Ithaca Energy Inc.
LSE : IAE

April 18, 2011 11:49 ET

Operational Update

FOR: ITHACA ENERGY INC.

TSX VENTURE, AIM SYMBOL: IAE

April 18, 2011

Ithaca Energy Inc. Operational Update

LONDON, UNITED KINGDOM and CALGARY, ALBERTA--(Marketwire - April 18, 2011) -

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

Ithaca Energy Inc. (TSX VENTURE:IAE)(AIM:IAE) announces an update on drilling operations and certain

operational setbacks at Beatrice and Jacky.

Both of the downhole electrical submersible pumps ("ESP") in the Jacky production well, J01, have developed

electrical faults under routine operations. Immediate plans are in effect to replace the pump units. Two ESP

units were installed in early 2009 in the original completion of the J01 well, to maintain production.

Technical experts have confirmed that both ESP units must be replaced. The well is now free flowing and gross

production from the J01 well is approximately 700 barrels of oil per day ("bopd")(approximately 335 bopd net to

Ithaca); prior to this, under ESP support gross production was approximately 2,800 bopd (1,330 bopd net to

Ithaca) as measured at the Nigg storage facility.

Drilling for the J03 well on the Jacky field has progressed, following rectification of the earlier operational

difficulties. The J03 well is now at approximately 5,400 feet measured depth and 13" casing has been set.

The Company intends to continue to free flow the J01 production well until the J03 well has reached the target

reservoir formation, the Beatrice "A" Sand, and been completed. This operation is anticipated to last until mid

May. The Northern Enhancer rig (currently located over the Jacky platform) will then be utilised to undertake a

workover operation to replace the failed ESPs in the J01 production well; this is expected to take a further 15

days. Production from the J03 well is planned to be optimised throughout the J01 work over operation period.

At Beatrice, the third workover well A28, on Beatrice Alpha, has been partially completed. The well, which was

shut in in December 2009, is currently free flowing at approximately 130 bopd gross (65 bopd net to Ithaca).

Meanwhile workover operations have transferred to well A21, the fourth and final well of the workover campaign.

On completion of the A21 well workover, operations will transfer back to well A28 to retrofit an ESP to support

production.

At the Athena development, drilling of the final development well, 14/18b-A2, is progressing on schedule. The

well has been directionally drilled to the north west of the field and is now entering the top reservoir (Top

Scapa A sands) at 8,900 feet true vertical depth subsea ("TVDSS") drilling in a sub horizontal section. A final

planned horizontal section of the well will be drilled from approximately 9,100 TVDSS. As scheduled, the

remaining drilling and completion of the well as a producer is expected to take approximately 40 days.

The Company shall await the results of the J03 drilling and J01 ESP replacement operations before it confirms

an updated overall forecast for net production in 2011. For provisional guidance purposes only, subject to

Athena first oil in November 2011, success of the J03 well and the installation of replacement ESPs in J01

well, the Company anticipates that net annual average production for 2011 will be between approximately 5,100

and 5,550 bopd excluding any contribution from the recently acquired assets, announced on April 4, 2011.

Notes to oil and gas disclosure:

In accordance with AIM Guidelines, Hugh Morel, BSc Physics and Geology (Durham), PhD Hydrogeology (London) and

senior petroleum engineer at Ithaca Energy is the qualified person that has reviewed the technical information

contained in this press release. Dr Morel has 30 years operating experience in the upstream oil industry.

About Ithaca Energy:

Ithaca Energy Inc. and its wholly owned subsidiary Ithaca Energy (UK) Limited ("Ithaca" or "the Company"), is

an oil and gas exploration, development and production company active in the United Kingdom's Continental Shelf

("UKCS"). The goal of Ithaca, in the near term, is to maximize production and achieve early production from the

development of existing discoveries on properties held by Ithaca, to originate and participate in exploration

and appraisal on properties held by Ithaca when capital permits, and to consider other opportunities for growth

as they are identified from time to time by Ithaca.

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 the estimated production levels , estimated workover periods with respect to

Beatrice, estimated time to replace the ESPs at the Jacky J01 well, , anticipated timing of the Beatrice field

development and workover campaign, estimated timing of the J03 well and Athena 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. 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.

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FOR FURTHER INFORMATION PLEASE CONTACT:

Enquiries:

Ithaca Energy:

Iain McKendrick

CEO

+44 (0) 1224 650 261

imckendrick@ithacaenergy.com

OR

Ithaca Energy:

John Woods

CDO

+44 (0) 1224 650 273

jwoods@ithacaenergy.com

OR

Ithaca Energy:

Nick Muir

CXO

+44 (0) 1224 650 267

nmuir@ithacaenergy.com

OR

Pelham Bell Pottinger Public Relations:

Philip Dennis

+44 (0) 207 861 3919

pdennis@pelhambellpottinger.co.uk

OR

Pelham Bell Pottinger Public Relations:

Elena Dobson

+44 (0) 207 861 3147

edobson@pelhambellpottinger.co.uk

OR

Cenkos Securities plc:

Jon Fitzpatrick

+44 (0) 207 397 8900

jfitzpatrick@cenkos.com

OR

Cenkos Securities plc:

Ken Fleming

+44 (0) 131 220 6939

kfleming@cenkos.com

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.

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