Contact Information: Contact: M. Bradley Davis Senior Vice President of Capital Markets bdavis@magnumhunterresources.com (832) 203-4545
Magnum Hunter Resources Corporation Announces $1.7 Million Producing Property Acquistion in East Chalkley Field
| Source: Magnum Hunter Resources
HOUSTON, TX--(Marketwire - September 15, 2009) - Magnum Hunter Resources Corporation (NYSE Amex : MHR ) (the "Company") announced today the execution of a definitive
agreement to acquire an additional 37.5% working interest in the Company
operated East Chalkley Field from an undisclosed private seller. The East
Chalkley Field is located in Cameron Parish, Louisiana.
Magnum Hunter has an approximate 34.4% working interest covering
approximately 714 gross mineral acres in the East Chalkley Field. Today's
announced purchase will increase the Company's working interest to
approximately 72%. Funding will be from the Company's existing cash. The
effective date for this purchase will be July 1, 2009 with an anticipated
closing date on or about October 15, 2009.
The Company operates the East Chalkley Field where the recent focus has
been on developing and producing crude oil reserves bypassed earlier in the
history of the field when the focus was on developing deep natural gas
reserves. Currently, the East Chalkley Field is producing approximately 80
to 90 Barrels of Oil Equivalent ("BOEs") per day net to the Company's
pre-purchase working interest. With the additional acquisition of the
ownership interest announced today, the Company's net daily production from
this field will increase to the new range of 170 to 190 BOEs per day.
Additionally, three new drill site locations have been identified within
this field by the Company and its third party petroleum engineers. Magnum
Hunter had approximately 93.0 MBOEs booked as net proved reserves in the
East Chalkley Field as of June 30, 2009 (37% proved developed producing and
94% crude oil) and pro forma for the acquisition, there will be 258.5 MBOEs
attributable to the East Chalkey Field.
Management Comments
Mr. Gary C. Evans, Chairman of the Company, commented, "Our announcement
today of the acquisition of an additional ownership interest in the Magnum
Hunter operated East Chalkley Field, advances our previously stated focus
on acquisitions and development of predominately crude oil properties. The
best place to find incremental crude oil and natural gas reserves is where
they have previously been found before. With a 72% working interest and
operations of the East Chalkley Field, we now have greater control of the
Company's future activities in this region. We are in the process of
implementing additional cost reductions in this field which include a new
saltwater disposal system. We continue to believe that the present low
commodity price environment presents our Company with significant upside
potential with respect to booking new proved reserves for generation of
superior returns to our shareholders once commodity prices begin recovering
over the next several years as the supply and demand for commodities are
rebalanced."
About Magnum Hunter Resources
Magnum Hunter Resources Corporation and subsidiaries are a Houston, Texas
based independent exploration and production company engaged in the
acquisition of exploratory leases and producing properties, secondary
enhanced oil recovery projects, exploratory drilling, and production of oil
and natural gas in the United States.
For more information, please view our website at
www.magnumhunterresources.com
Forward-looking Statements
The statements contained in this press release that are not historical are
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, as amended (the "Securities Act"), and Section 21E
of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
including statements, without limitation, regarding the Company's
expectations, beliefs, intentions or strategies regarding the future. Such
forward-looking statements may relate to, among other things: (1) the
Company's proposed exploration and drilling operations on its various
properties, (2) the expected production and revenue from its various
properties, (3) the Company's proposed redirection as an operator of
certain properties and (4) estimates regarding the reserve potential of its
various properties. These statements are qualified by important factors
that could cause the Company's actual results to differ materially from
those reflected by the forward-looking statements. Such factors include
but are not limited to: (1) the Company's ability to finance the continued
exploration, drilling and operation of its various properties, (2)
positive confirmation of the reserves, production and operating expenses
associated with its various properties; and (3) the general risks
associated with oil and gas exploration, development and operation,
including those risks and factors described from time to time in the
Company's reports and registration statements filed with the Securities and
Exchange Commission, including but not limited to the Company's Annual
Report on Form 10-K/A and Form 10-K/A for the year ended December 31, 2008
filed with the Securities and Exchange Commission on March 31, 2009 and
April 29, 2009, respectively, and the Company's Quarterly Reports on Form
10-Q for the quarters ending March 31, 2009 and June 30, 2009, filed on May
11, 2009 and August 14, 2009, respectively. The Company cautions readers
not to place undue reliance on any forward-looking statements. The Company
does not undertake, and specifically disclaims any obligation, to update or
revise such statements to reflect new circumstances or unanticipated events
as they occur.