In what the company listed as a “significant” increase to its total natural gas and oil production, Magnum Hunter Resources Inc. said last week that it has participated in three new oil and gas discoveries and commenced production from six additional lease blocks, all located on the Outer Continental Shelf (OCS) of the Gulf of Mexico. The company said initial gross production rates from the six blocks aggregates approximately 97 MMcfe/d, or approximately 22 MMcfe/d net to Magnum Hunter.

The company said it has recently participated in discoveries on Main Pass Block 108, South Timbalier Block 275, West Cameron Block 417, Eugene Island Block 302, South Marsh Island Block 93 and West Cameron Block 347. Magnum Hunter holds stakes ranging from 25-50% in the various blocks.

In the Eugene Island Block 397 field, the company has a 12.5% working interest in three new wells, the A-1, A-2, and A-4. Magnum Hunter said these wells have been completed and are currently producing at a combined daily rate of approximately 2,900 barrels of oil and 2.2 MMcf of natural gas. Drilling operations on the A-5 well are currently in progress. The company added that future plans are to drill up to four additional wells with three of the wells targeting exploratory zones. W & T Offshore, Inc. operates the Eugene Island 397 field with a 50% working interest. Magnum Hunter owns a 12.5% working interest and Remington Oil and Gas Corporation owns the remaining 37.5% stake.

“Magnum Hunter has participated in new discoveries in the Gulf of Mexico that have been put on production over the last several weeks, which now approximate 100 million cubic feet of natural gas equivalents per day of gross production,” said CEO Gary C. Evans. “Our decision to spread our capital risk dollars over a larger group of lease blocks is proving to be a wise game plan. We are exposed to many more opportunities and we have built relationships with strong industry partners.

“The company has been awarded 40 of the 41 offshore blocks where we were high bidder at the 2002 Central Gulf of Mexico lease sale,” Evans continued. “The addition of these new exploration blocks brings the company’s current leasehold inventory to 127 OCS blocks covering over 600,000 gross mineral acres. Our technical team has identified drillable prospects utilizing 3-D seismic on all of these blocks which contain reserve potential of 10-150 Bcfe per prospect. We are excited about the success our 2002 drilling program has shown to-date, and we believe our future exploration drilling has the potential for significant increases in reserves and the production profile of Magnum Hunter.”

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