MMRL Announces First Quarter Results

We are pleased to report our first quarter 1999 results and provide a summary of progress on our major projects during the quarter.

Saltfleetby

The third development well at Saltfleetby is progressing well. The primary purpose of this well was to confirm the thickness and location of the Basal Westphalian productive zones and to drill a 300 to 400 metre horizontal section into this zone for production later this year. The Westphalian zones have been encountered where expected and, in fact, appear somewhat thicker and more porous than forecasted. As a result, total reserves may increase at Saltfleetby.

The secondary purpose of this well was to take the opportunity to explore for additional hydrocarbons in the Brindsly Abdy and Namurian zones. It appears that we have discovered oil in the Brindsly Abdy zone. The value of this oil discovery will ultimately depend on how this zone extends over the Saltfleetby area. Additional work will be done over the next 12 months to evaluate its potential. The Namurian zone was also encountered by this well and appears to be natural gas bearing. Although the zone is not particularly thick at this location, with additional drilling success, the Namurian may provide incremental gas reserves at Saltfleetby.

The Saltfleetby infrastructure and pipeline are progressing according to plans with production expected to start in November of this year. The 1999 development costs are now expected to approximate $23 million (including the two development wells).

Kyle

The Kyle development project is progressing, but more slowly than planned. Oil from the Banff field is now being processed through the Banff Ramform FPSO vessel. The sub-sea infrastructure for the Kyle field is largely completed. Modifications to the Banff Ramform FPSO to accommodate Kyle production cannot be completed until gas from the Banff field is on stream. As a result, first oil from Kyle is now anticipated to come on stream in December of this year. We continue to expect production from this project to start at 1,500 boe/d net to MMRL.

Panny

The winter work program at Panny has indicated that the heavy oil cannot be produced by way of primary recovery methods as hoped. As a result, higher oil prices will be required before the oil project becomes economic

Peter A. Braaten
President and C.E.O.

May 28, 1999

This news release contains forward-looking information. Actual future results may differ materially. The risks, uncertainties and other factors that could influence actual results are described in MMRL's annual report to shareholders and other documents filed with regulatory authorities.