18th Mar 2013 07:00
MAGNOLIA PETROLEUM PLC - Operational UpdateMAGNOLIA PETROLEUM PLC - Operational Update
PR Newswire
London, March 17
Magnolia Petroleum Plc / Index: AIM / Epic: MAGP / Sector: Oil & Gas
18 March 2013
Magnolia Petroleum Plc(`Magnolia' or `the Company') Operational UpdateMagnolia Petroleum Plc, the AIM quoted US onshore oil and gas exploration andproduction company, is pleased to report an update on the Company's commercialactivities in proven US onshore formations including the Bakken/Three ForksSanish, North Dakota and the Mississippi Lime and Woodford/Hunton formations inOklahoma.
Initial Production Rates
The Company has been informed by the relevant operators that production hascommenced at the following four wells, with the initial production rates(`IPR') as set out below:
Well Name Formation Operator Magnolia's Gross IPR Magnolia's Net IPR
NRI NRI Curtis Bakken, Marathon 1.46677% 1,496.44 1.46677% 22Kerr North Dakota Oil boepd boepd24-8HNicky Bakken, Marathon 1.46677% 1,501 1.46677% 22Kerr 14-8 North Dakota Oil
boepd boepd Kelly Woodford, Eagle Rock 0.1302% 1,291 0.1302% 1.71-2H Oklahoma Energy boepd boepd Bessie Cotton Anadarko 0.17306% 4,900 mcf 0.17306% 8.5 mcfTodd GU Valley, /d /d31H TexasMagnolia COO, Rita Whittington said, "All four initial production rates areabove our expectations and highlight the positive impact horizontal drillingand fracture stimulation can have on recovery rates in proven onshore USformations which, in recent years, have transformed the US energy landscape.The prolific Bakken play has been at the forefront of this revolution, and islargely responsible for a more than seven fold increase in daily oil productionin North Dakota to over 700,000 boepd in just six years. With 14 wells atvarious stages of drilling or stimulation and another 15 waiting to spud, weexpect further growth in our net production in due course, as we continue withour strategy of drilling wells on our leases to prove up our reserves and, inthe process, create value for shareholders."
Participation in NewWell
The Cordray-Ritter 4-28-14 1H well, operated by Chesapeake Energy(`Chesapeake'), is an increased density horizontal well to test the MississippiLime Formation, within the same spacing unit as the successful Sundance well,in Woods County Oklahoma. The Sundance well, which Magnolia participated in,resulted in payout being achieved in three months which is a record for theCompany. Magnolia holds a 0.796% working interest and a 0.597% net revenueinterest in the Cordray-Ritter well. The total estimated cost of the well isUS$4,003,700, with the Company's share estimated at US$31.871.
Existing Well Updates
The Company has been informed by the operator of a change in status in thefollowing wells in which it participates:
Well Formation Status NRI % Operator Jake 2-11 # 1H Bakken Scheduled for fracture 1.4648 Statoil stimulation in June 2013 Jake 2-11 # 2TFH Three Forks Scheduled for fracture 1.4648 Statoil Sanish stimulation in June 2013 ** ENDS ** Glossary`boe' means barrels of oil equivalent: a unit of energy based on theapproximate energy released by burning one barrel (42 US gallons or 158.9873litres) of crude oil.
There are 42 gallons (approximately 159 litres) in one barrel of oil, whichwill contain approximately 5.8 million British Thermal Units (MBtus) or 1,700kilowatt hours (kWh). The value is necessarily approximate as various grades ofoil have slightly different heating values. BOE is used by oil and gascompanies in their financial statements as a way of combining oil and naturalgas reserves and production into a single measure.
`boepd' means barrels of oil equivalent per day
`IPR' means initial production rates
`mcf/d' means thousand cubic feet per day
`NRI' means net revenue interest
For further information on Magnolia Petroleum Plc visitwww.magnoliapetroleum.com or contact the following:
Steven Snead Magnolia Petroleum Plc +01 918 449 8750 Rita Whittington Magnolia Petroleum Plc +01 918 449 8750 Antony Legge/James Thomas Daniel Stewart & Company Plc +44 (0) 20 7776 6550 John Howes/John-Henry Wicks Northland Capital Partners +44 (0) 20 7796 8800 Limited Lottie Brocklehurst St Brides Media and Finance +44 (0) 20 7236 1177 Ltd Frank Buhagiar St Brides Media and Finance +44 (0) 20 7236 1177 Ltd Notes Magnolia Petroleum Plc is an AIM quoted, US focussed, oil and gas explorationand production company. Its portfolio includes interests in 95 producing andnon-producing assets, primarily located in the highly productive Bakken/ThreeForks Sanish hydrocarbon formations in North Dakota as well as the oil richMississippi Lime and the substantial and proven Woodford and Hunton formationsin Oklahoma. Summary of Wells Category Number of wells Producing 95 Being Drilled / Completed 14 Elected to participate / waiting to 15spud TOTAL 124This summary excludes four out of six wells acquired as part of the acquisitionof 800 gross acres with a 100% working interest in Osage County, Oklahoma, asannounced on 10 February 2012. These four wells are currently `shut in' andwill require a workover programme at some point in the future to bring backinto production.
Total US onshore net acreage 12,794.16 acres
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