Mariner Seals Deal on $365.5 Million Year-End Acquisitions

Mariner Energy has entered into separate agreements to acquire additional Spraberry interests in the Permian Basin from an undisclosed party for approximately $122.5 million and to acquire StatoilHydro's Gulf of Mexico shelf operations for $243 million. Both acquisitions are cash transactions and are expected to be funded under Mariner's bank credit facility.

Mariner's acquisition in the Permian Basin involves an approximate 56% working interest in approximately 32,000 gross acres in Reagan, Midland, Dawson, Glasscock, Martin and Upton Counties. The acquisition includes 348 wells producing approximately 1,250 barrels of oil equivalent (BOE) per day net to the interests acquired. Mariner estimates net proved oil and gas reserves attributable to the acquisition of approximately 16 million BOE (75% oil and liquids). Mariner's Permian acquisition is scheduled to close December 31, 2007. Mariner will operate substantially all of the assets.

Mariner's Gulf of Mexico transaction involves the acquisition of an operating subsidiary of Hydro Gulf of Mexico, Inc., a subsidiary of StatoilHydro ASA, which owns substantially all of StatoilHydro's shelf operations. The transaction is scheduled to close January 31, 2008 and includes estimated proved oil and gas reserves of 52.4 Bcfe, 95% developed, and estimated probable reserves of 24.1 Bcfe. The majority of the probable reserves are associated with proved reserves and should require little additional capital.

It also includes 32 wells, 71% of which are operated, producing approximately 58.2 million cubic feet of gas equivalent per day. Gas gathering systems comprised of 31 miles of 10", 12", and 16" pipelines generating LTM cash flows of $5 million.

There is approximately 256,000 net acres of undeveloped leasehold including 11 drill-ready exploration prospects with an estimated net risked reserve potential of 100 Bcfe. Several of the prospects could be drilled in 2008.

The purchase price includes reimbursement to StatoilHydro of $8 million for the drilling costs attributable to the High Island 166 #5 well, which is currently drilling and expected to reach its objective depth prior to closing.

Mariner also announced that it has been awarded its Bimini Prospect, located on Garden Banks Block 213, from the October 2007 Central Gulf Lease Sale. Bimini is a deepwater subsalt prospect in which Mariner and LLOG Exploration Offshore, Inc. will each have a 50% working interest. The prospect may be tested in 2008. Mariner is awaiting notification from the MMS on the remaining blocks on which it was the apparent high bidder during the October sale.

Scott D. Josey, Mariner's Chief Executive Officer commented on the simultaneous deals: "These transactions are consistent with our strategy of expanding our presence onshore, consolidating quality Gulf of Mexico shelf assets, and enhancing our deepwater position with high potential prospects. The Permian Basin acquisition is a bolt-on transaction adding long-lived quality properties in areas in which we already operate. Similarly, the StatoilHydro transaction complements our existing shelf position and we believe upside exists through further cost efficiencies, conversion of probable reserves, and drilling opportunities. The acquisitions, along with the award of our high potential Bimini deepwater prospect, are a great way to close out 2007 and set the stage for a promising 2008."


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