Magnus Energy Inc.
TSX VENTURE : MEI.A
TSX VENTURE : MEI.B

Magnus Energy Inc.

October 24, 2006 16:36 ET

Magnus Energy Closes Financing

CALGARY, ALBERTA--(CCNMatthews - Oct. 24, 2006) - Magnus Energy Inc. ("Magnus" or the "Company") (TSX VENTURE:MEI.A) (TSX VENTURE:MEI.B) is pleased to advise that it has closed its previously announced private placement of Class A Shares for gross proceeds of $9,007,210. In the financing, the Company issued 3,646,000 Class A Shares on a flow-through basis at an issue price of $1.51 per share, which included 1,656,000 flow-through Class A Shares issued pursuant to a fully subscribed over-allotment option and 3,045,000 Class A Shares at an issue price of $1.15 per share, which included 1,305,000 Class A Shares issued pursuant to a fully subscribed over-allotment option. The financing was completed through a syndicate of underwriters led by Dundee Securities Corporation and including Tristone Capital Inc. The shares issued in the private placement are subject to a four month hold period pursuant to applicable securities legislation.

The proceeds of the private placement will be used to expand and accelerate the development of the Company's core properties in the Paradise Valley area in east central Alberta, the Retlaw area in southern Alberta and the Antler area in southeast Saskatchewan.

About Magnus Energy

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

36,905,703 Class A Shares

1,044,000 Class B Shares

READER ADVISORY

This press release includes forward-looking statements and assumptions respecting the Company's strategies, future operations, expected financial results, financial sources, commodity prices, costs of production and quantum of oil and natural gas reserves and discusses certain issues, risks and uncertainties that can be expected to impact on any of such matters. By their nature, forward-looking statements are subject to numerous risks and uncertainties that can significantly affect future results. Actual future results may differ materially from those assumed or described in such forward-looking statements as a result of the impact of issues, risks and uncertainties whether described herein or not, which the Company may not be able to control. The reader is therefore cautioned not to place undue reliance on such forward-looking statements. The Company disclaims any intention or obligation to update or revise these forward-looking statements, as a result of new information future events or otherwise. In addition, the term BOE or BOE's may be misleading, particularly if used in isolation. A BOE (barrel of oil equivalent) conversion ratio of 6 Mcf per one (1) BOE is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release and has neither approved nor disapproved the contents of this release.

Contact Information

  • Magnus Energy Inc.
    Murray M. Stewart
    President and Chief Executive Officer
    (403) 233-4963
    (403) 262-9920 (FAX)
    Email: stewartm@magnusenergy.ca
    or
    Magnus Energy Inc.
    Stewart Larsen
    Chief Financial Officer
    (403) 233-4960
    (403) 262-9920 (FAX)
    Email: larsen@magnusenergy.ca
    or
    Magnus Energy Inc.
    Suite 1650, AMEC Place
    801 - 6th Avenue S.W.
    Calgary, Alberta T2P 3W2
    Website: www.magnusenergy.ca