The Board of Regal have noted recent speculation in the media with regards to a dispute itemised in a letter from the Ukranian Prosecutor-General's Office on the validity of licences held by Regal Petroleum Corporation Limited, the wholly owned subsidiary of Regal based in the Ukraine. Having received full guidance from legal counsel in Ukraine, the speculation has no substance and the licences owned by Regal remain legal and valid.

The letter appears to refer to actual facilities and wells that are currently delivering the pilot production from the field which were developed by the joint venture between Regal and Chernihivnaftogasgeology under a previous pilot production license and which has been the subject of Court proceedings in Ukraine to establish 25% of the value to be ascribed to these physical assets to be paid to Chernihivnaftogasgeology. This court action was completed and an appropriate sum paid into court by Regal. This ruling on valuation has been appealed by Chernihivnaftogasgeology and this action by the Prosecutor's office therefore requires clarification, which is currently being sought.

For further information, please contact:

Regal Tel: 020 7408 9500
Rex Gaisford, Chief Executive
Roger Phillips, Finance Director

Buchanan Communications Tel: 020 7466 5000
Bobby Morse / Ben Willey