Magma Energy Amends Final Prospectus and Announces Completion of Distribution

/NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES/

VANCOUVER, Aug. 5 /CNW/ - Magma Energy Corp. (TSX: MXY) (the "Company") today announced that it has obtained a receipt from securities regulatory authorities for the Amendment No. 1 dated July 30, 2010 to the Company's short form prospectus dated July 21, 2010. The Amendment No. 1 was prepared by the Company to disclose recent announcements by the government of Iceland regarding, among other things, the Company's acquisitions of shares of HS Orka hf, as previously discussed by the Company in its press release dated July 28, 2010 and its related material change report dated July 29, 2010. The Company also announces that the distribution pursuant to the short form prospectus is now complete.

About Magma Energy Corp.

Magma Energy Corp. is a global geothermal power company which operates, develops, explores and acquires geothermal energy projects. We have an extensive portfolio of properties throughout the western United States, Iceland and Latin America, including one operating power plant in Nevada and a significant interest in two in Iceland.

For further information: Alison Thompson, Vice President, Corporate Relations, Magma Energy Corp., Phone: [phone], Email: [email protected]