IAE Ithaca Energy Inc.

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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