MAGMA ENERGY ANNOUNCES FINDINGS OF SPECIAL COMMITTEE - HS ORKA TRANSACTION
FULLY IN COMPLIANCE WITH ICELANDIC LAW

VANCOUVER, Sept. 17 /CNW/ - Magma Energy Corp. (TSX: MXY) reports that a Special Committee appointed by the Icelandic government to review Magma's acquisition of a 98.53% stake in Icelandic geothermal company HS Orka has concluded that Magma acted in full compliance with Icelandic law.

At an HS Orka shareholders meeting today, a new Board of Directors was elected, where three new Magma appointees were elected, including Asgeir Margeirsson as Chairman. Mr. Margeirsson commented: "I am really pleased to be elected to chair this great Icelandic geothermal power company and to receive confirmation that Magma acted at all times in compliance with Icelandic laws in its acquisition of HS Orka. We can now direct our attention to continuing to build on HS Orka's reputation as a strong independent power producer with exceptional geothermal and human resources. "

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 two in Iceland.

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