Ithaca Energy Inc.

Ithaca Energy Inc.

May 01, 2007 11:47 ET

Ithaca Energy Completes Farmout of Interest in Basil


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

Ithaca Energy Inc. (TSX VENTURE:IAE)(AIM:IAE), an independent oil & gas company with exploration and development assets in the UK North Sea, announces today that it has completed a farmout of an interest in its Basil prospect.

North Sea Energy Corporation has agreed to pay 15% of the costs of drilling and completing the Basil well, which is currently being drilled in the Inner Moray Firth area, in consideration of which, it will earn a 10% interest in block 12/21c which is a portion of Ithaca's 100% owned License P. 1392. Subject to DTI and other approvals, the resulting interests in the well and prospect will be Ithaca 90% and North Sea Energy Corporation 10%.

Through the farm-in agreement, North Sea Energy Corporation has also been granted the right to participate on the same terms in Ithaca's Triton and Zeus prospects, should Ithaca decide to drill them in the future. The farmout is a part of Ithaca's strategy of reducing cost and managing risk while maximizing its ultimate interest in the project.

Lawrence Payne, CEO of Ithaca, commented "We are delighted to establish this relationship with Energy North Sea which is a Canadian new entry into the North Sea. We look forward to a mutually beneficial relationship."

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," "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 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.

In accordance with AIM Guidelines, Lawrie Payne, MA Marine Geology (Alberta & 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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