SOURCE: Xcite Energy Limited

February 10, 2012 08:59 ET

Xcite-Closing of second half of Private Placement

ABERDEENSHIRE, UNITED KINGDOM--(Marketwire - Feb 10, 2012) -


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


10 February 2012

Xcite Energy Limited
("Xcite Energy" or the "Company")

Closing of second half of Private Placement

Xcite Energy is pleased to announce that it has closed the second half
of its GBP25.5 million private placement (the "Placing") with Socius CG
II, Ltd. ("Socius"), a subsidiary of Socius Capital Group, LLC,
previously announced on 16 December 2011.

The Placing


The Placing occurred in two stages. The second stage, which closed
today, provides the Company with gross proceeds of GBP12.6 million
(C$19.9 million) through the issuance of 13,353,038 units (each, a"Unit")
at a price of GBP0.95 per Unit. The price per Unit is equal to
the 20 day volume weighted average price of the Shares on AIM (the "20
Day VWAP") ending on Wednesday 8 February 2012 (being two trading days
prior to the closing of the second stage of the Placing).

Each Unit comprises one ordinary share in the capital of the Company
(a"Share") and one-half of one ordinary share purchase warrant
(a"Warrant"). Each whole Warrant issued pursuant to the Placing is
exercisable for one additional Share at 120% of the Unit price per
share for three years from the date of issue. The exercise price of the
Warrants issued in the second stage of the Placing is GBP1.14.

The Warrants are subject to a forced exercise provision, at the
Company's discretion, provided that the 20 Day VWAP exceeds a 20%
premium to the Warrant exercise price and the average trading volume of
the Shares during such period exceeds one million shares. The Warrants
are subject to a cashless exchange right, exercisable at the discretion
of the holder, in the event that the 20 Day VWAP is less than the
exercise price of the Warrants. In such event, the holder may exchange
the Warrants for such number of Shares calculated by reference to the
Black-Scholes value of the Warrants divided by the last closing price
of the Shares on the AIM market of the London Stock Exchange plc
("AIM") at such time. The cashless exchange right is only exercisable
by the holder during the period commencing 20 trading days and ending
six months following the closing of the second stage of the Placing.

Additional Information

Dundee Securities Ltd. ("Dundee") acted as financial advisor to the
Company with respect to the Placing. A fee in the amount of 4.5% of the
gross proceeds of the Placing is payable by the Company to Dundee at
closing of each of the respective stages of the Placing.

The closing of this second stage of the Placing is subject to final
acceptance from the TSX-V. Except in accordance with Canadian
securities laws and with the prior written approval of the TSX-V, the
Shares underlying the Units and the Shares issuable upon exercise or
exchange of the Warrants may not be sold or otherwise traded on or
through the facilities of the TSX-V or otherwise in Canada or to or for
the benefit of a Canadian resident until the date that is four months
and one day from the date of issue.

Application has been made for admission ("Admission") to AIM of the
13,353,038 Shares underlying the Units issued in the second stage of
the Placing, and dealings are expected to commence on 13 February 2012.
The Shares shall rank pari passu in all respects with the Company's
existing issued ordinary shares of no par value. At Admission, Socius
will hold 11.7% of the Company's issued share capital.

Following Admission of the Shares issued in the second stage, the
Company's enlarged issued share capital will comprise 223,153,787
Shares with one voting right per share. There are no shares held in
treasury. The total number of voting rights in the Company is therefore
223,153,787. At Admission, the number of un-exercised Warrants issued
in the first and second stage of the Offering will be 14,274,166. In
addition, at Admission there will be 350,000 other outstanding warrants
to subscribe for Shares.

This figure of 223,153,787 Shares may be used by shareholders in the
Company as the denominator for the calculations by which they will
determine if they are required to notify their interest in, or a change
in their interest in, the share capital of the Company under the
Financial Service Authority's Disclosure and Transparency Rules or
pursuant to the AIM Rules for Companies.

This press release shall not constitute an offer for sale of the
securities referenced herein in the United States. The securities
offered have not been and will not be registered under the U.S.
Securities Act of 1933, as amended, or any state securities laws and
may not be offered or sold in the United States absent registration or
an exemption from those registration requirements.


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 7600

Emma Griffin                 Partner

Simon Edwards                Partner


Morgan Stanley (Joint Broker)                +44 (0) 207 425 8000

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.


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.


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.


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 November 15, 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.

                    This information is provided by RNS
          The company news service from the London Stock Exchange

END

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