Ithaca Energy Inc.

Ithaca Energy Inc.

February 09, 2010 02:00 ET

Athena Project Moves Ahead



Not for Distribution to U.S. Newswire Services or for Dissemination in the United States

                                            Ithaca Energy Inc.
                                        Athena Project Moves Ahead

LONDON,  U.K. - CALGARY, ALBERTA, February 8, 2010 - Ithaca Energy Inc. (LSE-AIM: IAE, TSX-V: IAE) and  its
wholly  owned subsidiary Ithaca Energy (UK) Limited ("Ithaca" or the "Company"), an independent oil  &  gas
company  with exploration, development and production assets in the UK sector of the North Sea, is  pleased
to announce that the Athena Joint Venture Partners have committed to the purchase of long lead equipment. A
full  project  team  has  been  commissioned  to  plan the  development  and  finalize  submission  of  the
Environmental Statement and Field Development Plan ("FDP") for approval.

The  Athena Joint Venture Partners have approved the immediate purchase of long lead equipment  up  to  the
value  of US$14.85 million to initiate the development of the Athena field. Orders will be placed  for  the
supply of Electrical Submersible Pumps ("ESPs"), subsea trees and engineering support.

The  project  team  will  initially focus on the finalisation of the Environmental Statement  and  FDP  for
submission in March 2010; FDP approval by the authorities is anticipated in July 2010. The team  will  also
undertake  the final stage negotiation of contracts for a Floating Production Storage and Offtake  ("FPSO")
vessel, construction and provision of sub-sea facilities and drilling services.

The  initial development consists of four production wells supported by one water injection well.  To  date
the  Company  has drilled three successful wells on Athena, 14/18b-15A, 14/18b-16 and 14/18b-18  which  are
currently  suspended,  and will be re-entered and completed for production.  These  interventions  and  the
drilling  of  a  water injection well and one further production well will take place in Q4  2010/Q1  2011.
Additional  wells will be drilled from seabed locations close to existing wells to allow for ease  of  tie-
back to a new subsea manifold.

Production  will  be routed via the subsea manifold and a two kilometre, 8 inch flowline to  a  stand-alone
FPSO.  Oil production will be exported via shuttle tankers. Produced gas will be used to generate power  on
the  FPSO.   Other services will include additional electrical power generation, chemical injection,  water
treatment and injection, and system monitoring and controls.

It is anticipated that all offshore installation works, including FPSO on location, will be complete by the
end of Q2 2011.

First  production  is being targeted for Q2 2011 with estimated initial gross production  rates  of  22,000
barrels of oil per day ("bopd") (4,950 bopd net to Ithaca).

The  latest  reserves  report  issued by Sproule International Limited for year  ended  December  31  2009,
ascribed  Proved  and Probable reserves in Athena of 24.40 million barrels ("mmbbls") of  oil  gross  (5.49
mmbbls net to Ithaca).

The  Company's petroleum and natural gas reserves (the "reserves") were independently evaluated by  Sproule
(  in  accordance  with  the Canadian Oil and Gas Evaluation  Handbook  ("COGEH")  reserves
definitions  and  evaluation  practices and procedures which abide by the standards  set  by  the  Canadian
Institute of Mining, Metallurgy and Petroleum ("CIM"), as specified by National Instrument 51-101 ("NI  51-
101"). The evaluation uses Sproule's forecast prices and costs at December 31, 2009.

The Athena Joint Venture Partners are Ithaca (operator, 22.5%), Dyas UK Ltd (47.5%), EWE Aktiengesellschaft
(20%) and Zeus Petroleum (10%).

John  Woods,  Chief Developments Officer, said "The Athena Joint Venture Partners have seized a  window  of
opportunity  to develop Athena, which has been enabled by the recovery in oil price since Q3 2008.   Ithaca
as  operator  of  the Athena Development has been working closely with the engineering services  sector  to
negotiate  competitive  rates that now secure a robust project which is expected to  come  into  production
within the next two years."


Ithaca Energy:
Iain McKendrick, CEO      +44 (0) 1224 650 261
John Woods, CDO           +44 (0) 1224 650 273
Nick Muir, CXO             +44 (0) 1224 650 267

Pelham Bell Pottinger:
Philip Dennis   +44 (0) 207 337 1516
Elena Dobson    +44 (0) 207 337 1517

Cenkos Securities plc:
Jon Fitzpatrick           +44 (0) 131 220 9773
Ken Fleming                   +44 (0) 131 220 9772

In  accordance  with AIM Guidelines, Lawrie Payne, MA Marine Geology (Alberta & Columbia) and  Chairman  of
Ithaca  Energy is the qualified person that has reviewed the technical information contained in this  press

Not for Distribution to U.S. Newswire Services or for Dissemination in the United States

Forward-looking statements
Some  of  the  statements  in  this  announcement are forward-looking. Forward-looking  statements  include
statements regarding the intent, belief and current expectations of Ithaca Energy Inc. or its officers with
respect  to various matters. When used in this announcement, the words "expects," "believes," "anticipate,"
"plans,"  "may,"  "will," "should", "scheduled", "targeted", "estimated" and similar expressions,  and  the
negatives  thereof, whether used in connection with development and future production rates  or  otherwise,
are  intended  to identify forward-looking statements. Such statements are not promises or guarantees,  and
are  subject  to  risks and uncertainties that could cause actual outcome to differ materially  from  those
suggested  by  any  such statements. These forward-looking statements speak only as of  the  date  of  this
announcement. Ithaca Energy Inc. expressly disclaims any obligation or undertaking to release publicly  any
updates  or  revisions  to  any forward-looking statement contained herein to reflect  any  change  in  its
expectations with regard thereto or any change in events, conditions or circumstances on which any forward-
looking statement is based except as required by applicable securities laws.

The  term "boe" may be misleading, particularly if used in isolation. A boe conversion of 6 Mcf: 1  bbl  is
based  on  an  energy equivalency conversion method primarily applicable at the burner  tip  and  does  not
represent a value equivalency at the wellhead.

Neither TSX Venture nor it's Regulation Services Provider (as that term is defined in the policies  of  the
TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Ithaca Energy Inc.