TEXT-S&P release on Stone Energy Corp

(The following statement was released by the rating agency)

March 31 - Standard & Poor's Ratings Services said today that it revised its outlook on independent exploration and production firm Stone Energy Corp. (SGY.N: Quote, Profile, Research) to stable from negative and affirmed the 'B+' corporate credit rating on the company.

"The outlook revision is predicated on Stone's strengthening credit metrics, liquidity position, and operating performance," said Standard & Poor's ratings analyst Jeffrey B. Morrison.

"We also consider the company's improving internal reserve replacement and finding and developing cost trends."

The ratings on Stone reflect a small reserve base, highly concentrated in the mature U.S. Gulf of Mexico shelf region, a short reserve life on a proved developed producing (PDP) basis, and participation in a historically cyclical and capital-intensive industry.

Concerns are partially tempered by stronger near-term liquidity and cash flow measures, lower year-over-year debt levels, and favorable near-term trends in realized commodity prices and per-unit cash margins.

As of Dec. 31 2007, Lafayette, La.-based Stone had $400 million in long-term debt, $589 million when fully adjusted for operating leases and asset retirement obligations.