Magnum Hunter Announces New Core Area Initiates Coal Bed Methane Play in San Juan Basin, New Mexico Leases 554,000 Mineral Acres Exercising Options on Additional 922,000 Mineral

Acres



Forms 6,000,000 Acre Area of Mutual Interest



Drilling Has Commenced



    IRVING, Texas, Sept. 22 /PRNewswire-FirstCall/ -- Magnum Hunter Resources,
 Inc. (NYSE:   MHR) announced today that it has established a new core area for
 the Company in the San Juan Basin of New Mexico concentrating on the Upper and
 Lower Menefee coals of the Mesaverde Group.  In an effort to immediately
 explore this substantial acreage position, Magnum Hunter has formed a joint
 venture arrangement with CDX, LLC and CDX Frontier, LLC (hereinafter
 collectively referred as "CDX Gas") to participate in the exploration and
 development of this region of New Mexico covering an approximate 6,000,000
 acre area of mutual interest ("AMI").  CDX is a private Dallas-based
 exploration company specializing in state-of-the-art coalbed methane drilling
 and production technologies and is recognized as an industry leader in
 developing unconventional resources.  Its world record winning Z-Pinnate(TM)
 Horizontal Drilling and Completion System has been recognized by
 environmentalists and regulatory agencies as having significant advantages in
 developing natural gas reserves with minimal surface and environmental impact.
 CDX's subsidiary, CDX-DART Drilling & Technology, LLC ("CDDT"), will perform
 all drilling operations with its fleet of purpose-built rigs.  Magnum Hunter
 will manage all production operations.
     Magnum Hunter and its affiliates have recently exercised certain options
 on mineral leasehold acreage located in McKinley, Sandoval and San Juan
 Counties, New Mexico covering approximately 554,000 acres that have been
 contributed to this joint venture.  Additionally, Magnum Hunter is in the
 process of exercising certain exclusive option rights on an incremental
 922,000 mineral acres located in Bernillo, Catron, Cibola and Socorro
 Counties, New Mexico.  CDX's contribution to the joint venture is
 approximately 14,000 mineral acres more commonly referred to as the Southeast
 Cabrito Project, Rio Puerco Project and Zed Project.  Also, the joint venture
 has recently acquired new mineral leases covering approximately 8,000 acres
 from the State of New Mexico.
     The joint venture is structured as a three phase drilling program which
 was initiated last week.  Phase I of the exploration program calls for the
 drilling of 25 wells at depths up to 3,500 feet which will be a combination of
 stratagraphic tests and core tests.  CDX and its affiliate will manage the
 drilling phase of the drilling program and total estimated cost of Phase I is
 approximately $3 million.  It is anticipated that all work will be completed
 under Phase I of the program on or before February 15, 2004.
     Phase II of the program will be comprised of drilling an additional 25
 wells (15 stratagraphic tests and 10 core tests).  It is anticipated that the
 Phase II program will be completed on or before July 1, 2004.  The total
 estimated cost of the Phase II program is $3 million.
     Phase III of the program will consist of drilling several pilot projects
 both vertical and horizontal.  The estimated cost of the Phase III program is
 approximately $5 million.
     In addition to the Southern San Juan coalbed methane potential in the
 Cretaceous Menefee formation, a number of conventional shallow oil and gas
 fields exist in the sands within the Menefee formation.  These fields, which
 range in depth from 300 to 2,200 feet, have produced over one million barrels
 of oil in McKinley County alone.
     On the southern portion of the Chaco shelf, along the south flank of the
 San Juan Basin, the Hospah sands developed within the Cretaceous Mancos shale
 interval, have produced over 21 million barrels of oil in six sections from
 depths of 1,100 to 2,300 feet.  The Hospah field was first discovered in 1927
 and has produced approximately seven million barrels of oil when it was offset
 in the mid 1960s.  The South Hospah Field was subsequently discovered with
 this offset.  This field has produced in excess of fourteen million barrels
 since that time.  Magnum Hunter own the mineral leases on approximately 75% of
 all of the acreage within an 18-mile radius of these fields.  Additionally,
 oil and gas potential is present throughout this substantial acreage position
 within the Cretaceous Dakota sandstone and in the Jurassic Entrada sandstone
 formations.
     Commenting on this new core area established in the San Juan Basin,
 Mr. Gary C. Evans, Chairman, President and CEO of Magnum Hunter stated, "This
 is one of the most exciting projects that I have ever been involved in my over
 18 year tenure here at Magnum Hunter.  The reserve potential of this
 unexplored region significantly exceeds our Company's current proved reserve
 base.  By attracting a company such as CDX Gas as our drilling partner who has
 brought significant knowledge and years of coalbed methane expertise,
 including their revolutionary patented technology, Magnum Hunter is able to
 immediately exploit this new asset with minimal capital outlay.  Some
 advantages of CDX's 'Z-Pinnate' drilling technology includes recovery of up to
 85% of gas in place within 36 months at flow rates ranging from 1.2 MMcf per
 day to 2.5 MMcf per day from low permeability reservoirs.  A well can cover up
 to 1200 acres from a single location, providing for minimal environmental
 impact."
     Mr. Doug Wight, Vice President of Corporate Development for CDX Gas
 stated, "We're thrilled about the combined synergy of strengths of Magnum
 Hunter and CDX Gas to explore and unlock the natural gas resources in New
 Mexico while simultaneously maintaining a reputation as an environmental
 guardian of all natural resources.  The Z-Pinnate(TM) system enables CDX to
 recover methane gas from unconventional reservoirs significantly faster and in
 a more environmentally friendly way than traditional technologies.  With
 today's increasing demand for natural gas, we are exploring new opportunities
 to apply our latest drilling technologies in developing gas from formations
 that in the past were uneconomic to drill with traditional technologies."
     When asked to respond, Bill Richardson, Governor of the State of New
 Mexico commented, "Our State and nation are in dire need of new sources of
 natural gas from our domestic homeland to meet our future energy requirements.
 The State of New Mexico has a rich resource base of natural gas, especially in
 the San Juan Basin.  This is the type of project that brings together new
 technology with previously untapped mineral acreage that will benefit all
 concerned.  The State of New Mexico supports these type of projects which will
 not only minimize surface damage, but will significantly enhance our State's
 tax revenue base."
     Formed in 1991, Dallas-based CDX is a North American land-based natural
 gas drilling and exploration company.  CDX has patented the Z-Pinnate(TM)
 Horizontal Drilling and Completion System that can tap rich, low-permeability
 coal and shale gas reservoirs, approaching recovery rates comparable to
 offshore well production rates.  CDX and affiliated companies provide turnkey
 production capabilities with their own coring rigs, drilling rig fleet,
 directional tools and services, laboratories and full spectrum operating
 teams.  It operates in locations throughout North America.
 
     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
 
 

SOURCE Magnum Hunter Resources, Inc.

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