Cancellation of Ministry Order in Ukraine

RNS Number : 1271L

Regal Petroleum PLC

26 July 2011

 



Regal Petroleum plc

("Regal" or the "Company")

26 July 2011

CANCELLATION OF MINISTRY ORDER IN UKRAINE

Regal, the AIM-listed oil and gas exploration and production group (symbol: RPT), provides an update on its Ukrainian operations.

As previously announced, on 21 May 2010, the Company received an order, dated 30 March 2010, signed by the Minister of Environmental Protection identifying certain matters requiring rectification in relation to Regal's compliance with certain legislation in Ukraine relating to its operations at its Mekhediviska Golotvshinska ("MEX-GOL") and Svyrydivske ("SV") gas and condensate fields, and requiring a suspension of operations whilst such matters were rectified (the "Ministry Order").   

On 2 July 2010, the Company received notification of an injunction order made by the District Administrative Court of Kiev suspending the Ministry Order pending a further hearing of the action in the District Administrative Court of Kiev.  This action, challenging the Ministry Order, was brought by OJSC Ukrzakordongeologia (the Company's sole gas customer under a long term gas offtake agreement) against the Ministry of Environmental Protection (the "MEP").  On 9 August 2010, the District Administrative Court of Kiev ruled that the Company should be substituted as the claimant in the action brought by OJSC Ukrzakordongeologia.  On 11 October 2010, the District Administrative Court of Kiev found in favour of the MEP in the action.  On 18 October 2010, the Company filed an appeal of this ruling and on 1 December 2010, the Administrative Court of Appeal in Kiev ruled in favour of the MEP.   On 24 December 2010, the Company appealed the decision of the Administrative Court of Appeal but such appeal has not been heard by the Court.

On 7 July 2011, the Company filed new proceedings in the District Administrative Court of Kiev against the MEP and the State Geological Service of Ukraine in respect of the Ministry Order based on new circumstances. At the same time the Company made an interim application in the new proceedings seeking a suspension of the Ministry Order, and on 8 July 2011 the Court made a ruling on such interim application to grant a suspension of the Ministry Order. This ruling allowed the Company to restart production at its MEX-GOL and SV fields and first production duly commenced on 22 July 2011.

Yesterday evening the Company received a written decision, dated 18 July 2011, of the District Administrative Court of Kiev in the new proceedings, ruling that the Ministry Order was unlawfully issued and ordering its cancellation.  The decision is capable of being appealed during a period of 10 days from today, failing which the decision will come into force on 6 August 2011.

For further information, please contact:

Regal Petroleum plc                        Tel: [phone] 

Keith Henry, Chairman

Robert Wilde, Finance Director

Strand Hanson Limited                    Tel: [phone]

Simon Raggett / Rory Murphy

Citigate Dewe Rogerson                 Tel: [phone]

Martin Jackson

 

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