Magnolia Petroleum Share News (MAGP)

Magnolia Petroleum, the AIM-listed US onshore focused oil and gas exploration and production company, has commenced production at its well in the Mississippi Lime Formation in Oklahoma.In an operational update issued on Wednesday, Magnolia Petroleum reported that following the fracture stimulation of the Magnolia operated, 100%-owned Roger Swartz #1 vertical well targeting the Mississippi Lime formation, an initial production rate (IPR) of 17 barrels of oil per day (bopd) had been recorded, which was "in line with management's expectations". To date, the company reported that 338 barrels of oil recovered by Roger Swartz had been sold. The total cost of the well including drilling, completing and stimulating costs was described as having come in "on budget at approximately $730,000".Roger Swartz is currently producing from the Mississippi Lime formation from which the company estimated that a total of up to 51,000 barrels of oil equivalent were recoverable. The directors said that they believed there was a potential payzone up hole, known as the Vertz, which holds an additional 10,000 barrels of recoverable reserves. Once all production has been recovered from the Mississippi Lime, the company said that it intended to move up hole and complete in the Vertz.Rita Whittington, Chief operating Officer of Magnolia, said: "The commencement of production at Roger Swartz, our first vertical well drilled as operator, is a major milestone for Magnolia." She added: "The initial production rates are in line with our expectations,while the identification of another potential payzone, the Vertz, adds to the attractive economics of the well and highlights the multiple horizons that exist in Oklahoma."Magnolia Petroleum's share price was down 0.94% to 2.62p at 10:34 on Wednesday.MF