Magellan's Q2 Earnings Drop on Gross Revenues

Magellan Petroleum Corporation reported a consolidated net loss of $9.7 million ($.23 per share) on gross revenues of $10.4 million in its fiscal second quarter ended December 31, 2007, as compared to a net loss of $8,000 ($.00 per share) on revenues of $8.4 million in last year's second quarter.

For the six-month period ended December 31, 2007, the Company reported a net loss of $9.3 million ($.22 per share) on $19.7 million in revenues, compared to net income of $1 million ($.02 per share) on revenues of $15.2 million in the prior period last year.

The net loss for both the second quarter and the six month period ended December 31, 2007 includes a charge of $12.8 million ($.31 per share) in the income tax provision for the tax settlement between Magellan's 100% owned Australian subsidiary, Magellan Petroleum Australia Limited (MPAL) and the Australian Taxation Office (ATO). (See Magellan's press release dated February 7, 2008).

Magellan's president, Dan Samela said "A look at operating results before the tax provision tells a different story. Pretax income was up $2.9 million over last year's quarter due mostly to the successful drilling campaign in the Nockatunga oil field. Pretax income for the six months ended December 31, 2007 was $.09 per share, nearly double the $.05 per share last year.

Though we had to absorb a tough ATO settlement, we are pleased with our operating results for this quarter and the first half of fiscal 2008. Total revenues are up 23% and 29% for the quarter and six months, respectively over last year."

Exploration and dry hole costs for the 2007 quarter are down $1.8 million over the 2006 quarter due to reduced exploration expenditures in the Cooper Basin.