PetroMagdalena announces farm-in with Interoil

    




 TORONTO, Feb. 29, 2012 /CNW/ - PetroMagdalena Energy Corp.   announced today that it has entered into a binding letter of intent  with Interoil Colombia E&P Inc. in respect of a 50% participation to  farm in to the LLA-47 block located in the Llanos just south and on  trend with the company's main Cubiro block and other producing blocks  in the basin. 

 The LLA-47 is located in the prolific Llanos basin and covers an area of  447 km(2). Interoil has owned a 100% of the working interest on the block and is  the current operator. The Company has agreed to undertake a $30 million  work program commitment in the three years of Phase 1 of the E&P  contract with the ANH. This transaction is subject to approval by the  ANH. In addition, the Company shall pay a $2 million signing fee upon  receipt of ANH approval. 

 Luciano Biondi, Chief Executive Officer of the Company stated: "We are  looking forward to working with InterOil and expanding the cooperative  relationship developed over the last few years as we have adjacent  operations with their Altair Block on the southern boundary of Cubiro.   This allows us to leverage our in-depth Cubiro experience to an  exciting new block with the same geological and surface characteristics  and logistical aspects.  With the existing 2D seismic indicating the  existence of several exploration leads similar to those on the Cubiro  block, that will be matured with 3D seismic as the first activity prior  to exploration drilling, we are pleased to have added a very  prospective Llanos exploration program to our portfolio." 

 PetroMagdalena is a Canadian-based oil and gas exploration and  production company, with working interests in 19 properties in five  basins in Colombia. Further information can be obtained by visiting our  website at www.petromagdalena.com 

 All monetary amounts in U.S. dollars unless otherwise stated. This news  release contains certain "forward-looking statements" and  "forward-looking information" under applicable Canadian securities laws  concerning the business, operations and financial performance and  condition of PetroMagdalena. Forward-looking statements and  forward-looking information include, but are not limited to, statements  with respect to estimated production and reserve life of the various  oil and gas projects of PetroMagdalena; the estimation of oil and gas  reserves; the realization of oil and gas reserve estimates; the timing  and amount of estimated future production; costs of production; success  of exploration activities; and currency exchange rate fluctuations.  Except for statements of historical fact relating to the company,  certain information contained herein constitutes forward-looking  statements. Forward-looking statements are frequently characterized by  words such as "plan," "expect," "project," "intend," "believe,"  "anticipate", "estimate" and other similar words, or statements that  certain events or conditions "may" or "will" occur. Forward-looking  statements are based on the opinions and estimates of management at the  date the statements are made, and are based on a number of assumptions  and subject to a variety of risks and uncertainties and other factors  that could cause actual events or results to differ materially from  those projected in the forward-looking statements. Many of these  assumptions are based on factors and events that are not within the  control of PetroMagdalena and there is no assurance they will prove to  be correct. Factors that could cause actual results to vary materially  from results anticipated by such forward-looking statements include  changes in market conditions, risks relating to international  operations, fluctuating oil and gas prices and currency exchange rates,  changes in project parameters, the possibility of project cost overruns  or unanticipated costs and expenses, labour disputes and other risks of  the oil and gas industry, failure of plant, equipment or processes to  operate as anticipated. Although PetroMagdalena has attempted to  identify important factors that could cause actual actions, events or  results to differ materially from those described in forward-looking  statements, there may be other factors that cause actions, events or  results not to be anticipated, estimated or intended. There can be no  assurance that forward-looking statements will prove to be accurate, as  actual results and future events could differ materially from those  anticipated in such statements. PetroMagdalena undertakes no obligation  to update forward-looking statements if circumstances or management's  estimates or opinions should change except as required by applicable  securities laws. The reader is cautioned not to place undue reliance on  forward-looking statements.  

 Neither TSX Venture Exchange nor its Regulation Services Provider (as  that term is defined in the policies of the TSX Venture Exchange)  accepts responsibility for the adequacy or accuracy of this news  release. 

PetroMagdalena Energy Corp.


CONTACT:  Michael DaviesChief Financial Officer(416) 360-7915Belinda LabatteInvestor Relations Representative(647) 436-2152 


    

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