Schull Well Spud

Island Oil and Gas PLC
16 July 2007



16 July 2007


                              ISLAND OIL & GAS PLC
                                        
                    COMMENCEMENT OF SCHULL GAS APPRAISAL WELL
                                        
                                        
Island Oil & Gas plc ('Island' or the 'Company') (LSE:IOG) today announces that
it has spudded gas appraisal well 57/2-3 ('Well 57/2-3') on Exploration Licence
5/05 (the Schull Field) in the Celtic Sea, offshore Ireland. Well 57/2-3 follows
on from Islands successful gas appraisal well at the nearby Old Head of Kinsale.
Island is operator with a 62.5% interest.


Well 57/2-3 was spudded on 14 July 2007 in a water depth of approximately 360
feet. The Schull Field was first discovered by the Total operated well 57/7-2,
which discovered a 60 foot gas column, in 1987 at a time of lower gas prices and
no available access to gas infrastructure.  The area contains two more potential
gas structures, the Schull Central and the Schull North prospects. Well 57/2-3
is designed to demonstrate the gas potential in the greater Schull area.


The Schull Field is located immediately to the southwest of the Seven Heads gas
field and the associated infrastructure linking Seven Heads to the Kinsale Alpha
platform.


Following completion of drilling and testing, Providence Resources plc will take
possession of the Petrolia Rig, allowing Island to reduce its mobilisation and
demobilisation costs.


Island's partners in the Schull Field are Valhalla Oil and Gas Limited with a
25% interest and EnCore Oil plc with a 12.5% interest.


Enquiries:


Paul Griffiths
Chief Executive
Island Oil & Gas plc

Tel: [phone]


Lisa J Newman MCIPR MIRS
Newman Consulting

Tel: [phone]


Notes to editors:


Island was founded in 2003 and listed on AIM in December 2004 (LSE:IOG).  The
Company has interests in eleven Irish offshore licences, as well as licences in
the Netherlands and Morocco.   Island is involved in an exploration and
appraisal programme which in 2006 saw successful Celtic Sea gas wells at the Old
Head of Kinsale and the Seven Heads Sub-Area.  The Company has again secured the
Petrolia rig for its 2007 Celtic Sea drilling programme. This commenced in the
second quarter of 2007 with a successful gas appraisal well at the Old Head of
Kinsale gas field.


This drilling update has been reviewed and approved by Paul Griffiths, Chief
Executive of Island.  Paul Griffiths is a geology graduate of the Royal School
of Mines, Imperial College London, and is a member of the Petroleum Exploration
Society of Great Britain. He has 30 years experience in the oil and gas
exploration sector and is a qualified person as defined in the guidance note for
Mining Oil & Gas Companies, March 2006 of the London Stock Exchange.



Further information on Island can be found on the Company's website at http://
www.islandoilandgas.com.





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