Magnum Energy Inc. Announces Signing of Letter of Intent

Magnum Energy Inc. (The "Company" or "Magnum") (TSX VENTURE:MEN) is pleased to
announce that the Company has entered into a Letter of Intent (LOI) to purchase
the Viking oil assets of a private company within its core Sedalia Area for $2.8
million, subject to a third party engineering report and board of directors'
approval. 


The private company is currently producing approximately 30 barrels of sweet
light crude per day from its 100% owned and operated vertical wells situated on
3.25 sections of largely undeveloped land. The 100% owned infrastructure
includes a battery, disposal well, and pipelines. 


In 1968, a unitization study was performed by McDaniel Consultants engineering
evaluators which was submitted to the Energy Resources Conservation Board (ERCB)
that indicated an oil resource of 5 million barrels of original oil in place
(OOIP) per section in the Viking "A" Pool. Cumulative recovered oil production
to date has been less than 5% of this estimate. Viking horizontal wells drilled
over the last year along this Viking oil trend have unlocked the remaining
recoverable reserves in these pools and vastly improved the economics over
vertical development.


This acquisition brings an excellent oil component to Magnum's very economic and
growing gas production within its core property, maintaining control of its 100%
operated working interest. 


About Magnum Energy Inc.

Magnum is a junior oil and gas producer with operations located in the Western
Canadian Sedimentary Basin. The Company produces from operations in Alberta, and
maintains 100% ownership of the Sedalia gas facility in East-Central Alberta.