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 today that it has signed
an Earn In agreement with Challenger Minerals (North Sea) Limited ("CMI") on the
Hurricane discovery ("Hurricane") in Block 29/10b, within the Ithaca operated
Greater Stella Development Area.


Hurricane was discovered in 1995 by well 29/10-4Z which tested the western lobe
of a mapped structure and encountered light oil (41 degrees API) in a 62 foot
section of reservoir sands; no drill stem test was undertaken at that time. The
Hurricane appraisal well is being designed to confirm hydrocarbons in the
eastern lobe of the structure characterized by high porosity (up to 30%)
channelised Paleocene Rogaland sandstones. On successful appraisal of Hurricane
by the initial well, the intention is to drill a sidetrack 'keeper' well up
structure in anticipation of future development and tie back to the Stella hub.


Under the terms of the Earn In agreement, CMI is committed to pay a share of
costs of the initial well in Block 29/10b. In consideration for this commitment
CMI is provided with an option, exercisable no later than 90 days following
abandonment or suspension of the initial appraisal and any sidetrack well, to
take an interest in Block 29/10b. Under the Earn In arrangements, CMI will pay
40% of gross Hurricane initial appraisal well costs in exchange for a 31% equity
interest in Block 29/10b, thereby carrying a part of Ithaca's share of all costs
of drilling an initial appraisal well. In addition, upon successful appraisal,
CMI will pay 40% of gross costs of a drill stem well test of any sidetrack. All
additional costs, including those for planned sidetrack drilling, shall be
apportioned such that CMI shall pay its 31% pro rata share.


The transaction is subject to agreeing 'turnkey' terms with Applied Drilling
Technology International ("ADTI") (a subsidiary of Transocean Inc.) for the
provision of a suitable drilling unit and well management services. Upon
agreement of 'turnkey' terms and provision of a suitable rig, Ithaca anticipates
that the appraisal well will be commenced in Q4 2011.


Ithaca currently holds 100% equity interest in the Hurricane discovery and Block
29/10b.


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, including the earn-in with CMI. When used in this announcement, the
words "expects," "believes," "anticipates," "plans," "may," "will," "should",
scheduled, targeted, estimated and similar expressions, and the negatives
thereof, whether used in connection with estimated production levels,
anticipated drilling operations and results therefrom, CMI's option to earn-in
to Hurricane 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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