Ithaca Energy Inc announces Operations Update

Ithaca Energy Inc announces Operations Update 
ABERDEEN, SCOTLAND -- (Marketwired) -- 06/27/13 --  Ithaca Energy Inc
(TSX VENTURE: IAE) 


 
 
Not for Distribution to U.S. Newswire Services or for Dissemination in
the United States
 
                            Ithaca Energy Inc.
 
                            Operations Update
 
                               27 June 2013
 
Ithaca Energy Inc. (TSX: IAE, LSE AIM: IAE) ("Ithaca" or the "Company")
reports estimated second quarter 2013 production results and provides
an operational update ahead of its 2013 Annual and Special Shareholders
Meeting.
 
Highlights
 
* Net average export production in the second quarter of 2013
("Q2-2013" or the "quarter") for the combined pro-forma Ithaca and
Valiant Petroleum plc ("Valiant") entities is anticipated to be
approximately 14,000 barrels of oil equivalent per day ("boepd"). This
includes the impact of planned shutdowns during the quarter.
 
* Total forecast production for the second half of 2013 ("H2-2013")
is forecast to be within the Company's guidance range of 14,000 to
16,000 boepd.
 
* A number of production enhancement activities, notably on the Dons
and Causeway Area fields, are scheduled to boost net production for
H2-2013.
 
Q2-2013 Production
With three days to the end of the quarter, net export production in
Q2-2013 is anticipated to be close to 14,000 boepd, including a full
quarter's pro-forma contribution from the assets acquired as a result
of the Valiant acquisition. Oil production is forecast to account for
approximately 95% of the total.
 
The fields produced strongly during the quarter, although, as
anticipated, production was impacted by planned maintenance shutdowns
on a number of assets, including the Company's operated Beatrice Area
infrastructure (approximately 25 days) and Anglia, together with the
non-operated Topaz field. Scheduled shutdowns were also incurred on
the Shell operated Anasuria floating production, storage and offloading
vessel that serves as the host facility for the Cook field to enable
the re-start of production from another field that uses the vessel.
 
Operations Update
Dons
Infill drilling activities are currently on-going on the EnQuest
operated Don Southwest field. An additional production well on the
field has just been completed and is being brought online over the next
few days through the "Northern Producer" host facility infrastructure.
The rig is currently preparing to commence drilling of a water
injection well in the same area of the field, to support production and
reserves recovery from that area.
 
Athena
During the quarter the Athena field completed its first full year of
operations, with gross production of over 3.6 million barrels having
been produced to date.
 
Gross daily production from the field is currently at a reduced level,
primarily as a function of one of the four producing wells, the "P2"
well, being temporarily shut-in awaiting a repair to the electrical
cable serving that particular well. A diving support vessel has been
contracted to perform the necessary operations to fix the electrical
fault and reinstatement of production from the well is anticipated
within the next few weeks.
 
During the quarter, the Athena field commenced the production of water
with oil. This is significantly later than originally anticipated. As
previously noted, the evolution of the water production profile will
now provide important information for forecasting the ultimate field
production profile and the scope for future potential upside investment
opportunities.
 
Causeway Area
Drilling activities on the Causeway water injection well and the Fionn
production well were completed in March 2013, prior to completion of
the Valiant acquisition on 19 April 2013. Since taking control of the
assets, the Company has completed the subsea tie-in works required to
enable the Fionn well to be put into production and is working closely
with Taqa, the operator of the Causeway Area host infrastructure, to
facilitate start-up of the installed electrical submersible pumps
("ESPs") and (Causeway) water injection as soon as practicable.
 
The flow tests that have been performed on the Fionn well since
completion of the subsea tie-in works have confirmed that the well has
the potential to flow at considerably better rates if sidetracked to a
more optimal location (the well is a re-completed appraisal well).
 
The Company has decided to utilise a rig option originally held by
Valiant to sidetrack the Fionn well. It is anticipated that drilling
operations will commence towards the end of 2013. The well will be
sidetracked to a location updip of the existing well to better optimise
access to the prime reservoir formation and to target potential upside
reserves in a secondary reservoir.
 
H2-2013 Production Outlook
Total forecast production for H2-2013 is expected to be within the
Company's guidance range of 14,000 to 16,000 boepd, supported by
production enhancement activities notably on the Don Southwest field.
 
Production in H2-2013 will be impacted by the second phase of planned
maintenance shutdown activity on the host facilities serving the
Company's fields. Most significantly, there will an approximately six
week shutdown of the Causeway Area fields as a result of maintenance
activities on the Taqa operated Cormorant infrastructure that serves
the fields.
 
Appointment of Norwegian General Manager
Building upon the Company's previously announced success in the recent
Norwegian 22nd Licensing Round, the Company is also pleased to announce
that it has appointed a new General Manager of its Norwegian
subsidiary; details of which will be announced upon the new General
Manager joining the Company. This demonstrates the Company's
continuing commitment to a focused strategy on the Norwegian
Continental Shelf.
 
Annual & Special Shareholders Meeting Presentation
A short presentation covering the Company's on-going operational and
corporate activities will be given at the 2013 Annual & Special
Shareholders Meeting that is scheduled to be held today at 2.p.m (local
time) in Calgary, Canada. The presentation will be made available on
the Company's website (www.ithacaenergy.com) immediately prior to the
meeting. The presentation contains unchanged data on future production
and cashflows. Updated information on the future oil price hedges
executed by the Company is included in the presentation.
 
Enquiries:
 
Ithaca Energy:
Iain McKendrick, imckendrick@ithacaenergy.com        +44(0) 1224 650 261
CEO
Graham Forbes,   gforbes@ithacaenergy.com            +44(0) 1224 652 151
CFO
 
FTI Consulting:
Billy Clegg      billy.clegg@fticonsulting.com      +44 (0) 207 269 7157
Edward Westropp  edward.westropp@fticonsulting.com  +44 (0) 207 269 7230
Georgia Mann     georgia.mann@fticonsulting.com     +44 (0) 207 269 7212
 
Cenkos Securities plc:
Jon Fitzpatrick  jfitzpatrick@cenkos.com            +44 (0) 207 397 8900
Neil McDonald    nmcdonald@cenkos.com               +44 (0) 131 220 6939
RBC Capital Markets:
Tim Chapman      tim.chapman@rbccm.com              +44 (0) 207 653 4641
Matthew Coakes   matthew.coakes@rbccm.com           +44 (0) 207 653 4871
 
Notes to Oil & Gas Disclosures
In accordance with AIM Guidelines, John Horsburgh, BSc (Hons)
Geophysics (Edinburgh), MSc Petroleum Geology (Aberdeen) and Subsurface
Manager at Ithaca is the qualified person that has reviewed the
technical information contained in this press release. Mr Horsburgh
has over 15 years operating experience in the upstream oil and gas
industry.
 
The term "boe" may be misleading, particularly if used in isolation. A
boe conversion of 6 Mcf: 1 bbl is based on an energy equivalency
conversion method primarily applicable at the burner tip and does not
represent a value equivalency at the wellhead.
 
About Ithaca Energy
Ithaca Energy Inc. (TSX: IAE, LSE AIM: IAE) is an oil and gas operator
focused on North Sea production, appraisal and development activities.
The Company's strategy is centred on building a highly profitable North
Sea oil and gas company by maximising production and cashflow from its
existing assets, the appraisal and development of existing discoveries
on properties held by the Company and the delivery of additional growth
via acquisitions and licence round participation.
 
    Not for Distribution to U.S. Newswire Services or for Dissemination
    in the United States
 
Forward-looking statements
Some of the statements and information in this press release are
forward-looking. Forward-looking statements and forward-looking
information (collectively, "forward-looking statements") are based on
the Company's internal expectations, estimates, projections,
assumptions and beliefs as at the date of such statements or
information, including, among other things, assumptions with respect to
production, drilling, well completion times, future capital
expenditures, future acquisitions and cash flow. The reader is
cautioned that assumptions used in the preparation of such information
may prove to be incorrect. When used in this press release, the
words"anticipate", "continue", "estimate", "expect", "may",
"will","project", "plan", "should", "believe", "could", "target" and
similar
expressions, and the negatives thereof, whether used in connection with
operational activities, production forecasts, budgetary figures
contained in the corporate presentation, potential developments or
otherwise, are intended to identify forward-looking statements. Such
statements are not promises or guarantees, and are subject to known and
unknown risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in such
forward-looking statements. The Company believes that the expectations
reflected in those forward-looking statements and are reasonable but no
assurance can be given that these expectations, or the assumptions
underlying these expectations, will prove to be correct and such
forward-looking statements and included in this press release should
not be unduly relied upon. These forward-looking statements speak only
as of the date of this press release. 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.
 
                                -ENDS-
 
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