Ithaca Energy Inc.
TSX VENTURE : IAE
AIM : IAE

Ithaca Energy Inc.

September 21, 2010 02:00 ET

Ithaca Energy Inc.: Athena Field Development Plan Approved

LONDON, UNITED KINGDOM and CALGARY, ALBERTA--(Marketwire - Sept. 21, 2010) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Ithaca Energy Inc. (TSX VENTURE:IAE)(AIM: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 it has received Field Development Plan ("FDP") approval from the UK Department for Energy and Climate Change ("DECC") for the Athena oil field.

Gaining FDP approval is a very significant step towards securing first production from the field, which is planned for Q3 2011 at 22,000 barrels of oil per day ("bopd") (4,950 bopd net to Ithaca) following an independent evaluation of the Company's petroleum and natural gas reserves by Sproule International Limited (www.sproule.com). The Athena field is operated by Ithaca.

Iain McKendrick, Chief Executive Officer, commented:

"Since announcing the launch of the Athena development in February of 2010, Ithaca and its Joint Venture partners have worked tirelessly to negotiate contracts that secure a robust development. Ithaca Energy is now in a great position to deliver the next phase of the Athena project, which will involve development drilling and fabrication to meet first production targeted in Q3 2011. FDP approval is a major milestone for any development and testament to the ability and dedication of the Company's development team and exceptional cooperation between the Joint Venture partners."

Notes:

The Company can now continue to swiftly progress the execution of the project which involves engineering and fabrication, and installation in the North Sea, 180 kilometres northeast from Aberdeen.

The initial development consists of four production wells supported by one water injection well. Production will be routed via the subsea manifold and a two kilometre, 8 inch flowline to a stand-alone floating production, storage and offloading ("FPSO") vessel. Oil production will be exported via shuttle tankers. Produced gas will be used to generate power on the FPSO.

On September 9, 2010, the Company announced the award of two major contracts; the provision of an FPSO and the provision of a semi-submersible drilling. Most principle suppliers to the project have now been selected after a competitive bid process.

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

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

Forward-looking statements:

Some of the statements in this press release 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, including, without limitation, the development of Athena, estimates of oil and gas reserves and associated future production and plans of the Company. When used in this press release, the words "expects," "believes," "anticipate," "plans," "may," "will," "should", "scheduled", "targeted", "estimated" and similar expressions, and the negatives thereof, whether used in connection with the estimated production levels, anticipated time of first oil, oil in place, hydrocarbon composition 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, including the risk that the Athena project may not proceed on the terms described herein or at all and the risk that the future benefits and anticipated production by the Company are not realized. 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.

Neither 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.

Contact Information