Magnum Hunter Makes New Strawn Reef Discovery
Magnum Hunter Resources is continuing to expand its successful exploration and development drilling activities onshore within the Morrow formation natural gas play located primarily in Southeastern New Mexico. Additionally, the Company is announcing a significant new Strawn reef discovery in this region.
Since initiation in April 2002 of a new drilling program targeting the Morrow formation in Eddy and Lea Counties, New Mexico, Magnum Hunter has successfully drilled 22 new wells. Of these new wells drilled, 15 have been completed to-date and are currently producing with average initial gross production per well of 2.5 million cubic feet equivalent ("Mcfe") per day. Results to-date indicate overall finding and development costs for Magnum Hunter of less than $1.00 per Mcfe in this program.
While drilling for the Morrow in Eddy County, New Mexico, the Company recently encountered a Strawn reef interval in a 50% working interest owned well. Three separate intervals of the Strawn reef covering a total of 339 feet have now been tested with the production results as follows:
Magnum Hunter presently has seven new natural gas wells in various stages
of completion procedures and continues to keep two drilling rigs active in
this region. The Company has been successful in expanding its mineral acreage
position in this area by acquiring the ownership interests of several smaller
independent oil and gas companies and individuals who have historically been
active in this region. Magnum Hunter is also in the process of completing
negotiations of farm-ins with several larger oil and gas companies that would
increase the Company's existing gross mineral acreage position by
approximately 55,000 acres.