Xcite Energy Announces Results of Reserves Assessment on Bentley Field

Following the successful completion of the pre-production well test in September 2012 and a new 3D seismic survey, Xcite Energy announces the results from its updated reserves assessment report as prepared by TRACS.

 Highlights

· Mean PIIP for the Bentley field of 909 MMstb, increased from 550 MMstb as previously reported in February 2012.

· 1P, 2P and 3P oil reserves for the Bentley field of 198 MMstb, 250 MMstb and 312 MMstb, respectively, based on an initial 35 year production period.

· Projected P50 peak production rate of approximately 45,000 stb/d in the first phase development, increasing to approximately 57,000 stb/d in the second phase development.

· NPV10 (after tax) value of oil reserves for the Bentley field of approximately $1.5 billion, $2.2 billion and $2.8 billion on a 1P, 2P and 3P basis, respectively.

· An additional 46 MMstb of P50 Contingent Resources assigned to the Bentley field for recoverable volumes beyond the initial 35 years production period.

· Aggregate, unrisked mean Prospective Resources assigned of approximately 96 MMstb, relating to prospects adjacent to the Bentley field and prospects as awarded in the recent UK Offshore 27th Licence Round.

See “Cautionary Language” below for a general explanation of the method and assumptions used in the above calculations.

Rupert Cole, Chief Executive Officer of Xcite Energy commented:

“I am very pleased to report this significant increase in both reserves and value attributable to our assets, which supports our long-held belief in the potential of the Bentley field. This 2P reserves update, at 250 million barrels, plus considerable upside potential, has exceeded our expectations.

 We have now moved Bentley from being a significant asset to one of the major strategic assets in the North Sea, which will be an important source of future employment and economic contribution to the UK for many years to come.

 We shall now continue to move the project forward with on-going studies into the potential for enhanced oil recovery, which has yet to be factored into the reserves assessment. There isalso further scope for field optimisation in order to accelerate delivery of the Contingent Resources, as well as the potential for exploration barrels from our Prospective Resources.

 Our next goal is to fund the future development of our assets. Having put in place the RBL facility last year, we still see this as an important part of our future funding structure. By increasing our reserves so significantly and developing a more balanced phasing of production volumes, with approximately half of the 2P reserves now expected to be delivered from the first phase development wells, we anticipate being in a position to increase the borrowing capacity of the field considerably and we shall be discussing this with our existing and potential new lenders.

 Based on this reserves update, it is also the right time to evaluate suitable farm-in partners for Bentley. We have demonstrated the value of the field, materially de-risked it ahead of development and we would expect potential partners to recognise these achievements.

 Finally, an updated Field Development Plan will be submitted to DECC in the coming months, which will reflect the results of the successful well test last year and the greater capacity of the first phase of development.

 I would like to take this opportunity, once again, to thank the entire Xcite Energy team for their unwavering belief in, and commitment to, this project, and for the application of their expertise to move the Bentley forward to become a strategic, development-ready asset. They should be rightfully proud of this immense achievement.”

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Press Release, April 8, 2013