Updated Resource Estimates

Island Oil and Gas PLC
20 March 2007


20 March 2007


                              ISLAND OIL & GAS PLC

            UPDATED RESOURCE ESTIMATES FROM FUGRO ROBERTSON LIMITED

Island Oil & Gas plc (LSE:IOG) ('Island' or 'the Company'), announces that Fugro
Robertson Limited ('Fugro Robertson') has recently completed an independent
assessment of the Company's most advanced near-development oil and gas projects.
These include: the Amstel Oil Field, offshore the Netherlands; the Old Head of
Kinsale and the Schull gas fields in the Celtic Sea. In addition,
Fugro-Robertson has also assessed the producing Seven Heads gas field taking
into account the results of the West Seven Heads 48/23-3 appraisal well drilled
by Island in 2006. This assessment constitutes a Competent Person's Report (the
'Report') under the AIM Rules. Island's 2007 drilling programme will commence in
the second quarter of this year and will include appraisal wells at both the Old
Head of Kinsale and Schull gas fields.

Highlights of the CPR Report are:

•Contingent P50 resources of 15.9 MMboe for Old Head of Kinsale,
Amstel and Seven Heads West;

•Old Head of Kinsale, Celtic Sea (Island interest 100%) - On a P50
basis, Field gross gas in place of 78 Bscf; Field Gross Gas Recoverable of 55
Bscf; net contingent resources of 9.2 MMboe.

•Amstel Oil Field, Netherlands (Block Q13) (Island interest 60% after
exercise of State back-in rights) - On a P50 basis, Field gross oil recoverable
of 10.9 MMbbl; total net contingent resources 6.5 MMboe.

•Schull Licence, Celtic Sea (Island interest 55%) - Fugro Robertson
evaluated the Schull 57/2-2 discovery well ('Schull Field') and two adjacent gas
prospects. On a P50 basis, Schull Field gas in place of 28 Bscf; and gross gas
recoverable reserves of 18.2 Bscf; net contingent resources of 1.7MMboe. For the
two adjacent gas prospects, the unrisked total prospective resources are 74.1
Bscf (net risked prospective resources 1.7 MMboe).

•Seven Heads West, Celtic Sea (Island 55.75%) - At the Seven Heads
West Sub-Area, P50 Field gross gas recoverable of 1.7 Bscf, making net
contingent resources of 0.2 MMboe, with potential P10 upside of net contingent
resources of 0.3 MMboe based on P10 gross gas recoverable of 3.1 Bscf.

Island drilled a successful gas well on the Old Head of Kinsale field in the
Celtic Sea, offshore Ireland as part of its 2006 drilling programme; the first
new gas discovery in the Celtic Sea for 16 years. The Company plans to drill a
further appraisal well at the Old Head of Kinsale in the second quarter of 2007,
using the Petrolia Rig. Subject to the results from this well, a Plan of
Development will be submitted based on completing and tying back the two wells
drilled by Island to the Kinsale facilities subject to commercial agreement with
Marathon and the consent of Irish regulatory authorities.

Following the Old Head of Kinsale well, the Petrolia rig will move to the nearby
Schull Licence, where Island will drill an appraisal well to evaluate the 57/2-2
discovery made in 1987 by Total. The appraisal well will assess the continuity
of and potential for establishing commercial gas flow rates from sands
encountered in the 57/2-2 well but not put on test at the time. The Schull well
is planned with a view to developing the gas potential of the area, where Island
has identified two additional structures, through the Seven Heads/Kinsale
infrastructure. There is significant potential upside in gas reserves in this
area subject to the results of the well to be drilled this year. A potential
satellite tie-back development at Old Head will significantly improve project
economics for Schull through a potential reduction in operating costs by sharing
the Kinsale Platform facilities.

Island acquired its interest in the Amstel Field, offshore the Netherlands, its
first international acreage, in November 2006. Island is operator and the
Company is currently evaluating development options for this oil field and
revising a Plan of Development previously submitted to the Dutch authorities.
Island is currently seeking availability of a Jack-up rig for drilling in the
field in 2008.

The CPR reserves have been calculated in accordance with the standards of the
Society of Petroleum Engineers. The CPR does not currently quantify any resource
volumes for Island's highly prospective Atlantic Margin licences, including its
potential multi-tcf gas prospects in the Slyne and Rockall Basins and also its
near-development oil projects off the west coast of Ireland (Connemara oil
field) and the Celtic Sea (Seven Heads oil field). Island will continue to
progress these projects and is currently in discussion with potential industry
partners to further pre-development appraisal activity.

Paul Griffiths, Chief Executive of Island Oil & Gas plc, commented:

' The Fugro Robertson report focuses on our most advanced projects from our
extensive project portfolio. We are now beginning the process of bringing
forward the value of our project portfolio through the prioritised development
of near-term production projects, farm-outs and industry alliances. We will
continue to prove-up the value of the remainder of our portfolio over the coming
12 to 24 months, and will be commencing our 2007 Celtic Sea drilling programme
in the second quarter with an appraisal well firstly at the Old Head of Kinsale
and then at the Schull gas fields.'

Enquiries:

Lisa J Newman
Newman Consulting

Tel: [phone]

Notes to Editors:

Dr Jan Ypma, Manager of the Petroleum Reservoir Group of Fugro Robertson Limited
, and a Petroleum Reservoir Engineer (PhD Theoretical Physics), is the qualified
person who managed the evaluation of the technical and commercial information
relating to Island Oil & Gas plc and the documentation of the Competent Persons
Report from Fugro Robertson Limited. Dr Ypma is also the qualified person who
reviewed and approved the technical information included in this announcement.

Glossary of technical terms:

Bscf - Billions of standard cubic feet of gas

MMboe - Million barrels of oil equivalent, which assumes that 6Mscf of gas has
the same calorific equivalent of 1 barrel of oil

Mscf - Thousands of standard cubic feet of gas

MMscf - Millions of standard cubic feet of gas

P10 - Proven, Probable and Possible reserves

P50 - Proven and Probable Reserves

Proven Reserves - Those quantities of petroleum which, by analysis of geological
and engineering data, can be estimated with reasonable certainty to be
commercially recoverable, from a given date forward, from known reservoirs and
under current economic conditions, operating methods, and government
regulations. Proved reserves can be categorized as developed or undeveloped. If
deterministic methods are used, the term reasonable certainty is intended to
express a high degree of confidence that the quantities will be recovered. If
probabilistic methods are used, there should be at least a 90% probability that
the quantities actually recovered will equal or exceed the estimate.

Unproven Reserves - Based on geologic and/or engineering data similar to that
used in estimates of proved reserves; but technical, contractual, economic, or
regulatory uncertainties preclude such reserves being classified as proved.
Unproved reserves may be further classified as probable reserves and possible
reserves.

Probable Reserves - Those unproved reserves which analysis of geological and
engineering data suggests are more likely than not to be recoverable. In this
context, when probabilistic methods are used, there should be at least a 50%
probability that the quantities actually recovered will equal or exceed the sum
of estimated Proved plus Probable reserves.

Possible Reserves - Those unproved reserves which analysis of geological and
engineering data suggests are less likely to be recoverable than probable
reserves. In this context, when probabilistic methods are used, there should be
at least a 10% probability that the quantities actually recovered will equal or
exceed the sum of estimated Proved plus Probable plus Possible reserves.

Reserve and Resource Categories

After discovery, reserves may be assigned to one of the following two categories
based upon their commercial status at any point in time.

Reserves - Those quantities of petroleum that have been discovered that are
estimated to achieve a commercial return on investment and have been approved
for development by Government and the Board of Directors of the owners.

Contingent Resources - Contingent Resources are those quantities of petroleum,
which are estimated, on a given date, to be potentially recoverable from known
(discovered) accumulations, but which are not currently considered being
commercially recoverable.

Prospective Resources - Prospective Resources are those quantities of petroleum
that are estimated, on a given date, to be potentially recoverable from
undiscovered accumulations.




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