Drilling Report Yanerbie-1 Cooper Basin South Australia

HARTFORD, Conn., June 30 /PRNewswire-FirstCall/ -- Magellan Petroleum Corporation said that its 55-percent-held subsidiary, Magellan Petroleum Australia Limited, made the following release to the Australian Stock Exchange on Wednesday, June 29, 2005:

                           Announcement to ASX

                             Drilling Report
                 Yanerbie-1 Cooper Basin South Australia

Magellan Petroleum Australia Limited (Magellan) advises that the Yanerbie- 1 exploration well in exploration permit PEL 110 spudded at 00:00 hours on June 29 and, at 06:00 hours today, was at a depth of 670 meters and preparing to run and set surface casing. The well is located some 150 km north of Moomba in South Australia.

As previously advised, Magellan reached agreement with Enterprise Energy NL to farmout a 6.25% interest in the Yanerbie Prospect. As a result of this farmout, Magellan's equity in the Yanerbie Prospect will be reduced to 31.25%. Magellan will retain a 37.5% interest in the remainder of PEL 110. However the terms of the farmout agreement with Enterprise also give that company an option to earn a 6.25% in the entire tenement by committing to funding further exploration expenditures after Yanerbie-1.

   Yanerbie-1 Details:
   Petroleum Title:     PEL 110.
   Location:            Cooper Basin, South Australia.
   Coordinates:         Latitude: 26 Degrees 54' 59.80" South.
                        Longitude: 140 Degrees 37' 49.10" East (GDA 94).
   Drilling Rig:        Century Rig 3.
   Total Depth:         2,534 metres RT.
   Objective:           The Jurassic Hutton Sandstone and Triassic Tinchoo
                        Formation are primary targets with the Poolowanna
                        Formation deemed a secondary objective
   Current Operations:  The well spudded at 00:00 hours on June 29, 2005 and
                        is currently at a depth of 670 meters and preparing
                        to run and set surface casing.
   Progress for Week:   670 meters

   Participants in the Yanerbie-1 well are:
   Magellan Petroleum (Southern) Pty Ltd           31.25%
   Beach Petroleum Ltd                             31.25%
                                                  (Operator)
   Cooper Energy Limited                            25.0%
   Enterprise Energy NL                             12.5%

Magellan will issue operational information to the Australian Stock Exchange weekly on Thursdays during the drilling of the Yanerbie-1 well.