PORTLAND, Maine ( TheStreet) -- Magellan Petroleum ( MPET) shares rallied sharply higher Friday on heavy volume after the company said it completed an acquisition of a Montana oil field.

Magellan Petroleum said it has acquired an 83.5% controlling interest in Denver-based Nautilus Poplar, which owns and operates oil development assets in Roosevelt County, Montana known as the East Poplar Unit and the Northwest Poplar field.

The deal was worth $10.9 million, Magellan said, comprised of a cash payment totaling approximately $7.3 million, the issuance of 1.7 million new shares of common stock valued at $1.40 a share, and with an adjustment for $1.2 million of net debt.

Shares of Magellan Petroleum were jumping by 14 cents, or 10%, to $1.54. Earlier in the session, the stock touched an intraday and new 52-week high of $1.66. More than 1.8 million shares changed hands by late Friday, compared to the stock's 50-day average daily volume of 296,000, according to the Nasdaq.

Magellan Petroleum has a 37.8 million-share float with only 9000 shares short as of Sept. 25, according to Yahoo! Finance. More than 20% of the company's shares are held by insiders with another 9% owned by institutions.

Investor posts on Internet message boards said the deal adds value to Magellan at very favorable conditions. Others expected shares to break out and continue to set new highs.

Read more about today's high-volume stocks in earlier "Pump Up the Volume" posts.

-- Written by Robert Holmes in New York.