Trading Update

Regal Petroleum PLC
20 January 2003


For Immediate Release                               20 January 2003


                         Regal Petroleum Plc ('Regal')

                                 Trading Update



The directors are pleased to announce the following trading update for Regal's
oil and gas operations in Ukraine:





HIGHLIGHTS:



•        New gas well GOL2 commences production at an approximate rate of
         200,000 cubic meters of gas per day



•        Gas well MEX3 continues production at an average rate of 110,000
         cubic meters of gas per day



•        Forward sales of gas have been achieved for the production of MEX3 and
         GOL2 at a rate of US$54 per thousand cubic meters with payment in 
         advance in US dollars





GOL2.  The drilling of Regal's second well was successfully completed in
November 2002 and, following production testing, was connected via a newly
constructed 10 kilometres 114mm diameter underground pipeline to Micherdovka,
the existing state owned treatment facility.

Technical staff have estimated that the flow rate will be approximately 200,000
cubic meters of gas and 2 metric tonnes of condensate per day.  Production has
commenced.



MEX3.  Regal's first well has produced an average of 110,000 cubic meters of gas
and 2 metric tonnes of condensate per day since being brought into production at
the beginning of September 2002.



SALES.  Production is being sold locally at a current rate of US$54 per thousand
cubic meters of gas and US$230 per metric tonnes of condensate.  All sales are
for payment in advance for US dollars.



GOL1.  The workover is continuing on Regal's third well GOL1 which is now
estimated to enter production in February 2003.  Severe weather conditions in
late November 2002 prevented the drilling rig from being manoeuvred into
position for makeover works, which has caused a six week delay.  However, all
infrastructure, including a newly constructed 11 kilometres 114mm diameter
pipeline, has been completed in readiness for connection to Micherdovka.



EXPORT SALES.  The completion of GOL1 will bring production from the three wells
to approximately 450,000 cubic meters of gas per day which is considered
sufficient to satisfy long-term orders from large utilities and heavy industrial
plants.  Current prices on international markets realised for gas sales are in
excess of US$90 per thousand cubic meters of gas which is a substantial premium
to locally sold gas.

Negotiations with potential buyers in Romania and Hungary are progressing
satisfactorily.



ADDITIONAL WELLS.  Three further wells are currently under construction:

-         SV10, an existing well that is currently being worked over

-         SV52, a new well, has been drilled to a depth of 3,881 meters and is
          being prepared to run the intermediate casing.

-         MEX102, a new well, has been drilled to 737 meters

-         Two other wells have been identified for workover



GAS PLANT. Regal is finalising negotiations with a US company for the provision
and lease of a 1.1 million cubic meters per day gas processing plant.  This will
provide Regal with direct control of the plant and result in significant
processing cost savings.

The gas plant will also allow for new wells and a further three makeover wells
in the vicinity of its proposed location to be brought into production.





For further information, please contact:


Regal                                                       Tel: [phone]

Frank Timis, Executive Chairman
Bill Humphries, Non-executive Director
Glenn Featherby, Finance Director

Buchanan Communications                                     Tel: [phone]
Bobby Morse / Tim Thompson








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