Regal Reports Progress in Ukraine

Regal Petroleum PLC on Wednesday announced the completion of both the pipeline that connects the SV-10 well to the existing Regal-owned MEX-GOL facility and the near-completion of the 3D seismic survey over the MEX-GOL field in Ukraine.

As announced in January 2007, Regal has tested the SV-10 well on the Svyrydivske ("SV") field and has since constructed a new 4.3 kilometer pipeline connecting the well to the Mekhediviska-Golotvschinska ("MEX-GOL") gas gathering facility. The SV-10 well was originally drilled in 1998 and was subsequently worked over by Regal in late 2006 using coiled tubing and nitrogen lift. The well was flow tested from mid November 2006 to February 2007 during which time average flow rates of approximately 46,000 m3/d of gas (1.62 mmcf/d) and 8.5 m3/d (50 bbls/d) of condensate were achieved.

Average production in April 2007 from Regal's existing Ukrainian pilot production operations was 117,100 m3/d (4.14 mmcf/d) of gas and 48.9 m3/d (290 bbls/d) of condensate.

Final pressure testing of the new pipeline is underway and, once completed, gas and condensate is expected to be available for sale before the end of May 2007. The additional production from the SV-10 well is forecast to increase the daily volume by some 25 percent.

In addition, the acquisition of a 3D seismic survey covering approximately 100 square kilometers of the MEX-GOL production license, which commenced on 24 January 2007, is nearing completion. The field crew has successfully acquired over 96 square kilometers of the survey and is now acquiring minor infill data to improve quality. This data will now be processed and interpreted by Ukrgeofizika and once interpreted, the data is expected to form the basis of a new reserves determination.

Neil Ritson, Regal's Chief Executive Officer, commented, "We are delighted with the progress on field operations which has been made since receiving the Supreme Court judgment supporting our title in December last year. The permanent hook up of a fifth producing well will provide a significant increase in production and the new 3D seismic should greatly assist in the full field development which will be underway with the commencement of drilling planned for the summer."

As previously announced, the Company is presently in the early stages of a partial divestment process relating to its Ukrainian production assets through advisors Tristone Capital Limited ("Tristone"), with a view to further accelerating the field development with a strategic partner. Qualified parties have been contacted by Tristone and proposals will be sought in due course.


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