Final Results

PETROCELTIC INTERNATIONAL PLC

RESULTS FOR THE TWELVE MONTHS ENDED 31 DECEMBER 2010

Petroceltic International plc ("Petroceltic" or "the Company"), the independent oil & gas exploration company focussed on the Middle East-North Africa ("MENA") and Mediterranean region today announces its results for the year ended 31 December 2010.

Highlights:

·; 6.1 TCF Petroceltic estimate of most likely gas resource in place in the Isarene permit area, Algeria

·; Appraisal drilling phase commenced in Algeria to complete before end of 2011

·; Preferred partner for Algerian farm-out identified and transaction submitted for approval to Algerian authorities

·; Fully carried 2 well exploration drilling programme completed on the Ksar Hadada permit in Tunisia

·; Strong investor base following successful US$120.5 million share placing in April 2010. Cash of US$82.2 million at year end and cash held as at 31 March 2011 is US$66.3 million

·; Strengthening of the Board with the appointment of Tom Hickey as Corporate Development Director

·; Additional high impact exploration and production opportunities under review

·; Loss before tax increased to US$12.6 million (2009 US$6.1 million), primarily due to the write-off of exploration costs associated with the withdrawal from the Ksar Hadada permit

Robert Arnott, Chairman of Petroceltic commented:

"2010 was a year of solid progress for Petroceltic despite challenging circumstances. The Company has put in place the resources to exploit its world class discovery in Algeria and the underlying strategy and investment case remains strong. The Company is well positioned to add value within its existing business through an on-going exploration and appraisal programme, and is continuing to explore opportunities to expand its portfolio in areas that exploit the strengths of our team."

Press Enquiries to:

Brian O'Cathain/ Alan McGettigan, Petroceltic International Tel: +353 (1) 421 8300

Philip Dennis / Jenny Renton, Pelham Bell Pottinger Tel: +44 (20) 7861 3919

Joe Murray / Joe Heron, Murray Consultants Tel: +353 (1) 498 0300

Hugh McCutcheon / John Frain, Davy Tel: +353 (1) 679 6363

Chairman and Chief Executive's Statement

Adding Value in Algeria

In Algeria in early 2010, Petroceltic completed a five-well drilling programme which resulted in the discovery of the world class Ain Tsila gas condensate discovery with internal estimates of most likely gas initially in place of 6.1 TCF. A two year appraisal period, ending in April 2012, was agreed with the Algerian authorities and a multi well appraisal programme commenced in November 2010. The first well successfully confirmed the extension of the field to the east and has increased the proven area and calculated gas-initially-in-place. On the second well of the campaign, the mud losses while drilling and log results on the pilot hole all indicate the interval is highly fractured with some of these being open natural fractures whilst also showing the objective Ordovician reservoir to be fully gas bearing. Over the next twelve months Petroceltic plans to further de-risk the discovery through the on-going appraisal programme, the negotiation of a gas sales contract and the completion of a field development plan.

 In order to manage its investment obligation to the Algerian asset, during 2010 the Company initiated discussions with third parties with the aim of bringing in a strong industry partner who can contribute to the long term development of the asset. Petroceltic has submitted a proposed farm-out transaction to the competent authorities and is awaiting their formal response, which is expected in the near future. The commercial effect of the transaction, if approved, will be to provide Petroceltic with a refund of certain historic costs incurred, as well as a substantial carry on the current appraisal drilling programme. Additional consideration may also become payable based on the results of the programme.

Notwithstanding the political events that are occurring in North Africa and across the Middle East, Algeria has remained stable and largely unaffected by unrest while Petroceltic's operations have progressed without interruption. However, the Board will continue to monitor the situation and respond accordingly should circumstances change.

Progress in Italy

In Italy, plans are progressing to drill an onshore well on the large Rovasenda oil prospect located on the Carisio permit early in 2012. As part of the preparations for drilling of the well, the operatorship of the license has recently been transferred from Petroceltic to ENI, in exchange for access to a substantial database of proprietary ENI seismic data in the area of the Carisio licence. The drilling of the Rovasenda prospect is a potential company-changing event, and the management team is focused on delivering this well in 2012.

Elsewhere in Italy, Petroceltic focussed its efforts on the offshore Elsa field in licence B.R268.RG where a well was due to be drilled in the fourth quarter of 2010. However, an unexpected change in Italian environmental legislation announced in June, in the aftermath of the Macondo oil spill in the Gulf of Mexico, resulted in an effective ban on all drilling within 5 nautical miles of the coastline and 12 miles of protected marine areas. This change has prevented the well from being drilled, and the licence has subsequently been suspended, pending clarification of the new legislation, thus preserving the value of the licence. Although the industry is actively lobbying the Italian Government to reverse the change in legislation it is unlikely the well will be drilled in the next 12 months. However, it is likely that recent events in North Africa will serve to highlight the importance of development of European indigenous resources for security of supply reasons, and we remain optimistic that Italian legislation will permit the development of shallow water offshore oil and gas fields again in the near future.

Exploration Programme Completed in Tunisia

In Tunisia, a two well exploration programme was completed on the Ksar Hadada permit. The two wells designed to test the Sidi Toui and Oryx prospects were unsuccessful with neither well finding commercial hydrocarbons. The Company's operations in Tunisia were fully carried as a result of a farm-out agreement with PetroAsian Energy Holdings Ltd, a Hong Kong listed company. Following these two wells the Company no longer has any current interests in the country, and has relinquished its interest in the Ksar Hadada permit.

Successful Placing and Strong Investor Base

Cash and cash equivalents at the year-end were US$82.2m and the Company had no bank debt. This followed the successful share placing completed in April 2010, which raised net proceeds of US$118.9m for the Company.

In January 2010 Iberdrola S.A. informed the Board that, in line with its general asset disposal programme designed to realise €2.5 billion in divestments of non-core assets, it wished to dispose of its investment in Petroceltic, and, with the agreement and active support of Petroceltic, successfully placed its 15.7% holding with a consortium of our existing investors. The combination of the Iberdrola placing and the further share placing in April 2010 have considerably strengthened the Company's shareholder base with many large institutional investors now occupying prominent positions on the Company's shareholder register and we look forward to their continued support at this exciting phase in the Company's growth.

Revenue from the Kinsale gas fields in 2010 increased slightly to US$270k (2009: US$210), with marginally higher gas prices offsetting lower production. The Company's loss for the year increased to US$12.6m (2009: US$6.1m) primarily due to the write-off of historical exploration costs associated with the withdrawal from the Ksar Hadada permit in Tunisia. These expenses mainly relate to activities prior to the PetroAsian farm-out in 2009.

A Strengthened Board

The Board was pleased to appoint Tom Hickey as Corporate Development Director in November. Tom brings with him a wide range of skills and experience gained during his long service as CFO of Tullow Oil where his tenure coincided with a hugely successful period for that company. Tom's appointment underlines Petroceltic's ambition to continue to grow its business over the coming years and significantly increases our capacity for deal-making and execution.

Focus on Corporate Governance, HSE, and Business Ethics

The Petroceltic Board recognises the importance of good Corporate Governance and is committed to business integrity across the Group's activities, which it views as an integral part of managing the Group's business. The Company is committed to the highest ethical standards in all aspects of business and expects the same from its employees, contractors and agents worldwide. We comply with relevant national and international laws and act in accordance with local operational guidelines and regulations, including those which are industry specific. We try to create value for our stakeholders and fulfil the obligations we have in the countries where we operate and towards those with whom we have dealings: employees, business partners, suppliers, competitors, host governments, shareholders and the community at large. We recognise that our reputation for behaving well and doing the right thing enables us to access new business opportunities, to partner with new host governments and ultimately build lasting relationships with countries, communities, partners and all other stakeholders, which are the key components of value creation in oil and gas exploration and development.

In Health, Safety and Environmental policy, we set targets for HSE performance, and monitor performance in all areas. In 2010, we had 431,472 million operational manhours, with 1 lost time incident, giving a lost -time incident frequency of 2.31 per million man-hours.

In 2010, we reviewed and strengthened the terms of reference for all Board committees, and published these on our website. The Board has also conducted a board effectiveness review, and continues to review methods and practices to make the Board more effective, and to provide entrepreneurial leadership to the Company, within an effective overall control structure which enables risk to be accurately identified, assessed and mitigated.

A Year of Growth in a Changing Environment

2010 was a challenging year as the Company focussed on delivering the next phase of the Algerian appraisal programme but was frustrated in its planned exploration programme in Italy. 2011 has begun positively with two successful appraisal wells in Algeria. We are happy that the results of the appraisal programme, allied to the initiation of the gas marketing discussion and pre-development planning will result in a substantial increase in the value of the Ain Tsila asset during 2011.

Petroceltic has strong growth ambitions and we will continue to complement our organic growth programme by continuing to pursue corporate and asset acquisition opportunities appropriate to our resources and strategy. However, the Board will remain vigilant with regard to the changing political conditions that are sweeping the Middle East - North Africa regions and pay particular attention to balance the risks involved with the potentially exciting opportunities that may become available.

We would like to thank Petroceltic's shareholders for the strong support which they have shown for the Company during the last twelve months. We are optimistic that this support will be rewarded with growth in shareholder value in the coming year when we hope to demonstrate the value in our existing assets and take advantage of the growth opportunities in our area of focus.

We would also like to thank Petroceltic's staff and contractors, our partners and other stakeholders for all their hard work and loyal support in bringing the Company to this exciting stage in its development and we look forward with considerable optimism to the years ahead.

On behalf of the Board of Directors.

Robert Arnott Brian O'Cathain

Chairman Chief Executive

Financial Review

Petroceltic delivered a solid financial performance in 2010, raising US$120.5m in April to fund the 2010 work programmes in Algeria and Italy, and to provide financial flexibility going forward into 2011. In Italy, prior to the postponement of operations, the Company raised over 70% of the funds needed to drill the Elsa-2 well through a 15% farm-out to Orca Exploration Group Inc. and a US$14m Investment Agreement with Gemini Oil & Gas. The Group ended the year with US$82.2m in cash (2009: US$33.7m) and cash held as at 31 March 2011 is US$66.3 million.

Capital Expenditure

Capital expenditure in the year was US$45.8m (2009: US$79.9m). A total of US$41.2m (2009: US$76.5m) was invested in the Isarene permit in Algeria. Of the remaining US$4.6m, US$2.7m was invested in Italy, primarily to prepare for the drilling of the Elsa-2 well and US$1.9m was invested in new ventures and a Group-wide systems and IT infrastructure upgrade. The Group incurred minimal investment in a two-well programme on the Ksar Hadada permit in Tunisia due to US$15.7m incurred by other partners who carried the Company through the programme.

Finance Income

Finance income for the year increased modestly to US$1.9m (2009: US$1.85m). Interest income also increased modestly in the year to US$1.0m (2009: US760k) due to increased cash at bank. Foreign currency gains declined US$216k to US$880k (2009: US$1.1m).

Net Loss

The net loss for the year attributable to equity holders of the Company increased by US$6.5m to US$12.6m (2009: US$6.1m). Diluted loss per share was 0.69 cents. Revenue generated by the Company's Kinsale Royalty increased to US$270k (2009: US$210k) primarily due to an increase in the weighted average gas price in the year to €4.93/mcf (2009: €3.55/mcf). Administrative expenses increased by US$808k to US$6.3m (2009: US$5.5m) as the Company expanded its technical capability. Exploration costs written off increased by US$5.7m to US$7.0m (2009: US$1.3m), due almost entirely to the write off of the Company's Ksar Hadada license in Tunisia.

Placing of Iberdrola Shares

In January of 2010, Iberdrola sold 215,769,231 ordinary shares, being all of its 15.68 per cent shareholding in the Group. The Iberdrola shareholding was subject to a lock-in arrangement and in exchange for the Company's consent to allow Iberdrola to place this stake, Iberdrola agreed to the early termination of its option to acquire a 49% interest in any of the Group's upstream assets. The Company agreed to the repayment of the US$7.3 million option fee initially paid by Iberdrola in January 2009. The placing was co-ordinated by Petroceltic's brokers Mirabaud and Davy. The shares were placed with a group of existing and some new Petroceltic shareholders at 16p per share.

Successful US$120.5 million Equity Fund Raising

On the 29th March 2010, the Company announced that it had conditionally raised gross proceeds of approximately US$120.5 million (Stg£81.0 million) by way of a placing of 635,294,000 new Ordinary Shares at a price of Stg12.75p per share. The placing was co-ordinated by Petroceltic's brokers Mirabaud and Davy and was completed in April 2010. The shares were placed with both existing and new institutional shareholders and proceeds were used to support the Company's appraisal programme in Algeria, to fund proposed drilling activities in Italy and for general corporate purposes.

Successful US$14 million Gemini Investment Agreement

On the 1st June 2010 the Company signed an investment agreement with Gemini Oil & Gas Fund II LP, a specialist oil & gas investment fund. Under the terms of the agreement, Gemini has agreed to provide US$14 million towards funding for the Elsa-2 well. In the event of success, Petroceltic has agreed to provide Gemini with an entitlement to receive a proportion of the revenues derived from oil and gas production from the Elsa field. In the event of failure, Gemini will receive no return on its investment. Following the postponement of the Elsa-2 well, Gemini have further agreed to extend the investment agreement.

Treasury and Liquidity

The Board sets out the treasury policies and objectives of the Company. In general the policies reflect the current development stage of the Company and thus focus primarily on capital raising, cash management and financial risk. The policies ensure that the Company's deposit terms are reviewed and optimised on an on-going basis and that capital is held with a diverse group of banks, but only those who meet the Company's long and short term credit rating standards.

The Company's budget is presented to the Board each year for approval. Prior to approval, the Board ensures the Company can continue to meet its liabilities as they fall due. Throughout the year, monthly performance against budget is prepared and reported by management at each board meeting. Increases to the budget over US$500k are brought to the Board for approval. Any material changes to the phasing of the budget spend must also be brought to the notice of the Board.

Investor Relations

The Company actively manages investor relations through regular meetings and telephone calls with market analysts and institutional investors, as well as interviews with journalists and presentations at national and international conferences. The Company keeps a record of meetings and calls held with institutional holders and during 2010 presented at ten conferences and met face to face with over one hundred institutional investors. In the year the Company increased its analyst research coverage with the addition of Goodbody Stockbrokers (Dublin) and GMP Securities (London).

Accounting Policies

The Company and Group's accounting policies and standards comply with IFRS as adopted by the EU and as required by the rules of the AIM and the ESM.

Preparing for Algerian Partnership

During 2010, there has been a significant increase in activity in the finance function. The Company has responded by strengthening the finance team in Dublin, as well as adding support in Algeria. In preparation for the introduction of a new Joint Venture partner in Algeria, the Company has deepened its cost accounting and reporting framework, streamlined its workflows and revised and codified its standard financial and accounting procedures.

Principal Risks and Uncertainties

The Company and Group have a risk management structure in place which is designed to identify, manage and mitigate business risk. A Risk Register is maintained by the group and updated on a monthly basis.

The main objective of the finance function is to provide a flexible financial organisation that helps leadership shape, fund and manage the long term strategy and direction of the Company. With the right people, processes and technologies we aim to deliver solid business planning, underpinned by budgets that are fully funded, delivering real-time information that enables good Company decision making. In doing this we ensure proper stewardship of our shareholders funds and as a company we remain flexible to respond to change and new opportunity.

Alan McGettigan

Finance Director

Dr. Dermot Corcoran, Head of Exploration, Petroceltic International plc, is the qualified person who has reviewed and approved the technical information contained in this announcement. Dr. Corcoran has a B.Sc in Geology, a M.Sc. in Geophysics, and a Masters degree in Business Administration, all from the National University of Ireland, Galway. He also holds a Ph.D in Geology from Trinity College, Dublin. Dr. Corcoran has over 20 years experience in oil & gas exploration and production, and has previously worked at ExxonMobil, the Petrofina Group, and Statoil. Definitions in this press release are consistent with Society of Petroleum Engineers/ World Petroleum Council guidelines.

Notes to Editors:

Petroceltic International plc is a leading Upstream Oil and Gas Exploration and Production Company, focused on the Middle East, North Africa and Mediterranean area, and listed on the London Stock Exchange's AIM Market and the Irish Stock Exchange's ESM Market. The Company has exploration and appraisal assets in Algeria and Italy. Petroceltic is in a unique position in Algeria, operating a significant licence in partnership with Sonatrach the National Oil Company of Algeria, and is the only AIM listed company to enjoy this position.

Glossary of Terms