Letter of Intent Signed

TomCo Energy PLC
21 January 2008

                                        
                                TomCo Energy plc
                                        
                                Letter of Intent

TomCo Energy Plc ('TomCo' or the 'Company') (AIM: TOM) is pleased to announce 
that it has today signed a Letter of Intent ('LOI') with Avenue Group Inc 
(AVNU.OB), a NY based US listed Oil & Gas Company, and its wholly-owned 
subsidiary Avenue Energy Israel Limited ('AEI'); to acquire a 50 per cent. 
interest in the Heletz-Kokhav License (the 'License') awarded to AEI by the 
Israel Petroleum Commission.

The Heletz-Kokhav field, located 55km south of Tel Aviv and 12km east of the 
Mediterranean, is Israel's only producing onshore oil and gas field. The 60,000 
acre license has produced in excess of 17 million barrels of oil to date from 
Cretaceous sands, with peak production of approximately 3,000 to 4,200 barrels 
per day ('bpd') between 1959 and 1967. The original oil-in-place (OOIP) for the 
field was estimated at 50.7 million bbls; the Israeli Government estimates that 
there are 2 million bbls of primary recoverable oil remaining, and studies 
suggest 5 -10 million bbls of secondary recovery potential. A number of 
undrilled, deeper exploration prospects have estimated potential of over 30 
million bbls. Recent production for the field was around 60 bpd, although TomCo 
expects that the implementation of modern production and recovery methods and 
the drilling of additional wells on the License will significantly increase 
production, resulting in the granting of a 30 years Production Lease.

TomCo and AEI will now work to finalise the terms of a binding contract.

Under the terms of the LOI, TomCo undertakes to:

1. within 5 days of signing the LOI, pay a non-refundable security deposit of 
   US$75,000, granting TomCo 45 days exclusivity in which to sign a definitive 
   agreement ('Closing').  This period can be increased to 60 days by TomCo 
   paying an additional deposit of US$25,000;
2. at Closing, pay AEI US$1 million in cash;
3. at Closing, issue to AEI TomCo ordinary shares ('Shares') valued at US$0.5 
   million at a price per Share equivalent  to the average middle market price 
   for the seven days prior to Closing;
4. at Closing pay to AEI 50 per cent. of AIE costs incurred to date in relation 
   to the License, which have been confirmed at US$108,000;
5. over the three year Phase 1 period of the License pay up to US$4.5 million of 
   development costs;
6. pay a further US$1.5 million to AEI after a 30 years production lease is 
   issued, which lease may be issued once production at the field reaches 300 
   bpd; and
7. pay a further US$5 million to AEI after the recoverable reserves are 
   declared to be more than 10 million barrels by an internationally acceptable 
   geologist.

Further updates regarding the acquisition of the 50 per cent. interest in the 
Licence will be announced in due course.

Howard Crosby, TomCo's Chief Executive Officer, commented:

'Whilst our main focus, of course, remains the implementation of our core 
investment strategy in North America and we are stepping up our infill drilling 
programme at our Texas Saratoga and Abel leases, we are increasingly finding, 
through our extensive evaluation of many oil & gas situations, some extremely 
attractive 'special situations' outside the USA. Heletz-Kokhav is an excellent 
opportunity to join with the US public company, Avenue Group, to develop the 
highly potential Heletz field in Israel and will create new horizons and will be 
an important investment for us.  We will continue to expand our portfolio, both 
in the USA and outside, in order to build TomCo into an oil company with both 
significant production and an aggressive exploration programme.'

Enquiries:

TomCo Energy Plc [phone]
Howard Crosby

Strand Partners Ltd. [phone]
Warren Pearce

Bankside Consultants Ltd. [phone]
Simon Rothschild

Notes:
TomCo is an AIM listed company which continues to actively develop a 
conventional oil production profile in the South-Western United States.  The 
Company also owns leases on approximately 3000 acres of shale oil holdings in 
Utah, estimated by SRK (an independent firm of mining consultants) to contain 
some 230 million barrels of oil.






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