Ithaca Energy Inc.
TSX VENTURE : IAE
AIM : IAE

Ithaca Energy Inc.

February 22, 2008 10:01 ET

Ithaca Energy: Commences Drilling and Farms Out Additional Interest in Manuel Prospect

LONDON, UNITED KINGDOM and CALGARY, ALBERTA--(Marketwire - Feb. 22, 2008) -

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Ithaca Energy Inc. (TSX VENTURE:IAE)(AIM:IAE), a Canadian independent oil & gas company with exploration and development assets in the UK North Sea, is pleased to announce it has commenced drilling of a well on the Manuel prospect and has also reduced its interest in Manuel further under a farmout arrangement with Norwest Energy. The Manuel prospect is located within block 11/29, 12 kilometers west of the Beatrice field.

The well was spudded on February 17 and is expected to take approximately 20 days to reach a depth of 6696 feet subsea to evaluate the potential of several Upper and Middle Jurassic sands. Utilizing the Galaxy II rig, the well will be drilled under tight hole status.

Under the terms of the Norwest farmout, Norwest will pay 7.5% of the cost of the well in return for a 5% interest. Consistent with Ithaca's strategy, this will reduce the company's responsibility to 52.5% of the costs while retaining a 68.4% interest in the prospect. The other participants in Manuel are Challenger Minerals 13.33% and North Sea Energy 13.33%.

Lawrie Payne, CEO commented:

"Manuel is an exciting exploratory prospect with potential for significant reserves of oil. Given the inherent risk in exploration, it is the Company's policy to farm out a portion of its interest and gain financial leverage."

Notes to Editors

Ithaca Energy Inc. (TSX VENTURE:IAE)(AIM:IAE) is an independent oil & gas company with exploration and development assets in the UK North Sea. On November 30, 2007 Ithaca announced its intention to acquire Talisman Energy's 100% share in and take of operatorship of the Beatrice field which comprises UK Offshore Licenses P187, P982 and P1031 of the United Kingdom's Continental Shelf. The transaction is expected to complete in mid 2008.

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," "anticipates," "plans," "may," "will," "should" and similar expressions, and the negatives thereof, 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, other than as required by the AIM Rules for Companies.

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

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

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