Magnolia Petroleum Regulatory News (MAGP)

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 andproduction company, announces a quarterly update on its operations acrossproven and producing US onshore hydrocarbon formations, including the Bakken/Three Forks Sanish in North Dakota and Montana and the Mississippi Lime and theHunton/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 relativelysmall working/net revenue interests. This allows Magnolia to gain access tocritical well information which is then used to further enhance itsunderstanding of the relevant formation.

Magnolia COO, Rita Whittington said, "Magnolia now has interests in 86producing wells, all of which are generating revenues for the Company, afurther 19 currently drilling/completing and 10 waiting to spud. In line withour strategy, all of these wells are located in proven, producing US onshoreformations and many are in partnership with established operators such asAnadarko and Chesapeake Energy.

"In the year ahead, we expect a further significant increase in the number ofwells in which we have an interest, thanks to the over 4,500 net mineral acresin the Mississippi Lime and the 7,866 net acres in the Montana section of theBakken we have acquired in the last twelve months. With this in mind, asfurther drilling progressively proves up the prospectivity of our acreage,leading to higher revenues and reserves attributable to our Company, I amconfident Magnolia is well placed to build further substantial value forshareholders."

* * 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 NotesMagnolia Petroleum Plc is an AIM quoted, US focused, oil and gas explorationand production company. Its portfolio includes interests in 86 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 WellsCategory Number of wells Producing 86 Being Drilled / Completed 19 Elected to participate / waiting to 10spud TOTAL 115

This table excludes four out of six wells acquired as part of the acquisitionof 800 gross acres with a 100% working interest in Osage County, Oklahoma, asannounced on 10 February 2012. These four wells are currently `shut in' andwill require a workover programme at some point in the future to bring backinto production.