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MAGNUM HUNTER RESOURCES CORP
Symbol U : MHR
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Magnum Hunter Resources Announces Expanded Senior Bank Credit Facility

2013-03-01 08:14 ET - News Release

HOUSTON, TX -- (Marketwire) -- 03/01/13

Magnum Hunter Resources Corporation (NYSE: MHR) (NYSE MKT: MHR.PRC) (NYSE MKT: MHR.PRD) (NYSE MKT: MHR.PRE) (the "Company" or "Magnum Hunter") announced today that the Company's conforming borrowing base under its $750 million Senior Bank Facility (the "Senior Credit Facility"), has been increased by $43.75 million from $306.25 million to $350 million (the "New Borrowing Base"). The 14.3% increase in Magnum Hunter's borrowing base is entirely due to organic growth of the Company's existing proved reserve base due to the successful drilling activities in its three unconventional resource plays. Effective with this increase in the conforming borrowing base, the previous non-conforming borrowing base tranche under the Senior Credit Facility of $31.25 has been eliminated. The non-conforming tranche was added in the fourth quarter of 2012 to support the Company's 2012 capital expenditures primarily related to the drilling program. However, as a result of issuances of Senior Notes and Preferred Stock and this new conforming borrowing base increase, the Company no longer has a need for the additional capital.

As a result of the New Borrowing Base and availability under the Company's Senior Revolving Credit Facility, as of March 1, 2013, the Company had approximately $115 million of total liquidity including cash and borrowing base availability under its New Borrowing Base. In addition, the Company has raised over $10 million of net proceeds year-to-date from the issuance of our Series D and Series E Preferred Stock. The Company anticipates additional liquidity to be generated from additional borrowing base increases and possible additional issuances of Preferred Stock later this year. In addition, the Company presently anticipates further liquidity to be generated from its monetization of selected assets planned for 2013. The Company presently has the ability to fully fund its 2013 upstream capital budget program of $300 million, and these additional sources will provide further improved liquidity.

The applicable interest rate margin of the Senior Credit Facility was lowered to range from LIBOR plus 2.00% to LIBOR plus 2.75%, depending on the amount drawn at any given time on the Senior Credit Facility. The Senior Credit Facility is governed by a semi-annual borrowing base redetermination derived from the Company's total proved crude oil and natural gas reserves. The next scheduled redetermination of the borrowing base is scheduled for November 2013.

Bank of Montreal serves as the "Administrative Agent" under the Senior Credit Facility, with Capital One, N.A. serving as the "Syndication Agent". Other banks in the Senior Credit Facility include ABN AMRO, Amegy Bank National Association, Bank of America, Citibank, N.A., Credit Suisse AG, Deutsche Bank Trust Company Americas, KeyBank National Association, Royal Bank of Canada, SunTrust Bank, Goldman Sachs Bank USA and UBS.

Magnum Hunter Management Comments

Mr. Ronald D. Ormand, Executive Vice President and Chief Financial Officer of Magnum Hunter, commented, "We are pleased to once again announce an increase in our borrowing base as established by our Senior Bank Group. In addition, we now have sufficient liquidity to completely eliminate our non-conforming tranche. This action represents the initial step in our goal to simplify our balance sheet and reduce overall leverage through selected asset monetizations in 2013 while maintaining ample liquidity for our 2013 capital budget plan."

About Magnum Hunter Resources Corporation

Magnum Hunter Resources Corporation and subsidiaries are a Houston, Texas based independent exploration and production company engaged in the acquisition, development and production of crude oil, natural gas and natural gas liquids, primarily in the states of West Virginia, Kentucky, Ohio, Texas and North Dakota and Saskatchewan, Canada. The Company is presently active in five of the most prolific unconventional shale resource plays in North America, namely the Marcellus Shale, Utica Shale, Eagle Ford Shale, Pearsall Shale and Williston Basin/Bakken Shale.

For more information, please view our website at www.magnumhunterresources.com.

Forward-Looking Statements

The statements and information contained in this press release that are not statements of historical fact, including any estimates and assumptions contained herein, are "forward looking statements" as defined in Section 27A of the Securities Act of 1933, as amended, referred to as the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, referred to as the Exchange Act. These forward-looking statements include, among others, statements, estimates and assumptions relating to our business and growth strategies, our oil and gas reserve estimates, our ability to successfully and economically explore for and develop oil and gas resources, our exploration and development prospects, future inventories, projects and programs, expectations relating to availability and costs of drilling rigs and field services, anticipated trends in our business or industry, our future results of operations, our liquidity and ability to finance our exploration and development activities and our midstream activities, market conditions in the oil and gas industry and the impact of environmental and other governmental regulation. In addition, with respect to any pending transactions described herein, forward-looking statements include, but are not limited to, statements regarding the expected timing of the completion of proposed transactions; the ability to complete proposed transactions considering various closing conditions; the benefits of any such transactions and their impact on the Company's business; and any statements of assumptions underlying any of the foregoing. In addition, if and when any proposed transaction is consummated, there will be risks and uncertainties related to the Company's ability to successfully integrate the operations and employees of the Company and the acquired business. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "could," "should," "expect," "intend," "estimate," "anticipate," "believe," "project," "pursue," "plan" or "continue" or the negative thereof or variations thereon or similar terminology.

These forward-looking statements are subject to numerous assumptions, risks, and uncertainties. Factors that may cause our actual results, performance, or achievements to be materially different from those anticipated in forward-looking statements include, among others, the following: adverse economic conditions in the United States, Canada and globally; difficult and adverse conditions in the domestic and global capital and credit markets; changes in domestic and global demand for oil and natural gas; volatility in the prices we receive for our oil, natural gas and natural gas liquids; the effects of government regulation, permitting and other legal requirements; future developments with respect to the quality of our properties, including, among other things, the existence of reserves in economic quantities; uncertainties about the estimates of our oil and natural gas reserves; our ability to increase our production and therefore our oil and natural gas income through exploration and development; our ability to successfully apply horizontal drilling techniques; the effects of increased federal and state regulation, including regulation of the environmental aspects, of hydraulic fracturing; the number of well locations to be drilled, the cost to drill and the time frame within which they will be drilled; drilling and operating risks; the availability of equipment, such as drilling rigs and transportation pipelines; changes in our drilling plans and related budgets; regulatory, environmental and land management issues, and demand for gas gathering services, relating to our midstream operations; and the adequacy of our capital resources and liquidity including, but not limited to, access to additional borrowing capacity.

These factors are in addition to the risks described in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's 2011 annual report on Form 10-K, as amended, filed with the Securities and Exchange Commission, which we refer to as the SEC. Most of these factors are difficult to anticipate and beyond our control. Because forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such statements. You are cautioned not to place undue reliance on forward-looking statements contained herein, which speak only as of the date of this document. Other unknown or unpredictable factors may cause actual results to differ materially from those projected by the forward-looking statements. Unless otherwise required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. We urge readers to review and consider disclosures we make in our reports that discuss factors germane to our business. See in particular our reports on Forms 10-K, 10-Q and 8-K subsequently filed from time to time with the SEC. All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements.

Contact:
Chris Benton
Assistant Vice President of Finance and Capital Markets
ir@magnumhunterresources.com
(832) 203-4539

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