LONDON--(Marketwire - February 8, 2010) -


THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO THE UNITED STATES

Xcite Energy (TSX-V: XEL) (AIM: XEL) (LSE: XEL), a developer of heavy oil assets in the UK North Sea, announces an offering of new ordinary shares of the Company (the "Offering") which will be offered for sale pursuant to a short form prospectus filed in all of the provinces of Canada except Québec. The Offering will also include a placing of the new ordinary shares in the United Kingdom. A receipt has been received by Xcite Energy from the applicable securities regulator for the preliminary short form prospectus filed on February 5, 2010. A copy of the preliminary short form prospectus will be available on www.sedar.com.

The net proceeds from the Offering will be used primarily to fund the drilling and flow testing of a pre-development well on the Company's Bentley oil field, which the Company currently estimates will cost approximately C$40 million, for early production system planning and engineering (approximately C$5 million) and for general working capital purposes (approximately C$5 million).

Octagon Capital Corporation and CIBC World Markets Inc. will act as exclusive agents of the Company with respect to sales of new ordinary shares in Canada. Arbuthnot Securities Limited will act as special selling agent of the Company and sole bookrunner in connection with the Offering in the United Kingdom.

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Contact Information: ENQUIRIES: Xcite Energy Limited Richard Smith Chief Executive Officer +44 (0) 1330 826 740 Rupert Cole Chief Financial Officer +44 (0) 1330 826 740 Arbuthnot Securities Limited Sole Bookrunner, United Kingdom Andrew Fairclough Richard Johnson Nick Tulloch Ed Burbidge +44 (0)20 7012 2000 Strand Hanson Limited (NOMAD) James Harris Rory Murphy +44 (0) 20 7409 3494 Pelham Bell Pottinger Public Relations Mark Antelme +44 (0) 20 7337 1500