Magnum Hunter Updates Activities in the Gulf of Mexico; Announces Two New Field Discoveries
November 24 2003 - 8:00AM
PR Newswire (US)
Magnum Hunter Updates Activities in the Gulf of Mexico; Announces
Two New Field Discoveries IRVING, Texas, Nov. 24
/PRNewswire-FirstCall/ -- Magnum Hunter Resources, Inc. announced
today that new production has commenced in the Gulf of Mexico
("GOM") at the company operated South Timbalier 264B platform.
Currently, two wells have tested from this platform at a combined
rate of approximately 9 million cubic feet ("MMcf") of natural gas
and 300 barrels ("Bbls") of condensate per day. The company owns a
70% working interest and a 58% net revenue interest in the
production from this platform. Magnum Hunter has also participated
in a new field discovery at West Cameron 403. The West Cameron 403
#1 well was drilled to a depth of 7,750 feet and encountered 106
feet of gas productive sands. The well flow tested at a rate of
over 16 million cubic feet of natural gas equivalents ("MMcfe") per
day. A caisson production structure is in the process of being
installed, with initial production expected to commence during the
first quarter of 2004. Magnum Hunter owns a 40% working interest in
West Cameron 403 and 33.33 % net revenue interest. Remington Oil
& Gas Corp. (NYSE:REM) owns a 60% working interest and is the
operator. Positive test results were also experienced at Vermillion
61, casing has been set after finding 60 of gross feet of
productive sands. From the same surface location, the rig will
drill the East Cameron 73 development location. Both wells will be
completed following the drilling of the second well. Magnum Hunter
owns a 25% working interest in both of these projects and 20.83%
net revenue interest. Remington Oil & Gas Corp. owns a 50%
working interest and is the operator. Production from Vermillion 61
and East Cameron 73 is anticipated to commence in early 2004.
Magnum Hunter is currently estimating an additional 20 million
cubic feet of natural gas equivalents of new net daily production
("MMcfe") will commence producing during the fourth quarter of 2003
and during the first quarter of 2004 from various lease blocks in
the Gulf of Mexico. This estimated incremental new shelf production
will come from these recent discoveries the Company has made along
with various partners this year. The five project areas with the
working interest percentage owned by Magnum Hunter are as follows:
Eugene Island 355 (33.3%) West Cameron 403 (40%) West Cameron 488
(25%) Vermilion 61/East Cameron 73 (25%) West Cameron 472 (50%)
Commenting on the Company's activities in the Gulf of Mexico, Mr.
Charles R. (Chuck) Erwin, Senior Vice President of Exploration for
Magnum Hunter stated, "Our Company's daily oil and gas production
from the Gulf of Mexico continues to increase each quarter. Gulf of
Mexico production is now averaging around 65 MMcfe per day, which
is approximately 31% of Magnum Hunter's company wide net daily
production. With drilling rig and service costs remaining at
unusually low levels in relation to current commodity prices, our
Gulf of Mexico drilling activity has captured the largest piece of
our Company's 2003 capital budget. The total potential reserve
exposure from the Company's six remaining 2003 Gulf of Mexico
exploratory projects, net to Magnum Hunter's interest, exceeds 51
Bcfe. Since entering the Gulf of Mexico in May, 1999, Magnum Hunter
has achieved an 83% overall drilling success rate with 72 out of 87
Gulf of Mexico wells successfully drilled thru October 31, 2003.
Our large inventory of 171 OCS Blocks will allow Magnum Hunter many
years of continued exploration activity in this highly prolific
natural gas prone region. Over 1 Tcfe of risk adjusted Gulf of
Mexico drilling prospects have been identified by management and
third party consultants for future exploration activities." Magnum
Hunter Resources, Inc. is one of the nation's fastest growing
independent exploration and development companies engaged in three
principal activities: (1) the exploration, development and
production of crude oil, condensate and natural gas; (2) the
gathering, transmission and marketing of natural gas; and (3) the
managing and operating of producing oil and natural gas properties
for interest owners. The information in this release includes
certain forward-looking statements that are based on assumptions
that in the future may prove not to have been accurate. Those
statements, and Magnum Hunter Resources, Inc.'s business and
prospects, are subject to a number of risks, including volatility
of oil and gas prices, the need to develop and replace reserves,
the substantial capital expenditures required to fund its
operations, environmental risks, drilling and operating risks,
risks related to exploration and development drilling,
uncertainties about estimates of reserves, competition, government
regulation, and the ability of the company to implement its
business strategy. These and other risks are described in the
company's reports that are available from the SEC. FOR FURTHER
INFORMATION CONTACT: M. BRADLEY DAVIS SENIOR VICE PRESIDENT-CAPITAL
MARKETS (972) 401-0752 DATASOURCE: Magnum Hunter Resources, Inc.
CONTACT: M. Bradley Davis, Senior Vice President-Capital Markets of
Magnum Hunter Resources, Inc., +1-972-401-0752 Web site:
http://www.magnumhunter.com/
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