SGY - MMS Moratorium

[dan_s]

LAFAYETTE, La., June 1 /PRNewswire-FirstCall/ -- Stone Energy Corporation (NYSE:SGY - News) today announced that the Minerals Management Service issued a Notice to Lessees ("NTL") on May 30, 2010 directing lessees and operators to cease drilling all new deepwater wells on federal leases in the Gulf of Mexico for six months. For purposes of this six-month deepwater moratorium ("NTL Moratorium"), "deepwater" means depths greater than 500 feet. This NTL Moratorium will delay drilling of the second well (Vili) in Stone Energy's Amberjack drilling program. Current production from the Amberjack platform remains unaffected and overall production guidance for 2010 remains in the original range of 205-225 million cubic feet equivalents per day. Drilling plans for several conventional shelf wells and two deep shelf wells (one currently drilling) do not appear to be impacted by the moratorium. Drilling operations in our Marcellus program and Rocky Mountain projects are continuing as planned. Adjustments in the 2010 capital budget are being reviewed.
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See my Net Income and Cash Flow Forecast Model for SGY by going to the website and clicking on the Sweet 16 Tab. Click on the SGY Logo.

Note that SGY is a much more diversified company than ATPG. The Federal Moratorium should not have a significant affect on the Company as SGY has the flexibility to shift capital to other projects. The oil at Amberjack isn't going anywhere, eventually they will be allowed to develop it.

Dan