Magma Energy Announces Closing of Public Offering of Common Shares and Exercise of Over-Allotment Option


Vancouver, B.C., Canada, July 27, 2010 - Magma Energy Corp. (TSX: MXY) (the "Company") has closed its previously announced public offering of common shares (the "Offering"). Pursuant to the Offering, the Company today issued 40,334,628 common shares at a price of $1.12 per common share, including 4,620,342 common shares issued upon partial exercise of the underwriters' over-allotment option, for aggregate gross proceeds of $45,174,783 and total proceeds, net of underwriting fees, of $43,305,629.

The Company expects to use the net proceeds from the Offering in connection with its previously announced acquisition of common shares of HS Orka hf, with the remainder (if any) to be used for working capital requirements and other general corporate purposes.

Raymond James Ltd. acted as the lead underwriter for the offering. The other members of the syndicate are National Bank Financial Inc., Cormark Securities Inc., Dundee Securities Corporation, Jacob Securities Inc., Mackie Research Capital Corporation, Salman Partners Inc., Wellington West Capital Markets Inc. and Canaccord Genuity Corp.

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 please contact:
Alison Thompson, Vice President, Corporate Relations
Magma Energy Corp.
Phone: 604.646.1882