8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  February 22, 2012

CLAYTON WILLIAMS ENERGY, INC.

(Exact name of Registrant as specified in its charter)

Delaware	001-10924	75-2396863
(State or other jurisdiction of	(Commission File	(I.R.S. Employer
incorporation or organization)	Number)	Identification Number)

6 Desta Drive, Suite 6500, Midland, Texas	79705-5510
(Address of principal executive offices)	(Zip code)

Registrant's Telephone Number, including area code:   (432) 682-6324

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨Pre-commencement communications pursuant to Rule 14d-2 (b) under the Exchange Act (17 CFR 240.14d-2 (b))

¨Pre-commencement communications pursuant to Rule 13e-4 (c) under the Exchange Act (17 CFR 240.13e-4 (c))

Item 7.01 -                      Regulation FD Disclosure

The Company hereby incorporates by reference into this Item 7.01 of Form 8-K the Financial Guidance Disclosures for 2012 attached as Exhibit 99.1.  This Exhibit 99.1 is being furnished to provide public disclosure of certain financial and operating estimates in order to permit the preparation of models to forecast the Company’s operating results for the fiscal year ending December 31, 2012.  The Company cautions users of this information that the estimates provided in this Exhibit 99.1 are based on information available to the Company as of the date of this filing, and actual results may vary materially from these estimates.  The Company does not undertake any obligation to update these estimates as conditions change or as additional information becomes available.

Item 9.01 -                      Financial Statements and Exhibits

(d)         Exhibits

The following exhibit is provided as part of the information furnished under Item 7.01 of this report.

Exhibit
Number	Description
99.1	Clayton Williams Energy, Inc. Financial Guidance Disclosures for 2012

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereto duly authorized.

CLAYTON WILLIAMS ENERGY, INC.

Date:	February  22, 2012	By:	/s/ Mel G. Riggs
			Mel G. Riggs
			Executive Vice President and Chief
			Operating Officer

Date:	February  22, 2012	By:	/s/ Michael L. Pollard
			Michael L. Pollard
			Senior Vice President and Chief Financial
			Officer

EX-99.1

EXHIBIT 99.1

CLAYTON WILLIAMS ENERGY, INC.

FINANCIAL GUIDANCE DISCLOSURES FOR 2012

Overview

Clayton Williams Energy, Inc. and its subsidiaries have prepared this document to provide public disclosure of certain financial and operating estimates in order to permit the preparation of models to forecast our operating results for the year ending December 31, 2012.  These estimates are based on information available to us as of the date of this filing, and actual results may vary materially from these estimates.  We do not undertake any obligation to update these estimates as conditions change or as additional information becomes available.

The estimates provided in this document are based on assumptions that we believe are reasonable.  Until our actual results of operations for this period have been compiled and released, all of the estimates and assumptions set forth herein constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  All statements, other than statements of historical facts, included in this document 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, could or may occur in the future, including such matters as production of oil and gas, product prices, oil and gas reserves, drilling and completion results, capital expenditures, operating costs and other such matters, are forward-looking statements.  Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from the results, performance, or achievements expressed or implied by such forward-looking statements.  Such factors include, among others, the following:  the volatility of oil and gas prices; the unpredictable nature of our exploratory drilling results; the reliance upon estimates of proved reserves; operating hazards and uninsured risks; competition; government regulation; and other factors referenced in filings made by us with the Securities and Exchange Commission.

As a matter of policy, we generally do not attempt to provide guidance on:

(a) production which may be obtained through future exploratory drilling;

(b) dry hole and abandonment costs that may result from future exploratory drilling;

(c) the effects of Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities” superseded by topic 815-10 of the Financial Accounting Standards Board Accounting Standards Codification;

(d) gains or losses from sales of property and equipment unless the sale has been consummated prior to the filing of financial guidance;

(e) capital expenditures related to completion activities on exploratory wells or acquisitions of proved properties until the expenditures are estimable and likely to occur; and

(f) revenues and expenses related to Desta Drilling, L.P., a wholly-owned subsidiary of the Company which provides contract drilling services for the Company and third parties.

Summary of Estimates

The following table sets forth certain estimates being used to model our anticipated results of operations for the fiscal year ending December 31, 2012.  Each range of values provided represents the expected low and high estimates for such financial or operating factor.

	Estimated Ranges
	Year Ending
	December 31, 2012
(Dollars in thousands, except per unit data)
Average Daily Production:
Oil (Bbls)		11,250 to 11,650
Gas (Mcf)		22,000 to 24,000
Natural gas liquids (Bbls)		750 to 850
Total oil equivalents (BOE)		15,667 to 16,500
Price Differentials to NYMEX:
Oil		92% to 94%
Gas		120% to 140%
Natural gas liquids (based on oil)		50% to 60%
Other Costs and Expenses:
Production expenses:
Direct costs ($/BOE)	$	15.00 to 16.00
Production taxes (% of sales)		5% to 6%
General and Administrative:
Excluding non-cash compensation	$	24,000 to 26,000
Non-cash compensation	$	15,000 to 17,000
DD&A:
Oil and gas ($/BOE)	$	19.00 to 21.00
Other	$	3,700 to 4,300
Exploration costs:
Abandonments and impairments	$	1,000 to 3,000
Seismic and other	$	5,000 to 7,000
Interest expense (cash rates):
$350 million Senior Notes due 2019		7.75%
Bank credit facility		LIBOR plus (175 to 275 bps)
Effective Federal and State Income
Tax Rate:
Current		0%
Deferred		36%

Capital Expenditures

The following table sets forth, by area, our planned capital expenditures for the year ending December 31, 2012.

	Planned
	Expenditures		2012
	Year Ending		Percentage
	December 31, 2012		of Total
	(In thousands)
Drilling and Completion:
Permian Basin Area:
Reeves	$	219,500		56	%
Other		46,500		12	%
Austin Chalk/Eagle Ford Shale		32,200		9	%
Other		5,600		1	%
		303,800		78	%
Leasing and seismic		66,700		17	%
Exploration and development		370,500		95	%
Facilities and other		20,600		5	%
Total capital expenditures	$	391,100		100	%

We currently plan to spend approximately $370.5 million on exploration and development activities in fiscal 2012, including $303.8 million for drilling and completion and $66.7 million for leasing and seismic activities.  Our actual expenditures during fiscal 2012 may be substantially higher or lower than these estimates since our plans for exploration and development activities may change during the year.  Other factors, such as prevailing product prices and the availability of capital resources, could also increase or decrease the ultimate level of expenditures during fiscal 2012.  Based on these current estimates, approximately 93% of our planned expenditures for exploration and development activities for fiscal 2012 will relate to developmental prospects, as compared to approximately 92% in fiscal 2011.

Accounting for Derivatives

The following summarizes information concerning our net positions in open commodity derivatives applicable to periods subsequent to December 31, 2011.  The settlement prices of commodity derivatives are based on NYMEX futures prices.

Swaps:

	Oil
	Bbls (a)		Price
Production Period:
1st Quarter 2012		444,000	$	95.70
2nd Quarter 2012		410,000	$	95.70
3rd Quarter 2012		384,000	$	95.70
4th Quarter 2012		362,000	$	95.70
		1,600,000

(a)Excludes oil hedges covering 393,863 barrels of oil for production months from January 2012 through May 2016 at a price of $91.15 per barrel.  These hedges cover production related to a volumetric production payment expected to be granted in connection with the proposed acquisition by our wholly owned subsidiary, Southwest Royalties, Inc., of 24 limited partnerships of which it is the general partner.

We did not designate any of the derivatives shown in the preceding table as cash flow hedges; therefore, all changes in the fair value of these contracts prior to maturity, plus any realized gains or losses at maturity, will be recorded as other income (expense) in our statement of operations.