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Magellan Revolving Loan Converted to Term Loan

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   |    Thursday,July 02,2015

Magellan Petroleum Corporation announced the amendment of the senior secured revolving loan facility, which Nautilus Poplar LLC, a wholly owned subsidiary of Magellan, entered into on September 17, 2014 with West Texas State Bank (WTSB).

Nautilus holds the Company's interests in the Poplar Field.

The Revolving Loan Facility was due to mature on September 30, 2015, and the outstanding balance amounted to $5.5 million. The interest payments were based on the prime rate and a floor rate of 3.25%. The Revolving Loan Facility was secured by substantially all of Nautilus's assets, and Magellan provided a guarantee secured by a pledge of its membership interest in Nautilus.

On June 30, 2015, the Revolving Loan Facility was converted into a single term loan, its maturity extended, and the grant of security interests by Nautilus in favor of WTSB reaffirmed. The total amount of the Term Loan will be $5.5 million and no additional draws may be made. The term of the Term Loan will be 5 years and will be due on June 30, 2020. The interest payable on the Term Loan will be due monthly and be based on the prime rate plus 1.50% with an interest rate floor of 4.75%. During the first twelve months of the Term Loan, only interest will be payable and the principal amount will be amortized over the remaining four years of the life of the Term Loan. The security and guarantee provided by the Company to WTSB will remain the same as those provided under the terms of the Revolving Loan Facility.

J. Thomas Wilson, President and CEO of the Company, commented, "The conversion of the Revolving Loan Facility into a Term Loan enables the Company to extend the maturity date of the loan and to benefit from one year of interest only payments, which we believe will provide the Company with additional flexibility in collecting additional data from the CO2-enhanced oil recovery pilot program at Poplar and the economic evaluation of the project. The conversion of the Revolving Loan Facility also reflects the constructive relationship between the Company and WTSB."


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