Magnum Energy Announces Acquisition of Producing Property in Sedalia Area
22 October 2009 - 2:42AM
Marketwired
MAGNUM ENERGY INC. (the "Company") (TSX VENTURE: MEN) is pleased to
announce that it has closed an acquisition (the "Acquisition") of
13 gross (9.24 net) sections of land in the Sedalia area of Alberta
with existing natural gas production of 415 mcf/d (70 BOE/D) as
previously announced on September 30, 2009. The Acquisition also
includes a 30% working interest in a gas processing plant and a
100% interest in a compressor facility which will be operated by
the Company.
The Company is also pleased to report that it has obtained a
$5,000,000 Operating Loan Facility from the Alberta Treasury
Branch. This loan facility has been used in part to repay
indebtedness to the Company's previous lender and to fund the
Acquisition. The balance of the loan available of $1,000,000 in
addition to cash flow will be used to upgrade the current
facilities and to bring further production on in the Sedalia area
and for general corporate purposes.
The Company intends to enhance the capacity of the gas plant to
enable it to commence production which is currently behind pipe in
100% owned wells. The Company's after acquisition current total
production of 255 boe/d is anticipated to increase to 500 boe/d by
the end of 2009 as a result of the planned Sedalia plant
upgrades.
Reader Advisory
This news release and the documents referred to therein contain
certain forward-looking statements, including management's
assessment of future plans and operations and capital expenditures
and the timing thereof, that involve substantial known and unknown
risks and uncertainties, certain of which are beyond Magnum's
control. Such risks and uncertainties include, without limitation,
risks associated with oil and gas exploration, development,
exploitation, production, marketing and transportation, loss of
markets, volatility of commodity prices, currency fluctuations,
imprecision of reserves estimates, environmental risks, competition
from other producers, inability to retain drilling rigs and other
services, delays resulting from or inability to obtain required
regulatory approvals and ability to access sufficient capital from
internal and external sources, the impact of general economic
conditions in Canada, the United States and overseas, industry
conditions, changes in laws and regulations, including the adoption
of new environmental laws and regulations, and changes in how they
are interpreted and enforced, increased competition, the lack of
availability of qualified personnel or management, fluctuations in
foreign exchange or interest rates, stock market volatility and
market valuations of companies with respect to announced
transactions and the final valuations thereof, and obtaining
required approvals of regulatory bodies. Actual results could
differ materially from those expressed in or implied by these
forward-looking statements. No assurances can be given that any of
the events anticipated by any forward-looking statements will
transpire or occur, or if any of them do so, what benefits Magnum
will derive there from. Readers are cautioned that the foregoing
list of factors is not exhaustive. All subsequent forward-looking
statements, whether written or oral, attributable to Magnum or
persons acting on behalf are expressly qualified in their entirety
by these cautionary statements. The forward-looking statements
contained in this news release and the documents referred to
herein, are made as at the date of this news release, and Magnum
does not undertake any obligation to update publicly or to revise
any of the included forward-looking statements, whether as a result
of new information, future events or otherwise, except as may be
required by applicable securities laws.
Petroleum and natural gas volumes are converted to an equivalent
measurement basis referred to as a "barrel of oil equivalent" (boe)
on the basis of 6 thousand cubic feet of natural gas equaling 1
barrel of oil. This is based on an energy equivalency conversion
method applicable at the burner tip and does not necessarily
represent a value equivalency at the wellhead. Readers are
cautioned that boe figures may be misleading, particularly if used
in isolation.
ON BEHALF OF THE COMPANY
Richard Nemeth, President
The TSX Venture Exchange has neither approved nor disapproved
the contents of this press release.
Contacts: Magnum Energy Inc. Richard Nemeth President & CEO
604.669.3155 604.669.3177 (FAX) rnemeth@magnumenergyinc.com
www.magnumenergyinc.com
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