HARTFORD, Conn., Nov. 18 /PRNewswire-FirstCall/ -- Magellan Petroleum Corporation (Nasdaq: MPET) (ASX: MGN) reported consolidated net income of $1.5 million, or $.04 per share on gross revenues of $10.4 million in its fiscal first quarter ended September 30, 2008, as compared to a net loss of $474,000, or $.01 per share on revenues of $9.3 million in last year's first quarter.

Magellan's president, Dan Samela, said, "We are pleased with our operating results for this quarter. Operating income is up by $3.4 million compared to last year's quarter and $816,000 over the fourth quarter of fiscal 2008. Though oil production was down 33% over last year, oil sales increased 19% due mostly to a 65% increase in the average price per barrel compared to last year's quarter."

The Company's Mereenie gas contract expires in June 2009. Mereenie gas sales were approximately $3.5 million (net of royalties) or 84% of total gas sales for the quarter ended September 30, 2008. Though the competition is strong, the Company is actively pursuing gas sales contracts for its remaining Mereenie reserves.

Depletion, depreciation and amortization costs for the 2008 quarter are down $1.9 million over the 2007 quarter due mostly to lower depletable costs and the 5% increase in the average exchange rate.

Statements in this press release which are not historical in nature are intended to be, and are hereby identified as, forward looking statements for purposes of the "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995. The Company cautions readers that forward looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated in the forward looking statements. Among these risks and uncertainties are pricing and production levels from the properties in which the Company has interests, and the extent of the recoverable reserves at those properties. In addition, the Company has a large number of exploration permits and faces the risk that any wells drilled may fail to encounter hydrocarbons in commercially recoverable quantities. The Company undertakes no obligation to update or revise forward- looking statements, whether as a result of new information, future events, or otherwise.

Comparative, consolidated results for the three month periods are shown in the following consolidated statements of operations:

                        MAGELLAN PETROLEUM CORPORATION

               CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (unaudited)

                                                         THREE MONTHS ENDED
                                                            September 30,
                                                          2008        2007
    REVENUES:
      Oil sales                                       $5,645,587  $4,732,820
      Gas sales                                        4,309,072   3,989,184
      Other production related revenues                  484,025     599,929
      Total revenues                                  10,438,684   9,321,933
    COSTS AND EXPENSES:
      Production costs                                 2,986,862   2,098,026
      Exploration and dry hole costs                     723,400   2,013,474
      Salaries and employee benefits                     466,192     444,509
      Depletion, depreciation and amortization         2,500,950   4,408,364
      Auditing, accounting and legal services            267,470     237,051
      Accretion expense                                  158,415     170,208
      Shareholder communications                          90,579      47,066
      Gain on sale of field equipment                     (3,506)     (9,653)
      Other administrative expenses                      769,069     869,913
      Total costs and expenses                         7,959,431  10,278,958
    Operating income (loss)                            2,479,253    (957,025)
      Interest income                                    628,169     489,217
    Income (loss) before income taxes                  3,107,422    (467,808)
    Income tax provision                              (1,599,611)     (6,638)
    NET INCOME (LOSS)                                 $1,507,811    (474,446)

    Average number of shares outstanding
        Basic                                         41,500,325  41,500,325
        Diluted                                       41,511,775  41,500,325

    NET INCOME (LOSS) PER SHARE (BASIC AND DILUTED)        $0.04      $(0.01)

SOURCE Magellan Petroleum Corporation