Acquisition of additional interest in Cygnus Field

Ithaca Energy, a leading UK independent production and growth company, is pleased to announce it has signed a sale and purchase agreement to acquire an additional 46.25% stake in the Cygnus gas field from Spirit Energy for a purchase price of £116 million (approximately $154 million) (the “Transaction”), based on an effective date of 1 January 2025. The Transaction, which is subject to NSTA consent, will increase Ithaca Energy's operated interest in Cygnus to 85%.

The Transaction is expected to add 23 mmboe of 2P reserves (as at 1 Jan 2025) and pro forma production between 12.5 - 13.5 kboe/d in 2025, enhancing the balanced production mix of our portfolio through additional gas volumes. This Transaction is in line with the Group's strategy to pursue value-accretive M&A, adding high-quality assets in our core UK Continental Shelf market. The Transaction equates to a valuation of less than $7/boe on 2P Reserves, which we believe is good value for equity in a producing field that we know and understand.

Cygnus is the largest UK Continental Shelf gas field and a key contributor to the UK’s energy security. Production started in 2016 with 11 wells currently producing, with three further infill wells approved, with the Valaris Norway on location with the first of the two firm wells to be spud in Q2 2025, and expected onstream during H2 2025 and H1 2026. The field is located in the Southern North Sea in blocks 44/11a, 44/11b and 44/12a in water depths in the range of 15 to 25 meters.

Yaniv Friedman, Executive Chairman, commented:

"Today’s transaction with Spirit Energy provides further equity in a high-margin, high-quality producing gas asset that we understand deeply through our operatorship. This deal follows our Japex (Seagull) deal announced just two months ago and further demonstrates our growth strategy in action. By increasing our stake in Cygnus we add incremental reserves and production to our portfolio at attractive valuation metrics that ticks all of our investment criteria, without adding any complexity. We also see significant upside potential through further infill drilling beyond the next three approved wells. This is the type of deals we like.”

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About Ithaca Energy plc

Ithaca Energy is a leading UK independent exploration and production company with a strong track record of material value creation. In recent years, the Company has been focused on growing its portfolio of assets through both organic investment programmes and acquisitions and has seen a period of significant M&A driven growth centred upon three transformational acquisitions in recent years, including the recent Business Combination with Eni UK. Today, Ithaca Energy is one of the largest independent oil and gas companies in the United Kingdom Continental Shelf (the “UKCS”), ranking second largest independent by production with the largest resource base.

With stakes in six of the ten largest fields in the UKCS and two of UKCS’s largest pre-development fields, and with energy security currently being a key focus of the UK Government, the Group believes it can utilise its significant reserves and operational capabilities to play a key role in delivering security of domestic energy supply from the UKCS.

Ithaca Energy serves today’s needs for domestic energy through operating sustainably. The Group achieves this by harnessing Ithaca Energy’s deep operational expertise and innovative minds to collectively challenge the norm, continually seeking better ways to meet evolving demands.

Ithaca Energy’s commitment to delivering attractive and sustainable returns is supported by a well-defined emissions-reduction strategy with a target of achieving net zero ahead of targets set out in the North Sea Transition Deal.

Ithaca Energy plc was admitted to trading on the London Stock Exchange (LON: ITH) on 14 November 2022.

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