MGM Unlocks Natural Gas at Ellice J-27 Well

MGM Energy has reached a deviated target depth at 2,102 meters (1,999 meters total vertical depth) on its Ellice J-27 well, the first well of its 2009 three well winter drilling program. The well encountered a number of zones that contain natural gas and testing of the well is currently expected to occur in February, 2009.

The well encountered net gas bearing sandstones of 57 meters in four zones, with an average porosity of 21%. Based upon information obtained while drilling and subsequent logging, testing will be completed on two of these zones. It is expected that this testing will be sufficient to gain regulatory approval of a Significant Discovery License to encompass all prospective reservoirs. MGM Energy will provide additional information regarding the Ellice J-27 well following the completion of the production test and interpretation of the test results.

The Company will now proceed to move the rig, Akita-Equitak 64, to its second location, Ellice J-17. This well is currently expected to spud on or before February 1, 2009.

"Additional work remains to be done to confirm the size of this discovery, but we are very excited by the initial results of the first well in this year's program," said Henry Sykes, President of MGM Energy.