Exhibit 99.1

Clayton Williams Energy Announces 2009 Financial Results and Year-End Reserves

MIDLAND, Texas--(BUSINESS WIRE)--March 10, 2010--Clayton Williams Energy, Inc. (the “Company”) (NASDAQ: CWEI) today reported its financial results for the quarter and year ended December 31, 2009, along with information about its proved oil and gas reserves as of December 31, 2009.

Financial Results for the Fiscal Year 2009

Net loss attributable to Company stockholders for fiscal 2009 was $117.4 million, or $9.67 per share, as compared to net income of $140.5 million, or $11.67 per share, for fiscal 2008. Cash flow from operations for 2009 was $104.7 million as compared to $382 million for 2008. The key factors affecting the comparability of the two years were:

• Oil and gas sales declined $221.6 million in 2009 versus 2008. Price variances accounted for $195.4 million of the decrease and production variances accounted for a decrease of $26.2 million. Average realized commodity prices in 2009 were significantly lower than the record-high prices realized by the Company in 2008. Average realized oil prices were $57.37 per barrel in 2009 versus $97.35 per barrel in 2008, and average realized gas prices were $4.35 per Mcf in 2009 versus $9.02 per Mcf in 2008. Most of the 7% decline in oil and gas production on barrel of oil equivalent (“BOE”) basis resulted from the sale of certain South Louisiana properties in April 2008.
• Loss on derivatives for 2009 was $17.4 million ($15.9 million realized loss on settled contracts and $1.5 million non-cash mark-to-market loss) versus a gain in 2008 of $74.7 million ($25 million realized gain on settled contracts and $49.7 million non-cash mark-to-market gain). Sharp declines in commodity prices late in 2008 caused the fair value of the Company’s derivative positions to escalate significantly. In December 2008, the Company elected to terminate all of its then-existing derivative positions for cash proceeds of $99.3 million. See accompanying tables for additional information about the Company’s accounting for derivatives.

• Non-cash impairments of property and equipment were $59.1 million in 2009 versus $12.9 million in 2008. The 2009 impairment included $32.1 million related to drilling rigs classified as assets held for sale in April 2009 and $27 million related to oil and gas properties that were impaired due to downgrades in proved reserves. See “Reserves.”

Financial Results for the Fourth Quarter of 2009

Net loss attributable to Company stockholders for the fourth quarter of 2009 (“4Q09”) was $42.9 million, or $3.53 per share, as compared to net income of $59.9 million, or $4.93 per share, for the fourth quarter of 2008 (“4Q08”). Cash flow from operations for 4Q09 was $35.6 million as compared to $158.9 million for 4Q08. The key factors affecting the comparability of the two quarters were:

• Oil and gas sales declined $7.5 million in 4Q09 versus 4Q08. Production variances accounted for a $12.3 million decrease, and price variances accounted for a $4.8 million increase. Oil production declined 9% and gas production declined 27% in 4Q09 versus 4Q08. The Company significantly reduced capital spending during the first half of fiscal 2009 in response to low operating margins caused by the recession that began in 2008. As a result, production from new wells was not sufficient to offset normal declines in existing production. Average realized oil prices were $72.78 per barrel in 4Q09 versus $59.63 per barrel in 4Q08, and average realized gas prices were $5.20 per Mcf in 4Q09 versus $6.75 per Mcf in 4Q08.
• Loss on derivatives for 4Q09 was $2.9 million ($9.7 million realized loss on settled contracts net of $6.8 million non-cash mark-to-market gain) versus a gain in 2008 of $136.7 million ($110.9 million realized gain on settled contracts and $25.8 million non-cash mark-to-market gain). The gains reported in 4Q08 resulted from sharp declines in commodity prices late in 2008 which caused the fair value of the Company’s derivative positions to escalate significantly. See accompanying tables for additional information about the Company’s accounting for derivatives.
• Non-cash impairments of proved properties were $27 million in 4Q09 versus $2.9 million in 4Q08. The 4Q09 impairment related to oil and gas properties that were impaired due to downgrades in proved reserves. See “Reserves.”

Reserves

The Company reported that its total estimated proved oil and gas reserves as of December 31, 2009 were 33.6 million barrels of oil equivalent (MMBOE), consisting of 21 million barrels of oil and NGL and 76.1 Bcf of natural gas. Proved developed reserves were 28.6 MMBOE, or 85% of total proved reserves. The present value of estimated future net cash flows from total proved reserves, before deductions for estimated future income taxes and asset retirement obligations, discounted at 10%, (referred to as “PV-10”) totaled $460.4 million. For a reconciliation of PV-10 (a non-GAAP measure) to standardized measure of discounted future net cash flows, see accompanying tables.

The following table summarizes the changes in proved reserves during 2009 on an MMBOE basis.

The Company replaced 63% of the 5.8 MMBOE produced in 2009 through extensions and discoveries, most of which were derived from drilling activities in the Permian Basin and Austin Chalk (Trend) despite curtailments of spending during the first half of 2009 due to unfavorable operating margins caused by the 2008 recession. Net downward revisions of 2.4 MMBOE were primarily due to the reclassification of certain Permian Basin reserves from proved undeveloped to probable based on changes required by the SEC modernization rule.

The above reserve estimates were computed in accordance with the SEC’s final rule on the modernization of oil and gas reporting, which the Company adopted effective December 31, 2009. The commodity prices used to estimate the Company’s proved reserves and their related present value of future net cash flows were based on the 12-month unweighted average of the first-day-of-the-month price received by the Company in 2009, resulting in average oil and NGL prices of $54.81 per Bbl and average gas prices of $3.71 per Mcf.

Commodity prices have a significant impact on proved oil and gas reserves and their related PV-10. In addition to the reserve estimates based on the SEC pricing guidelines, the Company has reported its proved reserves under two alternative pricing cases. The year-end pricing case is based on spot prices in effect at December 31, 2009 and is comparable to pricing guidelines under the old SEC rules. The futures pricing case is based on the five-year futures curve as of December 31, 2009.

Scheduled Conference Call

The Company will host a conference call to discuss these results and other forward-looking items today, March 10th at 1:30 pm CT (2:30 pm ET). The dial-in conference number is: 800-901-5213, passcode 98404354. The replay will be available for one week at 888-286-8010, passcode 35170722.

To access the conference call via Internet webcast, please go to the Investor Relations section of the Company’s website at www.claytonwilliams.com and click on “Live Webcast.” Following the live webcast, the call will be archived for a period of 90 days on the Company’s website.

Clayton Williams Energy, Inc. is an independent energy company located in Midland, Texas.

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical or current facts, that address activities, events, outcomes and other matters that we plan, expect, intend, assume, believe, budget, predict, forecast, project, estimate or anticipate (and other similar expressions) will, should or may occur in the future are forward-looking statements. These forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events. The Company cautions that its future natural gas and liquids production, revenues, cash flows, liquidity, plans for future operations, expenses, outlook for oil and natural gas prices, timing of capital expenditures and other forward-looking statements are subject to all of the risks and uncertainties, many of which are beyond our control, incident to the exploration for and development, production and marketing of oil and gas.

These risks include, but are not limited to, the possibility of unsuccessful exploration and development drilling activities, our ability to replace and sustain production, commodity price volatility, domestic and worldwide economic conditions, the availability of capital on economic terms to fund our capital expenditures and acquisitions, our level of indebtedness, the impact of the current economic recession on our business operations, financial condition and ability to raise capital, declines in the value of our oil and gas properties resulting in a decrease in our borrowing base under our credit facility and impairments, the ability of financial counterparties to perform or fulfill their obligations under existing agreements, the uncertainty inherent in estimating proved oil and gas reserves and in projecting future rates of production and timing of development expenditures, drilling and other operating risks, lack of availability of goods and services, regulatory and environmental risks associated with drilling and production activities, the adverse effects of changes in applicable tax, environmental and other regulatory legislation, and other risks and uncertainties are described in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking statements.

(a) Hedging gains/losses are only included in the determination of the Company's average realized prices if the underlying derivative contracts are designated as cash flow hedges under applicable accounting standards. The Company did not designate any of its 2009 or 2008 derivative contracts as cash flow hedges. This means that the Company's derivatives for 2009 and 2008 have been marked-to-market through its statement of operations as other income/expense instead of through accumulated other comprehensive income on the Company's balance sheet. This also means that all realized gains/losses on these derivatives are reported in other income/expense instead of as a component of oil and gas sales.

CONTACT:
Clayton Williams Energy, Inc.
Patti Hollums, 432-688-3419
Director of Investor Relations
cwei@claytonwilliams.com
www.claytonwilliams.com
or
Mel G. Riggs, 432-688-3431
Chief Financial Officer