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SANTOS LIMITED Capital/Financing Update 2007

Oct 18, 2007

65872_rns_2007-10-18_e922c94c-215f-4d10-8126-422cc24a96fd.pdf

Capital/Financing Update

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MAGELLAN PETROLEUM CORPORATION

ARBN 117 452 454

ADMINISTRATIVE OFFICE

Hartford Square North 10 Columbus Blvd – 10th Floor TELEPHONEFACSIMILE (+1) 860 293 2349 (+1) 860 293 2006 HARTFORD CT 06106, USA WEBSITE www.magpet.com AUSTRALIAN OFFICE 10th Floor, 145 Eagle Street BRISBANE QLD 4000 TELEPHONEFACSIMILE (+61) 7 3832 6411 (+61) 7 3224 1600 (GPO Box 2766, Brisbane Q 4001) WEBSITE www.magpet.com.au

19 October 2007

ANNOUNCEMENT TO ASX

Drilling Report – Maxwell 5 PL 50 – Cooper Basin QLD

Magellan Petroleum Corporation (NASDAQ: MPET; ASX: MGN) advises that the Maxwell 5 appraisal well spudded in PL 50 in the Cooper Basin of southwest Queensland on 14 October. The well is located on the Maxwell oil field approximately equidistant from Maxwell 3 and Maxwell 4 in an area of the field interpreted to be largely unswept by production from the three oil producing wells to the north. Oil is produced from the Murta Formation on the Maxwell field.

The well reached Total Depth of 1001 metres and good oil shows were encountered in the Murta Formation during drilling. Wireline logs were run. The well is being cased and suspended as a future oil producer.

Maxwell 5 was the second well in a 2-well drilling program at Nockatunga. No further reports will be issued.

Maxwell 5 Details:

Petroleum Title: PL 50, Queensland
Location: approximately 675 m SSW of Maxwell 3 and 700 m NE of Maxwell 4
Coordinates: Latitude: 27° 53' 40.15" South
Longitude: 142° 41' 28.08" East (GDA 94)
Drilling Rig: PDI 721
Proposed Total Depth: 991 metres RT
Objectives: Primary oil – the Murta Formation
Operations: Maxwell 5 spudded on 14 October 2007. Surface casing was set at
242 metres. The well reached a Total Depth of 1001 metres on
17 October. Wireline logs were run, and the well is being cased and
suspended.
Progress: 1001 metres

Participants in Maxwell 5 are:

Magellan Petroleum Corporation 38.994% Santos Limited (ASX:STO) (Operator) 61.006%

Page 2

Magellan Drilling Report

Forward Looking Statements

Statements in this release which are not historical in nature are intended to be, and are hereby identified as, forward-looking statements for purposes of the United States Private Securities Litigation Reform Act of 1995. These statements about Magellan may relate to its business and prospects, revenues, expenses, operating cash flows, and other matters that involve a number of uncertainties that may cause actual results to differ materially from expectations. Among these risks and uncertainties are the extent of the recoverable reserves at those properties and the risk that any wells drilled may fail to encounter hydrocarbons in commercially recoverable quantities. Any forward-looking information provided in this release should be considered with these factors in mind. Magellan assumes no obligation to update any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise.

For further information, please contact Dr Gwynn Davies, General Manager, Magellan Petroleum Australia Limited on telephone (07) 3224 1600.

Page 3

Magellan Drilling Report

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