Ithaca Energy - Greater Stella Area Update

Ithaca Energy Inc. (“Ithaca” or the “Company”) provides an update regarding Greater Stella Area (“GSA”) operations and the overall development schedule.

Continued progress has been made on execution of the main GSA development work programs since the start of 2014.  Strong flow test results were achieved on the second Stella development well and drilling is on-going on the third well, with the clean-up flow test results for the well expected around late June 2014.  The first of the 2014 subsea infrastructure installation campaigns was completed in April 2014, involving tie-in of the first two development wells at the Stella Main Drill Center, with the next scheduled activity being the installation of the “FPF-1” floating production facility mooring piles in June 2014.

Construction activities on the main deck of the FPF-1 have been advancing and are currently centered on fit-out of the main pre-assembled units that were lifted on to the vessel in the first quarter of the year along with preparation for the installation of additional equipment packages.  A number of key pieces of equipment have recently being installed on the main deck, including the three gas turbine generators.  In addition, installation of the four additional buoyancy blisters being added to the columns of the FPF-1 is at an advanced stage of completion.

While progress has been made on the FPF-1 modification works over recent months, the topsides construction program has advanced more slowly than planned.  As a consequence, Petrofac is now forecasting that the vessel will be ready for sail-away from the Remontowa yard in Poland to the Stella field in spring 2015.  This schedule is anticipated to result in first hydrocarbons from the GSA hub in mid-2015.

Ithaca is working with Petrofac to expedite the remaining construction and commissioning works on the FPF-1. Updates on the progress of the modification works will continue to be provided at regular intervals over the coming months.

The incremental cost to the Company of the delayed start-up is estimated to be between $5-10 million, relating primarily to project management costs.  The funding position of the company is not materially impacted by the delay.

Les Thomas, Chief Executive Officer, commented:
“While good progress has been made with drilling of the third Stella development well and the subsea infrastructure installation works, the delay in the FPF-1 sail-away schedule and consequently the impact on the timing of Stella first oil is clearly disappointing. We are working with Petrofac to expedite completion of the vessel modification and commissioning works and deliver start-up of the GSA hub as quickly as possible.”

First Quarter 2014 Financial Results
The Company will issue its financial results for the first quarter of the year on 13 May 2014.