Ithaca Boosts Gross Production Rates at Jacky Field in UK North Sea

Ithaca and its wholly owned subsidiary Ithaca Energy (UK) Limited has started operating the downhole pump on the Jacky field, increasing gross production rates to approximately 10,000 barrels of dry oil per day (bopd) (6,728 bopd net to Ithaca). This rate is significantly above the levels expected from the field with both the well and the reservoir performing strongly.

The Jacky field came on stream on April 6th at initial rates of approximately 8,800 bopd (gross). Downhole pressures and deliverability were above expectations and as a result the activation of the downhole pump was delayed in order to protect it. With the pressure having now fallen it has been possible to start operating the pump.

Average production in April and May (to date ) from Jacky and Beatrice (Bravo and Alpha facilities) was lower than the initial rates experienced due to the fall in downhole pressure from Jacky; constraints from ongoing commissioning and well maintenance work at Beatrice; and a portion of initial Jacky production contributing to fill the infield and export pipelines. As such in April the average Jacky and Beatrice volumes arriving at the Nigg Oil Terminal were 4,740 bopd (3,294 net to Ithaca) and in May, prior to switching on the downhole pump at Jacky, production from Jacky and Beatrice was approximately 5,390 bopd (3,710 bopd net to Ithaca). These numbers compare with expectations, prior to Jacky field startup, of 7,500 bopd gross (5,054 bopd net to Ithaca).

Commissioning and maintenance work is now drawing to a close and the Beatrice and Jacky facilities are currently producing at combined rates of approximately 11,500 bopd (7,850 bopd net to Ithaca) and will quickly make up the production deficit from April and May.

An update on capital expenditure for Jacky will be included in the Company's report on results for the first quarter to March 31, 2009.

Partners in the Jacky field are Ithaca (67.275%), Dyas UK Ltd (22.725%) and North Sea Energy (UK) Ltd (10%).

Partners in the Beatrice Field are Ithaca (74.75%) and Dyas UK Ltd (25.25%).