SOURCE: Magellan Energy Ltd.

December 02, 2008 08:00 ET

Magellan Energy Announces Shareholder Update

TORONTO--(Marketwire - December 2, 2008) - Magellan Energy Ltd. (PINKSHEETS: MGLG), an independent oil and gas company, issues an update on the status of its current projects including the participation agreements in Morgan County, Tennessee.

Magellan Energy is pleased to announce an updated status report and project summary on the company leases in Morgan County, Tennessee. The work on the Robert Anderson Lease has been completed and all necessary components of this project updated, installed and are currently ready for the production phase. We continue to remain shut in on this well due to the high levels of BTU but remain confident this is a short term delay.

The Davidson well #1 has not made any significant progress to date. We have examined the well's financial standing, past expenses for work over costs and any future work over costs to save this well and found it to be not beneficial to Magellan and its shareholders. Management has decided to focus their energy and finances on other profitable cost effective projects. The Davidson well will remain as part of our inventory and will be looked at again in the future.

The Martin Lease water flood project has been progressing on schedule. It continues to produce at a rate of 3 BOPD with gas reserves. Again, we are not able to place the gas into the lines as of yet due to their ongoing problem of BTU levels in that area. Management has been working closely with its operators to maintain a steady rate of progress on this project. Upon completion, this well has the capacity to be a great producer and revenue stream for Magellan Energy.

The company will continue to seek out other ventures and prospects for the company until it is able to connect our lines and sell our gas. Our strategy is to carefully examine future costs versus revenue intake and if we are able to forward our place in the oil and gas industry. We will not take any unnecessary risk or chances with any future prospects. This will ensure a positive future for Magellan and its shareholders.

About Magellan Energy:

Magellan Energy is a publicly traded independent oil and gas company (PINKSHEETS: MGLG). The company is actively acquiring oil and gas leases, producing properties, mineral rights, and surface interests in Tennessee and Oklahoma. Once acquired, the company intends to develop each property to maximize the income from each property by re-establishing production, refurbishing and improving the existing production and operations.

Forward-Looking Statements: The statements which are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including but not limited to, the effect of economic conditions, the impact of competition, the results of financing efforts, changes in consumers' preferences and trends. The words "estimate," "possible," and "seeking" and similar expressions identify forward-looking statements, which speak only to the date the statement was made. The Company undertakes no obligation to publicly update or revise any forward-looking statements, because of new information, future events, or otherwise. Future events and actual results may differ materially from those set forth herein, contemplated by, or underlying the forward-looking statements.

Contact Information

    Member of the Tennessee Oil and Gas Association
    Apolinar V. Carcasona
    Phone: 1-866-365-4724