(RTTNews) - Tuesday, independent oil and gas company Stone Energy Corp. (SGY: News ), said it now expects net daily productions for the third quarter and fiscal year 2009 above its previous projections. Stone also expects to ramp up its horizontal drilling activity in 2010.

The Lafayette, Louisiana-based company now anticipates Net daily production volumes for the third quarter to average between 230 million cubic feet of gas equivalent, or Mmcfe, to 235 MMcfe.

For the full-year, the company narrowed its daily production forecast and now expects average daily production to be in the range of 210 MMcfe to 220 Mmcfe, compared to earlier issued forecast of 205 Mmcfe to 225 MMcfe per day.

The company said its semi-annual borrowing base re-determination process has concluded and reaffirmed its borrowing base at $425 million. As at September 30, 2009, Stone had $250 million in borrowings outstanding on its credit facility and another $69 million in outstanding letters of credit, leaving $106 million in availability on the facility. Stone's cash position as at September 30, 2009 was around $97 million.

The company indicated that its delineation well at its deepwater Pyrenees Prospect, located on Garden Banks Block 293, is now complete and furnished the necessary information to estimate the three pay zones discovered in the initial well.

Stone noted that production into the new re-routed pipeline at Amberjack field on Mississippi Canyon 109 commenced in early August and barging operations closed at that time. Stone, which operates Amberjack and owns a 100% working interest expects to drill 4 or 5 wells during fiscal year 2010.
The company also has a drilling rig on location at Vermilion Block 96 and has spud the first of possibly two wells.

Stone, which currently has two operated rigs in West Virginia and northeastern Pennsylvania in the Marcellus Shale Play in the Appalachia Basin expects to drill 4 or 5 wells in West Virginia and 2 or 3 wells in Pennsylvania during the remainder of this year.

Stone is slated to release its third quarter 2009 results on Tuesday, November 3, 2009 after the close of the market.

SGY is currently trading at $18.13, up $0.49 or 2.78% on a volume of 87,420 shares on the NYSE.

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by RTT Staff Writer

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