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Magnolia Petroleum hails attractive economics of Oklahoma oil projects


Magnolia Petroleum (LON:MAGP) has talked up the attractive economics of the North American projects it is invested in.

The company today told investors it has participated in 15 new wells that entered into production before the end of 2014.

It has also elected to take part in 14 new wells in low cost ventures in the Mississippi Lime and Woodford plays in Oklahoma.

Chief operating officer Rita Whittington says the company continues to make excellent progress towards its objective, which is to rapidly build production and prove up the reserves.

She added: “Against a backdrop of heightened oil price volatility, we view the continued high level of activity in our key areas of interest as testament to the attractive economics of drilling proven plays in Oklahoma, where costs to drill are relatively low, access to infrastructure is excellent, and payback credentials are strong."

Magnolia highlighted that, in the three months to December 31, six new wells drilled by Devon Energy had strong initial production rates which added 96 barrels oil equivalent net to Magnolia, while a successful fracking programme on the group’s wholly owned Roger Swartz 1 vertical well increased flows to an average of 12.2 bopd.

The company also said a new updated competent person's report - which will take a view on the group’s resources and reserves - is due for release during the first quarter of 2015.

On AIM, Magnolia shares advanced around 4% in early deals.

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