Magnolia Petroleum Plc / Index: AIM / Epic: MAGP / Sector: Oil
& Gas
8 January 2013
Magnolia Petroleum Plc (`Magnolia' or `the Company')
Quarterly Operations Update for the period ended 31 December 2012
Magnolia Petroleum Plc, the AIM quoted US focused oil and gas
exploration and production company, announces a quarterly update on
its operations across proven and producing US onshore hydrocarbon
formations, including the Bakken/ Three Forks Sanish in
North Dakota and Montana and the Mississippi Lime and the
Hunton/Woodford in Oklahoma.
Quarter Highlights
* The total number of producing wells in which the Company has an interest
now stands at 86 - 34% increase since the beginning of 2012
* 19 wells currently being drilled/completed and a further 10 waiting to be
spud
* First well, the Roger Swartz #1, drilled as operator to the Mississippi
Lime formation in Oklahama - testing currently underway
* Significant increase in acreage during the quarter:
*
+ 6,881 net mineral acres acquired in the Montana section of the Bakken/
Three Forks Sanish formation - the majority of leases surrounded by
those recently acquired by Apache Corporation, the leading
international oil and gas company
+ 496.28 net mineral acres acquired in the Mississippi Lime, Oklahoma,
bringing total acreage in this formation to 4,507.35
* Raised £2.9 million at blended price of 4.5365p per share by way of draw
down from £10 million Equity Financing Facility (`EFF') with Darwin
Strategic Limited (`Darwin'), of which approximately £5.3m remains to be
drawn down if and when required
Outlook
* Q1 2013 expected to see further significant activity with numerous new
wells due to come into production
* Multiple well proposals being received - expected to lead to further
participations with leading operators
* Results of testing of first well drilled as operator to the Mississippi
Lime
* Plans to drill additional wells in Oklahoma as operator, with 50%+ net
revenue interests
* On-going leasing activity likely to result in additional acreage being
acquired in proven onshore US formations
*
+ 985 net mineral acres acquired in the Bakken, Montana bringing total
net acreage in this formation to 7,866 as announced on 4 January 2013
* Commissioned Moyes & Co. to update Reserves and Competent Person's Report
covering Magnolia's assets as at year end 2012 - Report will include:
*
+ an estimate on the Company's average production rates
+ an anticipated reserves upgrade due to reclassification of the
Company's Three Forks Sanish reserves from "possible" to "proven
undeveloped" and newly acquired Mississippi Lime acreage with multiple
"proven undeveloped" locations
Well Developments
The full list of well developments occurring in the quarter is
set out below.
Well Formation Status NRI % Operator
SPS 6-26 Hunton Producing 0.68079 Paul Gillham
Otis 2-27-12 1H Mississippi
Producing 3.370244 Chesapeake
Roger Swartz #1 Mississippi Undergoing 81.25 Magnolia
testing Petroleum
Lois Rust 7-27-12 Mississippi Sales line 1.8678 Chesapeake
1H capacity is being
increased.
Waiting on
installation
Thomason 10-27-12 Mississippi Sales line 9.375 Chesapeake
1H capacity is being
increased.
Waiting on
installation.
Walker 2-29 Viola Completed - 0.8335 Transpro
waiting on
initial
production
Prucha 1-23MH Mississippi Production 18.75 Devon Energy
facilities and
pipeline
installed - frac
water being
extracted
Montecristo 6-1H Mississippi Waiting on 5.3486 Cisco
installation of
pumping unit
Beebe 24-W1H Woodford Unloading frac 0.242188 Longfellow
water Energy
Curtis Kerr 24-8H Bakken Undergoing 1.46677 Marathon
fracture
stimulation
Nicky Kerr 14-8 Bakken Undergoing 1.46677 Marathon
fracture
stimulation
Joan 1-21 Mississippi Unloading frac 2.8125 Tessara
water Energy
Phenom 1-14H Mississippi Waiting on frac 1.72626 Territory
Resources
Bowen 2-29 Wilcox Completed-waiting 1.736006 Basis
on initial
production
results
Bowen 3-29 Wilcox Completed-waiting 1.736006 Basis
on initial
production
results
Mack 10-27-17 1H Mississippi
Drilled - waiting 0.504985 Chesapeake
on completion
Jake 2-11 # 1H Bakken Drilling 1.4648 Statoil
Jake 2-11 # 2TFH Three Forks Stimulating, 1.4648 Statoil
Sanish waiting on
initial
production
results
Campbell 1-H* Woodford Drilling 0.026025 Newfield
Kelly 1-2H* Woodford Drilling 0.1302 Eagle Rock
Energy
Forrest 1-8H Woodford Drilling 0.5859 Continental
Resources
Bessie Todd Estate Cotton Valley Drilling 0.17306 Anadarko
GU 31H
Partagas 1-1H Mississippi Planned 3.75976 Cisco
Sympson 1-6H Woodford Planned 0.71115 Continental
Resources
Condit 1-5H* Woodford Planned 0.04981 Continental
Resources
Peck 1-5H Mississippi Planned 0.502 Range
Resources
Cox 1-29H Hunton Planned 2.1875 Crown Energy
*From time to time, the Company elects to participate in wells
with relatively small working/net revenue interests. This allows
Magnolia to gain access to critical well information which is then
used to further enhance its understanding of the relevant
formation.
Magnolia COO, Rita Whittington
said, "Magnolia now has interests in 86 producing wells, all of
which are generating revenues for the Company, a further 19
currently drilling/completing and 10 waiting to spud. In line with
our strategy, all of these wells are located in proven, producing
US onshore formations and many are in partnership with established
operators such as Anadarko and
Chesapeake Energy.
"In the year ahead, we expect a further significant increase in
the number of wells in which we have an interest, thanks to the
over 4,500 net mineral acres in the Mississippi Lime and the 7,866
net acres in the Montana section
of the Bakken we have acquired in the last twelve months. With this
in mind, as further drilling progressively proves up the
prospectivity of our acreage, leading to higher revenues and
reserves attributable to our Company, I am confident Magnolia is
well placed to build further substantial value for
shareholders."
* * ENDS * *
For further information on Magnolia Petroleum Plc visit
www.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 Daniel Stewart & Company Plc +44 (0) 20 7776 6550
Thomas
John Howes / Northland Capital Partners +44 (0) 20 7796 8800
John-Henry Wicks 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 focused, oil and gas exploration
and production company. Its portfolio includes interests in 86 producing and
non-producing assets, primarily located in the highly productive Bakken/Three
Forks Sanish hydrocarbon formations in North Dakota as well as the oil rich
Mississippi Lime and the substantial and proven Woodford and Hunton formations
in Oklahoma.
Summary of Wells
Category Number of wells
Producing 86
Being Drilled / Completed 19
Elected to participate / waiting to 10
spud
TOTAL 115
This table excludes four out of six wells acquired as part of
the acquisition of 800 gross acres with a 100% working interest in
Osage County, Oklahoma, as
announced on 10 February 2012. These
four wells are currently `shut in' and will require a workover
programme at some point in the future to bring back into
production.