Mariner Energy has reported third quarter 2009 financial and operating results. The company reported net income of $4.2 million for the three-month period ended September 30, 2009, with diluted earnings per share (EPS) of $0.04. For the same period in the prior year, Mariner reported net income of $64.7 million with diluted EPS of $0.73. During the three-month period ended September 30, 2009, the company incurred certain hurricane-related lease operating expenses and certain other general and administrative expenses that negatively impacted income before taxes by approximately $15.4 million. The company reported operating cash flow of approximately $403.6 million for the nine months ended September 30, 2009

Third quarter and fourth quarter to date highlights include:

• Exploration success in deepwater at Green Canyon 490 (Wide Berth), encountering approximately 130 feet of net pay. Mariner holds a 56.25% working interest.
• Exploration success on the shelf at South Marsh Island 10, encountering approximately 87 feet of net pay. Mariner holds a 100% working interest.
• Net production for third quarter was up slightly from second quarter 2009 to 33.3 billion cubic feet of natural gas equivalent (Bcfe).
• Start up of production on two deepwater fields: Green Canyon 646 (Daniel Boone) and Viosca Knoll 821, with current gross daily production rates of approximately 7,000 barrels of oil equivalent (BOE) and 1,000 BOE, respectively. Mariner holds a 40% working interest in Daniel Boone and a 30% working interest in VK 821.
• Acquisition of a 50% working interest in the deepwater discovery on East Breaks 597 (Balboa), with estimated gross proved and probable reserves of 7 - 8 million barrels of oil equivalent. Mariner has assumed operations and commenced development on the project. Production could begin as early as fourth quarter 2010.
• Completion of an eight-block deepwater acreage trade with Anadarko Petroleum Company in the Heidelberg area and a farm-in to Anadarko's deepwater Keathley Canyon 875 (Lucius) prospect, which is currently drilling.
• Continued growth in the Permian Basin with success in seven wells, including three exploration wells further delineating our Deadwood field. At quarter's end, Mariner's net acreage position in the Permian Basin exceeded 123,000 acres.
• Affirmation of the company's $800 million borrowing base under its $1 billion revolving credit facility and further reduction of debt under the facility during the third quarter from approximately $145 million to approximately $70 million.
• Receipt of additional hurricane reimbursements, bringing the total year to date to approximately $68 million at October 31, 2009, with additional reimbursements expected prior to year end.

"During the third quarter, production increased in the deepwater and onshore, but construction delays temporarily deferred growth from the shelf. Mariner's capital spending for 2009 should be less than half of 2008's, but we expect to achieve a year-over-year production increase of approximately 10% to 128 - 130 Bcfe, as well as strong cash flow and excellent liquidity. We have continued to expand and diversify our opportunity set, most recently in the deepwater and onshore, including our entry into unconventional resources," said Scott D. Josey, Mariner's Chairman, Chief Executive Officer and President.

THIRD QUARTER 2009 RESULTS

For the three-month period ended September 30, 2009, Mariner reported net income of $4.2 million, or $0.04 per basic and diluted share. This compares with net income of $64.7 million and basic and diluted earnings per share of $0.74 and $0.73, respectively, for the same three-month period in the prior year. The lower year-over-year results are due primarily to lower commodity prices.

Net production for third quarter 2009 was 33.3 billion cubic feet of natural gas equivalent (Bcfe), up 23% compared with 27.1 Bcfe for third quarter 2008. Total natural gas net production for third quarter 2009 was 24.1 billion cubic feet (Bcf), compared with 18.4 Bcf for the same period in the prior year. Total net oil production for third quarter 2009 was 1.1 million barrels (MMBbls), compared with 1.1 MMBbls for the same period in 2008. Natural gas liquids (NGL) net production for third quarter 2009 was 0.4 MMBbls, compared with 0.4 MMBbls for third quarter 2008.

For third quarter 2009, Mariner's average realized natural gas price was $5.39 per thousand cubic feet (Mcf) compared with $10.50 per Mcf for the same period in 2008. Mariner's average realized oil price was $73.15 per barrel (Bbl) for third quarter 2009, compared with $92.97 per Bbl for third quarter 2008. The average realized NGL price was $36.85 per Bbl for third quarter 2009, compared with $61.05 per Bbl for the same period in 2008. Average realized prices reflect settlements during the period under Mariner's hedging program.