Eni has a proven track record of value creation through its strategic satellite model with regional exploration and production companies including successful joint ventures in Norway and Angola with Vår Energi and Azule Energy respectively. We look forward to updating the markets in the coming month."

Interim Chief Executive Officer and Chief Financial Officer, Iain Lewis, commented: "We have made material progress in 2023, executing against our BUY, BUILDand BOOSTstrategy including the milestone sanctioning of Phase I of the Rosebank development and the significant progress towards delivering our Captain EOR Phase II project.

I am pleased to share a strong set of financial results for 2023, despite the significant fiscal and political headwinds we have faced in the year. The Energy Profits Levy continues to have a direct impact on investment in the UK North Sea, with projects across our operated and non-operated deferred or cancelled. The extension of the Energy Profits Levy by a further year to a sunset date of March 2029, highlights the continued fiscal uncertainty our sector faces."

Ithaca Energy will host an in person and virtual presentation and Q&A session for investors and analysts at 09:00 GMT today, 27 March 2024, accessible via our website: https://investors.ithacaenergy.com/

Performance Overview

Executing our BUY, BUILD and BOOST Strategy

We made significant progress across our strategic goals in 2023, delivering against our BUY, BUILD and BOOST strategy to support the material long-term growth of the Group. We continue to focus on maximising value from across our diverse portfolio with targeted investment in high-quality assets demonstrating our commitment to investing in the UK North Sea.

In 2023, we were delighted to announce the landmark sanctioning of Phase I of the Rosebank development, with total recoverable resources over 300 mmboe and Phase I gross reserves of 234 mmboe. As the UK's largest undeveloped discovery, the field will provide critically important domestic energy, supporting a forecasted 7% of UK oil production from first production to 2030. And crucially, with its low carbon emissions design, the field has the potential to produce at a fraction of the world's average CO2 emissions contributing to both the UK's energy security and Net Zero objectives.

The Rosebank development is core to Ithaca Energy's BUILD strategy, executing on the material development portfolio acquired from Siccar Point Energy in 2022. With estimated net production of 15 kboe/d at the field's peak and a production life of 25 years, the field supports the Group's medium to long-term production growth. After taking the Final Investment Decision (FID), project activity has ramped up with work underway on upgrading the Petrojarl Rosebank FPSO (previously named Petrojarl Knarr), including making the vessel electrification ready in line with the North Sea Transition Deal. In 2024, work will commence on the installation of templates and satellite structures as part of the multi-year development timeline towards first production in 2026/27.

At Captain, material progress was made during the year on executing Phase II of our pioneering polymer Enhanced Oil Recovery (EOR) project with the project now over 90% complete and on track to support first Phase II polymer injection into the subsea wells in summer 2024. Remaining work scopes include final commissioning activities on the topsides, subsea tie-in campaign and completion of the drilling programme (completed during Q1 2024).

The EOR Phase II project, designed to maximise and accelerate reserve recovery from Captain and deliver on our strategy to BOOST field performance, will build on the success of the first phase of polymer injection with over 12 mmbbls recovered to date. Extensive subsurface modelling completed in H2 2023 to refine the predicted EOR Phase II polymer response, based on reprocessed seismic and latest field performance, has successfully confirmed initial overall EOR Phase II reserve recovery predictions. However, our expectation is that Captain production will now follow a longer path to peak response with production expected to peak in 2026, before plateau.

The Group continues to leverage our M&A capabilities to deliver on our BUY strategy evaluating potential inorganic opportunities both in the UK and internationally. In 2023, the Group acquired the remaining stakes of the Cambo and Fotla fields with the aim of preserving the long-term value of our assets by taking full control of pre-FID work programmes and timing.

Following the successful extension of the Cambo license milestones from 31 March 2024 to 31 March 2026, the Group is actively engaging with potential farm-in partners to secure an aligned joint venture partnership that would enable the future progression of the Cambo project towards FID.

In line with the Group's BUILD strategy we continue to target high-return tie-back opportunities close to existing infrastructure to maximise reserve recovery. In 2023, the Group reported positive appraisal activity at its non-operated Leverett discovery (Ithaca Energy Working Interest: 12%) and successful exploration drilling at its operated K2 prospect (Ithaca Energy Working Interest: 50%), however, the subsequent side-track encountered significant operational issues due to severe weather caused by Storm Babet and the sidetrack was suspended.

Strong delivery against 2023 management guidance

Our production in 2023 averaged 70.2 kboe/d (2022: 71.4 kboe/d), closing the year towards the mid-point of our 68-74 kboe/d production guidance range. Production was split 66% liquids and 34% gas with the Group's operated assets accounting for 51% of total 2023 production.

Our production performance in 2023 has been supported by strong production efficiency across our operated base of 84%, reflecting our commitment to maximise asset value through operational excellence. Most notably at FPF-1, where our focus on value and our investment in driving operational efficiency and uptime improvements continues to yield production efficiency rates above 90%.

Production from our non-operated portfolio was impacted by the delayed start-up and curtailed production from the Pierce field, where operational issues related to the vessel mooring system have temporarily shut down production from the field. We expect this issue to be rectified during H1 2024.

Operating costs in 2023 of $524 million (2022: $496 million), representing a net unit Opex cost of $20.5/boe (2022: $19.0/boe), came in below revised and lowered management guidance of $525 million to $575 million, reflecting the Group's stringent focus on cost control in an inflationary environment, improved FX rates and a reduction in planned activity.

Total net producing asset capital expenditure (excluding decommissioning) of $393 million (2022: $405 million), came in at the bottom end of the Group's management guidance range of $390 million to $435 million. Net capital expenditure on the progression of the Rosebank development totalled $97 million, compared to management guidance of $90 million to $110 million reflecting the meaningful activity in 2023 as project activity ramps up to support a targeted 2026/27 first oil date.

During 2023, the Group launched a cost optimisation project focused on maintaining tight control on expenditure across our operated and non-operated assets and corporate overhead base. The project was successful in continuing to build upon Ithaca Energy's strong cost culture and delivered more than $100 million of cash savings during the year.

Strong safety performance is critical to our continued success

Safety is our non-negotiable, number-one priority and is central to our business success - we do it safely or not at all. The Group delivered a slightly improved safety performance in 2023, with fewer Tier 1 and Tier 2 process safety events recorded in the year (2023: 1 Tier 1 and 2 events, 2022: 2 Tier 1 and 2 events). However, we believe there are areas for continued improvement and the Group is responding to an increase in personal safety incidents and process safety near misses in the final quarter of the year by revisiting the tone of safety leadership across the business.

Major accident prevention has been a core focus area in 2023, with the introduction of a process safety barrier tool across all operating locations designed to strengthen our defences against high-potential incidents and process safety events. The Process Safety Fundamentals programme supports greater visibility of our Major Accident Hazard (MAH) risks and aims to enable front-line workers to focus on process safety where potential for MAH events present in day-to-day operations. We will continue to support the roll-out of the barrier tool in 2024 with the aim of improving our focus on process safety risks and maintaining focus on preventing high-consequence events.

Meaningful focus on Decarbonisation

As we continue to progress short-term emissions reductions projects, we have made significant progress towards our long-term emissions reduction strategy, following the decision to proceed with the development of the low emission intensity Rosebank field. Development of Rosebank will act as a material catalyst as the Group looks to fundamentally transition our portfolio to low-intensity assets in the medium to long-term, as older higher-intensity assets move closer to the natural end of their life.

The Rosebank FPSO has been designed to be electrification ready as part of its optimised design to reduce carbon emissions, in line with the North Sea Transition Deal. The Group is collaborating with Equinor (as Operator), industry partners and government to pursue a regional solution for power from shore to Rosebank and nearby fields to minimise carbon emissions from production. With full electrification, it is estimated that the Rosebank lifetime upstream CO2 intensity would decrease from 12kg to approximately 3kg CO2/boe - a seventh of the current UK average of 21kg CO2/boe and a fraction of the emissions intensity associated with importing.

The Group's Scope 1 and 2 GHG emissions across our operated profile reduced from 483,325 tCO2e in 2022 to 435,792 tCO2e in 2023, representing a slight increase per barrel from 23.8kg CO2/boe to 25.0kg CO2/boe, due to a reduction in operated assets production in 2023 versus 2022, and an absolute reduction of 23%, compared to our 2019 baseline. The 23% reduction achieved in 2023 versus the Group's 2019 baseline, reflects reductions achieved through operational improvements of 12%, as well as a 11% reduction in emissions associated with Alba's John Brown turbine outage during the year, which is not expected to be a recurring reduction. We continue to work hard to deliver our targeted 25% reduction in Scope 1 and 2 CO2e emissions on a net equity basis by 2025 and remain on track to reach this target.

2023 has seen continued progress across our operated portfolio delivering operational improvements at FPF- 1 and Captain, while expanding our focus to more material emission reduction initiatives such as the potential for electrifying our flagship Captain field. Following a successful conclusion of a pre-Front-End Engineering and Design (FEED) study in Q1 2023, FEED activity commenced in Q2 and has been matured to support a Financial Investment Decision in the coming months. With over 70% of Captain's GHG emissions related to power generation, partial electrification of the asset has the potential to substantially reduce emissions intensity and is critical to the Group's ability to achieve its targeted 50% reduction in Scope 1 and 2 CO2e emissions on a net equity basis by 2030. We continue to seek assurances from the UK government to ensure the protection of the decarbonisation allowance on sanctioned projects to protect the economic viability of the project. In parallel, the Group will determine investment viability as projects compete for capital following a reduction in cash flow available for reinvestment as a result of the continued impact of the Energy Profits Levy.

Robust cash flow generation supporting low leverage position

In 2023, we delivered another year of strong cash flow generation supporting the further strengthening of our balance sheet. Our diversified, high-quality asset base reported adjusted EBITDAX of $1.7 billion (2022: $1.9 billion), generated free cash flow of $0.7 billion (2022: $1.1 billion), lowering our adjusted net debt position to $571.8 million at year-end (2022: $971.2 million), representing an adjusted net debt to adjusted EBITDAX ratio of 0.33x (2022: 0.51x).

With a robust available liquidity position at 31 December 2023 of over $1 billion (2022: $0.6 billion), the Group has sufficient available capital to support our future growth plans. During 2023, we have entered into attractive lending arrangements that supplement our existing capital structure including a five-year $100 million term loan facility agreement with bp at a commercial interest rate, and a $150 million project capex carry arrangement which was unutilised at the year-end.

Profit for the year of $215.6 million (2022: $1,031.5 million), was impacted by a $557.9 million pre-tax impairment charge (post-tax $154.0 million), principally in relation to the Greater Stella Area (GSA) and Alba, together with other gains of $89.1 million in the period. The impairment charge for GSA follows the decision not to proceed with further infill drilling at Harrier, as a direct result of the Energy Profits Levy (EPL) and falling gas prices and in relation to Alba due to the reduction in estimated future production.

Following revisions to the Energy Profits Levy in November 2022, that saw the rate of EPL rise to 35%, the Group incurred current EPL charges of $333.4 million in the year (2022: $131.4 million), with the charge payable in October 2024. The Group's cash flows continue to be protected by our tax efficient structure with a material ring fence corporate tax and supplementary charge tax loss position of $4.5 billion at year-end.

The importance of the Group's robust hedging policy has been highlighted in the year, with hedging gains recorded of $266 million. As we move into 2024, we continue to take a disciplined approach to hedging, recognising the importance of balancing upside exposure to commodity prices while managing downside protection of our cash flows. At year-end, the Group has a hedged position of 8.2 million barrels of oil equivalent (mmboe) (57% oil) from 2024 into 2025 at an average price floor of $78/bbl for oil and 135p/therm for gas.

In our first full year as a listed company, we are delighted to report that our strong financial performance in the year has supported the delivery of our 2023 dividend target. The Board has declared a further interim dividend of $134 million in respect of the 2023 financial year, bringing our overall 2023 dividend to $400 million, representing ~30% post-tax cash flow from operations (CFFO) in the year.

Outlook

Following a successful year of progress against our BUY, BUILD and BOOST strategy in 2023, we enter 2024 with a strong and diverse portfolio of cash-generative assets and increased 2P Reserves and 2C Resources of 544 mmboe (2022: 512 mmboe) following the acquisition of the remaining stakes in Cambo and Fotla, offset by a full year of production. With further strengthening of our balance sheet in 2023, we are well positioned to continue to deliver against our capital allocation framework supporting our long-term growth aspirations.

Through strategic acquisitions we have preserved our investment optionality across our portfolio with significant brownfield and greenfield development opportunities such as Cambo, Marigold, Fotla and Tornado and infill drilling at Montrose, Schiehallion and Mariner. With further consolidation in the sector likely due to continued market dislocation, our focus in 2024 will be on prioritising investment across our portfolio alongside the potential for value-accretive M&A to maximise shareholder returns.

As a direct result of the Energy Profits Levy, investment across the UK North Sea during 2023 has been significantly impacted, as the UK competes for capital across global portfolios. Our 2024 production guidance of 56-61 kboe/dreflects the impact of deferred or cancelled projects across our operated and non-operated asset base including in the Greater Stella Area, Montrose Arbroath Area, Elgin Franklin Area and Alba.

Beyond 2024, the Group expects production growth through the medium-term with a return towards 80 kboe/d by 2027, as we see the full benefit of investment in our Captain EOR Phase II project and first production from the sanctioned Rosebank development.

Our operating cost guidance for 2024 of $540-590 million reflects our continued focus on cost control but increasing net costs from the $524 million 2023 outturn, due partly to tariff revenues reducing with lower third-party throughput at Greater Stella Area. As a result of forecasted reductions in 2024 volumes we expect an increase in unit operating cost per barrel in the short-term.

Our mid-term ambition is to drive down our average operating cost per barrel as we transition our portfolio to earlier-life assets from mature assets with a significantly lower unit operating cost profile.

Our producing asset capital cost guidance of $335-385 million (excluding capital investment for projects awaiting Final Investment Decision and Rosebank), reflects investment in executing the final stages of the Captain EOR Phase II project to completion and first injection in the subsea wells, continued drilling at Mariner and Schiehallion and facilities upgrades at Captain. In 2024, we forecast capital spend on the Rosebank development to be in the range of $190-230 million reflecting a significant ramp up of activities including FPSO upgrades and installation of subsea templates and satellites structures.

Ithaca Energy is targeting a 2024 dividend at the top end of its capital allocation policy range of 15 - 30% post-tax CFFO.

Enquiries

The information contained within this announcement is deemed by Ithaca Energy to constitute inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No 596/2014 (as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018). By the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.  The person responsible for making this announcement on behalf of Ithaca Energy is Julie McAteer, General Counsel and Company Secretary.

About Ithaca Energy plc

Ithaca Energy is a leading UK independent exploration and production company focused on the UK North Sea 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 two transformational acquisitions in recent years. Today, Ithaca Energy is one of the largest independent oil and gas companies in the United Kingdom Continental Shelf (the "UKCS"), ranking second by resources.

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 by 2040.

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

-ENDS-

Financial review

Our first full year as a listed company has not been without its challenges including the investment and cash impact of fiscal changes. Yet despite these, we have reduced adjusted net debt by approximately $400 million during the year and have lowered our leverage ratio to 0.33 times adjusted net debt to adjusted EBITDAX whilst paying out $266 million of interim dividends.

We have achieved another strong year of production as well as maintaining our focus on operating costs with initiatives such as the Partnered Cost Optimisation project.

We have delivered a robust set of results, as well as moving forwards with sanctioning of the Rosebank development and strengthening our positions with the Cambo and Fotla prospects.

With a strong liquidity position at year end of $1,028 million (2022: $578.8 million), the Group has sufficient available capital to support investment and is well positioned to finance future growth plans. During the year we have entered into attractive lending arrangements including a new $100 million five-year term loan facility with bp and a $150 million capex carry arrangement which was unutilised at the year end.

Statutory profit for the year of $215.6 million (2022: $1,031.5 million) was impacted by a $557.9 million pre-tax impairment charge principally in relation to the Greater Stella area following the decision not to proceed with Harrier drilling, as a direct result of the Energy Profits Levy (EPL) and falling gas prices and in relation to Alba due to a reduction in estimated future production. In 2022, we benefitted from a one-off gain on bargain purchase of $1,335.2 million partly offset by a deferred tax charge of 766.5 million on the introduction of EPL.

The increase in the EPL rate to 35% at the start of the year was another disappointment for the industry as it further reduces the free cash available for reinvestment. However, despite this, we have continued to create substantive organic value through 2023 and we believe that our capital allocation framework should give investors confidence as we seek to continue to grow value through 2024 and beyond.

The Group reported average production of 70,239 boe/d for 2023 (2022: 71,403 boe/d) driving Groupadjusted EBITDAX of $1,722.7 million, net cash flow from operations of $1,290.8 million and statutory profit for the year of $215.6 million.

Financial performance: adjusted EBITDAX

Adjusted EBITDAX is a key measure of operational performance delivery in the business and in 2023 was $1,722.7 million (2022: $1,916.2 million). The reduction in EBITDAX was due to a combination of lower commodity prices, higher unit operating expenditure, discussed further below and slightly lower production volumes driven mainly by the planned maintenance shutdowns in Q3 2023.

Average realised oil prices for the year were $85/boe before hedging results and $82/boe after hedging results (2022: $100/boe before hedging results and $91/boe after hedging results). Average realised gas prices for 2023 were $76/boe before hedging results and $111/boe after hedging results (2022: $149/boe before hedging results and $137/boe after hedging results).

Unit operating expenditure increased to $20.5/boe (2022: $19.0/boe) largely due to the planned Q3 shutdowns as well as inflationary pressures slightly outweighing our disciplined cost management approach across the portfolio. When post shutdown production resumed in Q4 2023, unit operating expenditure was $18.5/boe which was broadly the same as Q4 2022.

Total costs and charges

Total costs and charges amounted to $2,017.8 million (2022: $358.0 million) and comprised:

Depletion, depreciation and amortisation charges were $740.3 million (2022: $662.9 million). The year-on-year increase is principally due to the full-year effect of acquisitions made during 2022. Depletion, depreciation and amortisation per barrel was $29 (2022: $25).

Operating costs amounted to $576.7 million (2022: $547.8 million) with the increase driven by the full-year impact of acquisitions made in 2022. As noted above, unit operating expenditure increased principally as a result of the Q3 maintenance shutdowns.

Movements in oil and gas inventories was a credit of $20.6 million (2022: charge of $130.3 million) representing movements in underlift/overlift entitlement imbalances.

Materials inventory provisions of $16.3 million (2022: $nil) were made in respect of principally MonArb, Britannia and Elgin-Franklin.

Impairment charges of $557.9 million (2022: $31.5 million) principally reflects charges in respect of the Greater Stella area and Alba following changes in commodity prices and planned drilling activities due to EPL.

Exploration and evaluation costs amounted to $13.6 million (2022: $9.0 million) and principally related to licence relinquishments during the year as a result of unsuccessful geotechnical evaluation.

Other gains of $89.1 million (2022: losses of $9.5 million) comprise principally the settlement of a claim relating to a historic acquisition of $50.1 million and a $43.0 million gain on the revaluation and realisation of commodity hedges.

Administrative expenses were $34.3 million (2022: $87.9 million) with the decrease principally due to non-recurring costs associated with the IPO of $20.3 million and acquisition costs of $25.8 million in 2022.

Gain on bargain purchase in 2022 arose on the Marubeni and Siccar Point Energy acquisitions (see note 17 for further details).

Net finance costs were $184.0 million (2022: $203.0 million) with the reduction principally due to there no longer being interest on related-party loans which were repaid during 2022 and lower bank interest due to lower debt levels, partly offset by higher accretion charges as the discount rate on long-term liabilities has increased from 2.5% in the year to 31 December 2022 to 4.25% in the year to31 December 2023.

Taxation

The tax charge for the year was $86.4 million (2022: $1,029.0 million) with the reduction principally due to the introduction of the EPL last year. The charge for 2022 included an exceptional EPL deferred tax charge of $766.5 million and a current EPL tax charge of $131.4 million compared to a 2023 EPL deferred tax credit of $215.9 million and a current EPL tax charge of $333.4 million.

Earnings per share (EPS)

Statutory EPS was 21.4 cents (2022: 102.6 cents) and adjusted EPS was 36.7 cents (2022: 46.0 cents). Adjusted EPS eliminates items which distort year-on-year comparisons such as gain on bargain purchase, impairment charges, the tax effect of these items where applicable and the exceptional non-cash deferred EPL charge upon initial implementation in 2022.

Shares in issue

During the year, 7.8 million shares were issued to the Ithaca Energy plc Employee Benefit Trust (EBT) in order to satisfy the exercise of employee share options during the year and in future. As at 31 December 2023 there were 1,014.4 million (2022: 1,006.6 million) shares in issue.

The weighted average number of shares, excluding shares held by the EBT, for EPS calculations was 1,006.7 million (2022: 1,005.2 million).

Dividends

Interim dividends of $266.0 million (2022: $nil) were paid during the year. A further interim dividend for FY 2023 of $134.0 million will be paid in April 2024.

Financial position: assets/liabilities/equity

Assets

At 31 December 2023, total assets amounted to$6,246.6 million (2022: $6,759.6 million), of which current assets were $845.6 million (2022: $988.7 million) and non-currents assets were $5,401.0 million (2022: $5,770.9 million). The decrease in total assets during the year was primarily due to fixed asset impairment charges of $557.9 million and lower cash balances of $100.6 million due to the repayment of debt partly offset by a higher deferred tax asset of $235.3 million due principally to the asset impairment charges.

Liabilities

At 31 December 2023, total liabilities amounted to $3,802.2 million (2022: $4,302.1 million) including decommissioning provisions of $1,859.7 million (2022: $1,720.5 million) and non-current borrowings of $718.2 million (2022: $1,213.7 million). The reduction in total liabilities during the year was primarily due to lower noncurrent borrowings of $495.5 million and a reduction in trade and other payables of $232.8 million due to a lower level of negative value commodity hedge positions, partly offset by higher decommissioning liabilities of $139.2 million, mainly due to revisions to asset retirement obligation estimates, and higher current tax payable of $214.4 million principally due to EPL.

Equity and reserves

At 31 December 2023, total equity and reserves amounted to $2,444.4 million (2022: $2,457.5 million) The decrease in equity and reserves during the year was primarily due to interim dividend payments of $266.0 million partly offset by the retained profit for the year of $215.6 million and net hedging gains of $23.9 million.

Financial position: cash

Operating cash flows

Net cash from operating activities amounted to $1,290.8 million (2022: $1,723.3 million) after accounting for adverse working capital movements of $210.8 million (2022: favourable movements of $94.8 million) with the reduction principally due to lower operating profit, the working capital movements and higher corporation tax payments during the year.

Investing cash flows

Cash flow used in investing activities was $492.4 million (2022: $1,404.2 million) reflecting capital expenditure of $478.8 million (2022: $380.6 million) driven mainly by Captain enhanced oil extraction activities and Rosebank, including ongoing modifications to the FPSO. 2022 included investing cash flows related to acquisitions (net of cash acquired) of $957.4 million being primarily the Siccar Point Energy ($926.7 million) acquisition.

Financing cash flows

Cash outflow from financing activities amounted to $900.7 million (2022: $107.4 million) with dividend payments of $266.0 million (2022: $nil), interest costs and lease payments of $141.7 million (2022: $177.2 million) and a net reduction in principal debt of $500.0 million (2022: net increase of $50.0 million).

At 31 December 2023, cash balances were $153.2 million (2022: $253.8 million) and available liquidity was $1,028.2 million (2022: $578.8 million).

Principal risks

The principal and emerging risks facing the Group are the same as those set out in the H1 Trading Update.

Derivative financial instruments

Derivative financial instruments are utilised to manage commodity price risk in a substantive financial hedging programme for future oil and gas production volumes. As at 31 December 2023, the following hedges were in place:

Subsequent events

On 6 March 2024, it was announced that EPL will be extended by a further year to 31 March 2029. If this had been enacted at the balance sheet date, it is estimated that this would have increased the deferred tax liability by $112.2 million.

On 19 March 2024, the North Sea Transition Authority sanctioned the extension of the licence on the Cambo field to 31 March 2026.

On 26 March 2024, the Group signed an exclusivity agreement between ENI and Ithaca Energy covering substantially all of ENI's UK upstream assets, excluding ENI CCUS and Irish sea assets, under which ENI has granted Ithaca exclusivity whilst a potential business combination is pursued. Under the terms of the proposed business combination ENI is anticipated to hold between 38% and 39% of the enlarged issued share capital of Ithaca Energy following completion.  If this progresses further, it will be subject to the issuance of both a Circular and a Prospectus and the related shareholder approvals and will also be subject to, amongst other things, regulatory approvals.

Going concern

Management closely monitor the funding position of the Group including monitoring continued compliance with covenants and available facilities to ensure sufficient headroom is maintained to fund operations.

Management have considered a number of risks applicable to the Group that may have an impact on the Group's ability to continue as a going concern. Short-term and long-term cash forecasts are produced on aweekly and quarterly/annual basis respectively along with any related sensitivity analysis. This allows proactive management of any business risks including liquidity risk.

The Directors consider the preparation of the financial statements on a going concern basis to be appropriate. This is due to the following key factors:

• Continuing robust commodity price backdrop and a well-hedged portfolio over the next 12 months;

• New unsecured loan arrangements of $100 million with bp which was fully drawn at 31 December 2023 and a new $150 million optional project specific capital expenditure carry arrangement available at the discretion of the Group which was undrawn at 31 December 2023;

• Reserves Based Lending (RBL) headroom of $836 million ($nil drawn versus $836 million available),plus $303 million of cash at 22 March 2024; and

• Robust operational performance and a well diversified portfolio

.

The Group's base case going concern assessment assumes an average oil price of $81/bbl and a gas price of 67p/therm in 2024 and an oil price of $77/bbl and a gas price of 75p/therm in the six months to 30 June 2025 with production in line with approved asset plans.

Owing to the ongoing fluctuations in commodity demand and price volatility, management prepared sensitivity analyses to the forecasts and applied a number of plausible downside scenarios including: decreases in production of 10%, reduced sales prices of 20% and increases in operating and capital expenditures of 10%. Management aggregated these scenarios to create a reasonable combined worst-case scenario. The sensitivity analysis showed that, after consideration of the mitigation strategies within management's control, there was no reasonably possible scenario that would result in the business being unable to meets its liabilities as they fall due. The analysis demonstrated that the Group would still continue to comply with financial covenants and have sufficient liquidity throughout the period to 30 June 2025 to continue trading.

In addition reverse stress tests have been performed reflecting further reductions in commodity prices, prior to any mitigating actions, to determine at what levels they would have to reach such that either lending covenants are breached or there is no liquidity headroom left. This stress test demonstrated that the likelihood of the fall in price required to cause a breach of covenants or liquidity issue, is considered sufficiently remote in the context of the mitigation strategies available to management. The mitigation strategies within the control of management include the reduction in uncommitted capital expenditure and variable opex savings in the low production scenario. In addition to this, there is also further potential to refinance the Group's borrowing arrangements.

Based on their assessment of the Group's financial position over the period to 30 June 2025, the Directors believe that the Group will be able to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis of accounting in preparing the consolidated financial statements.