Ithaca Acquires Certain UK North Sea Gas Interests form GDF Suez

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 that the Company has completed a transaction to acquire certain UK North Sea gas interests from GDF Suez E&P UK Ltd for an adjusted cash consideration of £6.7 million (approximately US$10.5 million) (the “Acquisition”).

The adjustment accounts for free cash flow generated by strong production throughout 2010 since the effective date of January 1, 2010.

Ithaca shall, with immediate effect, assume operatorship of the Anglia field, and the Opal and Garnet undeveloped discoveries. The Company shall assume responsibility for ongoing operations and gas sales nominations with immediate effect for the Anglia field. Ithaca has also become a non-operating partner in the producing Topaz field.

Anglia and Topaz 2010 production post the completion date shall be included in the Company’s 2010 production figures. In addition, the assets shall be independently evaluated by Sproule International Limited and  included in the 2010 year end reserves assessment of the Company.

On August 4, 2010, Ithaca Energy (UK) Limited, as the purchaser, announced that the Company had entered into an agreement to acquire certain UK North Sea gas interests from GDF Suez E&P UK Ltd for an unadjusted purchase price effective January 1, 2010 of £11.25 million (approximately US$16.9 million).

Anglia Field – Operated

Ithaca has acquired a 30% interest in and become operator of the producing Anglia Field which is located in Blocks 48/18b, 48/19b and 48/19e of the UK North Sea gas basin. Ithaca’s gas entitlement is currently contracted for the life of the field.

Topaz Field – Non Operated

Ithaca has acquired a 35% interest in the producing Topaz Field which is located in Blocks 49/1a and 49/2a in the UK Southern North Sea. Ithaca’s gas entitlement is currently sold under a contract set at the daily UK gas market price.

Garnet Field – Operated

Ithaca has acquired a 68.33% interest in and become operator of the undeveloped Garnet Field which is located in Block 44/27a in the UK Southern North Sea. The Garnet Field was discovered in 1986 and to date one well has been drilled, and one further appraisal well has been drilled off structure.

Opal Field – Operated

Ithaca has acquired a 53.84% interest in and become operator of the pre-development Opal Field which is located in Block 43/25a in the UK Southern North Sea. The Opal Field was discovered in 2005 and to date one well  has been drilled which was geologically sidetracked to appraise the limits of the field.

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Source:Ithaca Energy,  December 17, 2010;