IGAS.L Regulatory News (IGAS)

19 September 2011

IGAS ENERGY PLC("IGas Energy", "the Company" or "the Group")

Operational Update

IGas Energy Plc ("IGas Energy") is pleased to provide an operational update on its' activities following the announcement that the DG-3 well had spudded in late July.

Operational highlights

·; Doe Green

o Drilling in progress at DG-3. Planning for a further production well DG-4 at an advanced stage

o Facilities upgrade in progress - new wells to accommodate increased production

·; Front-End Engineering and Design ("FEED")study for full production facilities on-going

·; Site construction completed at Ince Marshes and Ellesmere Port

·; Drilling of Ellesmere Port followed by Ince Marshes expected to commence in October 2011

·; Ground works to begin shortly at Barton with the objective of drilling one well with potential for a second well

·; Expanding execution capability - IGas Energy team headcount increased and two rigs are under contract.

·; Updated CPR from Senergy GB Limited of IGas Energy assets post the recent Nexen acquisition showing a slight improvement on earlier assessments (now: 1C: 1.4 Tcf, 2C: 1.8 Tcf, 3C: 2.4Tcf)

Production & Development

At Doe Green (PEDL 145), near Warrington in Cheshire, DG-3 is the first well being drilled under the accelerated development programme, instituted post the Nexen acquisition and related fundraising. The DG-3 well involves several laterals being drilled into a different seam to the one from which our current production is derived, namely well DG-2. To date, lateral sections encountering ca. 1,500 ft of coal have been drilled. Further lateral sections are planned before the well is completed. Based on results so far from DG-3, plans for a further production well, DG-4, are at an advanced stage. It is now anticipated that DG-4 will be drilled in direct continuation from DG-3. Production facilities to deal with the anticipated increased production from the site are also in the process of being upgraded.

Production at Doe Green continued until commencement of drilling operations, at which point it was shut-in to allow the rig to safely access the site. Drilling activities at Doe Green are designed to substantially increase our production from the area. Production will resume through the upgraded facilities post completion of drilling activity (DG-3 and DG-4).

Site construction has now been completed at Ince Marshes and Ellesmere Port in PEDLs 190 and 184 respectively, with drilling operations due to commence in October.

Up to two additional wells are planned at our Barton site - PEDL 193. Groundworks are expected to start in Q4 in preparation for the rig arrival once DG-3 and DG-4 have been completed.

A FEED study for the design of a generic full production facility is now nearing completion.

Expanding Execution capability

We have been expanding our team to ensure availability of the right skills and experience to deliver IGas Energy's objectives and the headcount increased by an additional 8 employees in the half year.

The BDF rig is currently being deployed at Doe Green and will subsequently move to Barton. The Meehan R1 - TXD will shortly commence drilling at Ince Marshes

CPR Update

IGas Energy has commissioned Senergy (GB) Limited, an independent reserves assessor, to provide a Competent Person's Report (CPR) for the IGas Energy assets. The report both reflects the IGas Energy resources post the recent Nexen acquisition and also accounts for the relinquishment of PEDL92-1 and the retention of PEDL78-2. The resulting resource estimates are as follows: (1C: 1.4 Tcf, 2C: 1.8 Tcf, 3C: 2.4Tcf) which are slightly larger than the earlier estimates developed by DeGolyer & MacNaughton at end 2008 (now: 1C: 1.2 Tcf, 2C: 1.74 Tcf, 3C: 2.5 Tcf). A copy of the CPR will be available on our web site (www.Igasplc.com) in due course.

-Ends-

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