SOURCE: Mariner Energy, Inc.

Mariner Energy, Inc.

December 16, 2009 00:15 ET

Mariner Energy Announces $660 Million 2010 Capital Budget

HOUSTON, TX--(Marketwire - December 16, 2009) - Mariner Energy, Inc. (NYSE: ME) announced today a 2010 capital budget of approximately $660 million, which assumes closing the acquisition from Edge Petroleum Corporation of its assets and operations by year-end 2009.

Mariner's 2010 CAPEX plan ($ millions)

                                                  Development/
Area                                 Exploration  Exploitation    Total
                                     ============ ============ ============
Onshore, including Unconventional    $         20 $        175 $        195
                                     ============ ============ ============
Deepwater                            $        106 $        146 $        252
                                     ============ ============ ============
Shelf                                $         44 $        118 $        162
                                     ============ ============ ============
Capitalized Interest, G&A, Other                -            - $         51
                                     ============ ============ ============
TOTAL CAPITAL EXPENDITURES           $        170 $        439 $        660
                                     ============ ============ ============

Budget Highlights:

--  Onshore: Increased drilling to more fully develop the company's
    Permian Basin assets, including the Deadwood oil field in Glasscock County
    and the Scottish Rites Hospital field in Reagan County. Mariner expects to
    operate 8 - 10 rigs in the Permian in 2010 and to commence development of
    the South Texas properties upon closing of the Edge Petroleum transaction.
    Mariner expects to participate in 140 - 170 onshore wells and test several
    unconventional play concepts during 2010.
--  Deepwater: Program includes delineation wells at the Lucius and
    Heidelberg deepwater discoveries, exploration of two other deepwater
    subsalt prospects, 4 - 6 conventional amplitude wells, and development of
    Balboa and Wide Berth discoveries.
--  Shelf: Drilling of 6 - 8 moderate risk conventional shelf wells and
    pursuit of more than 30 recompletion opportunities are planned.
    

The budget is based on oil and natural gas prices averaging $75 per barrel and $5.50 per million British thermal units (MMBtu), respectively, and may be adjusted based upon exploration success and changes in commodity prices and industry conditions. It excludes the costs of hurricane-related repairs and anticipated insurance reimbursements. The company expects to fund 75-80% of its budget from internally generated cashflow.

Cost Structure: Mariner expects its full-year 2010 unit costs to fall within the following ranges:

                                                                $ per Mcfe
                                                                ===========
Lease Operating Expense (including workovers)                   1.75 - 2.00
                                                                ===========
Severance and Ad Valorem Taxes                                  0.13 - 0.16
                                                                ===========
Transportation Expense                                          0.14 - 0.16
                                                                ===========
Depreciation, Depletion & Amortization
 (including asset retirement obligation expense)                3.10 - 3.40
                                                                ===========
Net General and Administrative Expense                          0.35 - 0.45
                                                                ===========
Stock Compensation Expense (non-cash)                           0.16 - 0.24
                                                                ===========

Scott D. Josey, Chairman, Chief Executive Officer, and President of Mariner Energy, said: "Our 2010 capital program is designed to accomplish five primary objectives. First, we will accelerate drilling of our large portfolio of long-lived, oily Permian properties, much of the production benefit from which is expected to be realized in 2011. Second, we will delineate the significant deepwater discoveries we have made with Anadarko. Third, we will target several high-impact prospects in the deepwater. Fourth, we will develop deepwater discoveries at Balboa and Wide Berth, which should come online in the third quarter 2010 and first quarter 2011, respectively. Fifth, we will continue to build our unconventional resource portfolio and test several ideas. We expect our production for 2010 to range from 130 - 140 Bcfe, and we believe that our program is setting the stage for further increases in 2011."

Conference call to discuss the program

A conference call has been scheduled for 10 a.m. Eastern Time (9 a.m. Central Time) on Wednesday, December 16, to discuss the 2010 capital budget and other updates. To participate in the call, please dial (800) 638-5439 at least 10 minutes prior to the scheduled start time. International callers can dial (617) 614-3945. The conference pass code for both numbers is 5406 0916. The call also will be webcast live over the internet and can be accessed through the Investor Relations' Webcasts and Presentations section of Mariner's website at http://www.mariner-energy.com.

A telephonic replay of the call will be available through December 26, 2009 by dialing (888) 286-8010, pass code 8370 1354. International callers can dial 617-801-6888. An archive of the call will be available shortly after the call through January 31, 2010 on Mariner's website.

About Mariner Energy, Inc.

Mariner Energy is an independent oil and gas exploration, development, and production company headquartered in Houston, Texas, with principal operations in the Permian Basin and the Gulf of Mexico. For more information about Mariner, visit the company's website at www.mariner-energy.com.

Important Information Concerning Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, that address activities that Mariner assumes, plans, expects, believes, projects, estimates or anticipates (and other similar expressions) will, should or may occur in the future are forward-looking statements. Our forward-looking statements generally are accompanied by words such as "may," "will," "estimate," "project," "predict," "believe," "expect," "anticipate," "potential," "plan," "goal" or other words that convey the uncertainty of future events or outcomes. Forward-looking statements in this press release are based on Mariner's current belief based on currently available information as to the outcome and timing of future events and assumptions that Mariner believes are reasonable. Mariner does not undertake to update its guidance, estimates or other forward-looking statements as conditions change or additional information becomes available. Estimated reserves are related to hydrocarbon prices. Actual future prices may vary significantly from prices used in preparation of the reserve estimates. Therefore, volumes of reserves actually recovered may differ significantly from such estimates. Mariner cautions that its forward-looking statements are subject to all of the risks and uncertainties normally incident to the exploration for and development, production and sale of oil and natural gas. These risks include, but are not limited to, price volatility or inflation, environmental risks, drilling and other operating risks, regulatory changes, the uncertainty inherent in estimating future oil and gas production or reserves, and other risks described in the Annual Report on Form 10-K for the fiscal year ended December 31, 2008, as amended, and other documents filed by Mariner with the Securities and Exchange Commission (SEC). Any of these factors could cause Mariner's actual results and plans to differ materially from those in the forward-looking statements. Investors are urged to read the Annual Report on Form 10-K for the year ended December 31, 2008, as amended, and other documents filed by Mariner with the SEC.

This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities of Mariner.