LONDON (ShareCast) - AIM-listed US onshore oil and gas exploration company Magnolia Petroleum (Other OTC: MGPTF - news) has begun participating in two additional wells, an operational update issued on Thursday has revealed.
The company stated that it had opted to participate in the wells, which are both locatd in North Dakota, and had a share of $464,745 (equivalent to $929,490 in aggregate) in them.
Each of the wells, which are both operated by Marathon Oil, have an estimated cost of $8.6m.
Meanwhile, the company stated that production had commenced at the Cisco-operated Montecristo 6-1H horizontal well in the Mississippi Lime formation, in which Magnolia has a 6.2% working interest and 5.3% net revenue interest.
It stated that the gross initial production rate was 50 barrels of oil equivalent per day (boepd).
Magnolia Chief Operating Officer, Rita Whittington said: "Our participation alongside Marathon in Gustafson and Helgeson is in line with our strategy to grow our production and reserves by increasing both the number of wells in which we have an interest, as well as the average size of those interests."
"Through drilling we are systematically proving up the large number of leases in producing hydrocarbon formations which we have acquired over the last 12 months, increasing Magnolia's proven reserves and thereby creating significant value for shareholders."
Magnola Petroleum's share price was up 0.88% to 2.88p at 14:12 on Thursday afternoon.