Ed's Thread

[Ed Monton]

BUY: Ithaca Energy Inc.
IAE-TSXV/LSE-AIM: $0.71
Target: $2.50

Increased Production
· Ithaca announced an increase in gross production rates to 10,000 bd (6,728 bd net to Ithaca) following the commencement of operation of its downhole pump on the Jacky field (67.275% interest). This compares with lower average volumes from Jacky and Beatrice of 4,740 bd (3,294 bd net) in April and 5,390 bd (3,710 bd net) in May, prior to switching on the downhole pump.
· The Company is now finishing up commissioning and maintenance work, with Jacky and Beatrice currently producing a combined total of 11,500 bd (7,850 bd net). Additional drilling, perhaps by year-end, could add to production volumes.
· The cash flow that Ithaca has started generating this month will allow the Company to continue its drilling program in the North Sea with the aim of taking production up to as high as 15,000 bd net to their interest. We are maintaining our BUY recommendation and $2.50 target price.

Warren Verbonac