Magnus Energy Inc.

Magnus Energy Inc.

October 13, 2005 14:39 ET

Magnus Signs Farmin and Rolling Option Agreement

CALGARY, ALBERTA--(CCNMatthews - Oct. 13, 2005) - Magnus Energy Inc. (TSX VENTURE:MEI.A) (TSX VENTURE:MEI.B) ("Magnus") is pleased to announce that it has signed a multi-section Farmin and Rolling Option Agreement with a major oil and gas company in the North Esther (Provost) Area of East Central Alberta. The area is prospective for Viking gas and Mannville oil targets at drill depths of 750 metres and 900 metres, respectively. Magnus has committed to the drilling of 9 test wells prior to February 14, 2006 for these low risk, multi-zone targets.

The North Esther Farmin provides Magnus with access to 18,400 gross acres (28.75 sections), as well as the right to interpret the Farmor's extensive seismic database in the area. Magnus earns a 100% WI in the section comprising each Test Well, subject to the Farmor's right to elect, at casing point, whether to convert to a 40% WI or retain a non-convertible gross overriding royalty. Following the drilling of its Test Wells, Magnus has the right to continue earning on the same terms by drilling additional Option Wells on a rolling option basis. Based on the current down spacing which is in place in the area, Magnus has the opportunity to drill up to 4 Viking gas wells per section.

Murray Stewart, the President & CEO of Magnus states, "I am excited by this farmin opportunity. It gives us an excellent land base in the North Esther (Provost) Area with very low risk Viking targets. In addition, this farmin provides us with the opportunity to explore for deeper Mannville targets for small incremental drilling dollars. This is the fourth core area operated by Magnus; the others being Paradise Valley, which is also in East Central Alberta, and the Southeast Saskatchewan core areas of Tableland and Antler."

About Magnus Energy

Magnus Energy is a junior oil and gas company focused on the acquisition, exploration, exploitation and development of oil and natural gas in Western Canada.

ADVISORY: Certain information regarding Magnus Energy Inc. including management's assessment of future plans and operations, may constitute forward-looking statements under applicable securities laws and necessarily involve risks associated with oil and gas exploration, production, marketing and transportation such as loss of market, volatility of prices, currency fluctuations, imprecision of reserve estimates, environment risks, competition from other producers and ability to assess sufficient capital from internal and external source. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements.

15,415,000 Class A Shares

1,044,000 Class B Shares

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Contact Information

  • Magnus Energy Inc.
    Murray M. Stewart
    President and Chief Executive Officer
    (403) 233-4963
    (403) 262-9920 (FAX)
    Magnus Energy Inc.
    Suite 1650, AMEC Place
    801 - 6th Avenue S.W.
    Calgary, Alberta T2P 3W2