Magnum Energy Completes Drilling Program in Taber Area

Magnum Energy has now completed drilling of the previously announced six well farm-in program in the Taber area of Alberta. All wells have been cased, with completion operations either underway or pending.

"Apart from some minor weather delays the drilling has gone smoothly and all of the wells have indications of gas on logs. On the first two wells drilled in March, operations are currently underway to perform pressure build-up analysis to evaluate fracture stimulation potential. In addition to the zones currently being evaluated, there is up-hole potential for additional gas production in one of these wells. Now that drilling has concluded, completion of the remaining four wells will commence once equipment and services have been secured," commented Ralph Claussner, engineering consultant to the company.

Further testing will determine whether the wells will be tied-in and additional development wells required to fully exploit the prospective new discoveries. Initial indications are positive.

The company has also now received its first cash flow from gas production in the Vauxhall project.

"This is a significant event for the company and the first step in becoming successful industry participant. Cash flow from Vauxhall is expected to cover all of the G&A of the company in addition to recovering all Vauxhall drilling expenses within 6 months. Another well is expected to be drilled in this new discovery in the early fall. This development well is also anticipated to add to net cash flow for the company," said Ted Konyi.