SM Energy Co. grew proved reserves by 27% last year to 984.5 Bcfe at year-end compared to 772.2 Bcfe at the end of 2009, the company said Tuesday.

Reserves are composed of 57.4 million bbl of oil and 640 Bcf of natural gas, and are 70% proved developed, SM Energy said.

"From a production standpoint, our fourth quarter results cap a strong year of production growth. In particular, our programs in the Eagle Ford and Bakken/Three Forks saw significant growth in the fourth quarter," said CEO Tony Best. "With regard to our proved reserves, the company replaced nearly 350% of its production organically through the drillbit."

Preliminary estimated production for the fourth quarter was 31.7 Bcfe, which is above the previously provided guidance range of 28-30.5 Bcfe. On a sequential basis, production grew 15% from the 27.5 Bcfe reported in the third quarter of 2010.

Strong production in the company's Eagle Ford Shale (both operated and non-operated), Bakken/Three Forks and Haynesville shale programs are the principal drivers for the increase in production on a sequential basis, SM Energy said.

Within reported gas production, the Btu content of the natural gas continues to increase as a result of the growing contribution of natural gas liquids to the production stream, SM Energy said. This increase in Btu content results in higher price realizations.