Mr. Les Thomas reports

ITHACA ENERGY INC.: ITHACA ENERGY INC ANNOUNCES TENDER DEADLINE REMINDER - RECOMMENDED TAKEOVER BY DELEK

Ithaca Energy Inc. is highlighting, in respect of the previously announced all-cash takeover offer by Delek Group Ltd. for all of the issued and to be issued common shares of the company not currently owned by Delek or any of its affiliates for $1.95 per share, that the initial deposit period deadline is 5 p.m. ET on April 20, 2017.

Shareholders wishing to accept the offer must take action to deposit their shares. No shareholders will be deemed to have accepted the offer as a result of the actions of other holders.

Shareholders who hold their shares via an intermediary such as an investment adviser, stockbroker, bank, trust company or nominee should note that their intermediary's deposit cut-off times will likely be prior to the expiry time of the offer.

Successful completion of the offer is conditional upon, amongst other things, more than 50 per cent of the common shares outstanding (excluding the shares already owned by Delek and its affiliates) being validly deposited under the offer prior to the expiry time (minimum tender condition). No deposited shares will be purchased by Delek or any of its affiliates if the minimum tender condition is not satisfied.

The board of directors, excluding the Delek related-party directors, reiterates its unanimous recommendation that acceptance of the offer is in the best interests of shareholders. It is also noted that the independent equity research coverage of the company has been supportive of the transaction.

Full details of the offer are contained in the takeover bid circular issued by Delek and the directors circular issued by Ithaca, both of which are available on the company's website and on SEDAR.

Information on depositing your shares

Shares held via an intermediary

If you hold your shares through an intermediary such as an investment adviser, stockbroker, bank, trust company or nominee, to accept the offer you should contact your intermediary as soon as possible and it will assist you in validly depositing your shares.

Letter of transmittal (yellow form)

If you have share certificate(s) for your shares, you must use the letter of transmittal (available at the company's website). You should complete and return the form along with your share certificate(s). If you are unable to return your certificate(s) (because they are lost), please see (i) paragraph 11 (lost or mutilated certificates) on page 21 of the form; (ii) the pink form available on-line; or (iii) contact Computershare, which can advise you of the further actions you must take

If you hold your shares electronically in Canada through CDS -- you must follow the procedure for book-entry established by CDS (in which case you will be deemed to have completed and submitted a letter of transmittal).

If you hold your shares electronically in the United Kingdom through the CREST system -- do not use the letter of transmittal. You need to submit an electronic TTE instruction as set out on pages 23 to 24 of the takeover bid circular dated March 14, 2017 (in which case you will be deemed to have completed and submitted the letter of transmittal). Please note that the TTE instruction must be submitted by no later than 3 p.m. GMT on April 19, 2017, although it is likely your intermediary will have set an instruction deadline ahead of this time

Notice of guaranteed delivery (pink form)

The notice of guaranteed delivery is only applicable in certain circumstances for certificated shareholders (available at the company's website). This form is to be completed and returned along with the letter of transmittal for certificated shareholders whose share certificates are not immediately available if the deposit of shares will be made by or through an eligible institution (being a relevant financial institution as set out on page 3 of the form)

If assistance is required with accepting the offer and depositing your shares, please contact Computershare at:

North America:  1-800-564-6253 or 1-514-982-7555 (collect calls accepted)

United Kingdom:  44-0-370-703-6347

E-mail:  corporateactions@computershare.com

Questions on the offer can also be directed to the information agents, Laurel Hill Advisory Group and RD:IR. Laurel Hill Advisory Group can be contacted at 1-877-452-7184 (within North America) or 1-416-304-0211 (outside of North America) or by e-mail at assistance@laurelhill.com. RD:IR can be contacted by e-mail at corporateactions@rdir.com.

Further information on the offer

As previously announced, the board of directors excluding the Delek related-party directors, after consulting with its financial and legal advisers, considers the terms of the offer to be in the best interests of Ithaca and its shareholders and accordingly unanimously recommends that shareholders accept the offer and deposit their shares.

Reasons to accept the offer

In reaching its unanimous recommendation to shareholders to accept the offer, the directors evaluated multiple factors, including those summarized below. The evaluation and its conclusion were made in light of the directors' own knowledge of the business, the industry and the financial condition, and prospects of the company, and based upon the recommendation of a special committee of independent directors, which has been advised by RBC Capital Markets in its capacity as financial adviser to the company.

The principal reasons for the recommendation are centred on an evaluation of the fullness of the offer relative to the future risk profile of the business.

• Offer price at the upper end of independent valuation range -- The special committee engaged GMP FirstEnergy, as an independent valuator, to prepare a formal valuation in connection with the offer in accordance with Multilateral Instrument 61-101. GMP FirstEnergy was of the opinion that, as of March 9, 2017, the fair market value of the common shares was in the range of $1.60 to $2.10 per common share.
• Premium to analyst consensus price targets -- The offer price represents a premium of approximately 20 per cent to the average analyst consensus target price of $1.60 per share as at Feb. 3, 2017 (1).
• Favourable transaction timing -- The consideration payable for oil and gas company transactions is driven predominantly by calculations of discounted future cash flows, with risk factors applied to development projects dependent on remaining uncertainties. For this reason, the directors consider entering into the transaction shortly before Stella first hydrocarbons to be highly advantageous for realizing full value without taking exposure to poststart-up operational risk.
• Avoidance of operational and refinancing risks -- The company has near-term operational and refinancing execution risks ahead of it, the most immediate of which include: bringing the Stella field into full production in line with expectations; executing Harrier development drilling on budget and with reservoir performance in line with expectations; and refinancing the aggregate approximately $910-million (U.S.) (2) of existing bank facilities, senior notes and prepayment facilities. While the company expects it would be able to successfully navigate such risks, the directors do not consider that the resultant shareholder value creation is likely to be sufficiently in excess of the offer price to compensate for taking such risks.
• Reliance on Greater Stella area satellites -- The company intends to build out the Greater Stella area (GSA) production hub through securing satellite field tie-backs. If these are not secured, the potential benefits of the hub will be diluted. One of the anticipated near-term tie-backs, Vorlich, is not solely under the control of the company. While the company believes the most efficient development solution for the Vorlich field is a tie-back to the GSA infrastructure, the field development plan has yet to be agreed with the operator, which owns other infrastructure in the area and the U.K. Oil and Gas Authority. The potential impact of this risk has been considered by the directors in recommending the offer.
• Future growth potential -- Notwithstanding the successful record of the company, at this point in the life cycle of the U.K. Continental Shelf oil and gas sector, the directors believe that there are limited prospects for delivering a step change in the scale and operations of the company without the addition of significant capital. There can be no guarantee that such capital would be available to the company in the time frames or on the terms required to provide shareholders with the prospect of a satisfactory equity rate of return.
• Review of alternatives -- The special committee, after thorough review and discussion with its financial adviser, believes that there are limited prospects for alternative transactions that provide an immediate premium cash consideration to shareholders given the lack of potential acquirers of U.K. North Sea oil and gas companies.
• Immediate cash premium to shareholders -- The offer provides shareholders with the opportunity to crystallize the value of their holdings in cash, with the offer price representing a 12-per-cent premium to the Toronto Stock Exchange closing price on the Feb. 3, 2017 (being the last trading day before announcement of the offer), and a 27-per-cent premium to the 60-day volume-weighted average trading price to Feb. 3, 2017.
• Capitalizing on share price appreciation -- The offer allows shareholders to capitalize in cash on the value of the company's sustained share price growth over the last 12 months, with the offer price of $1.95 per share being more than 360 per cent higher than the 30-day volume-weighted average trading price to Feb. 6, 2016.

A fuller explanation of the reasons underlying the recommendation to accept the offer is contained in the directors circular, along with a full summary of the definitive support agreement entered into between Ithaca and Delek on Feb. 6, 2017.

The directors circular also sets out other factors concerning the offer that shareholders should be aware of, including:

• There is no obligation on the offeror to complete a compulsory acquisition of any shares not tendered to the offer.
• While the Alternative Investment Market rules for companies do not prescribe the required levels of free float for a company to be eligible for trading on AIM, depending on the number of shares purchased pursuant to the offer it is possible that the subsequent remaining free float could be insufficient to satisfy the criteria for continued admission of the shares for trading on AIM.
• If the offeror acquires sufficient shares under the offer it could be in a position to force delisting or cancellation of the company's shares from AIM. Under the AIM rules, cancellation of a company's shares from trading on AIM is generally conditional upon the consent of not less than 75 per cent of votes cast by its shareholders given in a shareholder meeting.
• The rules of the Toronto Stock Exchange establish certain criteria, which if not met, could lead to the cessation of trading and delisting of the company's shares from the TSX.

Lock-up agreements

Based on the reasons underpinning the directors' recommendation, all the directors and officers of Ithaca have entered into lock-up agreements under which they have irrevocably undertaken to tender their own beneficial shareholdings in the company, which amount in aggregate to 11,275,940 common shares (excluding common shares issued under options with an exercise price higher than the offer price), representing approximately 2.6 per cent of the entire issued and to be issued common shares of Ithaca. The lock-up agreements are subject to customary termination provisions. There are no agreements or arrangements in place between the directors and officers of Ithaca and Delek providing any payment or other benefit proposed to be made or given by way of compensation for loss of office or their remaining in or retiring from office if the offer is successful.

Notes

(1) The average analyst consensus target price as of Feb. 3, 2017, being the last trading day prior to announcement of the offer, is calculated based on the targets produced by the institutions that cover the company, being: Barclays, BMO, Canaccord Genuity, Cenkos, FinnCap, GMP FirstEnergy, Investec, Mackie Research Capital Corp., Macquarie, Peel Hunt, RBC. Price targets quoted in pounds sterling have been converted to Canadian dollars using the exchange rate on Feb. 3, 2017.

(2) The aggregate amount includes the company's existing $535-million (U.S.) senior reserve base lending facility, $300-million (U.S.) senior unsecured loan notes, and approximately $75-million (U.S.) oil and gas prepayment facilities.

Advisers

RBC is acting as financial adviser to the company and has delivered a fairness opinion addressed to the special committee. GMP FirstEnergy is acting as the formal valuator under the terms of MI 61-101. Pinsent Masons LLP and Burstall Winger Zammit LLP are acting as legal counsel to Ithaca. The company has also received strategic advice from Geopoint Advisory Ltd.

About Ithaca Energy Inc.

Ithaca Energy is a North Sea oil and gas operator focused on the delivery of lower-risk growth through the appraisal and development of U.K. undeveloped discoveries and the exploitation of its existing U.K. producing asset portfolio. Ithaca's strategy is centred on generating sustainable long-term shareholder value by building a highly profitable 25,000-barrel-of-oil-equivalent-per-day North Sea oil and gas company.

We seek Safe Harbor.