St. Mary Land & Exploration Co., Denver, (NYSE: SM) has one rig drilling on its Texas Haynesville assets.

The 3-D data for the company’s acreage in Shelby and San Augustine counties is currently being evaluated. St. Mary has 41,000 net acres that it believes are prospective for the Haynesville shale, of which 31,000 net acres are in Shelby and San Augustine counties. Much of the acreage in these counties is also believed to be prospective for the Bossier shale, according to St. Mary.

Seven operated horizontal wells targeting the Haynesville shale are planned for 2010, all of which will be on high working interest acreage in East Texas.

In North Dakota, the company recently completed a test designed to determine the connectivity of the Bakken and Three Forks formations in a portion of its acreage. Two horizontal wells were drilled, with one targeting the Bakken and the other targeting the Three Forks. These wells were then simul-fraced together.

The combined 24-hour initial production of the two wells was roughly 2,800 barrels of oil equivalent per day. St. Mary plans to observe the performance of the wells over a number of months to determine the extent to which the two wells may be producing incremental reserves beyond what could be obtained through a single zone completion.

St. Mary has approximately 70,000 net acres in North Dakota that it believes are prospective for development of the Bakken and Three Forks intervals. This is an increase of roughly 17,000 net acres from the end of 2008. Approximately 48,000 net acres are in McKenzie and Williams counties. The company also has roughly 21,000 net acres in Divide County where testing is focused on the Three Forks interval.

It plans to drill 17 operated wells in the Williston Basin in 2010, the majority of which will be Bakken wells in its Bear Den prospect in McKenzie County.

In the Woodford shale in southern Oklahoma, the two increased-density simultaneous fracture stimulation pilots that were conducted in 2009 have been concluded and analyzed, and the results are positive. During 2009, St. Mary’s first test involved simul-fracing four wells on 128-acre spacing, or five wells per section. Positive initial results from this test led to a four well test on 64-acre spacing, or ten wells per section.

St. Mary believes that it will be able to book proved reserves on these infill wells at a range of 2.7- to 3 billion cubic feet equivalent per well, which is consistent with the range seen on lower density drilling.

St. Mary believes that the results learned from this effort will improve its understanding of the ultimate spacing in some other shale plays, particularly the Eagle Ford and Marcellus shales.

The company has 34,000 net acres in the Arkoma Basin in Oklahoma with potential for the Woodford shale. St. Mary plans to drill six horizontal wells in 2010 is designed primarily to preserve its acreage position in the play.

In the Permian Basin, two operated rigs are currently running in the basin. The Wolfberry tight oil program continues to be the focus in the basin. St. Mary is drilling a horizontal Granite Wash well in its Mayfield area in Beckham County, Oklahoma. Roughly 32,000 net acres are prospective for the Granite Wash interval, the majority of which is held by production. Four operated wells are planned in this program for 2010.

St. Mary is also engaged in an exploration program targeting the Niobrara formation in southeastern Wyoming. It is currently in the process of drilling its first well. St. Mary currently has 24,000 net acres under lease in the area.

Tony Best, CEO and President, remarked, “Last year was a transformational year for St. Mary. We entered 2009 with a great deal of uncertainty regarding the economy and we responded appropriately by cutting back our level of capital investment, particularly in development activities.”

St. Mary has oil and gas assets primarily in the Ark-La-Tex, the Midcontinent, the Gulf Coast, the Permian and the Rockies regions.