Operations Update

Not for Distribution to U.S. Newswire Services or for Dissemination in the United States

Ithaca Energy Inc.

Operations Update

17 June 2014

Ithaca Energy Inc. (TSX: IAE, LSE AIM: IAE) ("Ithaca" or the "Company") provides an operations update ahead of today's 2014 Annual and Special Shareholders Meeting.

Stella Development Drilling Update

The third development well on the Stella field, well 30/06a-B1X ("B1"), has been successfully drilled to a total measured depth subsea of 16,185 feet. A 2,147 foot gross horizontal reservoir section was drilled in the Palaeocene Andrew sandstone reservoir, within the targeted oil rim. The well intersected high quality sands across a net reservoir interval of 2,034 feet, equating to 95% net pay. This compares to 1,312 feet and 2,514 feet in Stella wells A1 and A2, respectively.

Operations are currently on-going to run the well completion assembly, following which a clean-up flow test will be performed. It is anticipated that the results of the flow test will be announced around the end of June 2014.

Operations Update

The 2014 production enhancements programme is progressing as planned and guidance for the year remains unchanged at 11,000 to 13,000 barrels of oil equivalent per day.

The Fionn sidetrack was completed in May 2014. The platform modification works to enable start-up of the electrical submersible pumps installed in the Causeway and Fionn production wells have also been completed. The platform modifications to enable start-up of water injection on the Causeway field are now substantially complete and the commencement of water injection is expected in August 2014.

Drilling operations have just been completed on the infill production well on the Don Southwest field. Installation of the required subsea spool piece between the wellhead and the existing drilling centre manifold is scheduled for the coming weeks, with start-up of the well expected in August 2014.

The drilling rig that will be used for the Athena "P4" well workover currently remains on schedule to arrive on location at the field around late August 2014, once it has completed its work programmes for prior clients.

Les Thomas, Chief Executive Officer, commented:

"We are very pleased with the high quality reservoir sands encountered by the Stella B1 well and look forward to the flow test results when we finish well completion operations."

Annual & Special Shareholders Meeting Presentation

A short presentation covering the Company's on-going operational and corporate activities will be given at the 2014 Annual and Special Shareholders Meeting that is scheduled to be held today at 14.00 (local time) in Calgary, Canada. The presentation will be made available on the Company's website (www.ithacaenergy.com) immediately prior to the meeting, along with a new film providing additional information about the on-going work being completed on the Greater Stella Area development.

- ENDS -

Enquiries:

Ithaca Energy

Les Thomas [email protected] +44 (0)1224 650 261

Graham Forbes [email protected] +44 (0)1224 652 151

Richard Smith [email protected] +44 (0)1224 652 172

FTI Consulting

Edward Westropp [email protected] +44 (0)207 269 7230

Shannon Brushe [email protected] +44 (0)203 727 1077

Cenkos Securities

Neil McDonald [email protected] +44 (0)131 220 6939

Beth McKiernan [email protected] +44 (0)131 220 9778

RBC Capital Markets

Tim Chapman [email protected] +44 (0)207 653 4641

Matthew Coakes [email protected] +44 (0)207 653 4871

Notes

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.

References herein to barrels of oil equivalent ("boe") are derived by converting gas to oil in the ratio of six thousand cubic feet ("Mcf") of gas to one barrel ("bbl") of oil. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based on an energy conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6 Mcf: 1 bbl, utilising a conversion ratio at 6 Mcf: 1 bbl may be misleading as an indication of value.

About Ithaca Energy

Ithaca Energy Inc. (TSX: IAE, LSE AIM: IAE) is a North Sea oil and gas operator focused on the delivery of lower risk growth through the appraisal and development of UK undeveloped discoveries, the exploitation of its existing UK producing asset portfolio and a Norwegian exploration and appraisal business targeting the generation of discoveries capable of monetisation prior to development. Ithaca's strategy is centred on generating sustainable long term shareholder value by building a highly profitable 25kboe/d North Sea oil and gas company. For further information please consult the Company's website www.ithacaenergy.com.

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, construction times, well completion times, risks associated with operations, future capital expenditures, continued availability of financing for 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, Stella first oil, drilling plans, production forecasts, budgetary figures, 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.

Additional information on these and other factors that could affect Ithaca's operations and financial results are included in the Company's Management's Discussion and Analysis for the year ended December 31, 2013, and the Company's Annual Information Form for the year ended December 31, 2013 and in reports which are on file with the Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).