Regal provides an update on its hydrocarbon resources and operations in the Ukraine.

UKRAINE RESOURCES UPDATE Ryder-Scott Company L.P. ("Ryder Scott"), the independent petroleum consultants, was commissioned by Regal to produce an updated assessment of the reserves and prospective resources attributable to the Company's MEX-GOL-SV fields in Ukraine (the "Report"). The Report was published and released to Regal on 3 May 2010. The study is consistent with Regal's field development plan for the B-Sands, and accords with the 2007 Society of Petroleum Engineers Petroleum Resource Management System (SPE-PRMS) standards. The estimated recoverable gas and condensate reserves and undiscovered prospective resource volumes shown as MMscf and MMbbls in the table below have been extracted from the Report by consent of Ryder Scott and are further subject to the discussion contained in the referenced Ryder Scott report. The discussion presented herein was prepared by the Company and should not be attributed to Ryder Scott nor should it be construed to be approved by Ryder Scott for inclusion herein.

The Report has been prepared for the B-Sand reservoirs only with an effective date of 1 January 2010. In addition to the " Remaining Proved + Probable" reserves volume of 151.3 MMboe, the 2010 Report allocates to the B-Sands 102.4 MMboe to an additional "Remaining Possible" category and a further 151.9 MMboe to "P50 Prospective Resources (Unrisked)". It is intended to update the resource estimate for the B, T and D-Sands in due course once relevant additional data is available.

The Company believes that the new assessment forms a robust benchmark against which to accrete reserves on a well-by-well basis as the Company's Ukrainian field development proceeds. In particular, the upcoming step-out locations viz. MEX-120, SV-67 and SV-68 are all sited in areas that currently carry a 'Possible Reserves' or 'Prospective Resources' classification, neither of which were included in the 2005 report. These two assessment categories are a function of offset distance to a well penetration rather than reflecting any perceived geological risk factor. The new Report indicates that the 'Possible Reserves' category consists of an additional 68% of reserves beyond the combined Proven and Probable estimate. The addition of the 'Prospective Resources' category further highlights the potential for significant reserves accretion offered by the ongoing MEX-GOL-SV B-Sands field development program.

Tags: Regal Petroleum