price, net of future production costs		229,425			(380,841	)		502,324
Extensions and discoveries, net of future production and development costs		155,592			178,272			293,168
Changes in estimated future development costs, net of development costs incurred during the period		28,684			212,329			97,852
Revisions of quantity estimates		281,558			76,450			(27,854	)
Accretion of discount		202,087			207,292			118,722
Net change in income taxes		(28,084	)		22,947			(300,363	)
Purchases of reserves in-place		—			276,389			567,286
Sales of reserves in-place		15,531			2,480			(36,278	)
Changes in production rates due to timing and other		(5,633	)		73,320			40,823
Net increase (decrease) in standardized measure		171,143			(29,103	)		585,333
Standardized measure at end of year	$	1,685,002		$	1,513,859		$	1,542,962

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Summary of Stock Option Activity under Plan (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Options outstanding
Options outstanding, beginning of period	411,794	438,394	484,694
Granted
Exercised
Forfeited	(15,250)	(4,200)	(13,300)
Expired	(65,370)	(22,400)	(33,000)
Options outstanding, end of period	331,174	411,794	438,394
Options exercisable, end of period	318,279	378,004	378,710
Options unvested, end of period	12,895	33,790	59,684
Options outstanding, weighted Average Exercise Price
Options outstanding, beginning of period	$ 39.04	$ 38.76	$ 39.43
Granted
Exercised
Forfeited	$ 42.45	$ 35.54	$ 37.98
Expired	$ 36.56	$ 34.25	$ 48.85
Options outstanding, end of period	$ 39.37	$ 39.04	$ 38.76
Options exercisable, end of period	$ 40.62	$ 41.00	$ 41.66
Options unvested, end of period	$ 8.64	$ 17.17	$ 20.36
Options outstanding
Options outstanding, end of period	2 years 2 months 12 days	2 years 9 months 18 days	3 years 7 months 6 days
Options exercisable, end of period	2 years 1 month 6 days	2 years 6 months	3 years 1 month 6 days
Options unvested, end of period	5 years	5 years 4 months 24 days	6 years 1 month 6 days
Options outstanding, end of period, aggregate intrinsic value
Options outstanding, end of period	$ 1,708	$ 766	$ 1,143
Options exercisable, end of period	1,373	459	457
Options unvested, end of period	$ 335	$ 307	$ 686

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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

Analysis of Deferred Taxes

An analysis of our deferred taxes follows:

	As of December 31,
	2013			2012
Tax effect of temporary differences:
Net operating loss carryforwards	$	24,437		$	—
Oil and gas properties – full cost		(576,393	)		(465,862	)
Asset retirement obligations		180,905			175,788
Stock compensation		5,537			5,588
Hedges		826			(16,983	)
Accrued incentive compensation		9,189			4,762
Other		(3,484	)		1,391
		($358,983	)		($295,316	)

Reconciliation Between Statutory Federal Income Tax Rate and Effective Income Tax Rate as a Percentage of Income Before Income Taxes

A reconciliation between the statutory federal income tax rate and our effective income tax rate as a percentage of income before income taxes follows:

	Year Ended December 31,
	2013			2012			2011
Income tax expense computed at the statutory federal income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.0			1.0			1.0
IRC Sec. 162(m) limitation		0.8			0.6			0.3
Other		0.1			(0.5	)		(0.3	)
Effective income tax rate		36.9	%		36.1	%		36.0	%

Reconciliation Total Amount of Unrecognized Tax Benefits

A reconciliation of the total amounts of unrecognized tax benefits follows:

Total unrecognized tax benefits as of December 31, 2012	$	385
Increases (decreases) in unrecognized tax benefits as a result of:		—
Tax positions taken during a prior period		—
Tax positions taken during the current period		—
Settlements with taxing authorities		(385	)
Lapse of applicable statute of limitations		—
Total unrecognized tax benefits as of December 31, 2013	$	—

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Allocation of Recorded Value of Net Assets Acquired in Transaction (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Jun. 18, 2012
Business Combinations [Abstract]
Proved oil and gas properties	$ 39,221
Unevaluated oil and gas properties	1,637
Asset retirement obligations	(14,460)
Total fair value of net assets	$ 26,398	$ 26,398

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Analysis of Deferred Taxes (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Tax effect of temporary differences:
Net operating loss carryforwards	$ 24,437
Oil and gas properties - full cost	(576,393)	(465,862)
Asset retirement obligations	180,905	175,788
Stock compensation	5,537	5,588
Hedges	826	(16,983)
Accrued incentive compensation	9,189	4,762
Other	3,484	1,391
Deferred Tax Assets, Net, Total	$ (358,983)	$ (295,316)

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Before Tax Effect of Derivative Instruments in Statement of Operations (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Derivative Instruments And Hedging Activities Disclosure [Abstract]
Decrease/increase in oil revenue owing to effective hedging contracts	$ 3,520	$ 8,546	$ 32,706
Decrease/increase in gas revenue owing to effective hedging contracts	$ 16,769	$ 21,780	$ 19,432

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Earnings Per Share - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Earnings Per Share [Abstract]
Antidilutive stock options outstanding	242,000	347,000	374,000
Shares of common stock issued upon vesting of restricted stock	358,000	316,000	312,000

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EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

EARNINGS PER SHARE

NOTE 2 — EARNINGS PER SHARE:

The following table sets forth the calculation of basic and diluted weighted average shares outstanding and earnings per share for the indicated periods:

	Year Ended December 31,
	2013			2012			2011
Income (numerator):
Basic:
Net income	$	117,634		$	149,426		$	194,332
Net income attributable to participating securities		(2,817	)		(2,984	)		(3,670	)
Net income attributable to common stock—basic	$	114,817		$	146,422		$	190,662
Diluted:
Net income	$	117,634		$	149,426		$	194,332
Net income attributable to participating securities		(2,815	)		(2,982	)		(3,667	)
Net income attributable to common stock—diluted	$	114,819		$	146,444		$	190,665
Weighted average shares (denominator):
Weighted average shares—basic		48,693			48,319			47,988
Dilutive effect of stock options		42			42			42
Weighted average shares—diluted		48,735			48,361			48,030
Basic earnings per share	$	2.36		$	3.03		$	3.97
Diluted earnings per share	$	2.36		$	3.03		$	3.97

Stock options that were considered antidilutive because the exercise price of the options exceeded the average price of our common stock for the applicable period totaled approximately 242,000, 347,000 and 374,000 shares during the years ended December 31, 2013, 2012 and 2011, respectively.

During the years ended December 31, 2013, 2012 and 2011, approximately 358,000, 316,000 and 312,000 shares of our common stock, respectively, were issued from authorized shares upon the vesting (lapse of forfeiture restrictions) of restricted stock by employees and nonemployee directors.

Because it is management’s stated intention to redeem the principal amount of our 2017 Convertible Notes (see Note 11 – Long-Term Debt) in cash, we have used the treasury method for determining potential dilution in the diluted earnings per share computation. Since the average price of our common stock was less than the effective conversion price for such notes during the years ended December 31, 2013 and 2012, the 2017 Convertible Notes were not dilutive for such periods. Additionally, since the average price of our common stock was less than the strike price of the Sold Warrants (as defined in Note 11 – Long-Term Debt) for the years ended December 31, 2013 and 2012, such warrants were also not dilutive for such periods.

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Impact of Rights of Offset Associated with Recognized Assets and Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013
Current Asset [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Assets	$ 4,549
Long-term assets [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Assets	1,378
Current liabilities [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Liabilities	(7,753)
Long-term liabilities [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Liabilities	(470)
Effects of Netting [Member] | Current Asset [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Assets	(4,043)
Effects of Netting [Member] | Long-term assets [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Assets	(274)
Effects of Netting [Member] | Current liabilities [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Liabilities	4,043
Effects of Netting [Member] | Long-term liabilities [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Liabilities	274
With Effects of Netting [Member] | Current Asset [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Assets	506
With Effects of Netting [Member] | Long-term assets [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Assets	1,104
With Effects of Netting [Member] | Current liabilities [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Liabilities	(3,710)
With Effects of Netting [Member] | Long-term liabilities [Member]
Derivative Instruments And Hedging Activities [Line Items]
Fair Value of Derivative Instruments, Liabilities	$ (196)

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SUMMARIZED QUARTERLY FINANCIAL INFORMATION - UNAUDITED (Tables)

12 Months Ended

Dec. 31, 2013

Quarterly Financial Information Disclosure [Abstract]

Results of Operations by Quarter

The results of operations by quarter are as follows:

	2013 Quarter Ended
	March 31		June 30		September 30		December 31
Operating revenue	$	233,732	$	245,877	$	256,685	$	239,253
Income from operations		72,828		69,525		62,422		37,206	(a)
Net income		40,758		39,022		36,102		1,752	(a) (b)
Basic earnings per share	$	0.82	$	0.78	$	0.72	$	0.04
Diluted earnings per share	$	0.82	$	0.78	$	0.72	$	0.04
	2012 Quarter Ended
	March 31		June 30		September 30		December 31
Operating revenue	$	244,957	$	226,561	$	227,397	$	254,871
Income from operations		84,927		56,156		44,485		78,397
Net income		50,974		30,547		23,659		44,246
Basic earnings per share	$	1.04	$	0.62	$	0.48	$	0.89
Diluted earnings per share	$	1.04	$	0.62	$	0.48	$	0.89

(a) Includes franchise tax settlement of $12,590 before income tax effect ($8,058 net of income tax effect).

(b) Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

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EARNINGS PER SHARE (Tables)

12 Months Ended

Dec. 31, 2013

Earnings Per Share [Abstract]

Calculation of Basic and Diluted Weighted Average Shares Outstanding Earnings Per Share

The following table sets forth the calculation of basic and diluted weighted average shares outstanding and earnings per share for the indicated periods:

	Year Ended December 31,
	2013			2012			2011
Income (numerator):
Basic:
Net income	$	117,634		$	149,426		$	194,332
Net income attributable to participating securities		(2,817	)		(2,984	)		(3,670	)
Net income attributable to common stock—basic	$	114,817		$	146,422		$	190,662
Diluted:
Net income	$	117,634		$	149,426		$	194,332
Net income attributable to participating securities		(2,815	)		(2,982	)		(3,667	)
Net income attributable to common stock—diluted	$	114,819		$	146,444		$	190,665
Weighted average shares (denominator):
Weighted average shares—basic		48,693			48,319			47,988
Dilutive effect of stock options		42			42			42
Weighted average shares—diluted		48,735			48,361			48,030
Basic earnings per share	$	2.36		$	3.03		$	3.97
Diluted earnings per share	$	2.36		$	3.03		$	3.97

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ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation:

The financial statements include our accounts and the accounts of our wholly owned subsidiaries, Stone Energy Offshore, L.L.C. (“Stone Offshore”), Stone Energy Holding, L.L.C., Stone Energy Canada, U.L.C. and Caillou Boca Gathering, LLC (“Caillou Boca”). On September 6, 2012, Caillou Boca was merged into Stone Offshore. All intercompany balances have been eliminated.

Use of Estimates

Use of Estimates:

The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates are used primarily when accounting for depreciation, depletion and amortization (“DD&A”) expense, unevaluated property costs, estimated future net cash flows from proved reserves, costs to abandon oil and gas properties, taxes, accruals of capitalized costs, operating costs and production revenue, capitalized general and administrative costs and interest, insurance recoveries, effectiveness and estimated fair value of derivative positions, the purchase price allocation on properties acquired, estimates of fair value in business combinations and contingencies.

Fair Value Measurements

Fair Value Measurements:

U.S. GAAP establishes a framework for measuring fair value and requires certain disclosures about fair value measurements. As of December 31, 2013 and 2012, we held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. Additionally, fair value concepts were applied in recording the acquisition of various deep water assets in June 2012 and the acquisition of an office building in December 2012.

Hybrid Debt Instruments

Hybrid Debt Instruments:

In 2012, we issued $300,000 in aggregate principal amount of 1 ³⁄₄% Senior Convertible Notes due 2017 (the “2017 Convertible Notes”). See Note 11 – Long-Term Debt. On that same day we entered into convertible note hedging transactions which are expected to reduce the potential dilution to our common stock upon conversion of the notes. In accordance with Accounting Standards Codification (“ASC”) 480-20 and ASC 470, we accounted for the debt and equity portions of the notes in a manner that will reflect our nonconvertible borrowing rate when interest is recognized in subsequent periods. This results in the separation of the debt component, classification of the remaining component in stockholders’ equity, and accretion of the resulting discount as part of interest expense. Additionally, the hedging transactions meet the criteria for classification as equity transactions and were recorded as such.

ASC 260 provides that for contracts that may be settled in common stock or in cash at the election of the entity or the holder, the determination of whether the contract shall be reflected in the computation of diluted earnings per share should be made based on the facts available each period. It is presumed that the contract will be settled in common stock and therefore potential dilution be determined using the if-converted method. However, this presumption may be overcome if past experience or a stated policy provides a reasonable basis to believe that the contract will be settled partially or wholly in cash. Because it is management’s stated intent to redeem the principal amount of the notes in cash, we have used the treasury stock method for determining potential dilution of the notes in our diluted earnings per share computation in accordance with ASC 260.

Business Combinations

Business Combinations:

Our acquisition in 2012 of various deep water assets was accounted for according to the guidance provided in ASC 805, Business Combinations, which requires application of the acquisition method. This methodology requires the recordation of net assets acquired and consideration transferred at fair value. Differences between the net fair value of net assets acquired and consideration transferred are recorded as goodwill or a bargain purchase gain.

Cash and Cash Equivalents

Cash and Cash Equivalents:

We consider all money market funds and highly liquid investments in overnight securities through our commercial bank accounts, which result in available funds on the next business day, to be cash and cash equivalents.

Oil and Gas Properties

Oil and Gas Properties:

We follow the full cost method of accounting for oil and gas properties. Under this method, all acquisition, exploration, development and estimated abandonment costs, including certain related employee and general and administrative costs (less any reimbursements for such costs) and interest incurred for the purpose of finding oil and gas are capitalized. Such amounts include the cost of drilling and equipping productive wells, dry hole costs, lease acquisition costs, delay rentals and other costs related to such activities. Employee, general and administrative costs that are capitalized include salaries and all related fringe benefits paid to employees directly engaged in the acquisition, exploration and development of oil and gas properties, as well as all other directly identifiable general and administrative costs associated with such activities, such as rentals, utilities and insurance. We capitalize a portion of the interest costs incurred on our debt based upon the balance of our unevaluated property costs and our weighted-average borrowing rate. Employee, general and administrative costs associated with production operations and general corporate activities are expensed in the period incurred. Additionally, workover and maintenance costs incurred solely to maintain or increase levels of production from an existing completion interval are charged to lease operating expense in the period incurred.

U.S. GAAP allows the option of two acceptable methods for accounting for oil and gas properties. The successful efforts method is the allowable alternative to the full cost method. The primary differences between the two methods are in the treatment of exploration costs and in the computation of DD&A expense. Under the full cost method, all exploratory costs are capitalized while under the successful efforts method exploratory costs associated with unsuccessful exploratory wells and all geological and geophysical costs are expensed. Under the full cost method, DD&A expense is computed on cost centers represented by entire countries while under the successful efforts method cost centers are represented by properties, or some reasonable aggregation of properties with common geological structural features or stratigraphic condition, such as fields or reservoirs.

We amortize our investment in oil and gas properties through DD&A expense using the units of production (the “UOP”) method. Under the UOP method, the quarterly provision for DD&A expense is computed by dividing production volumes for the period by the total proved reserves as of the beginning of the period (beginning of the period reserves being determined by adding back production to end of the period reserves), and applying the respective rate to the net cost of proved oil and gas properties, including future development costs.

Under the full cost method, we compare, at the end of each financial reporting period, the present value of estimated future net cash flows from proved reserves (excluding cash flows related to estimated abandonment costs), to the net capitalized costs of proved oil and gas properties net of related deferred taxes. We refer to this comparison as a “ceiling test.” If the net capitalized costs of proved oil and gas properties exceed the estimated discounted future net cash flows from proved reserves, we are required to write-down the value of our oil and gas properties to the value of the discounted cash flows.

Sales of oil and gas properties are accounted for as adjustments to the net full cost pool with no gain or loss recognized, unless the adjustment would significantly alter the relationship between capitalized costs and proved reserves.

Asset Retirement Obligations

Asset Retirement Obligations:

U.S. GAAP requires us to record our estimate of the fair value of liabilities related to future asset retirement obligations in the period the obligation is incurred. Asset retirement obligations relate to the removal of facilities and tangible equipment at the end of an oil and gas property’s useful life. The application of this rule requires the use of management’s estimates with respect to future abandonment costs, inflation, market risk premiums, useful life and cost of capital. U.S. GAAP requires that our estimate of our asset retirement obligations does not give consideration to the value the related assets could have to other parties.

Other Property and Equipment

Other Property and Equipment:

Our office buildings in Lafayette, Louisiana are being depreciated on the straight-line method over their estimated useful life of 39 years.

Inventory

Inventory:

We maintain an inventory of tubular goods. Items remain in inventory until dedicated to specific projects, at which time they are transferred to oil and gas properties. Items are carried at the lower of cost or market based on the specific identification method.

Earnings Per Common Share

Earnings Per Common Share:

Under U.S. GAAP, certain instruments granted in share-based payment transactions are participating securities prior to vesting and are therefore required to be included in the earnings allocation in calculating earnings per share under the two-class method. Companies are required to treat unvested share-based payment awards with a right to receive non-forfeitable dividends as a separate class of securities in calculating earnings per share.

Production Revenue

Production Revenue:

We recognize production revenue under the entitlement method of accounting. Under this method, revenue is deferred for deliveries in excess of our net revenue interest, while revenue is accrued for undelivered volumes. Production imbalances are generally recorded at the estimated sales price in effect at the time of production.

Income Taxes

Income Taxes:

Provisions for income taxes include deferred taxes resulting primarily from temporary differences due to different reporting methods for oil and gas properties for financial reporting purposes and income tax purposes. For financial reporting purposes, all exploratory and development expenditures, including future abandonment costs, related to evaluated projects are capitalized and depreciated, depleted and amortized on the UOP method. For income tax purposes, only the equipment and leasehold costs relative to successful wells are capitalized and recovered through depreciation or depletion, although for 2011, 2012 and 2013, special provisions allowed for current deductions for the cost of certain equipment. Generally, most other exploratory and development costs are charged to expense as incurred; however, we follow certain provisions of the Internal Revenue Code that allow capitalization of intangible drilling costs where management deems appropriate. Other financial and income tax reporting differences occur as a result of statutory depletion, different reporting methods for sales of oil and gas reserves in place, different reporting methods used in the capitalization of employee, general and administrative and interest expense, and different reporting methods for employee compensation.

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities:

The nature of a derivative instrument must be evaluated to determine if it qualifies for hedge accounting treatment. Instruments that qualify for cash flow hedge accounting treatment with contemporaneous documentation are recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Additionally, monthly settlements of effective hedges are reflected in revenue from oil and gas production and cash flows from operations. Instruments not qualifying for hedge accounting treatment are recorded in our balance sheet at fair value, and changes in fair value are recognized in earnings through derivative expense (income).

Share-Based Compensation

Share-Based Compensation:

We record share-based compensation based on the grant date fair value of issued stock options and restricted stock over the vesting period of the instrument. We utilize the Black-Scholes option pricing model to measure the fair value of stock options. The fair value of restricted shares is typically determined based on the average of our high and low stock prices on the grant date.

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Financial Data Associated with Unevaluated Costs (Detail) (Unevaluated Costs [Member], USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2010
Unevaluated Costs [Member]
Capitalized Costs of Unproved Properties Excluded from Amortization [Line Items]
Acquisition costs	$ 306,793
Exploration costs	305,422
Capitalized interest	112,124
Total unevaluated costs	724,339
Acquisition costs	78,555	29,959	41,442	156,837
Exploration costs	248,846	56,033	499	44
Capitalized interest	39,846	32,755	20,501	19,022
Total unevaluated costs	$ 367,247	$ 118,747	$ 62,442	$ 175,903

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GUARANTOR FINANCIAL STATEMENTS (Tables)

12 Months Ended

Dec. 31, 2013

Text Block [Abstract]

Condensed Consolidating Balance Sheet

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	246,294		$	84,290		$	640		$	—		$	331,224
Accounts receivable		74,887			97,128			—			(44	)		171,971
Fair value of hedging contracts		—			4,549			—			—			4,549
Current income tax receivable		7,366			—			—			—			7,366
Deferred taxes *		8,659			23,051			—			—			31,710
Inventory		3,440			283			—			—			3,723
Other current assets		1,874			—			—			—			1,874
Total current assets		342,520			209,301			640			(44	)		552,417
Oil and gas properties, full cost method:
Proved		1,309,527			6,494,590			—			—			7,804,117
Less: accumulated DD&A		(459,932	)		(5,448,828	)		—			—			(5,908,760	)
Net proved oil and gas properties		849,595			1,045,762			—			—			1,895,357
Unevaluated		325,113			388,643			10,583			—			724,339
Other property and equipment, net		26,178			—			—			—			26,178
Fair value of hedging contracts		—			1,378			—			—			1,378
Other assets, net		45,410			1,349			2,128			—			48,887
Investment in subsidiary		747,472			—			12,711			(760,183	)		—
Total assets	$	2,336,288		$	1,646,433		$	26,062			($760,227	)	$	3,248,556
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	173,147		$	22,530		$	44			($44	)	$	195,677
Undistributed oil and gas proceeds		34,386			2,643			—			—			37,029
Accrued interest		9,022			—			—			—			9,022
Fair value of hedging contracts		—			7,753			—			—			7,753
Asset retirement obligations		—			67,161			—			—			67,161
Other current liabilities		53,682			838			—			—			54,520
Total current liabilities		270,237			100,925			44			(44	)		371,162
Long-term debt		1,027,084			—			—			—			1,027,084
Deferred taxes *		10,227			380,466			—			—			390,693
Asset retirement obligations		4,945			430,407			—			—			435,352
Fair value of hedging contracts		—			470			—			—			470
Other long-term liabilities		53,509			—			—			—			53,509
Total liabilities		1,366,002			912,268			44			(44	)		2,278,270
Commitments and contingencies Stockholders’ equity:
Common stock		488			—			—			—			488
Treasury stock		(860	)		—			—			—			(860	)
Additional paid-in capital		1,397,885			1,309,563			27,403			(1,336,966	)		1,397,885
Accumulated deficit		(425,165	)		(574,003	)		(52	)		574,055			(425,165	)
Accumulated other comprehensive loss		(2,062	)		(1,395	)		(1,333	)		2,728			(2,062	)
Total stockholders’ equity		970,286			734,165			26,018			(760,183	)		970,286
Total liabilities and stockholders’ equity	$	2,336,288		$	1,646,433		$	26,062			($760,227	)	$	3,248,556

* Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	228,398		$	51,128		$	—	$	—		$	279,526
Accounts receivable		59,213			108,075			—		—			167,288
Fair value of hedging contracts		—			39,655			—		—			39,655
Current income tax receivable		10,027			—			—		—			10,027
Deferred taxes *		5,947			9,567			—		—			15,514
Inventory		3,924			283			—		—			4,207
Other current assets		3,626			—			—		—			3,626
Total current assets		311,135			208,708			—		—			519,843
Oil and gas properties, full cost method:
Proved		1,004,808			6,239,658			—		—			7,244,466
Less: accumulated DD&A		(370,111	)		(5,140,055	)		—		—			(5,510,166	)
Net proved oil and gas properties		634,697			1,099,603			—		—			1,734,300
Unevaluated		254,757			193,038			—		—			447,795
Other property and equipment, net		22,115			—			—		—			22,115
Fair value of hedging contracts		—			9,199			—		—			9,199
Other assets, net		41,679			1,500			—		—			43,179
Investment in subsidiary		736,331			—			—		(736,331	)		—
Total assets	$	2,000,714		$	1,512,048		$	—		($736,331	)	$	2,776,431
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	74,503		$	19,858		$	—	$	—		$	94,361
Undistributed oil and gas proceeds		21,841			1,573			—		—			23,414
Accrued interest		18,546			—			—		—			18,546
Fair value of hedging contracts		—			149			—		—			149
Asset retirement obligations		—			66,260			—		—			66,260
Other current liabilities		16,765			—			—		—			16,765
Total current liabilities		131,655			87,840			—		—			219,495
Long-term debt		914,126			—			—		—			914,126
Deferred taxes *		47,758			263,072			—		—			310,830
Asset retirement obligations		5,479			416,563			—		—			422,042
Fair value of hedging contracts		—			1,530			—		—			1,530
Other long-term liabilities		29,563			6,712			—		—			36,275
Total liabilities		1,128,581			775,717			—		—			1,904,298
Commitments and contingencies Stockholders’ equity:
Common stock		484			—			—		—			484
Treasury stock		(860	)		—			—		—			(860	)
Additional paid-in capital		1,386,475			1,496,510			—		(1,496,510	)		1,386,475
Accumulated deficit		(542,799	)		(789,012	)		—		789,012			(542,799	)
Accumulated other comprehensive income		28,833			28,833			—		(28,833	)		28,833
Total stockholders’ equity		872,133			736,331			—		(736,331	)		872,133
Total liabilities and stockholders’ equity	$	2,000,714		$	1,512,048		$	—		($736,331	)	$	2,776,431

* Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

Condensed Consolidating Statement of Income

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	30,475		$	684,629		$	—		$	—		$	715,104
Gas production		68,895			121,685			—			—			190,580
Natural gas liquids production		32,293			28,394			—			—			60,687
Other operational income		7,163			645			—			—			7,808
Total operating revenue		138,826			835,353			—			—			974,179
Operating expenses:
Lease operating expenses		14,680			186,473			—			—			201,153
Transportation, processing, and gathering expenses		28,322			13,850			—			—			42,172
Production taxes		6,229			8,800			—			—			15,029
Depreciation, depletion, amortization		93,579			256,995			—			—			350,574
Accretion expense		372			33,203			—			—			33,575
Salaries, general and administrative		59,473			5			46			—			59,524
Franchise tax settlement		12,590			—			—			—			12,590
Incentive compensation expense		15,340			—			—			—			15,340
Other operational expenses		38			113			—			—			151
Derivative expense, net		—			2,090			—			—			2,090
Total operating expenses		230,623			501,529			46			—			732,198
Income (loss) from operations		(91,797	)		333,824			(46	)		—			241,981
Other (income) expenses:
Interest expense		32,816			21			—			—			32,837
Interest income		(1,480	)		(195	)		(20	)		—			(1,695	)
Other income		(875	)		(1,924	)		—			—			(2,799	)
Loss on early extinguishment of debt		27,279			—			—			—			27,279
(Income) loss from investment in subsidiaries		(214,983	)		—			26			214,957			—
Total other (income) expenses		(157,243	)		(2,098	)		6			214,957			55,622
Income (loss) before taxes		65,446			335,922			(52	)		(214,957	)		186,359
Provision (benefit) for income taxes:
Current		(10,904	)		—			—			—			(10,904	)
Deferred		(41,284	)		120,913			—			—			79,629
Total income taxes		(52,188	)		120,913			—			—			68,725
Net income (loss)	$	117,634		$	215,009			($52	)		($214,957	)	$	117,634
Comprehensive income (loss)	$	86,739		$	215,009			($52	)		($214,957	)	$	86,739

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	26,149		$	735,155		$	—		$	—		$	761,304
Gas production		34,331			100,408			—			—			134,739
Natural gas liquids production		15,264			33,234			—			—			48,498
Other operational income		2,766			397			357			—			3,520
Derivative income, net		—			3,428			—			—			3,428
Total operating revenue		78,510			872,622			357			—			951,489
Operating expenses:
Lease operating expenses		19,914			195,105			(16	)		—			215,003
Transportation, processing and gathering expenses		12,049			9,733			—			—			21,782
Production taxes		3,330			6,685			—			—			10,015
Depreciation, depletion, amortization		63,022			281,152			191			—			344,365
Accretion expense		561			32,513			257			—			33,331
Salaries, general and administrative		54,641			7			—			—			54,648
Incentive compensation expense		8,113			—			—			—			8,113
Other operational expenses		173			94			—			—			267
Total operating expenses		161,803			525,289			432			—			687,524
Income (loss) from operations		(83,293	)		347,333			(75	)		—			263,965
Other (income) expenses:
Interest expense		30,446			(71	)		—			—			30,375
Interest income		(285	)		(315	)		—			—			(600	)
Other income		(144	)		(1,661	)		—			—			(1,805	)
Loss on early extinguishment of debt		1,972			—			—			—			1,972
(Income) loss from investment in subsidiaries		(223,555	)		75			—			223,480			—
Total other (income) expenses		(191,566	)		(1,972	)		—			223,480			29,942
Income (loss) before taxes		108,273			349,305			(75	)		(223,480	)		234,023
Provision (benefit) for income taxes:
Current		15,022			—			—			—			15,022
Deferred		(56,175	)		125,750			—			—			69,575
Total income taxes		(41,153	)		125,750			—			—			84,597
Net income (loss)	$	149,426		$	223,555			($75	)		($223,480	)	$	149,426
Comprehensive income (loss)	$	156,391		$	223,555			($75	)		($223,480	)	$	156,391

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2011

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	5,675		$	658,283		$	—		$	—		$	663,958
Gas production		19,470			151,141			—			—			170,611
Natural gas liquids production		—			29,996			—			—			29,996
Other operational income		3,085			249			604			—			3,938
Derivative income, net		—			1,418			—			—			1,418
Total operating revenue		28,230			841,087			604			—			869,921
Operating expenses:
Lease operating expenses		6,632			169,018			231			—			175,881
Transportation, processing and gathering expenses		—			8,958			—			—			8,958
Production taxes		1,434			7,946			—			—			9,380
Depreciation, depletion, amortization		17,860			261,326			834			—			280,020
Accretion expense		15			30,385			364			—			30,764
Salaries, general and administrative		40,073			94			2			—			40,169
Incentive compensation expense		11,600			—			—			—			11,600
Other operational expenses		1,404			745			—			—			2,149
Total operating expenses		79,018			478,472			1,431			—			558,921
Income (loss) from operations		(50,788	)		362,615			(827	)		—			311,000
Other (income) expenses:
Interest expense		9,043			246			—			—			9,289
Interest income		(178	)		(242	)		—			—			(420	)
Other income		(52	)		(1,890	)		—			—			(1,942	)
Loss on early extinguishment of debt		607			—			—			—			607
(Income) loss from investment in subsidiary		(232,751	)		827			—			231,924			—
Total other (income) expenses		(223,331	)		(1,059	)		—			231,924			7,534
Income (loss) before taxes		172,543			363,674			(827	)		(231,924	)		303,466
Provision (benefit) for income taxes:
Current		(20,386	)		—			—			—			(20,386	)
Deferred		(1,403	)		130,923			—			—			129,520
Total income taxes		(21,789	)		130,923			—			—			109,134
Net income (loss)	$	194,332		$	232,751			($827	)		($231,924	)	$	194,332
Comprehensive income (loss)	$	230,404		$	232,751			($827	)		($231,924	)	$	230,404

Condensed Consolidating Statement of Cash Flows

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	117,634		$	215,009			($52	)		($214,957	)	$	117,634
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		93,579			256,995			—			—			350,574
Accretion expense		372			33,203			—			—			33,575
Deferred income tax provision (benefit)		(41,284	)		120,913			—			—			79,629
Settlement of asset retirement obligations		—			(83,854	)		—			—			(83,854	)
Non-cash stock compensation expense		10,347			—			—			—			10,347
Excess tax benefits		(156	)		—			—			—			(156	)
Non-cash derivative expense		—			2,239			—			—			2,239
Loss on early extinguishment of debt		27,279			—			—			—			27,279
Non-cash interest expense		16,219			—			—			—			16,219
Non-cash (income) loss from investment in subsidiaries		(214,983	)		—			26			214,957			—
Change in current income taxes		2,767			—			—			—			2,767
Change in intercompany receivables/payables		186,903			(186,947	)		44			—			—
(Increase) decrease in accounts receivable		(15,630	)		10,947			—			—			(4,683	)
Decrease in other current assets		1,752			—			—			—			1,752
Decrease in inventory		583			—			—			—			583
Increase (decrease) in accounts payable		(1,052	)		1,454			—			—			402
Increase in other current liabilities		40,543			1,908			—			—			42,451
Other		419			(2,972	)		—			—			(2,553	)
Net cash provided by operating activities		225,292			368,895			18			—			594,205
Cash flows from investing activities:
Investment in oil and gas properties		(273,474	)		(378,254	)		(11,571	)		—			(663,299	)
Proceeds from sale of oil and gas properties, net of expenses		6,300			42,521			—			—			48,821
Investment in fixed and other assets		(6,816	)		—			—			—			(6,816	)
Change in restricted funds		—			—			(1,742	)		—			(1,742	)
Investment in subsidiaries		(14,000	)		—			(13,404	)		27,404			—
Net cash used in investing activities		(287,990	)		(335,733	)		(26,717	)		27,404			(623,036	)
Cash flows from financing activities:
Proceeds from issuance of senior notes		489,250			—			—			—			489,250
Deferred financing costs		(9,065	)		—			—			—			(9,065	)
Redemption of senior notes		(396,014	)		—			—			—			(396,014	)
Excess tax benefits		156			—			—			—			156
Equity proceeds from parent		—			—			27,404			(27,404	)		—
Net payments for share-based compensation		(3,733	)		—			—			—			(3,733	)
Net cash provided by financing activities		80,594			—			27,404			(27,404	)		80,594
Effect of exchange rate changes on cash		—			—			(65	)		—			(65	)
Net change in cash and cash equivalents		17,896			33,162			640			—			51,698
Cash and cash equivalents, beginning of period		228,398			51,128			—			—			279,526
Cash and cash equivalents, end of period	$	246,294		$	84,290		$	640		$	—		$	331,224

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	149,426		$	223,555			($75	)		($223,480	)	$	149,426
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		63,022			281,152			191			—			344,365
Accretion expense		561			32,513			257			—			33,331
Deferred income tax provision (benefit)		(56,175	)		125,750			—			—			69,575
Settlement of asset retirement obligations		—			(65,567	)		—			—			(65,567	)
Non-cash stock compensation expense		8,699			—			—			—			8,699
Excess tax benefits		(949	)		—			—			—			(949	)
Non-cash derivative income		—			(509	)		—			—			(509	)
Loss on early extinguishment of debt		1,972			—			—			—			1,972
Non-cash interest expense		13,085			—			—			—			13,085
Non-cash (income) loss from investment in subsidiaries		(223,555	)		75			—			223,480			—
Change in current income taxes		10,618			—			—			—			10,618
Change in intercompany receivables/payables		275,819			(275,125	)		(694	)		—			—
(Increase) decrease in accounts receivable		(22,750	)		(33,345	)		224			—			(55,871	)
Increase in other current assets		(2,836	)		—			—			—			(2,836	)
Decrease in inventory		436			—			—			—			436
Increase (decrease) in accounts payable		5,348			(208	)		(39	)		—			5,101
Decrease in other current liabilities		(5,311	)		(5,115	)		—			—			(10,426	)
Other		10,960			(1,661	)		—			—			9,299
Net cash provided by (used in) operating activities		228,370			281,515			(136	)		—			509,749
Cash flows from investing activities:
Investment in oil and gas properties		(324,542	)		(231,313	)		—			—			(555,855	)
Proceeds from sale of oil and gas properties, net of expenses		403			—			—			—			403
Sale of fixed assets		134			—			—			—			134
Investment in fixed and other assets		(13,370	)		—			—			—			(13,370	)
Net cash used in investing activities		(337,375	)		(231,313	)		—			—			(568,688	)
Cash flows from financing activities:
Proceeds from bank borrowings		25,000			—			—			—			25,000
Repayment of bank borrowings		(70,000	)		—			—			—			(70,000	)
Proceeds from issuance of senior convertible notes		300,000			—			—			—			300,000
Deferred financing costs of senior convertible notes		(8,855	)		—			—			—			(8,855	)
Proceeds from sold warrants		40,170			—			—			—			40,170
Payments for purchased call options		(70,830	)		—			—			—			(70,830	)
Proceeds from issuance of senior notes		300,000			—			—			—			300,000
Deferred financing costs		(11,966	)		—			—			—			(11,966	)
Redemption of senior subordinated notes		(200,681	)		—			—			—			(200,681	)
Excess tax benefits		949			—			—			—			949
Net payments for share-based compensation		(3,773	)		—			—			—			(3,773	)
Net cash provided by financing activities		300,014			—			—			—			300,014
Net change in cash and cash equivalents		191,009			50,202			(136	)		—			241,075
Cash and cash equivalents, beginning of period		37,389			926			136			—			38,451
Cash and cash equivalents, end of period	$	228,398		$	51,128		$	—		$	—		$	279,526

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2011

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	194,332		$	232,751			($827	)		($231,924	)	$	194,332
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		17,860			261,326			834			—			280,020
Accretion expense		15			30,385			364			—			30,764
Deferred income tax provision (benefit)		(1,403	)		130,923			—			—			129,520
Settlement of asset retirement obligations		—			(63,391	)		—			—			(63,391	)
Non-cash stock compensation expense		5,905			—			—			—			5,905
Excess tax benefits		(1,493	)		—			—			—			(1,493	)
Non-cash derivative income		—			(2,216	)		—			—			(2,216	)
Loss on early extinguishment of debt		607			—			—			—			607
Non-cash interest expense		1,908			—			—			—			1,908
Other non-cash income		(1,602	)		—			—			—			(1,602	)
Non-cash income from investment in subsidiaries		(230,861	)		(1,063	)		—			231,924			—
Change in current income taxes		(19,451	)		—			—			—			(19,451	)
Change in intercompany receivables/payables		217,287			(217,724	)		437			—			—
Increase in accounts receivable		(11,022	)		(7,688	)		(890	)		—			(19,600	)
(Increase) decrease in other current assets		(80	)		14			—			—			(66	)
Decrease in inventory		1,605			14			—			—			1,619
Increase in accounts payable		2,658			3,341			40			—			6,039
Increase in other current liabilities		23,440			6,143			—			—			29,583
Other		(1,628	)		—			—			—			(1,628	)
Net cash provided by (used in) operating activities		198,077			372,815			(42	)		—			570,850
Cash flows from investing activities:
Investment in oil and gas properties		(309,026	)		(455,903	)		(4	)		—			(764,933	)
Proceeds from sale of oil and gas properties, net of expenses		5,575			82,355			—			—			87,930
Investment in fixed and other assets		(2,247	)		—			—			—			(2,247	)
Net cash used in investing activities		(305,698	)		(373,548	)		(4	)		—			(679,250	)
Cash flows from financing activities:
Proceeds from bank borrowings		75,000			—			—			—			75,000
Repayment of bank borrowings		(30,000	)		—			—			—			(30,000	)
Deferred financing costs		(4,017	)		—			—			—			(4,017	)
Excess tax benefits		1,493			—			—			—			1,493
Net payments for share-based compensation		(2,581	)		—			—			—			(2,581	)
Net cash provided by financing activities		39,895			—			—			—			39,895
Net change in cash and cash equivalents		(67,726	)		(733	)		(46	)		—			(68,505	)
Cash and cash equivalents, beginning of period		105,115			1,659			182			—			106,956
Cash and cash equivalents, end of period	$	37,389		$	926		$	136		$	—		$	38,451

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ACCOUNTS RECEIVABLE (Tables)

12 Months Ended

Dec. 31, 2013

Receivables [Abstract]

Components of Accounts Receivable

Our accounts receivable are comprised of the following amounts:

	As of December 31,
	2013		2012
Other co-venturers	$	13,904	$	16,735
Trade		134,622		130,448
Unbilled accounts receivable		22,001		20,053
Other		1,444		52
Total accounts receivable	$	171,971	$	167,288

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CONCENTRATIONS (Tables)

12 Months Ended

Dec. 31, 2013

Risks And Uncertainties [Abstract]

Customers from Whom We Derived 10% or More of Total Oil and Gas Revenue

The following table identifies customers from whom we derived 10% or more of our total oil and gas revenue during the years ended:

	December 31,
	2013			2012			2011
Conoco, Inc.		(a	)		13	%		28	%
Phillips 66 Company		35	%		18	%		(a	)
Shell Trading (US) Company		33	%		41	%		46	%

(a) Less than 10 percent.

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ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2013

Accounting Policies [Abstract]

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

Stone Energy Corporation (“Stone”) is an independent oil and natural gas company engaged in the acquisition, exploration, exploitation, development and operation of oil and gas properties. We have been operating in the Gulf Coast Basin since our incorporation in 1993 and have established a technical and operational expertise in this area. We have expanded our reserve base outside of the conventional shelf of the Gulf of Mexico (the “GOM”) and into the more prolific reserve basins of the GOM deep water and GOM deep gas, as well as onshore oil and gas shale opportunities, including the Marcellus Shale in Appalachia. We were incorporated in 1993 as a Delaware corporation. Our corporate headquarters are located at 625 E. Kaliste Saloom Road, Lafayette, Louisiana 70508. We have additional offices in New Orleans, Louisiana, Houston, Texas and Morgantown, West Virginia.

A summary of significant accounting policies followed in the preparation of the accompanying consolidated financial statements is set forth below.

Basis of Presentation:

The financial statements include our accounts and the accounts of our wholly owned subsidiaries, Stone Energy Offshore, L.L.C. (“Stone Offshore”), Stone Energy Holding, L.L.C., Stone Energy Canada, U.L.C. and Caillou Boca Gathering, LLC (“Caillou Boca”). On September 6, 2012, Caillou Boca was merged into Stone Offshore. All intercompany balances have been eliminated.

Use of Estimates:

The preparation of financial statements in conformity with U.S. Generally Accepted Accounting Principles (“GAAP”) requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates are used primarily when accounting for depreciation, depletion and amortization (“DD&A”) expense, unevaluated property costs, estimated future net cash flows from proved reserves, costs to abandon oil and gas properties, taxes, accruals of capitalized costs, operating costs and production revenue, capitalized general and administrative costs and interest, insurance recoveries, effectiveness and estimated fair value of derivative positions, the purchase price allocation on properties acquired, estimates of fair value in business combinations and contingencies.

Fair Value Measurements:

U.S. GAAP establishes a framework for measuring fair value and requires certain disclosures about fair value measurements. As of December 31, 2013 and 2012, we held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. Additionally, fair value concepts were applied in recording the acquisition of various deep water assets in June 2012 and the acquisition of an office building in December 2012.

Hybrid Debt Instruments:

In 2012, we issued $300,000 in aggregate principal amount of 1 ³⁄₄% Senior Convertible Notes due 2017 (the “2017 Convertible Notes”). See Note 11 – Long-Term Debt. On that same day we entered into convertible note hedging transactions which are expected to reduce the potential dilution to our common stock upon conversion of the notes. In accordance with Accounting Standards Codification (“ASC”) 480-20 and ASC 470, we accounted for the debt and equity portions of the notes in a manner that will reflect our nonconvertible borrowing rate when interest is recognized in subsequent periods. This results in the separation of the debt component, classification of the remaining component in stockholders’ equity, and accretion of the resulting discount as part of interest expense. Additionally, the hedging transactions meet the criteria for classification as equity transactions and were recorded as such.

ASC 260 provides that for contracts that may be settled in common stock or in cash at the election of the entity or the holder, the determination of whether the contract shall be reflected in the computation of diluted earnings per share should be made based on the facts available each period. It is presumed that the contract will be settled in common stock and therefore potential dilution be determined using the if-converted method. However, this presumption may be overcome if past experience or a stated policy provides a reasonable basis to believe that the contract will be settled partially or wholly in cash. Because it is management’s stated intent to redeem the principal amount of the notes in cash, we have used the treasury stock method for determining potential dilution of the notes in our diluted earnings per share computation in accordance with ASC 260.

Business Combinations:

Our acquisition in 2012 of various deep water assets was accounted for according to the guidance provided in ASC 805, Business Combinations, which requires application of the acquisition method. This methodology requires the recordation of net assets acquired and consideration transferred at fair value. Differences between the net fair value of net assets acquired and consideration transferred are recorded as goodwill or a bargain purchase gain.

Cash and Cash Equivalents:

We consider all money market funds and highly liquid investments in overnight securities through our commercial bank accounts, which result in available funds on the next business day, to be cash and cash equivalents.

Oil and Gas Properties:

We follow the full cost method of accounting for oil and gas properties. Under this method, all acquisition, exploration, development and estimated abandonment costs, including certain related employee and general and administrative costs (less any reimbursements for such costs) and interest incurred for the purpose of finding oil and gas are capitalized. Such amounts include the cost of drilling and equipping productive wells, dry hole costs, lease acquisition costs, delay rentals and other costs related to such activities. Employee, general and administrative costs that are capitalized include salaries and all related fringe benefits paid to employees directly engaged in the acquisition, exploration and development of oil and gas properties, as well as all other directly identifiable general and administrative costs associated with such activities, such as rentals, utilities and insurance. We capitalize a portion of the interest costs incurred on our debt based upon the balance of our unevaluated property costs and our weighted-average borrowing rate. Employee, general and administrative costs associated with production operations and general corporate activities are expensed in the period incurred. Additionally, workover and maintenance costs incurred solely to maintain or increase levels of production from an existing completion interval are charged to lease operating expense in the period incurred.

U.S. GAAP allows the option of two acceptable methods for accounting for oil and gas properties. The successful efforts method is the allowable alternative to the full cost method. The primary differences between the two methods are in the treatment of exploration costs and in the computation of DD&A expense. Under the full cost method, all exploratory costs are capitalized while under the successful efforts method exploratory costs associated with unsuccessful exploratory wells and all geological and geophysical costs are expensed. Under the full cost method, DD&A expense is computed on cost centers represented by entire countries while under the successful efforts method cost centers are represented by properties, or some reasonable aggregation of properties with common geological structural features or stratigraphic condition, such as fields or reservoirs.

We amortize our investment in oil and gas properties through DD&A expense using the units of production (the “UOP”) method. Under the UOP method, the quarterly provision for DD&A expense is computed by dividing production volumes for the period by the total proved reserves as of the beginning of the period (beginning of the period reserves being determined by adding back production to end of the period reserves), and applying the respective rate to the net cost of proved oil and gas properties, including future development costs.

Under the full cost method, we compare, at the end of each financial reporting period, the present value of estimated future net cash flows from proved reserves (excluding cash flows related to estimated abandonment costs), to the net capitalized costs of proved oil and gas properties net of related deferred taxes. We refer to this comparison as a “ceiling test.” If the net capitalized costs of proved oil and gas properties exceed the estimated discounted future net cash flows from proved reserves, we are required to write-down the value of our oil and gas properties to the value of the discounted cash flows.

Sales of oil and gas properties are accounted for as adjustments to the net full cost pool with no gain or loss recognized, unless the adjustment would significantly alter the relationship between capitalized costs and proved reserves.

Asset Retirement Obligations:

U.S. GAAP requires us to record our estimate of the fair value of liabilities related to future asset retirement obligations in the period the obligation is incurred. Asset retirement obligations relate to the removal of facilities and tangible equipment at the end of an oil and gas property’s useful life. The application of this rule requires the use of management’s estimates with respect to future abandonment costs, inflation, market risk premiums, useful life and cost of capital. U.S. GAAP requires that our estimate of our asset retirement obligations does not give consideration to the value the related assets could have to other parties.

Other Property and Equipment:

Our office buildings in Lafayette, Louisiana are being depreciated on the straight-line method over their estimated useful life of 39 years.

Inventory:

We maintain an inventory of tubular goods. Items remain in inventory until dedicated to specific projects, at which time they are transferred to oil and gas properties. Items are carried at the lower of cost or market based on the specific identification method.

Earnings Per Common Share:

Under U.S. GAAP, certain instruments granted in share-based payment transactions are participating securities prior to vesting and are therefore required to be included in the earnings allocation in calculating earnings per share under the two-class method. Companies are required to treat unvested share-based payment awards with a right to receive non-forfeitable dividends as a separate class of securities in calculating earnings per share.

Production Revenue:

We recognize production revenue under the entitlement method of accounting. Under this method, revenue is deferred for deliveries in excess of our net revenue interest, while revenue is accrued for undelivered volumes. Production imbalances are generally recorded at the estimated sales price in effect at the time of production.

Income Taxes:

Provisions for income taxes include deferred taxes resulting primarily from temporary differences due to different reporting methods for oil and gas properties for financial reporting purposes and income tax purposes. For financial reporting purposes, all exploratory and development expenditures, including future abandonment costs, related to evaluated projects are capitalized and depreciated, depleted and amortized on the UOP method. For income tax purposes, only the equipment and leasehold costs relative to successful wells are capitalized and recovered through depreciation or depletion, although for 2011, 2012 and 2013, special provisions allowed for current deductions for the cost of certain equipment. Generally, most other exploratory and development costs are charged to expense as incurred; however, we follow certain provisions of the Internal Revenue Code that allow capitalization of intangible drilling costs where management deems appropriate. Other financial and income tax reporting differences occur as a result of statutory depletion, different reporting methods for sales of oil and gas reserves in place, different reporting methods used in the capitalization of employee, general and administrative and interest expense, and different reporting methods for employee compensation.

Derivative Instruments and Hedging Activities:

The nature of a derivative instrument must be evaluated to determine if it qualifies for hedge accounting treatment. Instruments that qualify for cash flow hedge accounting treatment with contemporaneous documentation are recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Additionally, monthly settlements of effective hedges are reflected in revenue from oil and gas production and cash flows from operations. Instruments not qualifying for hedge accounting treatment are recorded in our balance sheet at fair value, and changes in fair value are recognized in earnings through derivative expense (income).

Share-Based Compensation:

We record share-based compensation based on the grant date fair value of issued stock options and restricted stock over the vesting period of the instrument. We utilize the Black-Scholes option pricing model to measure the fair value of stock options. The fair value of restricted shares is typically determined based on the average of our high and low stock prices on the grant date.

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ACQUISITIONS AND DIVESTITURES (Tables)

12 Months Ended

Dec. 31, 2013

Business Combinations [Abstract]

Allocation of Recorded Value of Net Assets Acquired in Transaction

The following represents the allocation of the recorded value of net assets acquired in the transaction.

Proved oil and gas properties	$	39,221
Unevaluated oil and gas properties		1,637
Asset retirement obligations		(14,460	)
Total fair value of net assets	$	26,398

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Summary of Standardized Measure of Discounted Future Net Cash Flows (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Extractive Industries [Abstract]
Future cash inflows	$ 7,040,928	$ 6,295,455	$ 6,171,279
Future production costs	(2,062,657)	(1,946,426)	(1,747,806)
Future development costs	(1,431,101)	(1,241,531)	(1,219,214)
Future income taxes	(884,637)	(799,007)	(852,364)
Future net cash flows	2,662,533	2,308,491	2,351,895
10% annual discount	(977,531)	(794,632)	(808,933)
Standardized measure of discounted future net cash flows	1,685,002	1,513,859	1,542,962
Changes in standardized measure of future net cash flows related to estimated proved oil and gas reserves
Standardized measure at beginning of year	1,513,859	1,542,962	957,629
Sales and transfers of oil, gas and NGLs produced, net of production costs	(708,017)	(697,741)	(670,347)
Changes in price, net of future production costs	229,425	(380,841)	502,324
Extensions and discoveries, net of future production and development costs	155,592	178,272	293,168
Changes in estimated future development costs, net of development costs incurred during the period	28,684	212,329	97,852
Revisions of quantity estimates	281,558	76,450	(27,854)
Accretion of discount	202,087	207,292	118,722
Net change in income taxes	(28,084)	22,947	(300,363)
Purchases of reserves in-place		276,389	567,286
Sales of reserves in-place	15,531	2,480	(36,278)
Changes in production rates due to timing and other	(5,633)	73,320	40,823
Net increase (decrease) in standardized measure	171,143	(29,103)	585,333
Standardized measure at end of year	$ 1,685,002	$ 1,513,859	$ 1,542,962

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SHARE-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2013

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Stock Option Activity under Plan

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2013 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		411,794		$	39.04
Granted		—			—
Exercised		—			—
Forfeited		(15,250	)		42.45
Expired		(65,370	)		36.56
Options outstanding, end of period		331,174			39.37	2.2 years	$	1,708
Options exercisable, end of period		318,279			40.62	2.1 years		1,373
Options unvested, end of period		12,895			8.64	5.0 years		335

Exercise prices for stock options outstanding at December 31, 2013 range from $6.97 to $53.20.

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2012 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		438,394		$	38.76
Granted		—			—
Exercised		—			—
Forfeited		(4,200	)		35.54
Expired		(22,400	)		34.25
Options outstanding, end of period		411,794			39.04	2.8 years	$	766
Options exercisable, end of period		378,004			41.00	2.5 years		459
Options unvested, end of period		33,790			17.17	5.4 years		307

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2011 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		484,694		$	39.43
Granted		—			—
Exercised		—			—
Forfeited		(13,300	)		37.98
Expired		(33,000	)		48.85
Options outstanding, end of period		438,394			38.76	3.6 years	$	1,143
Options exercisable, end of period		378,710			41.66	3.1 years		457
Options unvested, end of period		59,684			20.36	6.1 years		686

Summary of Restricted Stock Activity Under Plan

A summary of the restricted stock activity under the 2009 Plan for the years ended December 31, 2013, 2012 and 2011 is as follows (amounts in table represent actual values):

	2013					2012					2011
	Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share		Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share		Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share
Restricted stock outstanding, beginning of period		1,108,874		$	27.56		923,740		$	20.08		783,606		$	17.24
Issuances		848,498			20.61		670,818			31.43		597,062			23.62
Lapse of restrictions		(534,041	)		25.45		(462,141	)		18.29		(419,543	)		19.91
Forfeitures		(165,278	)		26.43		(23,543	)		26.10		(37,385	)		18.92
Restricted stock outstanding, end of period		1,258,053		$	23.92		1,108,874		$	27.56		923,740		$	20.08

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Financial Data Related to Oil and Gas Producing Activities (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013		Dec. 31, 2012		Dec. 31, 2011
Accumulated DD&A:
Balance, beginning of year	$ (5,510,166)
Provision for DD&A	(350,574)		(344,365)		(280,020)
Balance, end of year	(5,908,760)		(5,510,166)
Net proved oil and gas properties	1,895,357		1,734,300
Lease operating expenses	201,153		215,003		175,881
Transportation, processing and gathering expenses	42,172		21,782		8,958
Production taxes	15,029		10,015		9,380
Accretion expense	33,575		33,331		30,764
United States [Member]
Oil and gas properties, proved and unevaluated:
Balance, beginning of year	7,692,261		7,049,777		6,202,758
Costs incurred during the year (capitalized):
Acquisition costs, net of sales of unevaluated properties	70,903		102,807		270,354
Exploratory costs	297,113		81,458		84,199
Development costs	378,242	[1]	395,555	[1]	426,355	[1]
Salaries, general and administrative costs	32,815		25,318		24,430
Interest	46,860		37,656		42,033
Less: overhead reimbursements	(321)		(310)		(352)
Total costs incurred during the year	825,612		642,484		847,019
Balance, end of year	8,517,873		7,692,261		7,049,777
Accumulated DD&A:
Balance, beginning of year	(5,510,166)		(5,174,729)		(4,804,949)
Provision for DD&A	(346,827)		(341,096)		(276,480)
Sale of proved properties	(51,767)		5,659		(93,300)
Balance, end of year	(5,908,760)		(5,510,166)		(5,174,729)
Net proved oil and gas properties	2,609,113		2,182,095		1,875,048
DD&A per Mcfe	3.43		3.69		3.45
Lease operating expenses	201,153		215,003		175,881
Transportation, processing and gathering expenses	42,172		21,782		8,958
Production taxes	15,029		10,015		9,380
Accretion expense	33,575		33,331		30,764
Expensed costs - United States	291,929		280,131		224,983
Canada [Member]
Oil and gas properties, proved and unevaluated:
Balance, beginning of year
Costs incurred during the year (capitalized):
Acquisition costs	8,764
Exploratory costs	1,819
Total costs incurred during the year	10,583
Balance, end of year	$ 10,583

[1] Includes capitalized asset retirement costs of $54,737, $95,293 and $96,386, respectively.

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Long-Term Debt - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended	12 Months Ended					12 Months Ended			12 Months Ended		12 Months Ended			0 Months Ended				12 Months Ended
	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2013 Letter of Credit[Member]	Feb. 25, 2014 Letter of Credit[Member] Subsequent Event [Member]	Dec. 31, 2013 Bank debt [Member]	Dec. 31, 2012 Bank debt [Member]	Apr. 26, 2011 Bank debt [Member]	Dec. 31, 2013 Bank Credit Facility[Member]	Feb. 25, 2014 Bank Credit Facility[Member] Subsequent Event [Member]	Dec. 31, 2013 1.75% Senior Convertible Notes due 2017 [Member]	Dec. 31, 2012 1.75% Senior Convertible Notes due 2017 [Member]	Mar. 06, 2012 1.75% Senior Convertible Notes due 2017 [Member]	Nov. 27, 2013 7.5% Senior Notes due 2022 [Member]	Nov. 08, 2012 7.5% Senior Notes due 2022 [Member]	Dec. 31, 2013 7.5% Senior Notes due 2022 [Member]	Dec. 31, 2012 7.5% Senior Notes due 2022 [Member]	Dec. 31, 2013 8.625% Senior Notes due 2017 [Member]	Dec. 31, 2012 8.625% Senior Notes due 2017 [Member]	Nov. 17, 2010 8.625% Senior Notes due 2017 [Member]	Jan. 26, 2010 8.625% Senior Notes due 2017 [Member]
Debt Instrument [Line Items]
Credit facility initial date							Apr. 26, 2011
Redetermined base borrowing and credit facility									$ 700,000
Maturity of new credit facility if note issue under 2004 indenture are retired on or before April 15, 2014										Apr. 26, 2015
Initial bank and availability under facility							400,000			378,594	378,594
Outstanding borrowing under bank credit facility					21,406	21,406				0	0
Period in which outstanding amount has to be repaid to cure deficiency							10 days
Period in which bank has to add new properties to borrowing base and has to grant mortgage to banks							30 days
Oil and gas reserve as proportion of discounted present value of future net cash flow, for mortgage							80.00%
Debt to EBITDA ratio, as defined in credit agreement							not greater than 3.25 for preceding four quarter
EBITDA to consolidated net interest, as defined in credit agreement							not less than 3.0 for preceding four quarter
Debt to EBITDA ratio							1.73 to 1
EBITDA to consolidated net interest ratio							18.40 to 1
Aggregate principal amount of senior notes													300,000	300,000	475,000	300,000					100,000	275,000
Initial conversion rate of convertible note 2017												An initial conversion rate of 23.4449 shares of our common stock per $1 principal amount of 2017 Convertible Notes
Initial conversion rate of common stock												23.4449
Principal amount of 2017 convertible notes												$ 1
Initial conversion price of convertible note 2017												$ 42.65
Closing share price												$ 34.59
Convertible notes principal amount												1
Percentage of current conversion price lower than closing sale price												130.00%
Maximum trading day												20 days
Consecutive trading days ending on last trading day												30 days
Period in which distribution is made to all holders of common stock rights, option or warrants												45 days
Consecutive trading days immediately preceding, but excluding, declaration date												10 days
Percentage in which distribution has per share value exceeding closing sale price of common stock												10.00%
Percentage in which closing sale price of common stock is excess of convertible notes												98.00%
Number of consecutive business day												5 days
Number of consecutive trading day												25 days
Payment for call option												70,830
Anti-dilution adjustments for purchases of call option												7,033,470
Strike price per share												$ 55.91
Proceeds from sale of warrants												40,170
Liability component of convertible note	1,027,084	1,027,084	914,126									252,084	239,126				775,000	300,000		375,000
Accrued interest payment												1,750
Interest cost related to amortization of discount												12,959	9,956
Amortization of deferred financing cost												1,238	951
Interest expense related to contractual interest coupon of convertible notes												5,250	4,302
Proceeds from issuance of senior notes		489,250	300,000												480,195	293,203
Effective interest rates	7.51%	7.51%	7.75%	7.04%											3.00%
Redemption of senior notes																35.00%
Equity offerings redemption price																107.50%
Accrued interest payment	9,022	9,022	18,546														7,266
Total cost of the redemption																			406,967
Cost of redemption excluding accrued and unpaid interest																			396,014
Accrued and unpaid interest																			10,953
Redemption resulted in a charge to earnings	(27,279)	(27,279)	(1,972)	(607)															27,279
Premium paid for the repurchase and redemption																			21,014
Deferred financing costs write off																			6,265
Deferred financing costs, net of accumulated amortization	11,754	11,754	27,753
Total interest cost incurred		$ 79,697	$ 68,031	$ 51,322

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CONSOLIDATED BALANCE SHEET (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013		Dec. 31, 2012
Current assets:
Cash and cash equivalents	$ 331,224		$ 279,526
Accounts receivable	171,971		167,288
Fair value of hedging contracts	4,549		39,655
Current income tax receivable	7,366		10,027
Deferred taxes	31,710	[1]	15,514	[1]
Inventory	3,723		4,207
Other current assets	1,874		3,626
Total current assets	552,417		519,843
Oil and gas properties, full cost method of accounting:
Proved	7,804,117		7,244,466
Less: accumulated depreciation, depletion and amortization	(5,908,760)		(5,510,166)
Net proved oil and gas properties	1,895,357		1,734,300
Unevaluated	724,339		447,795
Other property and equipment, net of accumulated depreciation of $21,748 and $26,429, respectively	26,178		22,115
Fair value of hedging contracts	1,378		9,199
Other assets, net of accumulated depreciation and amortization of $5,768 and $6,438, respectively	48,887		43,179
Total assets	3,248,556		2,776,431
Current liabilities:
Accounts payable to vendors	195,677		94,361
Undistributed oil and gas proceeds	37,029		23,414
Accrued interest	9,022		18,546
Fair value of hedging contracts	7,753		149
Asset retirement obligations	67,161		66,260
Other current liabilities	54,520		16,765
Total current liabilities	371,162		219,495
Long-term debt	1,027,084		914,126
Deferred taxes	390,693	[1]	310,830	[1]
Asset retirement obligations	435,352		422,042
Fair value of hedging contracts	470		1,530
Other long-term liabilities	53,509		36,275
Total liabilities	2,278,270		1,904,298
Commitments and contingencies
Stockholders' equity:
Common stock, $.01 par value; authorized 100,000,000 shares; issued 48,750,533 and 48,392,552 shares, respectively	488		484
Treasury stock (16,582 shares, at cost)	(860)		(860)
Additional paid-in capital	1,397,885		1,386,475
Accumulated deficit	(425,165)		(542,799)
Accumulated other comprehensive income (loss)	(2,062)		28,833
Total stockholders' equity	970,286		872,133
Total liabilities and stockholders' equity	$ 3,248,556		$ 2,776,431

[1] Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

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Organization and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013 Building [Member]	Dec. 31, 2012 1.75% Senior Convertible Notes due 2017 [Member]	Mar. 06, 2012 1.75% Senior Convertible Notes due 2017 [Member]
Schedule Of Significant Accounting Policies [Line Items]
Aggregate principal amount of debt issued		$ 300,000	$ 300,000
Senior convertible note, maturity year		2017
Senior convertible note, stated interest rate		1.75%
Estimated useful life of Building	39 years

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CONSOLIDATED STATEMENT OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Cash flows from operating activities:
Net income	$ 117,634	$ 149,426	$ 194,332
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	350,574	344,365	280,020
Accretion expense	33,575	33,331	30,764
Deferred income tax provision	79,629	69,575	129,520
Settlement of asset retirement obligations	(83,854)	(65,567)	(63,391)
Non-cash stock compensation expense	10,347	8,699	5,905
Excess tax benefits	(156)	(949)	(1,493)
Non-cash derivative expense (income)	2,239	(509)	(2,216)
Loss on early extinguishment of debt	27,279	1,972	607
Non-cash interest expense	16,219	13,085	1,908
Other non-cash income			(1,602)
Change in current income taxes	2,767	10,618	(19,451)
Increase in accounts receivable	(4,683)	(55,871)	(19,600)
(Increase) decrease in other current assets	1,752	(2,836)	(66)
Decrease in inventory	583	436	1,619
Increase in accounts payable	402	5,101	6,039
Increase (decrease) in other current liabilities	42,451	(10,426)	29,583
Other	(2,553)	9,299	(1,628)
Net cash provided by (used in) operating activities	594,205	509,749	570,850
Cash flows from investing activities:
Investment in oil and gas properties	(663,299)	(555,855)	(764,933)
Proceeds from sale of oil and gas properties, net of expenses	48,821	403	87,930
Sale of fixed assets		134
Investment in fixed and other assets	(6,816)	(13,370)	(2,247)
Change in restricted funds	(1,742)
Net cash used in investing activities	(623,036)	(568,688)	(679,250)
Cash flows from financing activities:
Proceeds from bank borrowings		25,000	75,000
Repayments of bank borrowings		(70,000)	(30,000)
Proceeds from issuance of senior convertible notes		300,000
Deferred financing costs of senior convertible notes		(8,855)
Proceeds from sold warrants		40,170
Payments for purchased call options		(70,830)
Proceeds from issuance of senior notes	489,250	300,000
Deferred financing costs	(9,065)	(11,966)	(4,017)
Redemption of senior notes	(396,014)
Redemption of senior subordinated notes		(200,681)
Excess tax benefits	156	949	1,493
Net payments for share-based compensation	(3,733)	(3,773)	(2,581)
Net cash provided by financing activities	80,594	300,014	39,895
Effect of exchange rate changes on cash	(65)
Net change in cash and cash equivalents	51,698	241,075	(68,505)
Cash and cash equivalents, beginning of period	279,526	38,451	106,956
Cash and cash equivalents, end of period	331,224	279,526	38,451
Supplemental cash flow information:
Interest, net of amount capitalized	(29,883)	(20,150)	(9,808)
Income taxes	$ 13,670	$ (4,405)	$ 935

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Location and Fair Value Amounts of Derivative Instruments Reported in Balance Sheet (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Current liabilities [Member]
Liability Derivatives
Fair Value of Derivative Instruments, Liabilities	$ 7,753
Long-term liabilities [Member]
Liability Derivatives
Fair Value of Derivative Instruments, Liabilities	470
Current Asset [Member]
Asset Derivatives
Fair Value of Derivative Instruments, Assets	4,549
Long-term assets [Member]
Asset Derivatives
Fair Value of Derivative Instruments, Assets	1,378
Commodity Contracts [Member]
Asset Derivatives
Fair Value of Derivative Instruments, Assets	5,927	48,854
Liability Derivatives
Fair Value of Derivative Instruments, Liabilities	8,223	1,679
Commodity Contracts [Member] | Current liabilities [Member]
Liability Derivatives
Fair Value of Derivative Instruments, Liabilities	7,753	149
Commodity Contracts [Member] | Long-term liabilities [Member]
Liability Derivatives
Fair Value of Derivative Instruments, Liabilities	470	1,530
Commodity Contracts [Member] | Current Asset [Member]
Asset Derivatives
Fair Value of Derivative Instruments, Assets	4,549	39,655
Commodity Contracts [Member] | Long-term assets [Member]
Asset Derivatives
Fair Value of Derivative Instruments, Assets	$ 1,378	$ 9,199

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FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2013

Fair Value Disclosures [Abstract]

Schedule of Assets And Liabilities Measured at Fair Value Recurring Basis

The following tables present our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2013:

	Fair Value Measurements at December 31, 2013
Assets	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Marketable securities	$	8,248	$	8,248	$	—	$	—
Hedging contracts		5,927		—		5,927		—
Total	$	14,175	$	8,248	$	5,927	$	—

	Fair Value Measurements at December 31, 2013
Liabilities	Total		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Hedging contracts	$	8,223	$	—	$	8,223	$	—
Total	$	8,223	$	—	$	8,223	$	—

The following tables present our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2012:

	Fair Value Measurements at December 31, 2012
Assets	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Marketable securities	$	13,492	$	13,492	$	—	$	—
Hedging contracts		48,854		—		48,854		—
Total	$	62,346	$	13,492	$	48,854	$	—

	Fair Value Measurements at December 31, 2012
Liabilities	Total		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Hedging contracts	$	1,679	$	—	$	1,679	$	—
Total	$	1,679	$	—	$	1,679	$	—

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Fair Value Measurements - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Nov. 27, 2013	Dec. 31, 2012
8.625 % Senior Notes Due 2017 [Member]
Debt Instrument [Line Items]
Long term debt, Fair Value			$ 401,250
Convertible Notes Due 2017 [Member]
Debt Instrument [Line Items]
Liability component of convertible note	260,377		249,601
7.5% Senior Notes due 2022 [Member]
Debt Instrument [Line Items]
Liability component of convertible note	814,719		314,250
Aggregate principal amount of senior notes		$ 475,000

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Dec. 31, 2013

Commitments And Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 15 — COMMITMENTS AND CONTINGENCIES:

Leases

We lease office facilities in Lafayette and New Orleans, Louisiana, Houston, Texas and Morgantown, West Virginia under the terms of long-term, non-cancelable leases expiring on various dates through 2018. We also lease certain equipment on our oil and gas properties typically on a month-to-month basis. The minimum net annual commitments under all leases, subleases and contracts with non-cancelable terms in excess of 12 months at December 31, 2013 were as follows:

2014	$	736
2015		637
2016		358
2017		301
2018		147

Payments related to our lease obligations for the years ended December 31, 2013, 2012 and 2011 were approximately $597, $894 and $446, respectively.

Other Commitments

We are contingently liable to surety insurance companies in the amount of $81,878 relative to bonds issued on our behalf to the Bureau of Ocean Energy Management (the “BOEM”), federal and state agencies and certain third parties from which we purchased oil and gas working interests. The bonds represent guarantees by the surety insurance companies that we will operate in accordance with applicable rules and regulations and perform certain plugging and abandonment obligations as specified by applicable working interest purchase and sale agreements.

In connection with our exploration and development efforts, we are contractually committed to the use of drilling rigs and the acquisition of seismic data in the aggregate amount of $216,726 to be incurred over the next four years. We have placed $22,350 on deposit to guarantee these obligations.

The Oil Pollution Act (the “OPA”) imposes ongoing requirements on a responsible party, including the preparation of oil spill response plans and proof of financial responsibility to cover environmental cleanup and restoration costs that could be incurred in connection with an oil spill. Under the OPA and a final rule adopted by the BOEM in August 1998, responsible parties of covered offshore facilities that have a worst case oil spill of more than 1,000 barrels must demonstrate financial responsibility in amounts ranging from at least $10,000 in specified state waters to at least $35,000 in Outer Continental Shelf (the “OCS”) waters, with higher amounts of up to $150,000 in certain limited circumstances where the BOEM believes such a level is justified by the risks posed by the operations, or if the worst case oil-spill discharge volume possible at the facility may exceed the applicable threshold volumes specified under the BOEM’s final rule. We do not anticipate that we will experience any difficulty in continuing to satisfy the BOEM’s requirements for demonstrating financial responsibility under the OPA and the BOEM’s regulations.

Litigation

We are named as a defendant in certain lawsuits and are a party to certain regulatory proceedings arising in the ordinary course of business. We do not expect that these matters, individually or in the aggregate, will have a material adverse effect on our financial condition.

Since 2003, we have been involved in disputes with the Louisiana Department of Revenue (the “LDR”), which resulted in several petitions being filed by the LDR in Louisiana state court, claiming additional franchise taxes due. In addition, we received preliminary assessments from the LDR of additional franchise and income taxes resulting from audits of Stone and its subsidiaries. These petitions and assessments primarily related to the LDR’s assertion that sales of crude oil and natural gas from properties located on the OCS that are transported through the state should be sourced to the state for purposes of computing the Louisiana franchise tax and income tax apportionment ratios. By agreement dated November 22, 2013, Stone executed a settlement with the state in the amount of $13,000, resolving all claims asserted in litigation, as well as assessments proposed by the LDR for franchise and income taxes alleged to be due by Stone for the tax years 1999 through 2009, including claims for interest thereon. The agreement was reached under an amnesty program pursuant to Act 421 of the 2013 Regular Session of the Louisiana Legislature. The settlement amount, less income tax and interest amounts previously accrued, has been recorded as an expense in the accompanying consolidated statement of income. The tax years 2011 through 2013 remain subject to examination but the exposure to additional assessments is immaterial.

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ASSET RETIREMENT OBLIGATIONS (Tables)

12 Months Ended

Dec. 31, 2013

Asset Retirement Obligation Disclosure [Abstract]

Changes in Asset Retirement Obligations

The change in our asset retirement obligations during the years ended December 31, 2013, 2012 and 2011 is set forth below:

	Year Ended December 31,
	2013			2012			2011
Asset retirement obligations as of the beginning of the year, including current portion	$	488,302		$	425,779		$	373,920
Liabilities incurred		19,043			3,869			7,993
Liabilities settled		(79,695	)		(67,641	)		(63,226	)
Liabilities assumed		—			15,263			59,441
Divestment of properties		(9,245	)		(7,563	)		(10,900	)
Accretion expense		33,575			33,331			30,764
Revision of estimates		50,533			85,264			27,787
Asset retirement obligations as of the end of the year, including current portion	$	502,513		$	488,302		$	425,779

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OIL AND GAS RESERVE INFORMATION - UNAUDITED

12 Months Ended

Dec. 31, 2013

Extractive Industries [Abstract]

OIL AND GAS RESERVE INFORMATION - UNAUDITED

NOTE 17 — OIL AND GAS RESERVE INFORMATION – UNAUDITED:

Our estimated net proved oil and natural gas reserves at December 31, 2013 have been prepared in accordance with guidelines established by the Securities and Exchange Commission (“SEC”). Accordingly, the following reserve estimates are based upon existing economic and operating conditions at the respective dates. There are numerous uncertainties inherent in estimating quantities of proved reserves and in providing the future rates of production and timing of development expenditures. The following reserve data represents estimates only and should not be construed as being exact. In addition, the present values should not be construed as the market value of the oil and gas properties or the cost that would be incurred to obtain equivalent reserves.

The following table sets forth an analysis of the estimated quantities of net proved and proved developed oil (including condensate), natural gas and natural gas liquids (“NGL”) reserves, all of which are located onshore and offshore the continental United States. Estimated proved oil, natural gas and NGL reserves at December 31, 2013, 2012 and 2011 are prepared in accordance with the SEC’s rule, “Modernization of Oil and Gas Reporting,” using a historical 12-month average pricing assumption. In the first quarter of 2012, we began reporting NGL volumes and revenues separately from gas volumes. Historically, we reported “wet” gas volumes, which included entrained liquids. We now report NGLs and “dry” gas (shrunk for removal of liquids) volumes. Reserve volumes for the year ended December 31, 2011 have been reclassified to conform to the current presentation. Reserve volumes for the year ended December 31, 2010 have not been reclassified to conform to the current presentation given the immateriality of NGL volumes in such period.

	Oil (MBbls)			NGLs (MBbls)			Natural Gas (MMcf)			Oil, Natural Gas and NGLs (MMcfe)
Estimated proved reserves as of December 31, 2010		33,203			—			274,705			473,923
Revisions of previous estimates		2,889			4,911			(26,725	)		20,075
Extensions, discoveries and other additions		3,544			—			93,520			114,784
Purchase of producing properties		14,396			—			24,595			110,971
Sale of reserves		(1,950	)		—			(2,150	)		(13,850	)
Production		(6,427	)		(506	)		(38,466	)		(80,064	)
Estimated proved reserves as of December 31, 2011		45,655			4,405			325,479			625,839
Revisions of previous estimates		(1,559	)		9,349			(26,694	)		20,050
Extensions, discoveries and other additions		3,681			4,856			131,408			182,633
Purchase of producing properties		4,336			619			8,168			37,895
Sale of reserves		(60	)		—			(418	)		(775	)
Production		(7,135	)		(1,163	)		(42,569	)		(92,357	)
Estimated proved reserves as of December 31, 2012		44,918			18,066			395,374			773,285
Revisions of previous estimates		3,606			2,439			36,006			72,275
Extensions, discoveries and other additions		2,367			4,395			79,729			120,299
Sale of reserves		(170	)		—			(214	)		(1,235	)
Production		(6,894	)		(1,603	)		(50,129	)		(101,111	)
Estimated proved reserves as of December 31, 2013		43,827			23,297			460,766			863,513
Estimated proved developed reserves:
as of December 31, 2011		30,914			3,195			171,871			376,528
as of December 31, 2012		29,005			8,593			210,956			436,540
as of December 31, 2013		27,920			11,569			246,946			483,885

The following narrative provides the reasons for the significant changes in the quantities of our estimated proved reserves by year.

Year Ended December 31, 2013. Extensions, discoveries and other additions were primarily the result of our Appalachia drilling program (117 Bcfe). Revisions of previous estimates were primarily the result of positive reserve report pricing changes extending the economic limits of reservoirs (17.8 Bcfe) and well performance (54.5 Bcfe).

Year Ended December 31, 2012. Extensions, discoveries and other additions were primarily the result of our Appalachia drilling program (162 Bcfe) and our deep gas development project at LaCantera (17 Bcfe). Purchase of producing properties relates to our acquisition of an additional interest in the Pompano field.

Year Ended December 31, 2011. Extensions, discoveries and other additions were primarily the result of our Appalachia drilling program (94 Bcfe), our deep gas development project at LaPosada (11 Bcfe) and our GOM drilling program at Mississippi Canyon Block 109 (6 Bcfe). Purchase of producing properties primarily relates to our acquisition of the Pompano and Mica fields (102 Bcfe) and our acquisition of an additional 15% working interest in the Pyrenees project (6 Bcfe). Sale of reserves primarily relates to the sale of our non-operated interest in the Main Pass Block 296 and 311 fields (13 Bcfe).

The following tables present the standardized measure of discounted future net cash flows related to estimated proved oil, natural gas and NGL reserves together with changes therein, including a reduction for estimated plugging and abandonment costs that are also reflected as a liability on the balance sheet at December 31, 2013. You should not assume that the future net cash flows or the discounted future net cash flows, referred to in the tables below, represent the fair value of our estimated oil, natural gas and NGL reserves. Prices are based on either the historical 12-month average price based on closing prices on the first day of each month, or prices defined by existing contractual arrangements. The 2013 average historical 12-month oil and gas prices, net of applicable differentials, were $102.21 per Bbl of oil, $37.59 per Bbl of NGLs and $3.66 per Mcf of gas. The 2012 average 12-month oil and gas prices, net of applicable differentials, were $101.20 per Bbl of oil, $38.23 per Bbl of NGLs and $2.68 per Mcf of gas. The 2011 average 12-month oil and gas prices, net of applicable differentials, were $100.97 per Bbl of oil, $58.26 per Bbl of NGLs and $4.74 per Mcf of gas. Future production and development costs are based on current costs with no escalations. Estimated future cash flows net of future income taxes have been discounted to their present values based on a 10% annual discount rate.

	Standardized Measure Year Ended December 31,
	2013			2012			2011
Future cash inflows	$	7,040,928		$	6,295,455		$	6,171,279
Future production costs		(2,062,657	)		(1,946,426	)		(1,747,806	)
Future development costs		(1,431,101	)		(1,241,531	)		(1,219,214	)
Future income taxes		(884,637	)		(799,007	)		(852,364	)
Future net cash flows		2,662,533			2,308,491			2,351,895
10% annual discount		(977,531	)		(794,632	)		(808,933	)
Standardized measure of discounted future net cash flows	$	1,685,002		$	1,513,859		$	1,542,962
	Changes in Standardized Measure Year Ended December 31,
	2013			2012			2011
Standardized measure at beginning of year	$	1,513,859		$	1,542,962		$	957,629
Sales and transfers of oil, gas and NGLs produced, net of production costs		(708,017	)		(697,741	)		(670,347	)
Changes in price, net of future production costs		229,425			(380,841	)		502,324
Extensions and discoveries, net of future production and development costs		155,592			178,272			293,168
Changes in estimated future development costs, net of development costs incurred during the period		28,684			212,329			97,852
Revisions of quantity estimates		281,558			76,450			(27,854	)
Accretion of discount		202,087			207,292			118,722
Net change in income taxes		(28,084	)		22,947			(300,363	)
Purchases of reserves in-place		—			276,389			567,286
Sales of reserves in-place		15,531			2,480			(36,278	)
Changes in production rates due to timing and other		(5,633	)		73,320			40,823
Net increase (decrease) in standardized measure		171,143			(29,103	)		585,333
Standardized measure at end of year	$	1,685,002		$	1,513,859		$	1,542,962

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Income Taxes - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Income Tax Disclosure [Abstract]
Current federal income tax benefit	$ (10,904)	$ 15,022	$ (20,386)
Current income tax receivable	7,366	10,027
Operating loss carryforwards	67,882
Operating loss carryforwards expiration year	2033
Statutory depletion deductions available for tax reporting purposes	1,453
Income taxes allocated to other comprehensive income related to oil and gas hedges	(17,003)	3,918	20,290
Unrecognized tax benefits, interest expense	$ 0	$ 385

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CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (USD $) In Thousands	Total	Common Stock	Treasury Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)
Beginning Balance at Dec. 31, 2010	$ 430,357	$ 478	$ (860)	$ 1,331,500	$ (886,557)	$ (14,204)
Net income	194,332				194,332
Adjustment for fair value accounting of derivatives, net of tax	36,072					36,072
Exercise of stock options and vesting of restricted stock	(2,581)	3		(2,584)
Amortization of stock compensation expense	8,914			8,914
Net tax impact from stock option exercises and restricted stock vesting	735			735
Ending Balance at Dec. 31, 2011	667,829	481	(860)	1,338,565	(692,225)	21,868
Net income	149,426				149,426
Adjustment for fair value accounting of derivatives, net of tax	6,965					6,965
Exercise of stock options and vesting of restricted stock	(3,773)	3		(3,776)
Amortization of stock compensation expense	12,792			12,792
Net tax impact from stock option exercises and restricted stock vesting	814			814
Convertible notes offering	38,080			38,080
Ending Balance at Dec. 31, 2012	872,133	484	(860)	1,386,475	(542,799)	28,833
Net income	117,634				117,634
Adjustment for fair value accounting of derivatives, net of tax	(30,228)					(30,228)
Adjustment for foreign currency translation, net of tax	(667)					(667)
Exercise of stock options and vesting of restricted stock	(3,126)	4		(3,130)
Amortization of stock compensation expense	15,424			15,424
Net tax impact from stock option exercises and restricted stock vesting	(884)			(884)
Ending Balance at Dec. 31, 2013	$ 970,286	$ 488	$ (860)	$ 1,397,885	$ (425,165)	$ (2,062)

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CONSOLIDATED BALANCE SHEET (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Statement Of Financial Position [Abstract]
Other property and equipment, accumulated depreciation	$ 21,748	$ 26,429
Other assets, accumulated depreciation and amortization	$ 5,768	$ 6,438
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	48,750,533	48,392,552
Treasury stock, shares	16,582	16,582

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INCOME TAXES

12 Months Ended

Dec. 31, 2013

Income Tax Disclosure [Abstract]

INCOME TAXES

NOTE 10 — INCOME TAXES:

An analysis of our deferred taxes follows:

	As of December 31,
	2013			2012
Tax effect of temporary differences:
Net operating loss carryforwards	$	24,437		$	—
Oil and gas properties – full cost		(576,393	)		(465,862	)
Asset retirement obligations		180,905			175,788
Stock compensation		5,537			5,588
Hedges		826			(16,983	)
Accrued incentive compensation		9,189			4,762
Other		(3,484	)		1,391
		($358,983	)		($295,316	)

We estimate that we have approximately ($10,904), $15,022 and ($20,386) of current federal income tax expense (benefit) for the years ended December 31, 2013, 2012 and 2011, respectively. We have a $7,366 and $10,027 current income tax receivable at December 31, 2013 and 2012, respectively.

For tax reporting purposes, operating loss carryforwards totaled approximately $67,882 at December 31, 2013. If not utilized, such carryforwards would completely expire by the year 2033. In addition, we had approximately $1,453 in statutory depletion deductions available for tax reporting purposes that may be carried forward indefinitely. Recognition of a deferred tax asset associated with these carryforwards is dependent upon our evaluation that it is more likely than not that the asset will ultimately be realized.

A reconciliation between the statutory federal income tax rate and our effective income tax rate as a percentage of income before income taxes follows:

	Year Ended December 31,
	2013			2012			2011
Income tax expense computed at the statutory federal income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.0			1.0			1.0
IRC Sec. 162(m) limitation		0.8			0.6			0.3
Other		0.1			(0.5	)		(0.3	)
Effective income tax rate		36.9	%		36.1	%		36.0	%

Income taxes allocated to accumulated other comprehensive income related to oil and gas hedges amounted to ($17,003), $3,918 and $20,290 for the years ended December 31, 2013, 2012 and 2011, respectively.

As of December 31, 2013 and 2012, we had unrecognized tax benefits of $0 and $385, respectively. A reconciliation of the total amounts of unrecognized tax benefits follows:

Total unrecognized tax benefits as of December 31, 2012	$	385
Increases (decreases) in unrecognized tax benefits as a result of:		—
Tax positions taken during a prior period		—
Tax positions taken during the current period		—
Settlements with taxing authorities		(385	)
Lapse of applicable statute of limitations		—
Total unrecognized tax benefits as of December 31, 2013	$	—

Our unrecognized tax benefits pertained to proposed state income tax audit adjustments which were settled during 2013. See Note 15 – Commitments and Contingencies for additional information. It is our policy to classify interest and penalties associated with underpayment of income taxes as interest expense and general and administrative expenses, respectively. The liabilities for unrecognized tax benefits and accrued interest payable are components of other current liabilities on our balance sheet.

The tax years 2010 through 2012 remain subject to examination by major tax jurisdictions.

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Document and Entity Information (USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Feb. 25, 2014	Jun. 30, 2013
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2013
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	FY
Trading Symbol	SGY
Entity Registrant Name	STONE ENERGY CORP
Entity Central Index Key	0000904080
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		49,790,620
Entity Public Float			$ 961.6

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LONG-TERM DEBT

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

LONG-TERM DEBT

NOTE 11 — LONG-TERM DEBT:

Long-term debt consisted of the following:

	As of December 31,
	2013		2012
8 5⁄8% Senior Notes due 2017	$	—	$	375,000
1 3⁄4% Senior Convertible Notes due 2017		252,084		239,126
7 1⁄2% Senior Notes due 2022		775,000		300,000
Bank debt		—		—
Total long-term debt	$	1,027,084	$	914,126

Bank Debt

On April 26, 2011, we entered into an amended and restated revolving credit facility with commitments totaling $700,000 (subject to borrowing base limitations) through a syndicated bank group, replacing our previous facility. Our bank credit facility matures on April 26, 2015. On December 18, 2013, our borrowing base was reaffirmed at $400,000. As of December 31, 2013 and February 25, 2014, we had no outstanding borrowings under our bank credit facility and letters of credit totaling $21,406 had been issued pursuant to our bank credit facility, leaving $378,594 of availability under our bank credit facility.

The borrowing base under our bank credit facility is redetermined semi-annually, in May and November, by the lenders, taking into consideration the estimated value of our oil and gas properties and those of our direct and indirect material subsidiaries in accordance with the lenders’ customary practices for oil and gas loans. In addition, we and the lenders each have discretion at any time, but not more than two additional times in any calendar year, to have the borrowing base redetermined. If a reduction in our borrowing base were to fall below any outstanding balances under the bank credit facility plus any outstanding letters of credit, our agreement with the banks allows us one or more of three options to cure the borrowing base deficiency: (1) repay amounts outstanding sufficient to cure the deficiency within 10 days after our written election to do so; (2) add additional oil and gas properties acceptable to the banks to the borrowing base and take such actions necessary to grant the banks a mortgage in the properties within 30 days after our written election to do so or (3) arrange to pay the deficiency in five equal monthly installments.

Our bank credit facility is guaranteed by our only significant subsidiary, Stone Offshore. Our bank credit facility is collateralized by substantially all of Stone’s and Stone Offshore’s assets. Stone and Stone Offshore are required to mortgage, and grant a security interest in, their oil and natural gas reserves representing at least 80% of the discounted present value of the future net cash flows from their oil and natural gas reserves reviewed in determining the borrowing base. At Stone’s option, loans under our bank credit facility will bear interest at a rate based on the adjusted London Interbank Offering (“Libor”) Rate plus an applicable margin, or a rate based on the prime rate or federal funds rate plus an applicable margin.

Under the financial covenants of our bank credit facility, we must (1) maintain a ratio of consolidated debt to consolidated EBITDA, as defined in the credit agreement, for the preceding four quarterly periods of not greater than 3.25 to 1 and (2) maintain a ratio of consolidated EBITDA to consolidated Net Interest Expense, as defined in the credit agreement, for the preceding four quarterly periods of not less than 3.0 to 1. As of December 31, 2013, our debt to EBITDA ratio was 1.73 to 1 and our EBITDA to consolidated Net Interest Expense ratio was approximately 18.40 to 1. In addition, our bank credit facility includes certain customary restrictions or requirements with respect to disposition of properties, incurrence of additional debt, change of ownership and reporting responsibilities. These covenants may limit or prohibit us from paying cash dividends but do allow for limited stock repurchases. These covenants also restrict our ability to prepay other indebtedness under certain circumstances. We were in compliance with all covenants as of December 31, 2013.

2017 Convertible Notes

On March 6, 2012, we issued in a private offering $300,000 in aggregate principal amount of the 2017 Convertible Notes to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). The 2017 Convertible Notes are convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, based on an initial conversion rate of 23.4449 shares of our common stock per $1 principal amount of 2017 Convertible Notes, which corresponds to an initial conversion price of approximately $42.65 per share of our common stock. On December 31, 2013, our closing share price was $34.59. The conversion rate, and thus the conversion price, may be adjusted under certain circumstances as described in the indenture related to the 2017 Convertible Notes.

The 2017 Convertible Notes may be converted by the holder, in multiples of $1 principal amount, only under the following circumstances:

• prior to December 1, 2016, on any date during any calendar quarter beginning after June 30, 2012 (and only during such calendar quarter) if the closing sale price of our common stock was more than 130% of the then current conversion price for at least 20 trading days in the period of the 30 consecutive trading days ending on the last trading day of the previous calendar quarter;

• prior to December 1, 2016, if we distribute to all or substantially all holders of our common stock rights, options or warrants entitling them to purchase, for a period of 45 calendar days or less from the declaration date for such distribution, shares of our common stock at a price per share less than the average closing sale price of our common stock for the 10 consecutive trading days immediately preceding, but excluding, the declaration date for such distribution;

• prior to December 1, 2016, if we distribute to all or substantially all holders of our common stock cash, other assets, securities or rights to purchase our securities, which distribution has a per share value exceeding 10% of the closing sale price of our common stock on the trading day immediately preceding the declaration date for such distribution, or if we engage in certain corporate transactions described in the indenture related to the 2017 Convertible Notes;

• prior to December 1, 2016, during the five consecutive business-day period following any five consecutive trading-day period in which the trading price per $1 principal amount of 2017 Convertible Notes for each trading day during such five trading-day period was less than 98% of the closing sale price of our common stock for each trading day during such five trading-day period multiplied by the then current conversion rate; or

• on or after December 1, 2016, and prior to the close of business on the second scheduled trading day immediately preceding the maturity date of the 2017 Convertible Notes, which is March 1, 2017, without regard to the foregoing conditions.

Upon conversion, we will be obligated to pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. If we satisfy our conversion obligation solely in cash or through payment and delivery, as the case may be, of a combination of cash and shares of our common stock, the amount of cash and shares of common stock, if any, due upon conversion will be based on a daily conversion value (as described in the indenture related to the 2017 Convertible Notes) calculated on a proportionate basis for each trading day in a 25 consecutive trading-day conversion period (as described in the indenture related to the 2017 Convertible Notes). Upon any conversion, subject to certain exceptions, holders of the 2017 Convertible Notes will not receive any cash payment representing accrued and unpaid interest. Instead, interest will be deemed to be paid by the cash, shares of our common stock or a combination of cash and shares of our common stock paid or delivered, as the case may be, upon conversion of a 2017 Convertible Note.

In connection with the offering, we entered into convertible note hedge transactions with respect to our common stock (the “Purchased Call Options”) with Barclays Capital Inc., acting as agent for Barclays Bank PLC and Bank of America, N.A. (the “Dealers”). We paid an aggregate amount of approximately $70,830 to the Dealers for the Purchased Call Options. The Purchased Call Options cover, subject to customary antidilution adjustments, approximately 7,033,470 shares of our common stock at a strike price that corresponds to the initial conversion price of the 2017 Convertible Notes, also subject to adjustment, and are exercisable upon conversion of the 2017 Convertible Notes.

We also entered into separate warrant transactions whereby, in reliance upon the exemption from registration provided by Section 4(2) of the Securities Act, we sold to the Dealers warrants to acquire, subject to customary antidilution adjustments, approximately 7,033,470 shares of our common stock (the “Sold Warrants”) at a strike price of $55.91 per share of our common stock. We received aggregate proceeds of approximately $40,170 from the sale of the Sold Warrants to the Dealers. If, upon expiration of the Sold Warrants, the price per share of our common stock, as measured under the Sold Warrants, is greater than the strike price of the Sold Warrants, we will be required to issue, without further consideration, under each Sold Warrant a number of shares of our common stock with a value equal to the amount of such difference.

As of December 31, 2013, the carrying amount of the liability component of the 2017 Convertible Notes was $252,084 and $1,750 had been accrued in connection with the March 1, 2014 interest payment. During the year ended December 31, 2013, we recognized $12,959 of interest expense for the amortization of the discount and $1,238 of interest expense for the amortization of deferred financing costs related to the 2017 Convertible Notes. During the year ended December 31, 2012, we recognized $9,956 of interest expense for the amortization of the discount and $951 of interest expense for the amortization of deferred financing costs related to the 2017 Convertible Notes. During the years ended December 31, 2013 and 2012, we recognized $5,250 and $4,302, respectively, of interest expense related to the contractual interest coupon on the 2017 Convertible Notes.

2022 Notes

On November 8, 2012, we completed the public offering of $300,000 aggregate principal amount of our 2022 Notes, which are fully and unconditionally guaranteed on a senior unsecured basis by Stone Offshore and by certain future restricted subsidiaries of Stone. The net proceeds from the offering after deducting underwriting discounts, commissions, fees and expenses totaled $293,203. On November 27, 2013, we completed the public offering of an additional $475,000 aggregate principal amount of our 2022 Notes at a 3% premium. The net proceeds from this offering after deducting underwriting discounts, commissions, fees and expenses totaled $480,195. The 2022 Notes rank equally in right of payment with all of our existing and future senior debt, and rank senior in right of payment to all of our existing and future subordinated debt. The 2022 Notes mature on November 15, 2022, and interest is payable on the 2022 Notes on each May 15 and November 15. We may redeem some or all of the 2022 Notes at any time on or after November 15, 2017 at the redemption prices specified in the indenture, and we may redeem some or all of the 2022 Notes prior to November 15, 2017 at a make-whole redemption price as specified in the indenture. We also may redeem up to 35% of the 2022 Notes prior to November 15, 2015 with cash proceeds from certain equity offerings at a redemption price of 107.500% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date. If we sell certain assets and do not reinvest the proceeds or repay senior indebtedness, or we experience certain changes of control, each as described in the indenture, we must offer to repurchase the 2022 Notes. The 2022 Notes provide for certain covenants, which include, without limitation, restrictions on liens, indebtedness, asset sales, dividend payments and other restricted payments. The violation of any of these covenants could give rise to a default, which if not cured could give the holder of the 2022 Notes a right to accelerate payment. At December 31, 2013, $7,266 had been accrued in connection with the May 15, 2014 interest payment.

2017 Notes

On January 26, 2010, we issued $275,000 aggregate principal amount of our 2017 Notes. On November 17, 2010, we completed a public offering of an additional $100,000 aggregate principal amount of our 2017 Notes. In November 2013, we used proceeds from the 2022 Notes offering to purchase a portion of our 2017 Notes pursuant to a tender offer and consent solicitation. In December 2013, the remaining 2017 Notes were redeemed in full. The total cost of the redemption was $406,967, which included $396,014 to redeem the notes plus accrued and unpaid interest of $10,953. The transaction resulted in a charge to earnings of $27,279 in the fourth quarter of 2013, which represented the premium paid for the repurchase and redemption of $21,014 and the write off of the remaining deferred financing costs related to the 2017 Notes of $6,265.

Deferred Financing Cost and Interest Cost

Other assets at December 31, 2013 and 2012 included approximately $11,754 and $27,753, respectively, of deferred financing costs, net of accumulated amortization. These costs related primarily to the issuance of the 2017 Convertible Notes, the 2022 Notes and our bank credit facility. The costs associated with the 2017 Convertible Notes are being amortized over the life of the notes using a method that applies an effective interest rate of 7.51%. The costs associated with the November 2012 issuance and November 2013 issuance of the 2022 Notes are being amortized over the life of the notes using a method that applies effective interest rates of 7.75% and 7.04%, respectively. The costs associated with our bank credit facility are being amortized over the term of our bank credit facility.

Total interest cost incurred, before capitalization, on all obligations for the years ended December 31, 2013, 2012 and 2011 was $79,697, $68,031 and $51,322 respectively.

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Employee Benefit Plans - Additional Information (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended								12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011	Dec. 31, 2007	Dec. 31, 2007 Minimum [Member]	Dec. 31, 2007 Maximum [Member]	Dec. 31, 2013 2009 plan [Member]	May 20, 2011 2009 plan [Member]	Dec. 31, 2013 2009 plan [Member] All Employee [Member]	Dec. 31, 2013 2009 plan [Member] Non - Employee Directors [Member]	Dec. 31, 2013 Restricted Stock Grants [Member] Minimum [Member]	Dec. 31, 2013 Restricted Stock Grants [Member] Maximum [Member]
Employee Benefit And Retirement Plans [Line Items]
Liability of vested benefits recorded in other long term liabilities	$ 1,062
Expenses related to incentive compensation bonus	15,340	8,113	11,600
Additional number of common stock to be issued under incentive stock options								2,800,000
Vesting period of stock options									5 years	3 years	1 year	3 years
Period after which stock option will expire subsequent to award									10 years	10 years
Additional shares available for issuance							2,081,866
Percentage of vesting of an employee in matching contributions for each year of service	20.00%
Number of years required for vesting of contribution	5 years
Amount of contribution by the company to Stone Energy 401 (k) Profit Sharing Plan	1,793	1,759	1,435
Maximum Percentage of Deferred Compensation plan	100.00%
Plan assets included in other assets	8,248	7,498
Number of times of severance payments relating to annual pay and any target bonus at one hundred percent level	2.99
Percentage of excise tax rate under Section 4999 of the Internal revenue code	20.00%
Percentage of employer matching contribution under 401(k) plan	50.00%
Amount of one week's pay of each full of annual pay under Employee severance Plan				$ 10,000
Maximum period of sum of payments and benefits under employee severance plan					84 days	12 months
Period of involuntary termination of employment				6 months

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CONSOLIDATED STATEMENT OF INCOME (USD $) In Thousands, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Operating revenue:
Oil production	$ 715,104	$ 761,304	$ 663,958
Gas production	190,580	134,739	170,611
Natural gas liquids production	60,687	48,498	29,996
Other operational income	7,808	3,520	3,938
Derivative income, net		3,428	1,418
Total operating revenue	974,179	951,489	869,921
Operating expenses:
Lease operating expenses	201,153	215,003	175,881
Transportation, processing and gathering expenses	42,172	21,782	8,958
Production taxes	15,029	10,015	9,380
Depreciation, depletion and amortization	350,574	344,365	280,020
Accretion expense	33,575	33,331	30,764
Salaries, general and administrative expenses	59,524	54,648	40,169
Franchise tax settlement	12,590
Incentive compensation expense	15,340	8,113	11,600
Other operational expenses	151	267	2,149
Derivative expense, net	2,090
Total operating expenses	732,198	687,524	558,921
Income from operations	241,981	263,965	311,000
Other (income) expenses:
Interest expense	32,837	30,375	9,289
Interest income	(1,695)	(600)	(420)
Other income	(2,799)	(1,805)	(1,942)
Loss on early extinguishment of debt	27,279	1,972	607
Total other (income) expenses	55,622	29,942	7,534
Income before income taxes	186,359	234,023	303,466
Provision (benefit) for income taxes:
Current	(10,904)	15,022	(20,386)
Deferred	79,629	69,575	129,520
Total income taxes	68,725	84,597	109,134
Net income	$ 117,634	$ 149,426	$ 194,332
Basic earnings per share	$ 2.36	$ 3.03	$ 3.97
Diluted earnings per share	$ 2.36	$ 3.03	$ 3.97
Average shares outstanding	48,693	48,319	47,988
Average shares outstanding assuming dilution	48,735	48,361	48,030

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ACQUISITIONS AND DIVESTITURES

12 Months Ended

Dec. 31, 2013

Business Combinations [Abstract]

ACQUISITIONS AND DIVESTITURES

NOTE 5 — ACQUISITIONS AND DIVESTITURES:

Acquisitions

In December 2012, we closed on the acquisition of an office building. The acquisition was accounted for according to the guidance provided in ASC 805, Business Combinations, which requires application of the acquisition method. This methodology requires the recordation of net assets acquired and consideration transferred at fair value. Differences between the net fair value of net assets acquired and consideration transferred are recorded as goodwill or a bargain purchase gain. The building and land were recorded at fair value of $8,539. Consideration transferred in the transaction was $8,539 in cash, resulting in no goodwill or bargain purchase gain.

On June 18, 2012, we completed the acquisition of a 25% working interest in the five block deep water Pompano field in Mississippi Canyon, an approximate 14% working interest in Mississippi Canyon Block 29 and a 10% working interest in certain aliquots of Mississippi Canyon Block 72. The acquisition was also accounted for according to the guidance provided in ASC 805, Business Combinations. Consideration transferred in the transaction was $26,398 in cash, resulting in no goodwill or bargain purchase gain. The following represents the allocation of the recorded value of net assets acquired in the transaction:

Proved oil and gas properties	$	39,221
Unevaluated oil and gas properties		1,637
Asset retirement obligations		(14,460	)
Total fair value of net assets	$	26,398

Divestitures

In October 2013, we completed the sale of our interest in the Weeks Island field for cash consideration of approximately $42,957 and the assumption of the associated asset retirement obligation of approximately $9,245. The sale was accounted for as an adjustment to the full cost pool with no gain or loss recognized.

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CONCENTRATIONS

12 Months Ended

Dec. 31, 2013

Risks And Uncertainties [Abstract]

CONCENTRATIONS

NOTE 4 — CONCENTRATIONS:

Sales to Major Customers

Our production is sold on month-to-month contracts at prevailing prices. We obtain credit protections such as parental guarantees from certain of our purchasers. The following table identifies customers from whom we derived 10% or more of our total oil and gas revenue during the years ended:

	December 31,
	2013			2012			2011
Conoco, Inc.		(a	)		13	%		28	%
Phillips 66 Company		35	%		18	%		(a	)
Shell Trading (US) Company		33	%		41	%		46	%

(a) Less than 10 percent.

The maximum amount of credit risk exposure at December 31, 2013 relating to these customers amounted to $74,273.

We believe that the loss of any of these purchasers would not result in a material adverse effect on our ability to market future oil and gas production.

Production and Reserve Volumes- Unaudited

Approximately 16% of our estimated proved reserves at December 31, 2013 and 49% of our production during 2013 were associated with our Gulf Coast Basin conventional shelf and deep gas properties. Approximately 29% of our estimated proved reserves at December 31, 2013 and 25% of our production during 2013 were associated with our deep water properties. Approximately 55% of our estimated proved reserves at December 31, 2013 and 26% of our production during 2013 were associated with our Appalachian properties.

Cash and Cash Equivalents

A substantial portion of our cash balances are not federally insured.

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EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2013

Postemployment Benefits [Abstract]

EMPLOYEE BENEFIT PLANS

NOTE 16 — EMPLOYEE BENEFIT PLANS:

We have entered into deferred compensation and disability agreements with certain of our officers and former officers. The benefits under the deferred compensation agreements vest after certain periods of employment, and at December 31, 2013, the liability for such vested benefits was approximately $1,062 and is recorded in current and other long-term liabilities.

The following is a brief description of each incentive compensation plan applicable to our employees:

Annual Cash Incentive Compensation Plan

The Amended and Restated Revised Annual Incentive Compensation Plan, which was adopted in November 2007, provides for annual cash incentive bonuses that are tied to the achievement of certain strategic objectives as defined by our board of directors on an annual basis. Stone incurred expenses of $15,340, $8,113, and $11,600, net of amounts capitalized, for each of the years ended December 31, 2013, 2012 and 2011, respectively, related to incentive compensation bonuses to be paid under the revised plan.

Stock Incentive Plans

At the 2011 Annual Meeting of Stockholders, the stockholders approved the First Amendment (the “First Amendment”) to the 2009 Plan. The First Amendment increases the number of shares of our common stock that Stone may issue under the 2009 Plan, and the number of shares of our common stock that may be issued under the 2009 Plan through incentive stock options by 2,800,000 shares, effective May 20, 2011. The 2009 Plan is an amendment and restatement of the company’s 2004 Amended and Restated Stock Incentive Plan (the “2004 Plan”), and it supersedes and replaces in its entirety the 2004 Plan. The 2009 Plan provides for the granting of incentive stock options and restricted stock awards or any combination as is best suited to the circumstances of the particular employee or nonemployee director. The 2009 Plan eliminates the automatic grant of stock options or restricted stock awards to nonemployee directors that was provided for in the 2004 Plan so that awards under the 2009 Plan are entirely at the discretion of our board of directors. Under the 2009 Plan, we may grant both incentive stock options qualifying under Section 422 of the Internal Revenue Code and options that are not qualified as incentive stock options to all employees and directors. All such options must have an exercise price of not less than the fair market value of our common stock on the date of grant and may not be re-priced without stockholder approval. Stock options to all employees vest ratably over a five-year service-vesting period and expire 10 years subsequent to award. Stock options issued to non-employee directors vest ratably over a three-year service-vesting period and expire 10 years subsequent to award. In addition, the 2009 Plan provides that shares available under the 2009 Plan may be granted as restricted stock. Restricted stock grants typically vest in one to three years at the discretion of the Compensation Committee of our board of directors. At December 31, 2013, we had approximately 2,081,866 additional shares available for issuance pursuant to the Plan.

401(k) and Deferred Compensation Plans

The Stone Energy 401(k) Profit Sharing Plan provides eligible employees with the option to defer receipt of a portion of their compensation and we may, at our discretion, match a portion or all of the employee’s deferral. The amounts held under the plan are invested in various investment funds maintained by a third party in accordance with the directions of each employee. An employee is 20% vested in matching contributions (if any) for each year of service and is fully vested upon five years of service. For the years ended December 31, 2013, 2012 and 2011, Stone contributed $1,793, $1,759 and $1,435, respectively, to the plan.

The Stone Energy Corporation Deferred Compensation Plan provides eligible executives and employees with the option to defer up to 100% of their compensation for a calendar year and we may, at our discretion, match a portion or all of the participant’s deferral based upon a percentage determined by our board of directors. To date there have been no matching contributions made by Stone. The amounts held under the plan are invested in various investment funds maintained by a third party in accordance with the direction of each participant. At December 31, 2013 and 2012, plan assets of $8,248 and $7,498, respectively, were included in other assets. An equal amount of plan liabilities were included in other long-term liabilities.

Change of Control and Severance Plans

On April 7, 2009, we amended and restated our Executive Change of Control and Severance Plan effective as of December 31, 2008 (as so amended and restated, the “Executive Plan”). The Executive Plan also replaced and superseded our Executive Change in Control and Severance Policy that was maintained for certain designated executives (specifically, the CEO and CFO). The Executive Plan will provide the company’s officers that are terminated in the event of a change of control and upon certain other terminations of employment with change of control and severance benefits as defined in the Executive Plan. Executives who are terminated within the scope of the Executive Plan will be entitled to certain payments and benefits including the following: a base salary up to the date of termination; in the case of the CEO and CFO, a lump sum severance payment of 2.99 times the sum of his annual pay and any target bonus at the one hundred percent level; a lump sum amount representing a pro rata share of the bonus opportunity up to the date of termination at the then projected rate of payout; in the case of officers other than the CEO and CFO and an involuntary termination occurring outside a change of control period, a lump sum severance payment in an amount equal to the executive’s annual base salary; in the case of officers other than the CEO and CFO and an involuntary termination occurring during a change of control period, a lump sum severance payment in an amount equal to 2.99 times the executive’s annual base salary; continued health plan coverage for six months and outplacement services. In the case of the CEO and CFO, if the payments would be “excess parachute payments,” they will be reduced as necessary to avoid the 20% excise tax under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), but only if the executive is in a better net after-tax position after such reduction. Also, if a payment would be to a “key employee” for purposes of Section 409A of the Code, payment will be delayed until six months after his termination if required to comply with Section 409A. Benefits paid upon a change of control, without regard to whether there is a termination of employment, include the following: lapse of restrictions on restricted stock, accelerated vesting and cash-out of all in-the-money stock options, a 401(k) plan employer matching contribution at the rate of 50%, and a pro-rated portion of the projected bonus, if any, for the year of change of control.

On December 7, 2007, our board of directors approved and adopted the Stone Energy Corporation Employee Change of Control Severance Plan (“Employee Severance Plan”), as amended and restated to comply with the final regulations under Section 409A of the Internal Revenue Code and to provide that said plan will remain in force and effect unless and until terminated by our board of directors. The Employee Severance Plan amended and restated the company’s previous Employee Change of Control Severance Plan dated November 16, 2006. The Employee Severance Plan covers all full-time employees other than officers. Severance is triggered by an involuntary termination of employment on and during the six-month period following a change of control, including a resignation by the employee relating to a change in duties. Employees who are terminated within the scope of the Employee Severance Plan will be entitled to certain payments and benefits including the following: a lump sum equal to (1) weekly pay times full years of service, plus (2) one week’s pay for each full $10,000 of annual pay, but the sum of (1) and (2) cannot be less than 12 weeks of pay or greater than 52 weeks of pay; continued health plan coverage for six months; and a pro-rated portion of the employee’s targeted bonus for the year. Benefits paid upon a change of control, without regard to whether there is a termination of employment, include the following: lapse of restrictions on restricted stock, accelerated vesting and cash-out of all in-the-money stock options, a 401(k) plan employer matching contribution at the rate of 50%, and a lump sum cash payment equal to the product of (i) the number of “restricted shares” of company stock that the employee would have received under the company’s stock plan but did not receive for the time-vested portion of his long-term stock incentive award, if any, for the calendar year in which the change of control occurs times (ii) the price per share of the company’s common stock utilized in effecting the change of control, provided that such amount shall be pro-rated by multiplying such amount by the number of full months that have elapsed from January 1 of that calendar year to the effective date of the change of control and then dividing the result by 12.

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

12 Months Ended

Dec. 31, 2013

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

NOTE 12 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS):

Changes in accumulated other comprehensive income (loss) by component for the year ended December 31, 2013 were as follows:

	Cash Flow Hedges			Foreign Currency Items			Total
For the Year Ended December 31, 2013
Beginning balance, net of tax	$	28,833		$	—		$	28,833
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		(26,945	)		—			(26,945	)
Foreign currency translations		—			(667	)		(667	)
Income tax effect		9,701			—			9,701
Net of tax		(17,244	)		(667	)		(17,911	)
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		20,289			—			20,289
Income tax effect		(7,305	)		—			(7,305	)
Net of tax		12,984			—			12,984
Other comprehensive income (loss), net of tax		(30,228	)		(667	)		(30,895	)
Ending balance, net of tax		($1,395	)		($667	)		($2,062	)

In 2012 and 2011, the only component of accumulated other comprehensive income (loss) related to our cash flow hedges. Changes in accumulated other comprehensive income (loss) for the years ended December 31, 2012 and 2011 were as follows:

	Cash Flow Hedges
For the Year Ended December 31, 2012
Beginning balance, net of tax	$	21,868
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		41,209
Income tax effect		(14,836	)
Net of tax		26,373
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		30,326
Income tax effect		(10,918	)
Net of tax		19,408
Other comprehensive income, net of tax		6,965
Ending balance, net of tax	$	28,833

	Cash Flow Hedges
For the Year Ended December 31, 2011
Beginning balance, net of tax		($14,204	)
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives		43,089
Income tax effect		(15,512	)
Net of tax		27,577
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/gas production		(13,274	)
Income tax effect		4,779
Net of tax		(8,495	)
Other comprehensive income, net of tax		36,072
Ending balance, net of tax	$	21,868

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Results of Operations by Quarter (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended									12 Months Ended
	Dec. 31, 2013		Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Quarterly Financial Information Disclosure [Abstract]
Operating revenue	$ 239,253		$ 256,685	$ 245,877	$ 233,732	$ 254,871	$ 227,397	$ 226,561	$ 244,957	$ 974,179	$ 951,489	$ 869,921
Income from operations	37,206	[1]	62,422	69,525	72,828	78,397	44,485	56,156	84,927	241,981	263,965	311,000
Net income	$ 1,752	[1],[2]	$ 36,102	$ 39,022	$ 40,758	$ 44,246	$ 23,659	$ 30,547	$ 50,974	$ 117,634	$ 149,426	$ 194,332
Basic earnings per share	$ 0.04		$ 0.72	$ 0.78	$ 0.82	$ 0.89	$ 0.48	$ 0.62	$ 1.04	$ 2.36	$ 3.03	$ 3.97
Diluted earnings per share	$ 0.04		$ 0.72	$ 0.78	$ 0.82	$ 0.89	$ 0.48	$ 0.62	$ 1.04	$ 2.36	$ 3.03	$ 3.97

[1] Includes franchise tax settlement of $12,590 before income tax effect ($8,058, net of income tax effect).

[2] Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

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FAIR VALUE MEASUREMENTS

12 Months Ended

Dec. 31, 2013

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

NOTE 8 – FAIR VALUE MEASUREMENTS:

U.S. GAAP establishes a fair value hierarchy that has three levels based on the reliability of the inputs used to determine the fair value. These levels include: Level 1, defined as inputs such as unadjusted quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs for use when little or no market data exists, therefore requiring an entity to develop its own assumptions.

As of December 31, 2013 and December 31, 2012, we held certain financial assets and liabilities that are required to be measured at fair value on a recurring basis, including our commodity derivative instruments and our investments in marketable securities. We utilize the services of an independent third party to assist us in valuing our derivative instruments. We used the income approach in determining the fair value of our derivative instruments utilizing a proprietary pricing model. The model accounts for our credit risk and the credit risk of our counterparties in the discount rate applied to estimated future cash inflows and outflows. Our swap contracts are included within the Level 2 fair value hierarchy. For a more detailed description of our derivative instruments, see Note 7 - Derivative Instruments and Hedging Activities. We used the market approach in determining the fair value of our investments in marketable securities, which are included within the Level 1 fair value hierarchy.

The following tables present our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2013:

	Fair Value Measurements at December 31, 2013
Assets	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Marketable securities	$	8,248	$	8,248	$	—	$	—
Hedging contracts		5,927		—		5,927		—
Total	$	14,175	$	8,248	$	5,927	$	—

	Fair Value Measurements at December 31, 2013
Liabilities	Total		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Hedging contracts	$	8,223	$	—	$	8,223	$	—
Total	$	8,223	$	—	$	8,223	$	—

The following tables present our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2012:

	Fair Value Measurements at December 31, 2012
Assets	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Marketable securities	$	13,492	$	13,492	$	—	$	—
Hedging contracts		48,854		—		48,854		—
Total	$	62,346	$	13,492	$	48,854	$	—

	Fair Value Measurements at December 31, 2012
Liabilities	Total		Quoted Prices in Active Markets for Identical Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Hedging contracts	$	1,679	$	—	$	1,679	$	—
Total	$	1,679	$	—	$	1,679	$	—

The fair value of cash and cash equivalents and our variable-rate bank debt approximated book value at December 31, 2013 and 2012. As of December 31, 2012, the fair value of the 8 ⁵⁄₈% Senior Notes due 2017 (the “2017 Notes”) was approximately $401,250. On December 13, 2013, our 2017 Notes were fully redeemed. As of December 31, 2013 and 2012, the fair value of the liability component of the 2017 Convertible Notes was approximately $260,377 and $249,601, respectively. On November 27, 2013, we completed the public offering of $475,000 aggregate principal amount of additional 7 ¹⁄₂% Senior Notes due 2022 (the “2022 Notes”). See Note 11 – Long-Term Debt. As of December 31, 2013 and 2012, the fair value of the 2022 Notes was approximately $814,719 and $314,250, respectively.

The fair value of the 2017 Notes and the fair value of the 2022 Notes were determined based upon quotes obtained from brokers, which represent Level 1 inputs. We applied fair value concepts in determining the liability component of the 2017 Convertible Notes (see Note 11 – Long-Term Debt) at inception, at December 31, 2013 and at December 31, 2012. The fair value of the liability was estimated using an income approach. The significant inputs in these determinations were market interest rates based on quotes obtained from brokers and represent Level 2 inputs.

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Before Tax Effect of Derivative Instruments in Statement of Operations (Detail) (Cash Flow Hedging [Member], USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013		Dec. 31, 2012		Dec. 31, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain Recognized in Other Comprehensive Income (Loss), Effective Portion, Net, Total	$ (26,945)		$ 41,209		$ 43,089
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net, Total	20,289	[1]	30,326	[1]	(13,274)	[1]
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net, Total	(2,090)		3,428		1,418
Commodity Contracts [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain Recognized in Other Comprehensive Income (Loss), Effective Portion, Net, Total	(26,945)		41,209		43,089
Derivative income (expense), net [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net, Total	(2,090)		3,428		1,418
Operating revenue - oil/gas production [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net, Total	$ 20,289	[1]	$ 30,326	[1]	$ (13,274)	[1]

[1] For the year ended December 31, 2013, effective hedging contracts increased oil revenue by $3,520 and increased gas revenue by $16,769. For the year ended December 31, 2012, effective hedging contracts increased oil revenue by $8,546 and increased gas revenue by $21,780. For the year ended December 31, 2011, effective hedging contracts decreased oil revenue by $32,706 and increased gas revenue by $19,432.

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INVESTMENT IN OIL AND GAS PROPERTIES - UNAUDITED

12 Months Ended

Dec. 31, 2013

Extractive Industries [Abstract]

INVESTMENT IN OIL AND GAS PROPERTIES - UNAUDITED

NOTE 6 — INVESTMENT IN OIL AND GAS PROPERTIES — UNAUDITED:

The following table discloses certain financial data relative to our oil and gas producing activities located onshore and offshore in the continental United States:

	Year Ended December 31,
	2013			2012			2011
Oil and gas properties – United States, proved and unevaluated:
Balance, beginning of year	$	7,692,261		$	7,049,777		$	6,202,758
Costs incurred during the year (capitalized):
Acquisition costs, net of sales of unevaluated properties		70,903			102,807			270,354
Exploratory costs		297,113			81,458			84,199
Development costs (1)		378,242			395,555			426,355
Salaries, general and administrative costs		32,815			25,318			24,430
Interest		46,860			37,656			42,033
Less: overhead reimbursements		(321	)		(310	)		(352	)
Total costs incurred during the year, net of divestitures		825,612			642,484			847,019
Balance, end of year	$	8,517,873		$	7,692,261		$	7,049,777
Accumulated DD&A:
Balance, beginning of year	($	5,510,166	)	($	5,174,729	)	($	4,804,949	)
Provision for DD&A		(346,827	)		(341,096	)		(276,480	)
Sale of proved properties		(51,767	)		5,659			(93,300	)
Balance, end of year	($	5,908,760	)	($	5,510,166	)	($	5,174,729	)
Net capitalized costs – United States, proved and unevaluated	$	2,609,113		$	2,182,095		$	1,875,048
DD&A per Mcfe	$	3.43		$	3.69		$	3.45

(1) Includes capitalized asset retirement costs of $54,737, $95,293 and $96,386, respectively.

Costs incurred during the year (expensed):
Lease operating expenses	$	201,153	$	215,003	$	175,881
Transportation, processing and gathering expenses		42,172		21,782		8,958
Production taxes		15,029		10,015		9,380
Accretion expense		33,575		33,331		30,764
Expensed costs – United States	$	291,929	$	280,131	$	224,983

The following table discloses net costs incurred (evaluated) on our unevaluated properties located in the United States for the years indicated:

	Year Ended December 31,
	2013		2012			2011
Unevaluated oil and gas properties – United States:
Net costs incurred (evaluated) during year:
Acquisition costs	$	30,271	$	9,739			($2,397	)
Exploration costs		188,830		(1,209	)		(51,207	)
Capitalized interest		46,860		37,656			42,033
	$	265,961	$	46,186			($11,571	)

During 2013, we entered into an agreement to participate in the drilling of exploratory wells in Canada. The following table discloses certain financial data relative to our oil and gas producing activities located in Canada:

	Year Ended December 31,
	2013
Oil and gas properties – Canada, unevaluated:
Balance, beginning of year	$	—
Costs incurred during the year (capitalized):
Acquisition costs		8,764
Exploratory costs		1,819
Total costs incurred during the year		10,583
Balance, end of year, unevaluated	$	10,583

The following table discloses financial data associated with unevaluated costs (United States and Canada) at December 31, 2013:

	Balance as of December 31, 2013		Net Costs Incurred During the Year Ended December 31,
			2013		2012		2011		2010 and prior
Acquisition costs	$	306,793	$	78,555	$	29,959	$	41,442	$	156,837
Exploration costs		305,422		248,846		56,033		499		44
Capitalized interest		112,124		39,846		32,755		20,501		19,022
Total unevaluated costs	$	724,339	$	367,247	$	118,747	$	62,442	$	175,903

Approximately 140 specifically identified drilling projects are included in unevaluated costs at December 31, 2013 and are expected to be evaluated in the next four years. The excluded costs will be included in the amortization base as the properties are evaluated and proved reserves are established or impairment is determined. Interest costs capitalized on unevaluated properties during the years ended December 31, 2013, 2012 and 2011 totaled $46,860, $37,656 and $42,033, respectively.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

12 Months Ended

Dec. 31, 2013

Derivative Instruments And Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

NOTE 7 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES:

Our hedging strategy is designed to protect our near and intermediate term cash flows from future declines in oil and natural gas prices. This protection is essential to capital budget planning, which is sensitive to expenditures that must be committed to in advance, such as rig contracts and the purchase of tubular goods. We enter into hedging transactions to secure a commodity price for a portion of future production that is acceptable at the time of the transaction. These hedges are designated as cash flow hedges upon entering into the contract. We do not enter into hedging transactions for trading purposes. We have no fair value hedges.

The nature of a derivative instrument must be evaluated to determine if it qualifies for hedge accounting treatment. If the instrument qualifies for hedge accounting treatment, it is recorded as either an asset or liability measured at fair value and subsequent changes in the derivative’s fair value are recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge is considered effective. Additionally, monthly settlements of effective hedges are reflected in revenue from oil and gas production and cash flows from operations. Instruments not qualifying for hedge accounting treatment are recorded in our balance sheet at fair value, and changes in fair value are recognized in earnings through derivative expense (income). Monthly settlements of ineffective hedges are recognized in earnings through derivative expense (income) and cash flows from operations. Typically, a small portion of our derivative contracts are determined to be ineffective. This is because oil and natural gas price changes in the markets in which we sell our products are not 100% correlative to changes in the underlying price basis indicative in the derivative contract.

We have entered into fixed-price swaps with various counterparties for a portion of our expected 2014, 2015 and 2016 oil and natural gas production from the Gulf Coast Basin. Some of our fixed-price oil swap settlements are based on an average of the New York Mercantile Exchange (“NYMEX”) closing price for West Texas Intermediate crude oil during the entire calendar month, and some are based on the average of the Intercontinental Exchange closing price for Brent crude oil during the entire calendar month. Our fixed-price gas swap settlements are based on the NYMEX price for the last day of a respective contract month. Swaps typically provide for monthly payments by us if prices rise above the swap price or monthly payments to us if prices fall below the swap price. Our fixed-price swap contracts are with The Toronto-Dominion Bank, Barclays Bank PLC, BNP Paribas, The Bank of Nova Scotia, Bank of America, Natixis and Regions Bank.

All of our derivative instruments at December 31, 2013, 2012 and 2011 were designated as effective cash flow hedges. However, during the years ended December 31, 2013, 2012 and 2011, certain of our derivative contracts were determined to be partially ineffective. The following tables disclose the location and fair value amounts of derivative instruments reported in our balance sheet at December 31, 2013 and December 31, 2012.

Fair Value of Derivative Instruments at December 31, 2013
	Asset Derivatives			Liability Derivatives
Description	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Commodity contracts	Current assets: Fair value of hedging contracts	$	4,549	Current liabilities: Fair value of hedging contracts	$	7,753
	Long-term assets: Fair value of hedging contracts		1,378	Long-term liabilities: Fair value of hedging contracts		470
		$	5,927		$	8,223
Fair Value of Derivative Instruments at December 31, 2012
	Asset Derivatives			Liability Derivatives
Description	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Commodity contracts	Current assets: Fair value of hedging contracts	$	39,655	Current liabilities: Fair value of hedging contracts	$	149
	Long-term assets: Fair value of hedging contracts		9,199	Long-term liabilities: Fair value of hedging contracts		1,530
		$	48,854		$	1,679

The following table discloses the before tax effect of derivative instruments in the statement of income for the years ended December 31, 2013, 2012 and 2011.

Effect of Derivative Instruments on the Statement of Income for the Years Ended December 31, 2013, 2012 and 2011
Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives			Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion) (a)				Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion)
				Location				Location
	2013				2013				2013
Commodity contracts		($26,945	)	Operating revenue—oil/gas production	$	20,289		Derivative expense, net		($2,090	)
Total		($26,945	)		$	20,289				($2,090	)
	2012				2012				2012
Commodity contracts	$	41,209		Operating revenue—oil/gas production	$	30,326		Derivative income, net	$	3,428
Total	$	41,209			$	30,326			$	3,428
	2011				2011				2011
Commodity contracts	$	43,089		Operating revenue—oil/gas production		($13,274	)	Derivative income, net	$	1,418
Total	$	43,089				($13,274	)		$	1,418

(a) For the year ended December 31, 2013, effective hedging contracts increased oil revenue by $3,520 and increased gas revenue by $16,769. For the year ended December 31, 2012, effective hedging contracts increased oil revenue by $8,546 and increased gas revenue by $21,780. For the year ended December 31, 2011, effective hedging contracts decreased oil revenue by $32,706 and increased gas revenue by $19,432.

At December 31, 2013, we had an accumulated other comprehensive loss of $1,395, net of tax, which related to the fair value of our swap contracts that were outstanding as of December 31, 2013, the majority of which will be reclassified into earnings in the next 12 months.

Our derivative contracts are subject to netting arrangements. It is our policy not to offset our derivative contracts in presenting the fair value of these contracts as assets and liabilities in our balance sheet. The following presents the potential impact of the rights of offset associated with our recognized assets and liabilities at December 31, 2013:

	As Presented Without Netting			Effects of Netting			With Effects of Netting
Current assets: Fair value of hedging contracts	$	4,549		($	4,043	)	$	506
Long-term assets: Fair value of hedging contracts		1,378			(274	)		1,104
Current liabilities: Fair value of hedging contracts		(7,753	)		4,043			(3,710	)
Long-term liabilities: Fair value of hedging contracts		(470	)		274			(196	)

The following table illustrates our hedging positions for calendar years 2014, 2015 and 2016 as of February 25, 2014:

	Fixed-Price Swaps NYMEX (except where noted)
	Natural Gas					Oil
	Daily Volume (MMBtus/d)			Swap Price ($)		Daily Volume (Bbls/d)			Swap Price ($)
2014		10,000			4.000		1,000			90.06
2014		10,000			4.040		1,000			92.25
2014		10,000			4.105		1,000			93.55
2014		10,000			4.190		1,000			94.00
2014		10,000	(a)		4.250		1,000			98.00
2014		10,000			4.250		1,000			98.30
2014		10,000			4.350		2,000	(b)		98.85
2014							1,000			99.65
2014							1,000	(c)		103.30
2015		10,000			4.005		1,000			89.00
2015		10,000			4.120		1,000			90.00
2015		10,000			4.150
2015		10,000			4.165
2015		10,000			4.220
2015		10,000			4.255
2016		10,000			4.110
2016		10,000			4.120

(a) February through December

(b) January through June

(c) Brent crude oil contract

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ASSET RETIREMENT OBLIGATIONS

12 Months Ended

Dec. 31, 2013

Asset Retirement Obligation Disclosure [Abstract]

ASSET RETIREMENT OBLIGATIONS

NOTE 9 — ASSET RETIREMENT OBLIGATIONS:

The change in our asset retirement obligations during the years ended December 31, 2013, 2012 and 2011 is set forth below:

	Year Ended December 31,
	2013			2012			2011
Asset retirement obligations as of the beginning of the year, including current portion	$	488,302		$	425,779		$	373,920
Liabilities incurred		19,043			3,869			7,993
Liabilities settled		(79,695	)		(67,641	)		(63,226	)
Liabilities assumed		—			15,263			59,441
Divestment of properties		(9,245	)		(7,563	)		(10,900	)
Accretion expense		33,575			33,331			30,764
Revision of estimates		50,533			85,264			27,787
Asset retirement obligations as of the end of the year, including current portion	$	502,513		$	488,302		$	425,779

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Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	$ 8,248	$ 13,492
Assets, Fair Value, Total	14,175	62,346
Liabilities, Fair Value, Total	8,223	1,679
Hedging contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Assets, Fair Value	5,927	48,854
Derivative Liabilities, Fair Value	8,223	1,679
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities	8,248	13,492
Assets, Fair Value, Total	8,248	13,492
Liabilities, Fair Value, Total
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Hedging contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Assets, Fair Value
Derivative Liabilities, Fair Value
Significant Other Observable Inputs (Level 2) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities
Assets, Fair Value, Total	5,927	48,854
Liabilities, Fair Value, Total	8,223	1,679
Significant Other Observable Inputs (Level 2) [Member] | Hedging contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Assets, Fair Value	5,927	48,854
Derivative Liabilities, Fair Value	8,223	1,679
Significant Unobservable Inputs (Level 3) [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Marketable securities
Assets, Fair Value, Total
Liabilities, Fair Value, Total
Significant Unobservable Inputs (Level 3) [Member] | Hedging contracts [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Assets, Fair Value
Derivative Liabilities, Fair Value

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Results of Operations by Quarter (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Quarterly Financial Information Disclosure [Abstract]
Franchise tax settlement	$ 12,590	$ 12,590
Franchise tax settlement, after tax	8,058
Loss on early extinguishment of debt, before tax	27,279	27,279	1,972	607
Loss on early extinguishment of debt, after tax	$ 17,459

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Changes in Asset Retirement Obligations (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Asset Retirement Obligation Disclosure [Abstract]
Asset retirement obligations as of the beginning of the year, including current portion	$ 488,302	$ 425,779	$ 373,920
Liabilities incurred	19,043	3,869	7,993
Liabilities settled	(79,695)	(67,641)	(63,226)
Liabilities assumed		15,263	59,441
Divestment of properties	(9,245)	(7,563)	(10,900)
Accretion expense	33,575	33,331	30,764
Revision of estimates	50,533	85,264	27,787
Asset retirement obligations as of the end of the year, including current portion	$ 502,513	$ 488,302	$ 425,779

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Hedging Positions (Detail)	Dec. 31, 2013 MMBTU
Natural Gas [Member] | 2014 Hedging Position One [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.000
Natural Gas [Member] | 2014 Hedging Position Two [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.040
Natural Gas [Member] | 2014 Hedging Position Three [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.105
Natural Gas [Member] | 2014 Hedging Position Four [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.190
Natural Gas [Member] | 2014 Hedging Position Five [Member]
Derivative [Line Items]
Daily Volume	10,000	[1]
Swap Price	4.250
Natural Gas [Member] | 2014 Hedging Position Six [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.250
Natural Gas [Member] | 2014 Hedging Position Seven [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.350
Natural Gas [Member] | 2015 Hedging Position One [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.005
Natural Gas [Member] | 2015 Hedging Position Two [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.120
Natural Gas [Member] | 2015 Hedging Position Three [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.150
Natural Gas [Member] | 2015 Hedging Position Four [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.165
Natural Gas [Member] | 2015 Hedging Position Five [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.220
Natural Gas [Member] | 2015 Hedging Position Six [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.255
Natural Gas [Member] | 2016 Hedging Position One [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.110
Natural Gas [Member] | 2016 Hedging Position Two [Member]
Derivative [Line Items]
Daily Volume	10,000
Swap Price	4.120
Oil [Member] | 2014 Hedging Position One [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	90.060
Oil [Member] | 2014 Hedging Position Two [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	92.250
Oil [Member] | 2014 Hedging Position Three [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	93.550
Oil [Member] | 2014 Hedging Position Four [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	94.000
Oil [Member] | 2014 Hedging Position Five [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	98.000
Oil [Member] | 2014 Hedging Position Six [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	98.300
Oil [Member] | 2014 Hedging Position Seven [Member]
Derivative [Line Items]
Daily Volume	2	[2]
Swap Price	98.850
Oil [Member] | 2014 Hedging Position Eight [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	99.65
Oil [Member] | 2014 Hedging Position Nine [Member]
Derivative [Line Items]
Daily Volume	1	[3]
Swap Price	103.30
Oil [Member] | 2015 Hedging Position One [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	89.000
Oil [Member] | 2015 Hedging Position Two [Member]
Derivative [Line Items]
Daily Volume	1
Swap Price	90.000

[1] February through December

[2] January through June

[3] Brent crude oil contract

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

12 Months Ended

Dec. 31, 2013

Derivative Instruments And Hedging Activities Disclosure [Abstract]

Location and Fair Value Amounts of Derivative Instruments Reported in Balance Sheet

The following tables disclose the location and fair value amounts of derivative instruments reported in our balance sheet at December 31, 2013 and December 31, 2012.

Fair Value of Derivative Instruments at December 31, 2013
	Asset Derivatives			Liability Derivatives
Description	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Commodity contracts	Current assets: Fair value of hedging contracts	$	4,549	Current liabilities: Fair value of hedging contracts	$	7,753
	Long-term assets: Fair value of hedging contracts		1,378	Long-term liabilities: Fair value of hedging contracts		470
		$	5,927		$	8,223

Fair Value of Derivative Instruments at December 31, 2012
	Asset Derivatives			Liability Derivatives
Description	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Commodity contracts	Current assets: Fair value of hedging contracts	$	39,655	Current liabilities: Fair value of hedging contracts	$	149
	Long-term assets: Fair value of hedging contracts		9,199	Long-term liabilities: Fair value of hedging contracts		1,530
		$	48,854		$	1,679

Before Tax Effect of Derivative Instruments in Statement of Income

The following table discloses the before tax effect of derivative instruments in the statement of income for the years ended December 31, 2013, 2012 and 2011.

Effect of Derivative Instruments on the Statement of Income for the Years Ended December 31, 2013, 2012 and 2011
Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in Other Comprehensive Income on Derivatives			Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion) (a)				Gain (Loss) Recognized in Income on Derivatives (Ineffective Portion)
				Location				Location
	2013				2013				2013
Commodity contracts		($26,945	)	Operating revenue—oil/gas production	$	20,289		Derivative expense, net		($2,090	)
Total		($26,945	)		$	20,289				($2,090	)
	2012				2012				2012
Commodity contracts	$	41,209		Operating revenue—oil/gas production	$	30,326		Derivative income, net	$	3,428
Total	$	41,209			$	30,326			$	3,428
	2011				2011				2011
Commodity contracts	$	43,089		Operating revenue—oil/gas production		($13,274	)	Derivative income, net	$	1,418
Total	$	43,089				($13,274	)		$	1,418

(a) For the year ended December 31, 2013, effective hedging contracts increased oil revenue by $3,520 and increased gas revenue by $16,769. For the year ended December 31, 2012, effective hedging contracts increased oil revenue by $8,546 and increased gas revenue by $21,780. For the year ended December 31, 2011, effective hedging contracts decreased oil revenue by $32,706 and increased gas revenue by $19,432.

Impact of Rights of Offset Associated with Recognized Assets and Liabilities

The following presents the potential impact of the rights of offset associated with our recognized assets and liabilities at December 31, 2013:

	As Presented Without Netting			Effects of Netting			With Effects of Netting
Current assets: Fair value of hedging contracts	$	4,549		($	4,043	)	$	506
Long-term assets: Fair value of hedging contracts		1,378			(274	)		1,104
Current liabilities: Fair value of hedging contracts		(7,753	)		4,043			(3,710	)
Long-term liabilities: Fair value of hedging contracts		(470	)		274			(196	)

Hedging Positions

The following table illustrates our hedging positions for calendar years 2014, 2015 and 2016 as of February 25, 2014:

	Fixed-Price Swaps NYMEX (except where noted)
	Natural Gas					Oil
	Daily Volume (MMBtus/d)			Swap Price ($)		Daily Volume (Bbls/d)			Swap Price ($)
2014		10,000			4.000		1,000			90.06
2014		10,000			4.040		1,000			92.25
2014		10,000			4.105		1,000			93.55
2014		10,000			4.190		1,000			94.00
2014		10,000	(a)		4.250		1,000			98.00
2014		10,000			4.250		1,000			98.30
2014		10,000			4.350		2,000	(b)		98.85
2014							1,000			99.65
2014							1,000	(c)		103.30
2015		10,000			4.005		1,000			90.00
2015		10,000			4.120
2015		10,000			4.150
2015		10,000			4.165
2015		10,000			4.220
2015		10,000			4.255
2016		10,000			4.110
2016		10,000			4.120

(a) February through December

(b) January through June

(c) Brent crude oil contract

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Acquisitions and Divestitures - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended			1 Months Ended
	Dec. 31, 2012	Dec. 31, 2013	Jun. 18, 2012	Oct. 31, 2013 Weeks Island Field [Member]	Jun. 18, 2012 Block Deep Water Pompano Field Mississippi Canyon [Member]	Jun. 18, 2012 Mississippi Canyon Block 29 [Member]	Jun. 18, 2012 Mississippi Canyon Block 72 [Member]
Business Acquisition [Line Items]
Fair value of Land and Building at the time of Acquisition	$ 8,539
Purchase Consideration	8,539
Percentage of working interest acquired					25.00%	14.00%	10.00%
Cash consideration transferred		26,398	26,398
Sale of interest cash consideration				42,957
Estimates asset retirement obligation				9,245
Gain or loss recognized from the sale of interest				$ 0

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SHARE REPURCHASE PROGRAM

12 Months Ended

Dec. 31, 2013

Equity [Abstract]

SHARE REPURCHASE PROGRAM

NOTE 14 — SHARE REPURCHASE PROGRAM:

On September 24, 2007, our board of directors authorized a share repurchase program for an aggregate amount of up to $100,000. The shares may be repurchased from time to time in the open market or through privately negotiated transactions. The repurchase program is subject to business and market conditions and may be suspended or discontinued at any time. Through December 31, 2013, 300,000 shares had been repurchased under this program at a total cost of $7,071, or an average price of $23.57 per share. No shares were repurchased during the years ended December 31, 2013, 2012 and 2011.

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SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2013

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 19 — SUBSEQUENT EVENTS:

On January 16, 2014, we completed the sale of our interests in the Cut Off and Clovelly fields for cash consideration of approximately $41,575. On January 31, 2014, we completed the sale of our interest in the Hatch Point field for cash consideration of approximately $9,720. These sales will be accounted for as an adjustment to capitalized costs with no gain or loss recognized.

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Customers from Whom We Derived Ten Percent or More of Total Oil and Gas Revenue (Detail)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Conoco, Inc [Member]
Concentration Risk [Line Items]
Customers from whom 10% or more revenue derived		13.00%	28.00%
Concentration risk, benchmark description	Less than 10%
Phillips 66 Company [Member]
Concentration Risk [Line Items]
Customers from whom 10% or more revenue derived	35.00%	18.00%
Concentration risk, benchmark description			Less than 10%
Shell Trading (US) Company [Member]
Concentration Risk [Line Items]
Customers from whom 10% or more revenue derived	33.00%	41.00%	46.00%

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COMMITMENTS AND CONTINGENCIES (Tables)

12 Months Ended

Dec. 31, 2013

Commitments And Contingencies Disclosure [Abstract]

Minimum Net Annual Commitments Under all Leases, Subleases and Contracts with Non-Cancelable Terms in Excess of 12 Months

The minimum net annual commitments under all leases, subleases and contracts with non-cancelable terms in excess of 12 months at December 31, 2013 were as follows:

2014	$	736
2015		637
2016		358
2017		301
2018		147

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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended									12 Months Ended
	Dec. 31, 2013		Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Statement Of Income And Comprehensive Income [Abstract]
Net income	$ 1,752	[1],[2]	$ 36,102	$ 39,022	$ 40,758	$ 44,246	$ 23,659	$ 30,547	$ 50,974	$ 117,634	$ 149,426	$ 194,332
Other comprehensive income (loss) net of tax effect:
Derivatives										(30,228)	6,965	36,072
Foreign currency translation										(667)
Comprehensive income										$ 86,739	$ 156,391	$ 230,404

[1] Includes franchise tax settlement of $12,590 before income tax effect ($8,058, net of income tax effect).

[2] Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

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Condensed Consolidating Statement of Income (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended									12 Months Ended
	Dec. 31, 2013		Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Operating revenue:
Oil production										$ 715,104	$ 761,304	$ 663,958
Gas production										190,580	134,739	170,611
Natural gas liquids production										60,687	48,498	29,996
Other operational income										7,808	3,520	3,938
Derivative income, net											3,428	1,418
Total operating revenue	239,253		256,685	245,877	233,732	254,871	227,397	226,561	244,957	974,179	951,489	869,921
Operating expenses:
Lease operating expenses										201,153	215,003	175,881
Transportation, processing and gathering expenses										42,172	21,782	8,958
Production taxes										15,029	10,015	9,380
Depreciation, depletion, amortization										350,574	344,365	280,020
Accretion expense										33,575	33,331	30,764
Salaries, general and administrative										59,524	54,648	40,169
Franchise tax settlement	12,590									12,590
Incentive compensation expense										15,340	8,113	11,600
Other operational expenses										151	267	2,149
Derivative expense, net										2,090
Total operating expenses										732,198	687,524	558,921
Income (loss) from operations	37,206	[1]	62,422	69,525	72,828	78,397	44,485	56,156	84,927	241,981	263,965	311,000
Other (income) expenses:
Interest expense										32,837	30,375	9,289
Interest income										(1,695)	(600)	(420)
Other income										(2,799)	(1,805)	(1,942)
Loss on early extinguishment of debt	27,279									27,279	1,972	607
Total other (income) expenses										55,622	29,942	7,534
Income (loss) before taxes										186,359	234,023	303,466
Provision (benefit) for income taxes:
Current										(10,904)	15,022	(20,386)
Deferred										79,629	69,575	129,520
Total income taxes										68,725	84,597	109,134
Net income (loss)	1,752	[1],[2]	36,102	39,022	40,758	44,246	23,659	30,547	50,974	117,634	149,426	194,332
Comprehensive income (loss)										86,739	156,391	230,404
Parent [Member]
Operating revenue:
Oil production										30,475	26,149	5,675
Gas production										68,895	34,331	19,470
Natural gas liquids production										32,293	15,264
Other operational income										7,163	2,766	3,085
Total operating revenue										138,826	78,510	28,230
Operating expenses:
Lease operating expenses										14,680	19,914	6,632
Transportation, processing and gathering expenses										28,322	12,049
Production taxes										6,229	3,330	1,434
Depreciation, depletion, amortization										93,579	63,022	17,860
Accretion expense										372	561	15
Salaries, general and administrative										59,473	54,641	40,073
Franchise tax settlement										12,590
Incentive compensation expense										15,340	8,113	11,600
Other operational expenses										38	173	1,404
Total operating expenses										230,623	161,803	79,018
Income (loss) from operations										(91,797)	(83,293)	(50,788)
Other (income) expenses:
Interest expense										32,816	30,446	9,043
Interest income										(1,480)	(285)	(178)
Other income										(875)	(144)	(52)
Loss on early extinguishment of debt										27,279	1,972	607
(Income) loss from investment in subsidiaries										(214,983)	(223,555)	(232,751)
Total other (income) expenses										(157,243)	(191,566)	(223,331)
Income (loss) before taxes										65,446	108,273	172,543
Provision (benefit) for income taxes:
Current										(10,904)	15,022	(20,386)
Deferred										(41,284)	(56,175)	(1,403)
Total income taxes										(52,188)	(41,153)	(21,789)
Net income (loss)										117,634	149,426	194,332
Comprehensive income (loss)										86,739	156,391	230,404
Guarantor Subsidiary [Member]
Operating revenue:
Oil production										684,629	735,155	658,283
Gas production										121,685	100,408	151,141
Natural gas liquids production										28,394	33,234	29,996
Other operational income										645	397	249
Derivative income, net											3,428	1,418
Total operating revenue										835,353	872,622	841,087
Operating expenses:
Lease operating expenses										186,473	195,105	169,018
Transportation, processing and gathering expenses										13,850	9,733	8,958
Production taxes										8,800	6,685	7,946
Depreciation, depletion, amortization										256,995	281,152	261,326
Accretion expense										33,203	32,513	30,385
Salaries, general and administrative										5	7	94
Other operational expenses										113	94	745
Derivative expense, net										2,090
Total operating expenses										501,529	525,289	478,472
Income (loss) from operations										333,824	347,333	362,615
Other (income) expenses:
Interest expense										21	(71)	246
Interest income										(195)	(315)	(242)
Other income										(1,924)	(1,661)	(1,890)
(Income) loss from investment in subsidiaries											75	827
Total other (income) expenses										(2,098)	(1,972)	(1,059)
Income (loss) before taxes										335,922	349,305	363,674
Provision (benefit) for income taxes:
Deferred										120,913	125,750	130,923
Total income taxes										120,913	125,750	130,923
Net income (loss)										215,009	223,555	232,751
Comprehensive income (loss)										215,009	223,555	232,751
Non-Guarantor Subsidiaries [Member]
Operating revenue:
Other operational income											357	604
Total operating revenue											357	604
Operating expenses:
Lease operating expenses											(16)	231
Depreciation, depletion, amortization											191	834
Accretion expense											257	364
Salaries, general and administrative										46		2
Total operating expenses										46	432	1,431
Income (loss) from operations										(46)	(75)	(827)
Other (income) expenses:
Interest income										(20)
(Income) loss from investment in subsidiaries										26
Total other (income) expenses										6
Income (loss) before taxes										(52)	(75)	(827)
Provision (benefit) for income taxes:
Net income (loss)										(52)	(75)	(827)
Comprehensive income (loss)										(52)	(75)	(827)
Consolidation, Eliminations [Member]
Other (income) expenses:
(Income) loss from investment in subsidiaries										214,957	223,480	231,924
Total other (income) expenses										214,957	223,480	231,924
Income (loss) before taxes										(214,957)	(223,480)	(231,924)
Provision (benefit) for income taxes:
Net income (loss)										(214,957)	(223,480)	(231,924)
Comprehensive income (loss)										$ (214,957)	$ (223,480)	$ (231,924)

[1] Includes franchise tax settlement of $12,590 before income tax effect ($8,058, net of income tax effect).

[2] Includes loss on early extinguishment of debt of $27,279 before income tax effect ($17,459 net of income tax effect).

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ACCOUNTS RECEIVABLE

12 Months Ended

Dec. 31, 2013

Receivables [Abstract]

ACCOUNTS RECEIVABLE

NOTE 3 — ACCOUNTS RECEIVABLE:

In our capacity as operator for our co-venturers, we incur drilling and other costs that we bill to the respective parties based on their working interests. We also receive payments for these billings and, in some cases, for billings in advance of incurring costs. Our accounts receivable are comprised of the following amounts:

	As of December 31,
	2013		2012
Other co-venturers	$	13,904	$	16,735
Trade		134,622		130,448
Unbilled accounts receivable		22,001		20,053
Other		1,444		52
Total accounts receivable	$	171,971	$	167,288

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Derivative Instruments and Hedging Activities - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2013	Dec. 31, 2012
Derivative Instruments And Hedging Activities Disclosure [Abstract]
Maximum correlation between price of oil & natural gas in market and underlying price basis indicative in the derivative contract	100.00%
Accumulated other comprehensive income (loss)	$ (2,062)	$ 28,833

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Summary of Estimated Proved Oil and Natural Gas Reserve (Detail)	12 Months Ended
	Dec. 31, 2013 MBbls	Dec. 31, 2012 MBbls	Dec. 31, 2011 MBbls
Oil (MBbls) [Member]
Reserve Quantities [Line Items]
Estimated proved reserves, beginning balance	44,918	45,655	33,203
Revisions of previous estimates	3,606	(1,559)	2,889
Extensions, discoveries and other additions	2,367	3,681	3,544
Purchase of producing properties		4,336	14,396
Sale of reserves	(170)	(60)	(1,950)
Production	(6,894)	(7,135)	(6,427)
Estimated proved reserves, ending balance	43,827	44,918	45,655
Estimated proved developed reserves	27,920	29,005	30,914
Natural Gas Liquids (MBbls) [Member]
Reserve Quantities [Line Items]
Estimated proved reserves, beginning balance	18,066	4,405
Revisions of previous estimates	2,439	9,349	4,911
Extensions, discoveries and other additions	4,395	4,856
Purchase of producing properties		619
Production	(1,603)	(1,163)	(506)
Estimated proved reserves, ending balance	23,297	18,066	4,405
Estimated proved developed reserves	11,569	8,593	3,195
Natural Gas (MMcf) [Member]
Reserve Quantities [Line Items]
Estimated proved reserves, beginning balance	395,374	325,479	274,705
Revisions of previous estimates	36,006	(26,694)	(26,725)
Extensions, discoveries and other additions	79,729	131,408	93,520
Purchase of producing properties		8,168	24,595
Sale of reserves	(214)	(418)	(2,150)
Production	(50,129)	(42,569)	(38,466)
Estimated proved reserves, ending balance	460,766	395,374	325,479
Estimated proved developed reserves	246,946	210,956	171,871
Oil And Natural Gas (MMcfe) [Member]
Reserve Quantities [Line Items]
Estimated proved reserves, beginning balance	773,285	625,839	473,923
Revisions of previous estimates	72,275	20,050	20,075
Extensions, discoveries and other additions	120,299	182,633	114,784
Purchase of producing properties		37,895	110,971
Sale of reserves	(1,235)	(775)	(13,850)
Production	(101,111)	(92,357)	(80,064)
Estimated proved reserves, ending balance	863,513	773,285	625,839
Estimated proved developed reserves	483,885	436,540	376,528

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Reconciliation Between Statutory Federal Income Tax Rate and Effective Income Tax Rate as Percentage of Income Before Income Taxes (Detail)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Income Tax Disclosure [Abstract]
Income tax expense computed at the statutory federal income tax rate	35.00%	35.00%	35.00%
State taxes	1.00%	1.00%	1.00%
IRC Sec. 162(m) limitation	0.80%	0.60%	0.30%
Other	0.10%	(0.50%)	(0.30%)
Effective income tax rate	36.90%	36.10%	36.00%

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GUARANTOR FINANCIAL STATEMENTS

12 Months Ended

Dec. 31, 2013

Text Block [Abstract]

GUARANTOR FINANCIAL STATEMENTS

NOTE 20 – GUARANTOR FINANCIAL STATEMENTS:

Stone Offshore is an unconditional guarantor (the “Guarantor Subsidiary”) of the 2017 Convertible Notes and 2022 Notes. Our other subsidiaries (the “Non-Guarantor Subsidiaries”) have not provided guarantees. The following presents consolidating financial information as of December 31, 2013 and 2012 and for the years ended December 31, 2013, 2012 and 2011 on an issuer (parent company), Guarantor Subsidiary, Non-Guarantor Subsidiaries, and consolidated basis. Elimination entries presented are necessary to combine the entities.

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	246,294		$	84,290		$	640		$	—		$	331,224
Accounts receivable		74,887			97,128			—			(44	)		171,971
Fair value of hedging contracts		—			4,549			—			—			4,549
Current income tax receivable		7,366			—			—			—			7,366
Deferred taxes *		8,659			23,051			—			—			31,710
Inventory		3,440			283			—			—			3,723
Other current assets		1,874			—			—			—			1,874
Total current assets		342,520			209,301			640			(44	)		552,417
Oil and gas properties, full cost method:
Proved		1,309,527			6,494,590			—			—			7,804,117
Less: accumulated DD&A		(459,932	)		(5,448,828	)		—			—			(5,908,760	)
Net proved oil and gas properties		849,595			1,045,762			—			—			1,895,357
Unevaluated		325,113			388,643			10,583			—			724,339
Other property and equipment, net		26,178			—			—			—			26,178
Fair value of hedging contracts		—			1,378			—			—			1,378
Other assets, net		45,410			1,349			2,128			—			48,887
Investment in subsidiary		747,472			—			12,711			(760,183	)		—
Total assets	$	2,336,288		$	1,646,433		$	26,062			($760,227	)	$	3,248,556
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	173,147		$	22,530		$	44			($44	)	$	195,677
Undistributed oil and gas proceeds		34,386			2,643			—			—			37,029
Accrued interest		9,022			—			—			—			9,022
Fair value of hedging contracts		—			7,753			—			—			7,753
Asset retirement obligations		—			67,161			—			—			67,161
Other current liabilities		53,682			838			—			—			54,520
Total current liabilities		270,237			100,925			44			(44	)		371,162
Long-term debt		1,027,084			—			—			—			1,027,084
Deferred taxes *		10,227			380,466			—			—			390,693
Asset retirement obligations		4,945			430,407			—			—			435,352
Fair value of hedging contracts		—			470			—			—			470
Other long-term liabilities		53,509			—			—			—			53,509
Total liabilities		1,366,002			912,268			44			(44	)		2,278,270
Commitments and contingencies Stockholders’ equity:
Common stock		488			—			—			—			488
Treasury stock		(860	)		—			—			—			(860	)
Additional paid-in capital		1,397,885			1,309,563			27,403			(1,336,966	)		1,397,885
Accumulated deficit		(425,165	)		(574,003	)		(52	)		574,055			(425,165	)
Accumulated other comprehensive loss		(2,062	)		(1,395	)		(1,333	)		2,728			(2,062	)
Total stockholders’ equity		970,286			734,165			26,018			(760,183	)		970,286
Total liabilities and stockholders’ equity	$	2,336,288		$	1,646,433		$	26,062			($760,227	)	$	3,248,556

* Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

CONDENSED CONSOLIDATING BALANCE SHEET

DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries		Eliminations			Consolidated
Assets
Current assets:
Cash and cash equivalents	$	228,398		$	51,128		$	—	$	—		$	279,526
Accounts receivable		59,213			108,075			—		—			167,288
Fair value of hedging contracts		—			39,655			—		—			39,655
Current income tax receivable		10,027			—			—		—			10,027
Deferred taxes *		5,947			9,567			—		—			15,514
Inventory		3,924			283			—		—			4,207
Other current assets		3,626			—			—		—			3,626
Total current assets		311,135			208,708			—		—			519,843
Oil and gas properties, full cost method:
Proved		1,004,808			6,239,658			—		—			7,244,466
Less: accumulated DD&A		(370,111	)		(5,140,055	)		—		—			(5,510,166	)
Net proved oil and gas properties		634,697			1,099,603			—		—			1,734,300
Unevaluated		254,757			193,038			—		—			447,795
Other property and equipment, net		22,115			—			—		—			22,115
Fair value of hedging contracts		—			9,199			—		—			9,199
Other assets, net		41,679			1,500			—		—			43,179
Investment in subsidiary		736,331			—			—		(736,331	)		—
Total assets	$	2,000,714		$	1,512,048		$	—		($736,331	)	$	2,776,431
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable to vendors	$	74,503		$	19,858		$	—	$	—		$	94,361
Undistributed oil and gas proceeds		21,841			1,573			—		—			23,414
Accrued interest		18,546			—			—		—			18,546
Fair value of hedging contracts		—			149			—		—			149
Asset retirement obligations		—			66,260			—		—			66,260
Other current liabilities		16,765			—			—		—			16,765
Total current liabilities		131,655			87,840			—		—			219,495
Long-term debt		914,126			—			—		—			914,126
Deferred taxes *		47,758			263,072			—		—			310,830
Asset retirement obligations		5,479			416,563			—		—			422,042
Fair value of hedging contracts		—			1,530			—		—			1,530
Other long-term liabilities		29,563			6,712			—		—			36,275
Total liabilities		1,128,581			775,717			—		—			1,904,298
Commitments and contingencies Stockholders’ equity:
Common stock		484			—			—		—			484
Treasury stock		(860	)		—			—		—			(860	)
Additional paid-in capital		1,386,475			1,496,510			—		(1,496,510	)		1,386,475
Accumulated deficit		(542,799	)		(789,012	)		—		789,012			(542,799	)
Accumulated other comprehensive income		28,833			28,833			—		(28,833	)		28,833
Total stockholders’ equity		872,133			736,331			—		(736,331	)		872,133
Total liabilities and stockholders’ equity	$	2,000,714		$	1,512,048		$	—		($736,331	)	$	2,776,431

* Deferred income taxes have been allocated to Guarantor Subsidiary where related oil and gas properties reside.

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	30,475		$	684,629		$	—		$	—		$	715,104
Gas production		68,895			121,685			—			—			190,580
Natural gas liquids production		32,293			28,394			—			—			60,687
Other operational income		7,163			645			—			—			7,808
Total operating revenue		138,826			835,353			—			—			974,179
Operating expenses:
Lease operating expenses		14,680			186,473			—			—			201,153
Transportation, processing, and gathering expenses		28,322			13,850			—			—			42,172
Production taxes		6,229			8,800			—			—			15,029
Depreciation, depletion, amortization		93,579			256,995			—			—			350,574
Accretion expense		372			33,203			—			—			33,575
Salaries, general and administrative		59,473			5			46			—			59,524
Franchise tax settlement		12,590			—			—			—			12,590
Incentive compensation expense		15,340			—			—			—			15,340
Other operational expenses		38			113			—			—			151
Derivative expense, net		—			2,090			—			—			2,090
Total operating expenses		230,623			501,529			46			—			732,198
Income (loss) from operations		(91,797	)		333,824			(46	)		—			241,981
Other (income) expenses:
Interest expense		32,816			21			—			—			32,837
Interest income		(1,480	)		(195	)		(20	)		—			(1,695	)
Other income		(875	)		(1,924	)		—			—			(2,799	)
Loss on early extinguishment of debt		27,279			—			—			—			27,279
(Income) loss from investment in subsidiaries		(214,983	)		—			26			214,957			—
Total other (income) expenses		(157,243	)		(2,098	)		6			214,957			55,622
Income (loss) before taxes		65,446			335,922			(52	)		(214,957	)		186,359
Provision (benefit) for income taxes:
Current		(10,904	)		—			—			—			(10,904	)
Deferred		(41,284	)		120,913			—			—			79,629
Total income taxes		(52,188	)		120,913			—			—			68,725
Net income (loss)	$	117,634		$	215,009			($52	)		($214,957	)	$	117,634
Comprehensive income (loss)	$	86,739		$	215,009			($52	)		($214,957	)	$	86,739

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non- Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	26,149		$	735,155		$	—		$	—		$	761,304
Gas production		34,331			100,408			—			—			134,739
Natural gas liquids production		15,264			33,234			—			—			48,498
Other operational income		2,766			397			357			—			3,520
Derivative income, net		—			3,428			—			—			3,428
Total operating revenue		78,510			872,622			357			—			951,489
Operating expenses:
Lease operating expenses		19,914			195,105			(16	)		—			215,003
Transportation, processing and gathering expenses		12,049			9,733			—			—			21,782
Production taxes		3,330			6,685			—			—			10,015
Depreciation, depletion, amortization		63,022			281,152			191			—			344,365
Accretion expense		561			32,513			257			—			33,331
Salaries, general and administrative		54,641			7			—			—			54,648
Incentive compensation expense		8,113			—			—			—			8,113
Other operational expenses		173			94			—			—			267
Total operating expenses		161,803			525,289			432			—			687,524
Income (loss) from operations		(83,293	)		347,333			(75	)		—			263,965
Other (income) expenses:
Interest expense		30,446			(71	)		—			—			30,375
Interest income		(285	)		(315	)		—			—			(600	)
Other income		(144	)		(1,661	)		—			—			(1,805	)
Loss on early extinguishment of debt		1,972			—			—			—			1,972
(Income) loss from investment in subsidiaries		(223,555	)		75			—			223,480			—
Total other (income) expenses		(191,566	)		(1,972	)		—			223,480			29,942
Income (loss) before taxes		108,273			349,305			(75	)		(223,480	)		234,023
Provision (benefit) for income taxes:
Current		15,022			—			—			—			15,022
Deferred		(56,175	)		125,750			—			—			69,575
Total income taxes		(41,153	)		125,750			—			—			84,597
Net income (loss)	$	149,426		$	223,555			($75	)		($223,480	)	$	149,426
Comprehensive income (loss)	$	156,391		$	223,555			($75	)		($223,480	)	$	156,391

CONDENSED CONSOLIDATING STATEMENT OF INCOME

YEAR ENDED DECEMBER 31, 2011

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Operating revenue:
Oil production	$	5,675		$	658,283		$	—		$	—		$	663,958
Gas production		19,470			151,141			—			—			170,611
Natural gas liquids production		—			29,996			—			—			29,996
Other operational income		3,085			249			604			—			3,938
Derivative income, net		—			1,418			—			—			1,418
Total operating revenue		28,230			841,087			604			—			869,921
Operating expenses:
Lease operating expenses		6,632			169,018			231			—			175,881
Transportation, processing and gathering expenses		—			8,958			—			—			8,958
Production taxes		1,434			7,946			—			—			9,380
Depreciation, depletion, amortization		17,860			261,326			834			—			280,020
Accretion expense		15			30,385			364			—			30,764
Salaries, general and administrative		40,073			94			2			—			40,169
Incentive compensation expense		11,600			—			—			—			11,600
Other operational expenses		1,404			745			—			—			2,149
Total operating expenses		79,018			478,472			1,431			—			558,921
Income (loss) from operations		(50,788	)		362,615			(827	)		—			311,000
Other (income) expenses:
Interest expense		9,043			246			—			—			9,289
Interest income		(178	)		(242	)		—			—			(420	)
Other income		(52	)		(1,890	)		—			—			(1,942	)
Loss on early extinguishment of debt		607			—			—			—			607
(Income) loss from investment in subsidiary		(232,751	)		827			—			231,924			—
Total other (income) expenses		(223,331	)		(1,059	)		—			231,924			7,534
Income (loss) before taxes		172,543			363,674			(827	)		(231,924	)		303,466
Provision (benefit) for income taxes:
Current		(20,386	)		—			—			—			(20,386	)
Deferred		(1,403	)		130,923			—			—			129,520
Total income taxes		(21,789	)		130,923			—			—			109,134
Net income (loss)	$	194,332		$	232,751			($827	)		($231,924	)	$	194,332
Comprehensive income (loss)	$	230,404		$	232,751			($827	)		($231,924	)	$	230,404

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2013

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	117,634		$	215,009			($52	)		($214,957	)	$	117,634
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		93,579			256,995			—			—			350,574
Accretion expense		372			33,203			—			—			33,575
Deferred income tax provision (benefit)		(41,284	)		120,913			—			—			79,629
Settlement of asset retirement obligations		—			(83,854	)		—			—			(83,854	)
Non-cash stock compensation expense		10,347			—			—			—			10,347
Excess tax benefits		(156	)		—			—			—			(156	)
Non-cash derivative expense		—			2,239			—			—			2,239
Loss on early extinguishment of debt		27,279			—			—			—			27,279
Non-cash interest expense		16,219			—			—			—			16,219
Non-cash (income) loss from investment in subsidiaries		(214,983	)		—			26			214,957			—
Change in current income taxes		2,767			—			—			—			2,767
Change in intercompany receivables/payables		186,903			(186,947	)		44			—			—
(Increase) decrease in accounts receivable		(15,630	)		10,947			—			—			(4,683	)
Decrease in other current assets		1,752			—			—			—			1,752
Decrease in inventory		583			—			—			—			583
Increase (decrease) in accounts payable		(1,052	)		1,454			—			—			402
Increase in other current liabilities		40,543			1,908			—			—			42,451
Other		419			(2,972	)		—			—			(2,553	)
Net cash provided by operating activities		225,292			368,895			18			—			594,205
Cash flows from investing activities:
Investment in oil and gas properties		(273,474	)		(378,254	)		(11,571	)		—			(663,299	)
Proceeds from sale of oil and gas properties, net of expenses		6,300			42,521			—			—			48,821
Investment in fixed and other assets		(6,816	)		—			—			—			(6,816	)
Change in restricted funds		—			—			(1,742	)		—			(1,742	)
Investment in subsidiaries		(14,000	)		—			(13,404	)		27,404			—
Net cash used in investing activities		(287,990	)		(335,733	)		(26,717	)		27,404			(623,036	)
Cash flows from financing activities:
Proceeds from issuance of senior notes		489,250			—			—			—			489,250
Deferred financing costs		(9,065	)		—			—			—			(9,065	)
Redemption of senior notes		(396,014	)		—			—			—			(396,014	)
Excess tax benefits		156			—			—			—			156
Equity proceeds from parent		—			—			27,404			(27,404	)		—
Net payments for share-based compensation		(3,733	)		—			—			—			(3,733	)
Net cash provided by financing activities		80,594			—			27,404			(27,404	)		80,594
Effect of exchange rate changes on cash		—			—			(65	)		—			(65	)
Net change in cash and cash equivalents		17,896			33,162			640			—			51,698
Cash and cash equivalents, beginning of period		228,398			51,128			—			—			279,526
Cash and cash equivalents, end of period	$	246,294		$	84,290		$	640		$	—		$	331,224

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2012

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	149,426		$	223,555			($75	)		($223,480	)	$	149,426
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		63,022			281,152			191			—			344,365
Accretion expense		561			32,513			257			—			33,331
Deferred income tax provision (benefit)		(56,175	)		125,750			—			—			69,575
Settlement of asset retirement obligations		—			(65,567	)		—			—			(65,567	)
Non-cash stock compensation expense		8,699			—			—			—			8,699
Excess tax benefits		(949	)		—			—			—			(949	)
Non-cash derivative income		—			(509	)		—			—			(509	)
Loss on early extinguishment of debt		1,972			—			—			—			1,972
Non-cash interest expense		13,085			—			—			—			13,085
Non-cash (income) loss from investment in subsidiaries		(223,555	)		75			—			223,480			—
Change in current income taxes		10,618			—			—			—			10,618
Change in intercompany receivables/payables		275,819			(275,125	)		(694	)		—			—
(Increase) decrease in accounts receivable		(22,750	)		(33,345	)		224			—			(55,871	)
Increase in other current assets		(2,836	)		—			—			—			(2,836	)
Decrease in inventory		436			—			—			—			436
Increase (decrease) in accounts payable		5,348			(208	)		(39	)		—			5,101
Decrease in other current liabilities		(5,311	)		(5,115	)		—			—			(10,426	)
Other		10,960			(1,661	)		—			—			9,299
Net cash provided by (used in) operating activities		228,370			281,515			(136	)		—			509,749
Cash flows from investing activities:
Investment in oil and gas properties		(324,542	)		(231,313	)		—			—			(555,855	)
Proceeds from sale of oil and gas properties, net of expenses		403			—			—			—			403
Sale of fixed assets		134			—			—			—			134
Investment in fixed and other assets		(13,370	)		—			—			—			(13,370	)
Net cash used in investing activities		(337,375	)		(231,313	)		—			—			(568,688	)
Cash flows from financing activities:
Proceeds from bank borrowings		25,000			—			—			—			25,000
Repayment of bank borrowings		(70,000	)		—			—			—			(70,000	)
Proceeds from issuance of senior convertible notes		300,000			—			—			—			300,000
Deferred financing costs of senior convertible notes		(8,855	)		—			—			—			(8,855	)
Proceeds from sold warrants		40,170			—			—			—			40,170
Payments for purchased call options		(70,830	)		—			—			—			(70,830	)
Proceeds from issuance of senior notes		300,000			—			—			—			300,000
Deferred financing costs		(11,966	)		—			—			—			(11,966	)
Redemption of senior subordinated notes		(200,681	)		—			—			—			(200,681	)
Excess tax benefits		949			—			—			—			949
Net payments for share-based compensation		(3,773	)		—			—			—			(3,773	)
Net cash provided by financing activities		300,014			—			—			—			300,014
Net change in cash and cash equivalents		191,009			50,202			(136	)		—			241,075
Cash and cash equivalents, beginning of period		37,389			926			136			—			38,451
Cash and cash equivalents, end of period	$	228,398		$	51,128		$	—		$	—		$	279,526

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31, 2011

(In thousands)

	Parent			Guarantor Subsidiary			Non-Guarantor Subsidiaries			Eliminations			Consolidated
Cash flows from operating activities:
Net income (loss)	$	194,332		$	232,751			($827	)		($231,924	)	$	194,332
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization		17,860			261,326			834			—			280,020
Accretion expense		15			30,385			364			—			30,764
Deferred income tax provision (benefit)		(1,403	)		130,923			—			—			129,520
Settlement of asset retirement obligations		—			(63,391	)		—			—			(63,391	)
Non-cash stock compensation expense		5,905			—			—			—			5,905
Excess tax benefits		(1,493	)		—			—			—			(1,493	)
Non-cash derivative income		—			(2,216	)		—			—			(2,216	)
Loss on early extinguishment of debt		607			—			—			—			607
Non-cash interest expense		1,908			—			—			—			1,908
Other non-cash income		(1,602	)		—			—			—			(1,602	)
Non-cash income from investment in subsidiaries		(230,861	)		(1,063	)		—			231,924			—
Change in current income taxes		(19,451	)		—			—			—			(19,451	)
Change in intercompany receivables/payables		217,287			(217,724	)		437			—			—
Increase in accounts receivable		(11,022	)		(7,688	)		(890	)		—			(19,600	)
(Increase) decrease in other current assets		(80	)		14			—			—			(66	)
Decrease in inventory		1,605			14			—			—			1,619
Increase in accounts payable		2,658			3,341			40			—			6,039
Increase in other current liabilities		23,440			6,143			—			—			29,583
Other		(1,628	)		—			—			—			(1,628	)
Net cash provided by (used in) operating activities		198,077			372,815			(42	)		—			570,850
Cash flows from investing activities:
Investment in oil and gas properties		(309,026	)		(455,903	)		(4	)		—			(764,933	)
Proceeds from sale of oil and gas properties, net of expenses		5,575			82,355			—			—			87,930
Investment in fixed and other assets		(2,247	)		—			—			—			(2,247	)
Net cash used in investing activities		(305,698	)		(373,548	)		(4	)		—			(679,250	)
Cash flows from financing activities:
Proceeds from bank borrowings		75,000			—			—			—			75,000
Repayment of bank borrowings		(30,000	)		—			—			—			(30,000	)
Deferred financing costs		(4,017	)		—			—			—			(4,017	)
Excess tax benefits		1,493			—			—			—			1,493
Net payments for share-based compensation		(2,581	)		—			—			—			(2,581	)
Net cash provided by financing activities		39,895			—			—			—			39,895
Net change in cash and cash equivalents		(67,726	)		(733	)		(46	)		—			(68,505	)
Cash and cash equivalents, beginning of period		105,115			1,659			182			—			106,956
Cash and cash equivalents, end of period	$	37,389		$	926		$	136		$	—		$	38,451

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Share Based Compensation - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation	$ 15,425	$ 13,399	$ 8,914
Stock based compensation capitalized into oil and gas properties	5,078	4,288	3,010
Exercise price of stock options outstanding, minimum	$ 6.97
Exercise price of stock options outstanding, maximum	$ 53.20
Restricted stocks issued, shares	848,498	670,818	597,062
Restricted stocks issued, value	17,487,000	21,085,000	14,100,000
Unrecognized compensation cost, weighted average period of recognition	1 year 8 months 12 days
Unrecognized compensation cost	17,004,000
Adjustments to additional paid-in capital related to net tax effect of stock options exercises and restricted stock vesting	(884,000)	814,000	735,000
Restricted Stock[Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation	15,405	13,308	8,796
Restricted Stock[Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of stock options	1 year
Restricted Stock[Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of stock options	3 years
Stock Options[Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation	$ 20	$ 91	$ 118
2009 plan [Member] | All Employee [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of stock options	5 years
Period after which stock option will expire subsequent to award	10 years
2009 plan [Member] | Non - Employee Directors [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of stock options	3 years
Period after which stock option will expire subsequent to award	10 years

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LONG-TERM DEBT (Tables)

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

Long-Term Debt

Long-term debt consisted of the following:

	As of December 31,
	2013		2012
8 5⁄8% Senior Notes due 2017	$	—	$	375,000
1 3⁄4% Senior Convertible Notes due 2017		252,084		239,126
7 1⁄2% Senior Notes due 2022		775,000		300,000
Bank debt		—		—
Total long-term debt	$	1,027,084	$	914,126

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SHARE-BASED COMPENSATION

12 Months Ended

Dec. 31, 2013

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

SHARE-BASED COMPENSATION

NOTE 13 — SHARE-BASED COMPENSATION:

Under the Stone Energy Corporation 2009 Amended and Restated Stock Incentive Plan (the “2009 Plan”), we may grant both incentive stock options qualifying under Section 422 of the Internal Revenue Code and options that are not qualified as incentive stock options to all employees and directors. All such options must have an exercise price of not less than the fair market value of our common stock on the date of grant and may not be re-priced without stockholder approval. Stock options to all employees vest ratably over a five-year service-vesting period and expire 10 years subsequent to award. Stock options issued to non-employee directors vest ratably over a three-year service-vesting period and expire 10 years subsequent to award. In addition, the 2009 Plan provides that shares available under the 2009 Plan may be granted as restricted stock. Restricted stock typically vests over a one- to three-year period.

We record share-based compensation expense under U.S. GAAP for equity-based compensation awards based on the fair value on the date of grant. Compensation expense for equity-based compensation awards is recognized in our financial statements over the vesting period of the award.

For the year ended December 31, 2013, we incurred $15,425 of share-based compensation, of which $15,405 related to restricted stock issuances and $20 related to stock option grants, and of which a total of approximately $5,078 was capitalized into oil and gas properties. For the year ended December 31, 2012, we incurred $13,399 of share-based compensation, of which $13,308 related to restricted stock issuances and $91 related to stock option grants, and of which a total of approximately $4,288 was capitalized into oil and gas properties. For the year ended December 31, 2011, we incurred $8,914 of share-based compensation, of which $8,796 related to restricted stock issuances and $118 related to stock option grants, and of which a total of approximately $3,010 was capitalized into oil and gas properties. Because of the non-cash nature of share-based compensation, the expensed portion of share-based compensation is added back to net income in arriving at net cash provided by operating activities in our statement of cash flows. The capitalized portion is not included in net cash used in investing activities.

Stock Options. There were no stock option grants during the years ended December 31, 2013, 2012 or 2011.

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2013 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		411,794		$	39.04
Granted		—			—
Exercised		—			—
Forfeited		(15,250	)		42.45
Expired		(65,370	)		36.56
Options outstanding, end of period		331,174			39.37	2.2 years	$	1,708
Options exercisable, end of period		318,279			40.62	2.1 years		1,373
Options unvested, end of period		12,895			8.64	5.0 years		335

Exercise prices for stock options outstanding at December 31, 2013 range from $6.97 to $53.20.

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2012 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		438,394		$	38.76
Granted		—			—
Exercised		—			—
Forfeited		(4,200	)		35.54
Expired		(22,400	)		34.25
Options outstanding, end of period		411,794			39.04	2.8 years	$	766
Options exercisable, end of period		378,004			41.00	2.5 years		459
Options unvested, end of period		33,790			17.17	5.4 years		307

A summary of stock option activity under the 2009 Plan during the year ended December 31, 2011 is as follows (amounts in table represent actual values except where indicated otherwise):

	Number of Options			Wgtd. Avg. Exercise Price		Wgtd. Avg. Term	Aggregate Intrinsic Value (in thousands)
Options outstanding, beginning of period		484,694		$	39.43
Granted		—			—
Exercised		—			—
Forfeited		(13,300	)		37.98
Expired		(33,000	)		48.85
Options outstanding, end of period		438,394			38.76	3.6 years	$	1,143
Options exercisable, end of period		378,710			41.66	3.1 years		457
Options unvested, end of period		59,684			20.36	6.1 years		686

Restricted Stock. The fair value of restricted shares is typically determined based on the average of our high and low stock prices on the grant date. During the year ended December 31, 2013, we issued 848,498 shares of restricted stock valued at $17,487. During the year ended December 31, 2012, we issued 670,818 shares of restricted stock valued at $21,085. During the year ended December 31, 2011, we issued 597,062 shares of restricted stock valued at $14,100.

A summary of the restricted stock activity under the 2009 Plan for the years ended December 31, 2013, 2012 and 2011 is as follows (amounts in table represent actual values):

	2013					2012					2011
	Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share		Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share		Number of Restricted Shares			Wgtd. Avg. Fair Value Per Share
Restricted stock outstanding, beginning of period		1,108,874		$	27.56		923,740		$	20.08		783,606		$	17.24
Issuances		848,498			20.61		670,818			31.43		597,062			23.62
Lapse of restrictions		(534,041	)		25.45		(462,141	)		18.29		(419,543	)		19.91
Forfeitures		(165,278	)		26.43		(23,543	)		26.10		(37,385	)		18.92
Restricted stock outstanding, end of period		1,258,053		$	23.92		1,108,874		$	27.56		923,740		$	20.08

As of December 31, 2013, there was $17,004 of unrecognized compensation cost related to all non-vested share-based compensation arrangements under the 2009 Plan. That cost is being amortized on a straight-line basis over the vesting period and is expected to be recognized over a weighted-average period of 1.7 years.

Under U.S. GAAP, if tax deductions exceed book compensation expense, then excess tax benefits are credited to additional paid-in capital to the extent realized. If book compensation expense exceeds tax deductions, the tax deficit results in either a reduction in additional paid-in capital or an increase in income tax expense depending on the pool of available excess tax benefits to offset such deficit. Adjustments to additional paid-in capital related to the net tax effect of stock option exercises and restricted stock vesting were ($884), $814 and $735 in 2013, 2012 and 2011, respectively.