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Louisiana-based independent oil and gas explorer, Stone Energy Corporation (SGY - Analyst Report) announced that it has contracted a dynamically positioned deepwater drilling rig from Ensco plc’s (ESV - Analyst Report) ENSCO 8500 series. The rig would be used for Stone Energy's Cardona oil development program at Mississippi Canyon 29. The newly contracted rig would allow Stone Energy to further develop the reserves around the Pompano platform.  

Drilling on the first Cardona well is expected to commence during the second half of 2013 followed by the drilling of the Cardona South well. Stone Energy plans to tie back both wells to its wholly owned Pompano platform with production projected for late 2014.  Stone is the operator of the Cardona wells with a 65% working interest.

Based on its track record of sustaining volume growth, Stone Energy currently expects net daily production of 230−240 million cubic feet of gas equivalent per day (MMcfe/d) during the first quarter of 2013. The company also expects liquids to represent approximately 50% of overall volumes in the first quarter.

Stone Energy is an independent oil and natural gas exploration and production company headquartered in Lafayette, Louisiana with additional offices in New Orleans, Houston and Morgantown, West Virginia.  

Stone Energy is well placed in the industry with a widespread and high-yielding inventory. The company boasts an extensive capital project inventory and generates surplus cash flow with no bank debt. Although Stone Energy aims to apportion its capital across its portfolio, the focus will be on the Gulf of Mexico shelf as well as the Marcellus region.

Among the U.S. based oil exploration and production players, Stone Energy and Range Resources Corporation (RRC - Analyst Report) both Zacks Ranked #1 (Strong Buy) stocks are expected to outperform the market over the next few months. Another promising name in this space is Zacks Ranked #2 (Buy) Continental Resources, Inc. (CLR - Snapshot Report).

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