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Magnolia Petroleum

  • BY: Andrew Hore |
  • POSTED: 30/01/2015 |

US oil and gas producer and explorer Magnolia Petroleum says that net proved oil and gas producing reserves rose by 37% and 39% respectively in the second six months of 2014. 

There were 985Mbbl of oil and 2,905MMcf of gas at the beginning of 2015. Total net proved and probable reserves are 1,044Mbbl of oil and 3,114MMcf of gas.

The NPV of the proved reserves is $26.7m, which is down from $31.8m at the end of July 2014 reflecting the decline in the oil price. The lower oil price also means that the borrowing base limit of the company’s credit facility has been cut from $4.6m to $3.28m and there is still some headroom in this facility.

Magnolia has a spread of stakes in wells in Oklahoma. It has interests in 176 producing wells. Production has increased from 257boepd at the end of July 2014 to 281boepd at the beginning of January.

At 0.63p a share, Magnolia is valued at £5.73m. That is a large discount to the NPV of the proved reserves even after taking account of the borrowings. 

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