Loan Facility, RMB Resources

Island Oil and Gas PLC
23 October 2007


23 October 2007


                              ISLAND OIL & GAS PLC

                    RMB RESOURCES - ADDITIONAL LOAN FACILITY

Island Oil & Gas plc (LSE:IOG) ('Island' or the 'Company'), is pleased to
announce that it has secured an additional loan facility for Stg£4.5million with
the London office of RMB Resources, the resources merchant banking business of
Rand Merchant Bank, part of the FirstRand Group of South Africa. This is in
addition to the existing Stg£7.5 million short term loan facility arranged
through RMB Resources in December 2006. The entire facility is repayable at any
time up to 31 December 2007. The terms of the extended facility are the same as
those for the original facility.

Following on from the successful 2007 drilling results, discussions are
continuing with RMB Resources to secure the provision of medium-term financing
to allow the Company to progress these opportunities within the optimum time
scale.

Island, having drilled and tested four successful gas wells on its core Celtic
Sea assets during 2006 and 2007, will partly use the new facility to accelerate
pre-development planning in 2007. This early work is designed to complete
ongoing engineering and commercial due diligence required in order to be in a
position to make a Declaration of Commerciality, subject to the consents and
approvals of the Department of Communications, Energy and Natural Resources, as
early as possible in 2008. Currently Island is targeting first gas production in
2009.

Paul Griffiths, Chief Executive of Island, commented:

'Our 2006 and 2007 drilling programmes have delivered four successful gas wells
which now form the basis for growing our Celtic Sea gas business. The additional
loan demonstrates the support Island receives from key industry relationships
and consolidates Islands position, allowing it to maximise the potential of its
project portfolio.'


Enquiries:

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, Morocco and Albania.

This announcement 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.

RMB Resources is one of Africa's leading natural resource players, providing
innovative financial solutions to companies operating in the mining, oil, gas
and energy sectors. With a presence in each of the major resource sector capital
raising centres, it has an international capability and the potential to provide
the equity, quasi-equity and debt funding necessary for the future development
of Island's oil and gas portfolio.

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