Stone Energy Updates Gulf of Mexico Operations

During the third quarter of 2003, Stone evaluated nine new wells, seven of which were successful. Through October 31, 2003, the Company spudded 44 of the 53 new wells planned for this year. With six wells currently drilling, the company has achieved an 84% drilling success rate with 32 discoveries and six dry holes. Of the 32 discoveries, 20 wells are currently producing.

Main Pass 288/287 Fields. Drilling is in-progress on the seventh of nine wells scheduled for 2003 on this acreage. We earlier reported the first four exploratory successes, the presidents prospects, that were drilled and suspended during the first half of the year from an open water location on Main Pass Block 287. The "A" platform was installed in early October and tieback operations on the four successful discoveries are now complete. We have begun completing the four new wells and expect to bring the wells on production at two-week intervals beginning in November with full production expected by early 2004. Following the well completion work, we plan to drill a 7,000 foot test on the Harding Prospect, to the same zone found productive in the first four wells, in an untested fault block beneath the platform. Installation is in progress on a flowline bundle from the new "A" platform on Main Pass Block 287 to the Main Pass Block 288 "A" production platform.

A platform rig has been installed on the "A" platform on Main Pass Block 288 and a multi-well drilling program is in-progress designed to test field productive sands in traps for both attic reserves updip from depleted wells and untested fault blocks on the east flank of a salt dome. Cumulative production from seven productive sands between 3,500 and 6,500 feet on the east flank is approximately 62 Bcf of natural gas and 44 million barrels of oil. The first well in the program, the No. A-4 STK, was drilled to a total depth of 6,400 feet on August 17, 2003 and logged 154 net feet measured depth (MD) of oil pay in four zones. The No. A-4 STK was completed and placed on production during September. The second well, the No. A-6 STK, reached a total depth of 6,914 feet in October on the Monroe Prospect and logged 132 net feet MD of oil pay in three sands in two separate fault blocks. Drilling is in progress on the third well, the No. A-27 STK3, a planned 8,150 foot test on the Roosevelt Prospect that, similar to the Monroe Prospect, is evaluating both untested and attic reserves. Following the drilling of the No. A-27 STK3, we plan to complete this well along with the No. A-6 STK before drilling two exploratory wells for field pay sands in fault traps away from the salt dome. We have been encouraged with reservoir pressure measured in the No. A-4 and No. A-6 wells. We had assumed that previous production from field pay sands had materially reduced reservoir pressures. The recent measured pressures found the sands to be substantially repressured indicating higher recoverable volumes than we had anticipated. Stone has a 100% working interest (WI) and an 83.3% net revenue interest (NRI) in these wells.

Ewing Bank Block 305 Field. A multi-well drilling and workover program from the "A" Platform began in September of this year. A workover of the No. A-9 STK Well is complete and the well is currently flowing 7.5 MMcf of gas and 600 barrels of oil per day from one of the established field productive sands. Completion operations are in-progress on the No. A-19 STK2 Well on the Tank Prospect that drilled to a total depth of 13,916 feet or 8,750 feet of true vertical depth (TVD). Stone has a 100% WI and an 80.6% NRI in the Ewing Bank Block 305 Field.

Mississippi Canyon Block 109. The No. A-22 STK1 BP1 Well was drilled and cased to a total depth of 13,330 feet and completed as an oil producer. The well was placed on production in late September and is flowing at a gross daily rate of 1.5 MMcf gas and 900 barrels of oil. The well also found gas in three shallower sands.

Completion operations are in-progress on the second well, the No. A-33 Well, that drilled to a total depth of 13,692 feet (8,709 feet TVD) and logged approximately 408 net feet MD of pay in eight sands. The A-33 Well confirmed 221 net feet MD of pay in the J sand in an up-dip position in a fault block that has produced 3.7 million barrels of oil from four wells. The deeper exploratory objective, an 8,000 foot sand series, was found productive with 111 net feet MD of pay, extending production in these sands 3,700 feet east of three productive wells. In addition to these two wells, eight new wells and two workovers are planned while the rig is on the platform. Stone has a 33% WI and a 27.5% NRI in Mississippi Canyon Block 109.

South Pelto Block 23. As previously reported, the South Pelto Block 23 No. C-4 Well was drilled to a depth of 18,693 feet on the Hammerhead Prospect and logged gas in several field pay sands. A sidetrack well was drilled to a total depth of 17,010 feet to capture attic reserves updip to the original hole. During September, the well was put on production and is flowing at a stabilized gross daily rate of 5.5 MMcf of gas and 656 barrels of condensate. Stone has a 100% WI and an 80.9% NRI in this well.

South Pelto Block 22. Completion operations are in-progress on the first delineation well at the Can of Corn Prospect discovery on South Pelto Block 22. The No. 3 Well was drilled to a total depth of 19,000 feet (18,155 feet TVD) in a sidetrack hole at a bottom hole location approximately 1,700 feet southwest of the No. 2 discovery well. The No. 3 appraisal well logged 205 net feet MD of pay in eight sands in a fault block adjacent to that tested by the discovery well. Following the completion of the No. 3 Well, the rig will move to drill the No. 4 well from a surface location adjacent to the discovery well. The No. 4 is planned to drill to total depth of 19,136 feet MD (18,000 feet TVD) and is designed to drill updip from the discovery well. A four-pile production facility is currently under construction and expected to be installed to allow production start up in the first quarter of 2004 from the No. 2 and No. 3 wells and the No. 4 Well if successful. Additional drilling is planned moving east along the same major fault that traps the discovery. Stone has mapped three untested fault traps for the productive sand section, each successively down-faulted from the discovery well moving east towards Stone's 2003 deep sand discovery on the Hammerhead Prospect on South Pelto Block 23. Stone has a 50% WI and a 40.7% NRI in the South Pelto Block 22 No. 2 and No. 3 wells.

East Cameron Block 378. The No. 3 BP4 Well was drilled and cased to total depth of 14,467 feet and was mud-line suspended awaiting completion operations. As reported earlier, the well encountered gas pays in two sands. In early October 2003, the operator recommended a sidetrack of the No. 3 BP4 well to the deepest objective of the original hole, which was not reached due to hole problems. This operation would also permit a larger casing string to be set through the two gas pay sands logged in the original wellbore. A consequence of this redesign would be higher potential flow rates once the well is brought onstream. Operations are in-progress to sidetrack the No. 3 Well to a planned measured depth of 15,364 feet (13,174 feet TVD).

A subsea completion and tieback is planned for this well with first production expected late in the second quarter of 2004. The current sidetracking operation is not expected to delay the remaining work to connect the well to production facilities. Stone has a 57% WI and a 42% NRI in these wells.

South Marsh Island Block 288. The No. CB-1 STK1 Well is currently drilling at 12,948 feet towards a proposed total depth of 16,949 feet. Stone has a 50% WI and a 41.7% NRI in this well.

Vermilion Block 255 Field. The No. J-3 BP/2 Well on the Aetna Prospect was drilled as a sidetrack from an idle wellbore to a total depth of 14,514 feet MD and logged 87 net feet MD of gas pay in three K sands. Along the same fault system that traps recent discoveries on the Scorpios and West Scorpios prospects on Vermilion Block 276, the J-3 BP/2 Well drilled directionally to a crestal location for the primary objective K sands that had produced approximately 5.3 Bcf gas and 192 thousand barrels of oil from a down dip well. Production commenced during October, and the well is flowing at a gross daily rate of 5.0 MMcf gas and 150 barrels of condensate. Stone has a 100% WI and an 82.8% NRI in this well.

The OCS-G 2082 No. 5 Well, the initial test of the Olympus Prospect, spudded on August 4th and has drilled to 15,303 feet. The well is designed to drill to a total depth of 19,073 feet. This deep wildcat is drilling beneath nearly one half trillion cubic feet equivalent of established production and is targeting stratigraphically trapped, geopressured Miocene age sands projected from state of the art seismic processing. Stone has a 66.7% WI and a 55.2% NRI in this well.

Mustang Island Block A65. The No. 1 exploratory well on the Triumph Prospect reached a total depth of 15,609 feet (12,560 feet TVD) in late October 2003. This wildcat well was directionally drilled along the up-thrown side of a fault to test a dip closure trap from 10,000 feet to total depth. Non-commercial quantities of gas were logged and the well was subsequently plugged and abandoned. Stone has a 100% working interest in the lease block.