SOURCE: Xcite Energy Limited

December 01, 2011 02:00 ET

Bentley Field - Operational Update

ABERDEENSHIRE--(Marketwire - Dec 1, 2011) -


NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART
DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO
WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF
SUCH JURISDICTION



                         TSX-V, LSE-AIM: XEL



1 December 2011



                         Xcite Energy Limited

                  ("Xcite Energy" or the "Company")


                 Bentley Field - Operational Update


The Company notes the recent publication of the Addendum to the Bentley
Environmental Statement, which will be available on the Company's
website and on  www.sedar.com .

In response to feedback from the Department of Energy and Climate
Change ("DECC") on the Bentley field development plan, the Company has
re-configured its approach to the first phase of development of Bentley
to provide a more financially efficient outcome.

This re-configuration has allowed the Company to maintain the first oil
date in 2012, while enabling the completion of a more cost effective
field development plan. The principal elements of this plan are Phase
1A with first oil planned for 2012, Phase 1B planned for 2013 and Phase
2 estimated to commence in 2016. The Company understands that the plan
is in the final stages of DECC approval.

If DECC approval is obtained, the financial resources to commence Phase
1A are available. The Company continues to make good progress with
respect to securing additional sources of funding, including project
finance from commercial lending banks.

Whilst adopting this more financially efficient approach to Phase 1,
the Company intends to pre-invest substantially in Phase 1B and Phase
2, with the objective of lowering the unit cost of oil produced and,
thus, maximising the commercial industry value of the Bentley asset in
advance of Phase 1B.

Management considers that this re-configuration of the Phase 1
production and financial plans for the Bentley field should maximise
shareholder value. Further announcements will be made to the market as
soon as practicable.



ENQUIRIES:
Xcite Energy Limited
                                                 +44 (0) 1483 549 063
Richard Smith                Chief Executive
                             Officer
Rupert Cole                  Chief Financial
                             Officer


Oriel Securities (Joint Broker and Nomad)        +44 (0) 207 710 7600Emma
Griffin                 Partner
Simon Edwards                Partner


Morgan Stanley (Joint                            +44 (0) 207 425 8000
Broker)
Andrew Foster                Managing Director


Pelham Bell Pottinger                            +44 (0) 207 861 3232
Mark Antelme                 Director
Henry Lerwill                Account Director


Paradox Public Relations                            +1 514 341 0408
Jean-Francois Meilleur       Consultant


Neither the TSX Venture Exchange nor its 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.

Notes to editors - Phase 1 and Phase 2 Information

Phase 1A comprises the drilling of and production from the first
motherbore well and associated laterals on Bentley, prior to the final
design and optimisation of Phase 1B. The produced oil will be
transferred via a pipeline to a dynamically positioned shuttle tanker,
in which a diluent crude oil will be present and thus enabling blending
tests to be undertaken for marketing and offtake purposes.

Phase 1B is planned to comprise a permanent, normally unattended,
minimum facilities, lightweight wellhead tower, capable of
accommodating up to 12 drilling risers and remaining throughout the
rest of field life. Four additional production motherbore wells will
initially be drilled with their associated laterals which, together
with the well drilled in Phase 1A, will provide the basis for the
remainder of Phase 1 production. Crude oil will be produced to an FPSO
via a subsea pipeline, with export via a shuttle tanker. The intention
is to run Phase 1B for approximately 3 years, with the additional riser
and potential production capacity providing significant flexibility.

Phase 2 remains as previously planned, with a further permanent
production platform comprising full processing, drilling and
accommodation facilities for the balance of life of field production.

Morgan Stanley which is authorised and regulated in the United Kingdom
by the Financial Services Authority, is acting exclusively for Xcite
Energy and for no one else in connection with the subject matter of
this announcement and will not be responsible to anyone other than
Xcite Energy for providing the protections afforded to its clients or
for providing advice in connection with the subject matter of this
announcement.

Oriel Securities which is authorised and regulated in the United
Kingdom by the Financial Services Authority, is acting exclusively for
Xcite Energy and for no one else in connection with the subject matter
of this announcement and will not be responsible to anyone other than
Xcite Energy for providing the protections afforded to its clients or
for providing advice in connection with the subject matter of this
announcement.


Forward-Looking Statements

Certain statements contained in this announcement constitute
forward-looking information within the meaning of securities laws.
Forward-looking information may relate to the Company's future outlook
and anticipated events or results and, in some cases, can be identified
by terminology such as "may", "will", "should", "expect",
"plan","anticipate", "believe", "intend", "estimate", "predict",
"target","potential", "continue" or other similar expressions concerning
matters
that are not historical facts. These statements are based on certain
factors and assumptions including expected growth, results of
operations, performance and business prospects and opportunities. While
the Company considers these assumptions to be reasonable based on
information currently available to us, they may prove to be incorrect.
Forward-looking information is also subject to certain factors,
including risks and uncertainties that could cause actual results to
differ materially from what we currently expect. These factors include
risks associated with the oil and gas industry (including operational
risks in exploration and development and uncertainties of estimates oil
and gas potential properties), the risk of commodity price and foreign
exchange rate fluctuations and the ability of Xcite Energy to secure
financing. Additional information identifying risks and uncertainties
are contained in the Company's annual information form dated October
26, 2010 and in the annual Management's Discussion and Analysis for
Xcite Energy dated March 24, 2011 filed with the Canadian securities
regulatory authorities and available at  www.sedar.com . The Company
disclaims any intention or obligation to update or revise any
forward-looking statements whether as a result of new information,
future events or otherwise, except as required under applicable
securities regulations.











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