Eni, Petroceltic Trade Reins at Carisio

Petroceltic announced an update on its activities in Italy.

Po Valley

On March 15, 2011 Petroceltic signed an agreement for the transfer of operatorship of the Carisio exploration permit (Petroceltic 47.5%) to ENI S.p.A. ("ENI"), in exchange for 550 km of existing 2D seismic data on the Ronsecco permit plus access to reprocessed 2D seismic data and other technical studies in the Carisio permit. The Carisio and Ronsecco permits are located in the Western Po Valley, Piedmont Region, approximately 30km west of the 250 mmboe ENI operated Villafortuna-Trecate oil field, one of Europe's largest onshore oil fields which has existing production facilities with spare processing capacity.

This acquired data will provide the basis for the planning of the material Rovasenda-1 well and the possible farm-out of part of Petroceltic's interest in the Carisio permit. It will also enable Petroceltic to assess the prospectivity in the adjacent Ronsecco permit (Petroceltic 100%, awarded 29th November 2010).

Petroceltic, along with its co-venturers is now planning to drill the 270 Million barrels Rovasenda exploration prospect in the first half of 2012, subject to approval by the relevant ministries and local authorities. This prospect consists of an Early Jurassic-Triassic reservoir target which is analogous to the producing reservoirs in Villafortuna-Trecate. No further seismic data acquisition is anticipated prior to the commencement of the Rovasenda-1 well.

Elsa Discovery

Activity on Petroceltic's Elsa discovery, located in the Central Adriatic B.R268.RG permit, continues to be delayed due to uncertainties in the legal interpretation of Italian Legislative Decree L.D. 128, passed into law in August 2010, which prohibits drilling in the Italian seas within 5 nautical miles of the coastline and within 12 nautical miles around the perimeter of protected Marine and Coastal Parks. This decree clearly states that it does not apply to "existing titles"; however the impact of the law on existing exploration licences is as yet unclear.

In response to this uncertainty, Petroceltic has been seeking approval from the Ministry of Economic Development ("MSE") to suspend the license until these interpretation issues have been clarified. On March 1, 2011, the MSE signed the decree suspending the B.R268.RG permit. The decree will be published in the April edition of the Ministry's monthly bulletin. Petroceltic and its partners have extended existing agreements pertaining to the farm-out of this permit, with the $26M of funding, raised for the drilling of the proposed Elsa-2 appraisal well, remaining available

Brian O'Cathain, Chief Executive of Petroceltic, commented, "These developments in the Carisio and Ronsecco permits represent a significant step forward in Petroceltic's efforts to develop a portfolio of material oil prospects in Italy. ENI's confirmation as Operator of Carisio will assist in the process of maturing the exciting Rovasenda prospect towards drilling, and may also create additional options with respect to the funding of the forward work program."