Magnolia Petroleum Regulatory News (MAGP)

Magnolia Petroleum Plc / Index: AIM / Epic: MAGP / Sector: Oil & Gas 14 October 2014 Magnolia Petroleum Plc (`Magnolia' or `the Company') Quarterly Operations Update for the Period Ended 30 September 2014 Magnolia Petroleum Plc, the AIM quoted US focused oil and gas exploration andproduction company, is pleased to announce a quarterly update on its operationsacross proven and producing US onshore hydrocarbon formations, including theBakken/Three Forks Sanish in North Dakota and Montana, and the Mississippi Limeand the Hunton/Woodford in Oklahoma. Quarter Highlights * 161 producing wells as at end of Q3 2014 a further 67 at various stages of development - elected to participate in 24 new wells * Strong initial production rates from Mississippi Lime wells highlighting the formation's potential - Cummings 31-28-12 1H (525.52 boepd) * Net daily production increased to 257 boepd as at 1 July 2014, up from 150 boepd as at 1 April 2014 due to a number of wells in which Magnolia holds larger than average NRIs commencing production * Sale of 24 small interests in non-core wells for US$240,750, a 190% increase on the US$83,000 value assigned to the combined proved and developed producing reserves (`PDP') of these wells as at 1 July 2014 * + Demonstrates market value of non-operated US onshore properties * Net PDPs estimated at 162 Mbbl of oil and condensate and 540 MMcf gas with NPV10 of US$9.143 million in Reserves Report as at 1 July 2014 - up from US$8.416 million as at 1 April 2014 * + Total net proved reserves (`1P') of 719 Mbbl of oil and condensate and 2,093 MMcf gas with NPV10 of US$31.832 million as at 1 July 2014 + Report does not reflect Woodford formation's potential, which lies below the Mississippi Lime and is at an earlier stage of development * New US$6 million Credit Facility secured with initial borrowing base limit of US$4,596,944 to accelerate drilling activity and prove up reserves on leases following increase in the value of PDP reserves * 93% increase in half year revenues to US$1,755,459 (H1 2013: US$910,721) * Half year EBITDA of US$699,397 compared to US$237,552 (after removing gain on foreign exchange) during six months to 30 June 2013 Outlook * New wells due to come into production in Q4 2014 - including several infill wells on the Company's leases held by production in North Dakota and Oklahoma to maximise recovery of reserves on individual spacing units * Further participations in new wells and infill drilling with leading operators expected * On-going lease acquisition and management activity in line with strategy to grow and diversify portfolio Magnolia COO, Rita Whittington said, "Aside from further operational progresson the ground, which has seen the number of producing US onshore wells in whichwe have an interest increase to 161 with a further 67 under development, anumber of milestones were achieved during the quarter, including the securingof a new US$6 million credit facility. In our view, however, the sale of 24small interests in non-core wells for three times the value of their PDPreserves is the quarter's key event, as this demonstrates how the market valuesUS onshore producing properties. The sale and the price achieved validates ourbusiness model which is focused on proving up the value of our US onshorereserves through drilling. "With our US$6 million credit facility in place and our rapidly growingrevenues, which at the half year stage almost doubled year on year toUS$1,755,459, we will continue to participate in new drilling activityalongside established operators such as Devon Energy. We have put in place aplatform from which we can accelerate the roll-out of our strategy, and in theprocess deliver on our objective to generate value for shareholders." Well Developments The full list of well developments occurring in the quarter is set out below. Well Formation Status NRI % Operator Cummings Mississippi Lime, Producing 3.34 Chesapeake31-28-12-1H Oklahoma Energy Cummings 2H Mississippi Lime Producing 3.34 Chesapeake Energy Voise 1-24 H Woodford, Producing 6.38 Devon Energy Oklahoma Skunk Creek Bakken, North Producing 0.675 Kodiak4-8-17-13H Dakota Exploration Skunk Creek Three Forks Producing 0.675 Kodiak4-8-17-13H3 Sanish, North Exploration Dakota Skunk Creek Bakken, North Producing 0.675 Kodiak4-8-17-14H Dakota Exploration Skunk Creek Three Forks Producing 0.675 Kodiak4-8-17-14H3 Sanish, North Exploration Dakota Nighswonger Farms 2 Mississippi Lime, Waiting to spud 2.242 Sandridge Oklahoma Energy Edwards Mississippi Lime, Waiting on IP 1.25 Devon Energy Woodford, rates Oklahoma The Company only provides details and updates for wells in which it has aworking interest of 1.5% or more. The Summary of Wells table at the end of eachrelease includes all wells in which Magnolia has an interest and is updated asand when a change in status occurs for all wells. The four Skunk Creek wellsare included due to their combined costs and being located in North Dakota. * * ENDS * * 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 Jo Turner / James Caithie Cairn Financial Advisers LLP +44 20 7148 7900 John Howes / Alice Lane / Northland Capital Partners +44 20 7796 8800Luke Cairns Limited Lottie Brocklehurst St Brides Media and Finance Ltd +44 20 7236 1177 Frank Buhagiar St Brides Media and Finance Ltd +44 20 7236 1177 Notes Magnolia Petroleum Plc is an AIM quoted, US focused, oil and gas explorationand production company. Its portfolio includes interests in 161 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 161 Waiting on first sales / IP rates 8 Being drilled / completed 6 Elected to participate / waiting to 53spud TOTAL 228