INA

NOT FOR DISTRIBUTION TO UNITED STATES NEWS WIRE SERVICES OR DISSEMINATION IN
UNITED STATES


Iona Energy Inc. ("Iona" or the "Company") (TSX VENTURE:INA) is pleased to
announce it has entered into a definitive Sale and Purchase Agreement with
Carrizo Oil & Gas, Inc. ("Carrizo") to acquire the entire share capital of its
wholly owned subsidiary, Carrizo UK Huntington Limited ("Carrizo UK"), including
its interest in License P1114 of UK North Sea Block 22/14b including the
near-producing Huntington oil field development ("Huntington"). In addition to
customary closing conditions and purchase price adjustments, the transaction is
subject only to final approval of the United Kingdom's Department of Energy and
Climate Change ("DECC"), and is expected to close prior to the end of January
2013. 


Included in the Sale and Purchase are:



--  A 15% non-operated working interest in the Huntington oil field; 
    
--  Royalties equivalent to 2.55% of total gross oil and gas production from
    the Huntington Joint Venture Partners (the "Royalties"); 
    
--  A 100% interest in that part of the yet-to-be licensed 27th License
    Round award covering Block 22/14d that contains the 3D seismically
    mapped extension of the Jurassic discovery which underlies Huntington;
    and 
    
--  Carrizo UK's ring-fenced tax losses totaling USD$111 million as at the
    transaction effective date of July 1st, 2012. 



Under the terms of the agreement, Iona paid to Carrizo a USD$6 million
non-refundable deposit upon signing the Sale and Purchase Agreement, and will
additionally pay to Carrizo:




--  cash consideration of USD$152 million on closing, including standard
    financial adjustments, at the transaction effective date of July 1st,
    2012; and 
    
--  a deferred payment of USD$18 million from first producing field revenues
    
--  normal working capital adjustments from the effective date up to the
    date of closing 



Upon completion of the acquisition of Carrizo's interest in Huntington, the
working interests on License P1114 will be E.ON Ruhrgas UK E&P (25% Operator),
Premier Oil plc (40%), Norwegian Energy Company ASA (20%), and Iona (15%). 


Huntington consists of Paleocene reservoir oil, located in Block 22/14b in the
Central North Sea. Huntington has been developed with four production and two
water-injection wells and will be tied back to Teekay's Floating Production
Storage and Offloading ("FPSO") vessel, the Voyageur Spirit. The FPSO arrived at
its final location on October 2nd, 2012. Final hook-up of risers, completion and
commissioning are now taking place, with first oil expected in the first half of
2013.


Initial stabilized gross production rates are estimated to be 30,000 bbls of oil
per day ("bopd") and 27 MMscf of gas per day ("MMscf/d"), or 4,500 bopd and 4.0
MMscf/d, totaling 5,175 boepd net to Iona (not including approximately net 765
bopd and 0.68 MMscf/d attributed to the Royalties). Management believes peak
production rates will be considerably governed by the processing capacity of the
FPSO, and as a result production decline rates in the first 24 months are
expected to be slight. Given the API of 43 degrees and other qualities of the
Huntington crude oil, Iona anticipates a slight premium to Brent quality priced
crude. 


As developed and under current market conditions, Iona estimates reserves for
its interest in Huntington to be, 3.5 MMbbls Proved Reserves, 6.0 MMbbls Proved
plus Probable Reserves, and 7.3 MMbbls Proved plus Probable plus Possible
Reserves respectively (excluding volumes attributed to the Royalties from the
Huntington Joint Venture Partners)(1). Iona expects to include the working and
royalty interests in Huntington to its 2012 year-end independent reserves
evaluation due to be completed no later than April 30th, 2013. 


Carrizo has also agreed to assign its 100% interest in that part of Block 22/14d
containing a 3D seismically mapped extension of the Jurassic discovery
underlying the Huntington field. This agreement is subject to confirmation of
the award of Block 22/14d to Carrizo in the UK's 27th License Round and to DECC
approval of this assignment to Iona. 


Iona's existing cash, a $60 million bridge financing with a Canadian
institutional investor, and a senior secured reserves based lending facility
("RBL") with a group of lenders for up to USD$200 million will provide financing
for this acquisition. The Company has agreed to terms with a group of RBL
lenders and is subject to, amongst other things, continued due diligence, credit
or investment committee approvals, definitive documentation and final agreements
expects to close both financings on or before January 31, 2013. 


Iona's Chief Executive Officer, Neill Carson commented, "We are delighted with
the acquisition within our target metrics of meaningful near-term production at
Huntington. We believe this transaction is an enabler that will ultimately
deliver the booked pre-tax value of USD$1.2 billion in Iona's other 38 million
barrels of oil equivalent 2P reserves(2). I would also like to acknowledge the
effort of our entire team in getting this agreement executed."  


Brad Gunn, Iona's Chief Financial Officer, noted, "This deal clearly represents
a strategic cornerstone for Iona Energy and we expect this acquisition will
unlock our USD$200 million credit facility and provide significant 2013 and 2014
cash flow. By utilizing Carrizo UK's and Iona's tax losses, the majority of
future Huntington cash flows are expected to surpass our obligations and fully
fund our development aspirations at Orlando and Kells."


Additional information relating to the Company is available on SEDAR at
www.sedar.com.




Notes:                                                                      
                                                                            
(1)    Prepared by a non-independent qualified reserves evaluator.          
(2)    Based on: (a) Orlando reserves and net present value information     
       prepared by Gaffney, Cline & Associates Ltd. ("GCA") (using forecast 
       prices and costs) as of September 30, 2012; (b) Trent & Tyne reserves
       and net present value information prepared by GCA (using forecast    
       prices and costs) as of December 31, 2011; (c) Kells reserves and net
       present value information prepared by GCA (using forecast prices and 
       costs) as of March 31, 2012, and (d) West Wick reserves and net      
       present value information prepared by GCA (using forecast Prices and 
       costs) as of December 31, 2011.                                      



About Iona Energy:

Iona Energy Inc. and its wholly owned subsidiary Iona Energy Company (UK)
Limited (collectively, "Iona" or the "Company"), is an oil and gas exploration,
development and production company focused on oil and gas development and
exploration in the United Kingdom's North Sea.


Forward-looking statements and Cautionary Notes

Some of the statements in this announcement are forward-looking, including
statements estimates of the quantities of proved reserves, probable reserves,
and possible reserves, as well as estimates of the net present value of future
net revenue of proved reserves, probable reserves, and possible reserves.
Forward-looking statements include statements regarding the intent, belief and
current expectations of Iona Energy Inc. or its officers with respect to various
matters, including estimated production, reserves, the RBL and the Bridge, or
otherwise. When used in this announcement, the words "expects," "believes,"
"anticipate," "plans," "may," "will," "should", "scheduled", "targeted",
"estimated" and similar expressions, and the negatives thereof, are intended to
identify forward-looking statements. Such statements are not promises or
guarantees, are based on various assumptions by Iona's management and are
subject to risks and uncertainties that could cause actual outcome to differ
materially from those suggested by any such statements. These forward-looking
statements speak only as of the date of this announcement. Iona Energy Inc.
expressly disclaims any obligation or undertaking to release publicly any
updates or revisions to any forward-looking statement contained herein to
reflect any change in its expectations with regard thereto or any change in
events, conditions or circumstances on which any forward-looking statement is
based except as required by applicable securities laws.


Notes Regarding Oil and Gas Disclosure 

As used in this press release, "boe" means barrel of oil equivalent on the basis
of 6 mcf of natural gas to 1 bbl of oil. Boes may be misleading, particularly if
used in isolation. A boe conversion ratio of 6 mcf: 1 bbl is based on an energy
equivalency conversion method primarily applicable at the burner tip and does
not represent a value equivalency at the wellhead.  


It should not be assumed that the present worth of estimated future net revenue
represents the fair market value of the reserves disclosed in this press
release. The reserve and related revenue estimates set forth in this press
release are estimates only and the actual reserves and realized revenue may be
greater or less than those calculated. The estimates of reserves and future net
revenue for individual properties may not reflect the same confidence level as
estimates of reserves and future net revenue for all properties, due to the
effects of aggregation. 


As used in this press release, "possible reserves" are those additional reserves
that are less certain to be recovered than probable reserves. There is a 10%
probability that the quantities actually recovered will equal or exceed the sum
of proved plus probable plus possible reserves. 


Additionally, this press release uses certain abbreviations as follows:



Oil and Natural Gas Liquids              Natural Gas                        
--------------------------------------   -----------------------------------
                                                                            
bbls       barrels                       Bcf        billion cubic foot      
                                                                            
MMbbls     millions of barrels           MMscf      million standard cubic  
                                                    feet                    
                                                                            
MMboe      million barrels of oil                                           
           equivalent                                                       



FOR FURTHER INFORMATION PLEASE CONTACT: 
Iona Energy Inc.
Neill A. Carson
Chief Executive Officer
+011 (44) 1224 228400


Iona Energy Inc.
Brad G. Gunn
Chief Financial Officer
(403) 775-7442

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