Magnum Hunter & Nissho Iwai Team Up in the Gulf of Mexico

Magnum Hunter Resources and NI Energy Venture Inc., an affiliated company of Nissho Iwai American Corporation, covering ownership participation in five lease blocks located on the Outer Continental Shelf (OCS) of the Gulf of Mexico. The offshore Louisiana blocks include South Timbalier Block 264 (Platform B), Ship Shoal Block 278 and Ship Shoal Block 358. The offshore Texas lease blocks include High Island A-153 and High Island A-154. Magnum Hunter is the operator of the South Timbalier Block 264 and High Island Block A-154 OCS blocks.

The new joint venture agreement includes a combination of the sale of existing production by Magnum Hunter and the participation by Nissho Iwai in the drilling, completion and further development of certain wells located on the above described properties. The total consideration on Nissho Iwai's account will be approximately $11 million.

Commenting on the new joint venture arrangement, Mr. Gary C. Evans, Chairman, President and CEO of Magnum Hunter stated, "Our Company is excited about this new joint venture agreement with Nissho Iwai in the Gulf of Mexico. With 171 OCS lease blocks in our current inventory, we need to continue to seek industry partners who can participate in our projects and can assist us in funding the capital requirements to sufficiently develop them."