DALLAS, TX--(MARKET WIRE)--Oct 1, 2008 -- HKN, Inc. (HKN - News) ("HKN") today reported its initial assessment of the impact of Hurricanes Gustav and Ike on its domestic oil and gas operations which are primarily located onshore and offshore in the Gulf of Mexico.

Prior to the storms and in response to mandatory actions from state and regulatory agencies, domestic production was shut-in and all employees and contractors were safely evacuated from all affected areas. As a general note, restoration of shut-in or lost oil and gas production is dependent on many factors such as the resumption of downstream infrastructure and the availability of services and equipment contractors necessary for over-water transportation and repairs. HKN anticipates that gross damage estimates will total approximately $2.8 million prior to insurance and third party partner reimbursements. Net damages to be paid by HKN after insurance and third party reimbursements are estimated to be approximately $800,000.

Immediately prior to the hurricanes, our net domestic production rate was averaging approximately 800 barrels of oil equivalent ("boe") per day. As of September 30, 2008, we are now averaging approximately 650 boe per day.

Domestic Operations Update:

OPERATED FIELDS:

 
--  Main Pass 35:  Oil production resumed as of September 30, 2008 at 100%
    of pre-hurricane rates. As of September 30, 2008, field personnel had
    substantially completed repairs to the gas lift lines damaged in the
    storms. Infrastructure not involved in the production of oil and gas are
    still on-going repair.

--  Lake Raccourci:  Oil and gas production is currently shut-in due to
    extensive damage from the storms. Repair work on the platform and wells
    began the week of September 22, 2008. Estimated repair time is anticipated
    to be approximately two months.

--  Point A La Hache: Our oil well is currently shut-in. Our portion of
    repair work from storm damages was completed the week of September 21,
    2008. We await repairs and the restart of third-party equipment. HKN
    anticipates that oil production will resume within the next few weeks.

NON-OPERATED FIELDS:

 
--  Certain of our non-operated properties were shut-in to reduce the
    impact of the storms. No formal damage estimates from the operators of
    these properties are currently available. HKN does not anticipate that any
    of these properties sustained any significant damages and several of these
    properties have already returned to pre-hurricane production rates.

HKN, Inc. is an independent energy company engaged in the development and production of crude oil, natural gas and coalbed methane assets and in the active management of investments in energy industry securities traded on both domestic and international securities exchanges. Additional information may be found at the HKN Web site, www.hkninc.com. Please e-mail all investor inquiries to HKNinquiries@ctaintegrated.com.

Certain statements in this announcement and inferences derived therefrom may be regarded as "forward-looking statements" within the meaning of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on the opinions and estimates of management at the time the statements are made. Management's current view and plans, however, are subject to numerous known and unknown risks, uncertainties and other factors that may cause the actual results, performance, timing or achievements of HKN to be materially different from any results, performance, timing or achievements expressed or implied by such forward-looking statements. The various uncertainties, variables, and other risks include those discussed in detail in the Company's SEC filings, including the Annual Report on Form 10-K filed on February 19, 2008 and the Quarterly Report on Form 10-Q filed on August 7, 2008 for the period ended June 30, 2008. HKN undertakes no duty to update or revise any forward-looking statements. Actual results may vary materially.

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