AGM Statement

Regal Petroleum PLC
29 July 2005


Immediate Release                                                  29 July 2005


                              REGAL PETROLEUM PLC

                           ('Regal' or the 'Company')

                        Corporate and Operational Update

The Directors announce the following update on corporate and operational
matters:

Greece Operational Update (working interest 95%): the Company is pleased to
announce that John Clinton has been appointed as Managing Director of Kavala Oil
S.A. ('Kavala'). Mr Clinton is an experienced management professional with a
successful track record at director level in the international oil industry,
particularly in eastern Europe. Previous appointments include Director of INDECO
(1998-2005), Managing Director of McDermott Europe (1994-1998), Commercial
Director of Amerada Hess Trading Ltd (1988-1994) and Director of Beatrice
Resources Ltd (1985-1988).

Current stabilised daily production in Greece is approximately 2,300bopd.
Following an internal asset and operational review, the Company has adopted a
production enhancement programme for the Prinos field with the following
targets:

  • 3,500bopd by the end of 2005 by performing 3 work-overs/sidetracks; and
  • 5,000bopd by mid-2006 by performing 4 additional work-overs/sidetracks.

In accordance with the recent operational review, the Company has implemented a
cost reduction programme which has already achieved monthly operational cost
reductions of approximately $500,000 per month. With current oil prices and
recent cost reductions, operations at Kavala are now cash-flow positive.

Ukraine Operational Update (working interest 100%): current pilot production is
approximately 4.4MMscfd and 100bbls of condensate per day. With low operational
costs, the Ukraine operations continue to be profitable and generate positive
cash-flow for Regal.

The Company is continuing to work-over existing wells in order to increase pilot
production in the near term.

In 2004 the Company successfully converted its pilot production licences into
two 20 year full exploitation and production licences: licence 3334 for the MEX/
GOL field and licence 3335 for the SV field. Accordingly, the Company is
currently formulating the full development plan in order to bring the two fields
into full production.

The combined area of the two licence areas is approximately 269km2, which makes
it one of the largest fields in Europe by area.

Romania Operational Update (working interest 100%):

Suceava Block

Following the successful completion of the first exploration well on the
4,103km2 Suceava Block in April 2005, a further seismic survey was completed
which is being interpreted in order to determine the overall prospectivity of
the Suceava licence area. In conjunction with this seismic analysis, a drilling
programme is being finalised and it is expected that an exploration well will be
drilled in late 2005. The results of this exploration well will then be analysed
to formulate the next stage of the drilling programme.

Barlad Block

Reprocessing of 800km of existing seismic data has been completed and the
acquisition and processing of 500km of new seismic data is continuing on the
6,285km2 Barlad Block in order to determine the depositional history. This will
improve lead structure identification and refine mapping of prospects to allow
well locations to be selected.

Egypt Operational Update (working interest 100%): a well location has been
approved by the Egyptian Petroleum Corporation, long lead items have been
purchased and the Company is currently assessing the availability of drilling
rigs. It is expected that drilling will commence in late 2005. The dry hole cost
of the well is expected to be less than $4 million.

In accordance with the Company's asset rationalisation policy, the Company is
considering its options to reduce its working interest in Egypt.

Liberia Operational Update (working interest 25%): the Production Sharing
Contracts for Blocks 8 and 9 were finalised and signed by The National Oil
Company of Liberia in June 2005. The Production Sharing Contracts are now
awaiting ratification by the Liberian Government.

Audit of Reserves: as announced by the Company on 1 July 2005, work on the
reserves reports being prepared by independent auditors on the Company's Ukraine
and Greece proven and probable reserves is continuing and it is expected that
the reports will be finalised in late August 2005. A further announcement will
be made once the final reports have been received.

Peak Resources Call Option: the Company announced on 20 June 2005 that it had
been notified by solicitors acting for Peak Resources Limited of Hong Kong
('Peak Resources') of the existence of a call option ('Call Option') purporting
to acquire the entire issued capital of Regal Petroleum (Jersey) Limited, a
wholly owned subsidiary of the Company and the holder of the Company's Ukraine
assets. The Company has sought legal advice and believes that the Call Option is
invalid and unenforceable.

The Call Option states that the valuation of the Company's Ukraine assets will
be calculated by applying a price of $1.50 to total proven (P1), probable (P2)
and possible (P3) reserves in Ukraine as certified by Ryder Scott Company, L.P.
('Ryder Scott'). Ryder Scott are independent reserve auditors which the Company
has engaged to estimate the remaining reserves of its Ukraine licence areas.

As stated by the Company on 1 July 2005, Ryder Scott have not finalised their
report. However, a preliminary report has been issued on the B reservoirs which
states proven and probable reserves of 174MMboe.

Ryder Scott is currently completing its work to include the proven and probable
reserves for the T reservoir sections. Ryder Scott have not been instructed to
produce a certified figure for possible reserves as yet but informal indications
from them suggest that the relatively modest amount of data available at present
from the pilot drilling and production phase so far completed on these
concessions, is quite insufficient for any reasonably meaningful 'certified'
possible reserve figure to be arrived at under formal SPE/WPC certification
rules. Furthermore, the proven and probable reserve figures are similarly
restricted by the certification rules.

In order to understand the potential value of the field, the Company engaged
petroleum consultants Petro Solutions Ltd to report on potential technical
reserves in the field. Petro Solutions Ltd have indicated technical reserves in
the field are as follows:

                                                                   MMboe

         Proven producing                                             11

         Proven undeveloped                                          668

         Probable                                                    328

         Total technical reserves                                  1,007

                                                                
The Directors wish to emphasise that the above technical reserves are NOT
audited reserve numbers and are merely indicative in nature.

Should the Company accept the terms of the Call Option, irrespective of its
validity, and proceed with any transaction then the consideration payable by
Peak Resources would be calculated on certified reserves and is estimated to be
in the region of $300 million. The Company believes that this amount is
significantly less than the potential value of the field and, accordingly, does
not consider a sale on these terms to be in the best interests of the
shareholders.

Irrespective of the enforceability of the Call Option, if Peak Resources
persists in this process then the Company would place any outcome that it
believes not to be in the interests of the shareholders before the shareholders
at an Extraordinary General Meeting for a vote and recommend its rejection.

The Company remains interested in selling all or part of the Ukraine assets on a
fair value basis and accordingly has entered into discussions with Peak
Resources.

Financial Update: as at 30 June 2005 the Group had cash reserves of
approximately $54 million and the Directors believe that the Company is
adequately funded to fulfil its commitments and to implement its approved
programmes for its various assets.

For further information, please contact:

Regal                                                       Tel: [phone]
Roger Phillips, Finance Director

Buchanan Communications                                     Tel: [phone]
Bobby Morse / Ben Willey


Definitions:
bbls              barrels
bopd              barrels of oil per day
km                kilometres
km2               square kilometres
MMboe             millions of barrels of oil equivalent
MMscfd            millions of cubic feet per day
SPE               Society of Petroleum Engineers
WPC               World Petroleum Congress


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