UK: Ithaca Energy Inc. 3rd Q 2010 Production and A04 Workover Update

Ithaca Energy Inc.  and its wholly owned subsidiary Ithaca Energy (UK) Limited , an independent oil & gas company with exploration, development and production assets in the UK sector of the North Sea, announces third quarter production and the completion of the first workover in a five well workover campaign on Beatrice Alpha.

Production in the third quarter averaged 10,125 barrels of oil per day (“bopd”) gross (4,862 bopd net to Ithaca) with the first of a five well workover programme now complete (“the A04 well”). The production figure represents a slight reduction over second quarter production of 10,217 bopd gross (4,914 bopd net to Ithaca). Further to strong production from the Beatrice Complex in July, production during the months of August and September was marginally tempered by A04 being non-productive during the intervention. Further production time was lost (1.5 days) due to a power supply outage from the mainland to the Beatrice Alpha platform. In addition, during September, production from Jacky was halted for 2 days to allow a chemical ‘squeeze’ operation which has successfully protected the reservoir productivity from potential scale damage.

The Beatrice Complex average daily sales volumes for the period as measured at the Nigg storage facility are summarised as follows: Gross (bopd) Net to Ithaca (bopd) Average Q3 2010 10,125 4,862 July 10,852 5,211

August 10,033 4,816 September 9,489 4,560 The average realised price for production in July was $75.648/bbl and in August was $76.294/bbl (before any additional price uplift at the point of sale to a third party).  Deliveries for September are currently being priced. The first of a five well workover campaign on the Beatrice Alpha platform (consisting of the replacement of tubulars and downhole pumps) has now been completed. The A04 well has been brought back on line and is now being flowed as part of ‘clean-up’ operations following the workover ‘shut-in’ period. A further production update will be provided as flow rates stabilise.

The Jacky field continues to perform above expectation. Detailed technical work is ongoing  using the production history to date to determine where additional potential lies within the field.

Partners in the Jacky field are Ithaca (47.5%), Dyas UK Ltd (42.5%) and North Sea Energy (UK) Ltd (10%).

Joint Venture Partners in the Beatrice Field, including Beatrice Bravo are Ithaca (50%) and Dyas UK Ltd (50%).

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Source:Ithaca Energy , October 7, 2010;