02:00 EST Tuesday, January 06, 2009

LONDON, UNITED KINGDOM and CALGARY, ALBERTA--(Marketwire - Jan. 6, 2009) -

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Ithaca Energy Inc. ("Ithaca" or "the Company") (TSX VENTURE:IAE)(AIM:IAE) and its wholly owned subsidiary Ithaca Energy (UK) Limited, an independent oil & gas company with exploration, development and production assets in the UK sector of the North Sea, announces the successful and safe installation of the Jacky platform and associated pipelines in the Inner Moray Firth area of the United Kingdom.

Installation of the Jacky platform and pipelines is a major step in the process of bringing the field on stream. The remaining activities will be the completion and tie-in of the already drilled Jacky production well and minor modifications to the nearby Beatrice Field facility to accommodate Jacky production. The Jack-up drilling rig 'Ensco 92' is scheduled to enter the field in mid February or early March to conduct the well work (schedule dependent on previous well timing).

The Jacky field is likely to come on stream in mid March once tie-in activities and modification to the Beatrice field have been completed. It is expected to produce at an initial rate of approximately 7,500 bopd, delivering significant cash flow for the field owners.

The installation of the Jacky platform was delayed by adverse weather conditions that have impacted a number of North Sea projects over the last 2 months. Despite these conditions, Ithaca and its co-venturers have been able to progress work on the project and ensure there is no impact on the schedule for the pipelay and well completion activities by securing, at short notice, the services of the 'Hermod' Heavy Lift Vessel, which had been undergoing maintenance in Rotterdam. However, this activity, combined with a significant shift in the US dollar / UK pound / Euro exchange rates has meant that project costs are likely to be between 20% and 24% above the original estimate of 59.7 million pounds sterling.

As part of the Jacky development project, Ithaca is also re-instating production from the closed in Beatrice 'Bravo' platform. The Bravo facility was producing around 800 bopd when it was shut in by the previous field owners in July 2007.

The Jacky Field is owned by Ithaca (67.3% Operator), Dyas (22.7%) and North Sea Energy (10%) and is being developed as a 'normally unmanned' facility with a single well tied back to the nearby Beatrice Field facilities.

Iain McKendrick, CEO of Ithaca said:

"This major milestone in the development of the Jacky field removes much of the uncertainty over the project schedule and cost. We now have the development facilities installed and are looking forward to the well completion activity and final tie-in work at Beatrice.

The Jacky field is significant to Ithaca as it will add substantial cash flow over and above our already producing Beatrice field. The professionalism and proactivity of the project team, supported by our Joint Venture Partners, in securing the services of the Hermod are a tribute to the skill of our technical team and to the ethos of small independent oil companies, which remain a driving force in the North Sea even in today's environment."

In accordance with AIM Guidelines, Lawrie Payne, MA Marine Geology (Alberta & Columbia) and Chairman of Ithaca Energy is the qualified person that has reviewed the technical information contained in this press release.

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

Forward-looking statements

Some of the statements in this announcement are forward-looking. Forward-looking statements include statements regarding the intent, belief and current expectations of Ithaca Energy Inc. or its officers with respect to various matters. When used in this announcement, the words "expects," "believes," "anticipates," "plans," "may," "will," "should" and similar expressions, and the negatives thereof, are intended to identify forward-looking statements. Such statements are not promises or guarantees, and are subject to risks and uncertainties that could cause actual outcome to differ materially from those suggested by any such statements. These forward-looking statements speak only as of the date of this announcement. 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.

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.

FOR FURTHER INFORMATION PLEASE CONTACT:

Ithaca Energy Inc.
Iain McKendrick
CEO
+44 (0) 1224 650 261

Email: imckendrick@ithacaenergy.com

Ithaca Energy Inc.
Steven Turner
CFO
+44 (0) 1224 652 151

Email: sturner@ithacaenergy.com

Ithaca Energy Inc.
John Woods
CDO
+44 (0) 1224 650 273

Email: jwoods@ithacaenergy.com

Pelham Public Relations
Charles Vivian

+44 (0) 207 743 6672

Email: charles.vivian@pelhampr.com

Pelham Public Relations
Philip Dennis

+44 (0) 207 743 6363

Email: philip.dennis@pelhampr.com

Ambrian Partners Limited
Marc Cramsie

+44 (0) 207 634 4858

Email: marc.cramsie@ambrian.com

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this news release.

© Marketwire