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=
Magellan Petroleum
Announces
Produ=
ction
and Exploration Activities for the Quarter Ended March 31, 2007
The Comp=
any's
share of natural gas sales during the quarter ended March 31, 2007 increase=
d by
5.1 percent from the March 2006 quarter, as detailed below:
|
Field (Magellan Share) |
Million
Cubic Feet |
Terajoules
|
Variance
|
|
|
Total |
Daily |
|||
|
Mereenie<=
/span> |
1,354.0=
|
15.1 |
1,582 |
+7.3% |
|
|
445.0 |
4.9 |
507 |
–1.4% |
|
Total Gas |
1,799.0=
|
20.0 |
2,089 |
+5.1% |
Crude Oil and Condens=
ate
The Comp=
any's
share of crude oil and condensate produced for sale during the quarter ended March 31,
2007 decreased by 7.5 percent from the March 20=
06
quarter, as detailed below:
|
Fields (Magellan Share) |
Barrels
|
Kilolitres
|
Variance
|
|
|
Total |
Daily |
|||
|
Mereenie<=
/span> |
29,946<= o:p> |
333 |
4,761 |
=
+ 5.5% |
|
Nockatung=
a |
19,192<= o:p> |
213 |
3,051 |
+ 55.0% |
|
Kiana |
2,627 |
29 |
418 |
– 82.6%<= o:p> |
|
Aldinga |
679 |
8 |
108 |
– 17.6%<= o:p> |
|
Total Crude Oil and Condensate |
52,444<= o:p> |
583 |
8,338 |
– 7.5% |
Mereenie
Oil and Gas Field (PL 4 & 5) –
The Mereenie oil and=
gas field
which is operated by Santos Ltd produced an average of approximately 43
Nockatunga
Oil Fields (PLs 33, 50 & 51) –
The Nockatunga oil fields which are operated by Santos Ltd
produced an average of approximately 560 barrels of oil per day (BOPD) duri=
ng
the March quarter.
The e=
xploration,
appraisal and development, drilling campaign at the No=
ckatunga
area, which commenced on December 31, 2006, was
completed during the quarter. The 10-well campaign in Petroleum Lease 51 was
part of
The Thungo-11 appraisa=
l well
spudded on March 26 and was drilled to a total =
depth
of 1391 meters. Oil shows were encountered in the Murta
Member and the well was cased and suspended as a future oil producer.
Thungo-13, an appraisal well on the southeast margin of the field, spudded on January 21 and was drilled to a t= otal depth of 1,138 meters. Oil shows were recorded in the = Murta Member and wireline logs indicated 8 meter= s of net pay. The well was cased and suspended as a future oil producer. =
Four wells were drilled on the Muthero field. The Muthero-4 appraisal well spudded on February 13 and was drilled to a total depth of 1,440 metres. Muthero-4 was designed to appraise the eastern extent of the Mur= ta Member and Birkhead Formation oil pools encount= ered in Muthero-3 which was drilled in early 2006. Oil shows were recorded in th= e Murta Member and the upper Birkh= ead Formation. Wireline logs indicate 6 metres of n= et pay in the upper Birkhead Formation. The well was c= ased and suspended and will be completed as a future Birkhe= ad oil producer.
The Muthero-5 appraisal well spudde= d on February 23, 2007 and oil shows were also recorded in the Murta Member and the Birkhead Formation. The well was designed to test the southern extension of the Muthero-3 oil pools. The well was cased and suspended and will be completed as a future Birkhead oil producer.
The Muthero-6 appraisal well locate= d to the east of Muthero-3 spudded on March 4, 2007 and encountered oil shows in the= Coorikiana Sandstone, Murta Member and the Birkhead Formation. The well was= cased and suspended as a future Murta oil producer.
The Muthero-7 development well spud= ded on February 8 and was drilled to a total depth of 1,146 metres. Muthero-7 was designed to develop the Murta Member oil pool encountered in Muthero-3. Oil shows were recorded in the Murta Member as anticipated and the well was cased and suspended as a future Murta oil producer.
The Kamel-1 exploration well, locat= ed approximately 1.7 kilometers north northwest of= the Thungo oil field, spudded on March 16 and was drilled= to a total depth of 1,391 meters. Oil shows were recorded in the Murta Member during drilling. Wi= reline logs were run and the well was cased and suspended as a future Murta Member oil producer. The well will be connected= to the Thungo field facilities.
Planning for the completion for pro= duction and tie-in of the wells to the existing facilities is well advanced with several of the wells expected to be on-line by the end of May. An upgrade of the surface facilities at the Thungo and Muthero fields is currently being undertaken to accom= modate the anticipated increased production from these fields.
Producti=
on from
the Kiana-1 well averaged 97 BOPD during the M=
arch
quarter. The well is producing from both upper and lower Patchawarra
Formation zones.
Aldinga Oil Field (PPL 210) – Cooper Basin=
SA
(50% Interest)
Magellan=
has a
2.67% carried interest in the Kotaneelee gas fi=
eld in
the Yukon Territory of Canada. Devon Canada Corporation is operator of this
partially developed field which is connected to a major pipeline system.
The Tunkalilla-1 exploration well w=
as
drilled in PEL 94 (Magellan 35% interest) in
The Telowie-1 exploration well was =
designed
to test a simple anticlinal structure on the north-eastern end of the Milpera Horst. The well is approximately 4.8
Elsewher=
e in the
Cooper Basin of South Australia, exploration evaluation of PEL 95 (Magellan=
50%
interest), PEL 107 (Magellan 20% interest) and PEL 110 (37.5% interest=
) is
ongoing.
The 167 =
kilometer 2D Scutus seism=
ic
survey was conducted in PEL 95 during January 2007 to better define prospec=
ts
and leads in the northern portion of the permit area. Beach petroleum is
operator of the PEL 94 and PEL 95 joint ventures.
In ATP 613P (Magellan 100% interest) in the Maryborough Basin of
Queensland, two exploration wells, Burrum-1 and 2, were drilled to test the=
Coal
Seam Gas potential of the previously unexplored Burrum=
Coal Measures in the northern portion of the Burrum
Syncline. Magellan is operator of the Burrum jo=
int venture.
The Burrum-1 well spudded on February 28 and was drilled to a total depth of 438 meters. The well was fully cored over the 252-438
meters interval.
Several coal seams were intersected and sampled for
desorption analysis. Wireline logs were run to further evaluate the coal seams
intersected, particularly those in the open-hole section. The well was plug=
ged
and abandoned as planned.
Burrum-2 spudded on March 8 and was drilled to a t=
otal
depth of 545 met=
ers.
The well was fully cored over the 115-390 meter interval. Several coal seams with a total net thickness of approximately 16 meters
were cored and sampled for desorption analysis. Three Drill Stem Tests were
conducted over coaly intervals in the cored section which indicated that the
coals have low primary permeability. Burrum-2 was plugged and abandoned as planned and =
the
rig released on March 20.
Eureka Petroleum, a wholly-owned su=
bsidiary
of Energy Investments Limited, is funding 100% of a two-staged coal seam gas
exploration program, in return for which it will be assigned a 90% working
interest in the Burrum Syncline farmin
area. Stage 1 comprised the current two-well program. Magellan has the righ=
t to
back-in to retain up to a 50% participating interest in any development by
matching
Magellan=
(40%
interest) will participate in the Markwells Woo=
d-1
exploration well in PEDL 126 and the Leigh Park-1 exploration well in
PEDLS 155 and 099 of the Weald Basin of southern England in 2007. Well sites
and planning consents are being sought for the drilling by Northern Petrole=
um,
operator of these joint ventures. Both wells will target oil in the Great
Oolite Formation, and Markwells Wood-1 will tes=
t a
possible extension of the currently producing Horndean=
oil field.
Magellan=
holds
interests in ten other exploration licences in the
EXPENDITURES
Expendit=
ures
incurred on exploration, appraisal and development activities during the Ma=
rch
2007 quarter, totalled $3,371,000.
All figures are unaudited.
Forward Looking Statements
Statements in this release which ar= e not historical in nature are intended to be, and are hereby identified as, forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. These statements about Magellan and MPAL may relate to their businesses and prospects, revenues, expenses, operating cash flows, and other matters that involve a number of uncertainties that may cause actual results to differ materially from expectations. Among these risks and uncertainties are prici= ng and production levels from the properties in which Magellan and MPAL have interests, the extent of the recoverable reserves at those properties, the future outcome of the negotiations for gas sales contracts for the remaining uncontracted reserves at both the Mereenie and Palm Valley gas fields in the Amadeus Ba= sin, including the likelihood of success of other potential suppliers of gas to = the current customers of Mereenie and Palm Valley production. In addition, MPAL has a large number of exploration permits and faces the risk that any wells drilled may fail to encounter hydrocarbons in commercially recoverable quantities. Any forward-looking information pro= vided in this release should be considered with these factors in mind. Magellan assumes no obligation to update any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.
For further information, please
contact Daniel Samela at (860) 293-2006.