ABERDEENSHIRE--(Marketwire - Mar 23, 2012) -

 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART DIRECTLY OR INDIRECTLY IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION TSX-V, LSE-AIM: XEL 23 March 2012 Xcite Energy Limited ("Xcite Energy" or the "Company") Results for the Year Ended 31 December 2011 Xcite Energy announces its results for the year ended 31 December 2011 and progress in 2012 to date. The key highlights are as follows: Highlights - Achievement of oil reserves of the type 1P, 2P and 3P for the core area of the Bentley field of approximately 96 MMstb, 116 MMstb and 140 MMstb, respectively, with NPV10 (after tax) for the core area of $1.076 billion, $1.464 billion and $1.921 billion on a 1P, 2P and 3P basis, respectively (see "Cautionary Language" below for a general explanation of the method and assumptions used in these calculations). - Strengthened balance sheet, with net new equity capital financing of GBP62.7 million in 2011. Cash balance at year end of GBP64.1 million, with an additional net GBP26.4 million raised since the year end. Included in cash balances at the year ended 31 December 2011 are amounts held in escrow of GBP47.1 million relating to the Bentley Phase 1A work programme. - Department of Energy and Climate Change approvals to drill and produce the planned Bentley field 9/3b-7 and 7Z wells under the Well Operations Notification System, the Petroleum Operations Notice and the Oil Pollution Emergency Planning. - Rowan Norway jack-up rig commenced Phase 1A of the work programme on the Bentley field, with 9/3b-7 well spudded on 18 March 2012. The following tables summarise the Group's performance in the year to 31 December 2011 and the comparatives for the year to 31 December 2010 and the year to 31 December 2009. The Group had no trading revenue in any of these periods. Year ended Year ended Year ended 31 December 31 December 31 December Income Statement Information 2011 2010 2009 GBPm GBPm GBPm Net profit/(loss) 0.1 (2.4) (0.9) Earnings/(loss) per share (basic) 0.1p (1.9p) (1.4p) in pence Earnings/(loss) per share (diluted) 0.1p (1.9p) (1.4p) in pence Year ended Year ended Year ended 31 December 31 December 31 December Cash Flow Information 2011 2010 2009 GBPm GBPm GBPm Net cash flow from operations (12.6) 20.9 (1.5) Net cash flow from investing (22.0) (39.3) (0.5) activities Net cash flow from financing 62.8 52.6 1.9 activities As at As at As at 31 December 31 December 31 December Balance Sheet Information 2011 2010 2009 GBPm GBPm GBPm Total assets 152.8 102.8 24.8 Current liabilities 9.5 23.7 0.2 Long term liabilities (deferred 0.5 0.5 0.5 tax) Total net assets 142.7 78.6 24.1 The Company's full Financial Results for the Year Ended 31 December 2011 can be found at the following link: [ http://www.rns-pdf.londonstockexchange.com/rns/9245Z_-2012-3-22.pdf ] The Company has filed copies of its audited financial statements and management discussion and analysis in respect thereof for the year ended 31 December 2011. These documents can be found for viewing by electronic means on the System for Electronic Document and Analysis Retrieval at [ www.sedar.com ] ENQUIRIES: Xcite Energy Limited +44 (0) 1483 549 063 Richard Smith Chief Executive Officer Rupert Cole Chief Financial Officer Oriel Securities +44 (0) 207 710 7600 (Joint Broker and Nomad) Emma Griffin Partner Michael Shaw Partner Morgan Stanley +44 (0) 207 425 8000 (Joint Broker) Andrew Foster Managing Director Pelham Bell Pottinger +44 (0) 207 861 3232 Mark Antelme Director Henry Lerwill Account Director Paradox Public Relations +1 514 341 0408 Jean-Francois Meilleur Consultant Cautionary Language Oriel Securities Limited, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Xcite Energy and for no one else in connection with the subject matter of this announcement and will not be responsible to anyone other than Xcite Energy for providing the protections afforded to its clients or for providing advice in connection with the subject matter of this announcement. Morgan Stanley, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for Xcite Energy and for no one else in connection with the subject matter of this announcement and will not be responsible to anyone other than Xcite Energy for providing the protections afforded to its clients or for providing advice in connection with the subject matter of this announcement. The independent reserves and resources audit of the Company Assets effective 31 December 2011, as audited by TRACS is based on forecast and prices effective as at 31 December 2011 from McDaniel & Associates' October 2011 Brent oil forecast, less a 12% discount for Bentley crude ( [ www.mcdan.com ] ). The calculation of the NPV10 (after tax) for the core area disclosed above takes into account the following: (a) UK Corporation Tax is charged at the rate of 30% on net taxable income; (b) UK Supplemental Corporation Tax ("SCT") is charged at the rate of 32% on net taxable income; and (c) heavy oil allowances of up to GBP800 million have been applied to offset the SCT to the extent possible. Glossary"1P" means proved reserves."2P" means proved plus probable reserves."3P" means proved plus probable plus possible reserves. Possible reserves are those additional reserves that are less certain to be recovered than probable reserves and there is a 10% probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves."MMstb" means millions stock tank barrels."NPV10" means net present value in money of the day using a 10% forward discount rate, which values do not represent fair market value."$" means US dollars. Forward-Looking Statements Certain statements contained in this announcement constitute forward-looking information within the meaning of securities laws. Forward-looking information may relate to the Company's future outlook and anticipated events or results and, in some cases, can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "target", "potential","continue" or other similar expressions concerning matters that are not historical facts. These statements are based on certain factors and assumptions including expected growth, results of operations, performance and business prospects and opportunities. While the Company considers these assumptions to be reasonable based on information currently available to us, they may prove to be incorrect. Forward-looking information is also subject to certain factors, including risks and uncertainties that could cause actual results to differ materially from what we currently expect. These factors include risks associated with the oil and gas industry (including operational risks in exploration and development and uncertainties of estimates oil and gas potential properties), the risk of commodity price and foreign exchange rate fluctuations and the ability of Xcite Energy to secure financing. Additional information identifying risks and uncertainties are contained in the Company's annual information form dated 26 October 2010 and in the annual Management's Discussion and Analysis for Xcite Energy dated 22 March 2012 filed with the Canadian securities regulatory authorities and available at [ www.sedar.com ] . The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations. Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. This information is provided by RNS The company news service from the London Stock Exchange END