Interim Results

Regal Petroleum PLC
27 September 2004


For Immediate Release                                 Monday 27th September 2004

                              REGAL PETROLEUM PLC

                       INTERIM RESULTS FOR THE SIX MONTHS

                     ENDED 30 JUNE 2004 / TRADING STATEMENT

Regal Petroleum plc ('Regal', 'the Company' or 'the Group'), the oil and gas
exploration and production company, today announces its results for the six
months ended 30 June 2004.

Operational highlights include:

Greece

  • Independent report on the Greater Kallirachi Area (southern area of the
    Prinos Group Basin) was completed in September 2004 indicating up to 1
    billion barrels of hydrocarbons in place
  • The Kallirachi-1 exploration well was completed in January 2004 which
    proved the presence of sweet (37 degrees API), high quality oil
  • Increase in shareholding in August 2004 in Kavala to 81.66% (from 57.69%)
    through €10m share purchase with the funds being used towards the Greek
    asset development programme
  • Commencement of drilling an appraisal well in the Greater Kallirachi Area
    and the completion of an infill well on Prinos North expected in Q4 2004
  • Full independent reserve audit of the Prinos Group Basin with P1 and P2
    classifications will be available by Q2 2005

Ukraine

  • Cashflow positive and profitable during the period
  • Awarded 100% interest in two production licences
  • Construction of extra storage plant commenced in Q3 2004 and is due for
    completion in Q4 2004
  • Optimisation of the GOL/MEX processing plant is due to be completed in Q2
    2005
  • Based on positive results from western technology completions a full
    independent reserve audit to be carried out by end of 2004

Romania and Egypt

  • Government ratification of the exploration, development and production
    licence for Suceava Block in Romania, with seismic acquisition to be
    completed in October 2004
  • First Romanian appraisal well to be drilled and another spudded before end
    of 2004
  • Signed an agreement to acquire LK Exploration N.V.'s exploration and
    production licence in the East Ras Budran Area, Gulf of Suez, Egypt
  • Government approval for the transfer of the Egyptian licence is expected
    in Q4 with exploration drilling targeted for Q2 2005

Board and senior management

  • Mr Roger Phillips appointed as Group Finance Director in September 2004
  • Dr Luis Quintero promoted to Chief Operating Officer of Regal and Managing
    Director of Kavala Oil in September 2004
  • A further 5 senior technical and operational personnel have recently
    joined the Group's operations

Financial highlights

  • Turnover increased to $13.4m (30-Jun-03: $1.2m)
  • Pre-tax loss of $2.5m (30-Jun-03: loss of $1.4m), with loss per share of
    2.3 cents (30-Jun-03: loss per share of 2.4 cents)
  • Average production of 4,800 boepd during the period, generating average
    sales price of $22/boe
  • Placing of shares which raised £37.5m net of expenses during the period
  • Net cash of $65.7m (30-Jun-03: $2.8m) at period end and net assets of
    $131.5m (30-Jun-03: $14.5m)



Commenting on the interim results, Frank Timis, Executive Chairman, said:

'The six months period in question was one of development and change for Regal.
Having addressed significant issues, both technical and operational, and having
strengthened our management team, the Company is in a considerably stronger
position to deliver returns from its high quality assets in Europe and Egypt.'

For further information, please contact:
Regal                                                         Tel: [phone]
Frank Timis, Executive Chairman
Roger Phillips, Group Finance Director

Buchanan Communications                                       Tel: [phone]
Bobby Morse / Catherine Miles

Notes to Editors

Regal is a London based independent oil and gas producer listed on the
Alternative Investment Market of the London Stock Exchange with ambitious growth
plans. Regal is focused on the exploration, development and production of oil
and gas assets in Ukraine, Greece, Romania and Egypt.

Regal's total proven and probable reserves as at 31 December 2003 were over 273
Mmbbls. In terms of its producing assets, Regal owns 100% of its operations in
Ukraine, and 81.66% of Kavala Oil SA, Regal's Greek business. Through its 100%
owned Romanian subsidiary, Regal has two significant licence blocks in Romania,
making Regal the largest foreign concession holder in the country. In August
2004, Regal agreed to acquire LK Exploration N.V.'s interest in certain
petroleum exploration and production rights in the East Ras Budran Area, Gulf of
Suez, Egypt.


Attached          Trading Statement
                  Chairman's Statement
                  Consolidated Profit and Loss Account
                  Consolidated Balance Sheet
                  Consolidated Cash flow Statement
                  Notes to the Accounts

TRADING STATEMENT

Prinos Basin Study: Greater Kallirachi Area

The Directors are pleased to announce that an independent report has confirmed
pre-drill volumetric estimates of the Greater Kallirachi Area (southern area of
the Prinos Group Basin) holding up to 1 billion barrels of hydrocarbons in
place.

The report on the Greater Kallirachi Area has been produced by GEUS and
Odegaard, independent oil and gas consultants. The report includes work on
volumetrics, 3D seismic inversion and interpretation, geological modelling and
structural mapping.

Work continues on firming up well locations for drilling an appraisal well in
the Greater Kallirachi Area in Q4 2004.

Greece

Following the successful drilling of the Kallirachi well in February 2004 and
the completion of the independent Greater Kallirachi Area Study, which has
confirmed the pre drill volumetric estimate of up to 1 billion barrels in place,
Regal is now confirming well locations for appraisal drilling which is expected
to commence in Q4 2004.

Regal successfully increased its interest in Kavala Oil to 81.66% on 13 August
2004 for an investment of €10 million cash, with the funds being used towards
the Greek asset development programme.

The average production for the six months ended 30 June 2004 was 3,300bopd. Due
to equipment mobilisation delays, current production in Greece is approximately
2,000-2,500bopd. Following work-over and infill drilling programmes production
is expected to increase to 6,000-7,000 bopd by year-end.

The first infill well is currently being drilled on Prinos North and it is
expected to be completed in December 2004 at an initial production rate of
2,000bopd. In addition, well simulations/workovers on Prinos are expected to be
completed in Q4 2004 as well as re-entry and/or sidetracks of current shut-in
wells to complement existing production.

A number of development studies have been carried out on Epsilon and a reservoir
development plan is currently being finalised. It is expected that a well will
be drilled in Q1 2005.

Comprehensive reservoir engineering for five fields is underway (Prinos North,
Epsilon, Kallirachi, Prinos and South Kavala).

A full independent reserve audit will be undertaken on the Prinos Group Basin
with P1 and P2 classifications by Q2 2005.

Ukraine

The Ukraine operations continue to be profitable and generate positive cash-flow
for the Group.

On 30 June 2004 Regal was awarded a 100% interest in two production licences:
Mekhedivsko-Golotovshenske (MEX/GOL) and Svyrydivske (SV). The licences are for
20 years and allow full exploitation and production of hydrocarbons. Gross
royalties payable to the state of Ukraine are $7.62 per 1,000 cubic metres for
gas and $23.41 per metric tonne of condensate.

Current production in Ukraine is 120,000 cubic metres of gas and 470bopd of
condensate from four wells on production: MEX102, MEX3, GOL1 and GOL2. Regal
will continue to increase production by exploiting western oil technology and by
performing well simulations on the MEX/GOL field which are due to be completed
in Q4 2004.

The construction of extra storage plant to cope with the unexpectedly high
condensate flow from MEX102 commenced in Q3 2004 and is due for completion in Q4
2004. In addition, the optimisation of the GOL/MEX processing plant is due to be
completed in Q2 2005.

Regal has commenced comprehensive reservoir engineering on both fields and a
review of the geological model and Russian log re-interpretation is underway.
Furthermore, Regal has commenced analysis of hydrocarbon quality tendency by
layer, cluster analysis and MonteCarlo simulation to determine selection of
optimum well locations and timings.

Based on positive results from western technology completions a full independent
reserve audit is to be carried out by the end of 2004

Romania

The Suceava Block licence has completed the government ratification process and
seismic acquisition and processing has commenced. To date, 458km of 2D data over
the two most prospective structures has been acquired with 402km left to acquire
over the remaining structures. It is expected that the seismic acquisition
programme will be completed in Q4 2004. It is planned to drill one well and spud
another on the Suceava Block before the end of 2004.

The Barlad Block licence is moving through the government ratification process
and it is expected to be ratified by the end of 2004. It is expected that
seismic surveys will be performed on the Barlad Block in 2005.

Egypt

In August 2004 Regal signed an agreement to acquire LK Exploration N.V.'s
exploration and production licence in the East Ras Budran Area, Gulf of Suez,
Egypt. Government approval of the transfer is expected to be obtained in October
2004. Four prospects have been identified, all data is being re-digitised and
interpreted and exploration drilling is expected to commence in Q2 2005.

Outlook

The Directors of Regal Petroleum plc advise that, due to lower than expected
production of oil from their Greek operations, results for the second half of
2004 will be similar to the first half results.

The lower than expected production in Greece has been caused by delays in the
mobilisation of drilling rigs and other equipment necessary to work-over
existing wells and to drill new production wells. The Directors believe that
this will cause a six month delay to previous production forecasts.

CHAIRMAN'S STATEMENT

Dear Shareholder

During the first half of 2004 we have continued our strategy of focusing on
building shareholder value through the acquisition and development of highly
prospective exploration and production licences which are close to established
hydrocarbon markets and infrastructure.

In addition, we have continued our production strategy of exploiting existing
assets to drive cash flow in order to fund our aggressive development and
exploration activities.

Considerable Growth

The first half of 2004 has seen considerable growth in potential reserves
through the discovery of up to 1 billion barrels of hydrocarbons in place in the
Greater Kallirachi Area. Furthermore, we have achieved profitable operations in
Ukraine that are now generating significant cashflow for the Group.

Review of Results

The financial results for the six months ended 30 June 2004 are in line with
expectations and reflect the successful integration of Kavala Oil S.A. business
into the Group together with substantial capital expenditure in line with our
development and exploration strategy.

In March 2004 Regal successfully placed 13.3 million new ordinary shares and
raised £37.5 million to develop assets in Greece and Romania.

Turnover for the six months was $13,432,616 (30-Jun-03: $1,228,000) which is
mainly attributable to oil sales in Greece and gas and condensate sales in
Ukraine. During the first six months of 2004 the Group achieved an average daily
production of 4,800boepd at an average sales price of $22/boe.

The operating loss after minority interests for the six months was $2,497,659
(30-Jun-03: $1,382,000).

As at 30 June 2004 the Group had no long term external borrowings. Total
interest receivable for the six months was $839,972 (30-Jun-03: $71,000)
reflecting successful cash management for the period.

The net capital expenditure and financial investment outflow of $22,825,000
(30-Jun-03: $4,035,000) represented the aggressive investment toward development
and exploration, particularly in Greece.

Board and Senior Management

On 1 September 2004 Roger Phillips was appointed to the Regal Board of Directors
as Group Finance Director. Mr Phillips is a Chartered Accountant with over 25
years experience in the oil and gas industry including 19 years at Amerada Hess
Corporation where he was the Vice President and Director of Amerada Hess in
London.

The integration of Kavala Oil into Regal and the aggressive development and
exploration plans that are underway in Greece necessitated a change to the
senior management team. In September 2004 it was decided to promote Dr Luis
Quintero from Managing Director of Ukraine Operations to Chief Operating Officer
of Regal and Managing Director of Kavala Oil.

In addition, a further five senior technical and operational personnel have
recently joined the Group's operations.

During the second half of 2004 Regal will concentrate its exploration and
development efforts in Greece and Romania in order to add additional reserves to
the existing reserves portfolio and to increase Group production by exploiting
western oil technology in Ukraine and Greece.

V. Frank Timis

Chairman

Regal Petroleum plc

Consolidated profit and loss account for the six months ended 30 June 2004


                                            Six months          Six months                Year
                                                 ended               ended               ended
                                             30-Jun-04           30-Jun-03           31-Dec-03
                                            (unaudited)         (unaudited)           (audited)
                                   Note           $000                $000                $000

Turnover                              2         13,433               1,228              10,194
Cost of sales                                   (7,518)               (317)             (8,973)
Gross profit                                     5,915                 911               1,221
Other income                                        41                   -               2,966
Administrative expenses                         (9,378)             (2,364)             (8,528)
Operating Loss                                  (3,422)             (1,453)             (4,341)

Interest receivable                                840                  71                 254
Interest payable and similar
charges                                            (33)                  -                (129)
Loss on ordinary activities
before and after taxation                       (2,615)             (1,382)             (4,217)

Minority interest                                  117                   -               1,309
Loss for the financial period         3         (2,498)             (1,382)             (2,908)

Loss per ordinary share (cents)
Basic                                 4            2.3c               2.4c                4.5c
Diluted                               4            2.3c               2.4c                4.5c

All amounts for the six months ended 30 June 2004 and 2003 relate to continuing
activities.


Regal Petroleum plc

Consolidated balance sheet at 30 June 2004

                                              30-Jun-04       30-Jun-03       31-Dec-03
                                             (unaudited)     (unaudited)       (audited)
                                  Note             $000            $000            $000

Fixed assets
Intangible assets                                 2,754               -           2,350
Tangible assets                                  56,081           9,882          36,188
Investments                                         576              54             203
                                                 59,411           9,936          38,741

Current assets
Stocks                                           14,241               -           3,626
Debtors                                          10,171           3,220          10,169
Investments                                       3,000               -           3,770
Cash at bank and in hand                         65,739           2,775          28,539
                                                 93,151           5,995          46,104

Creditors: amounts falling due
within one year                                 (15,912)         (1,299)        (15,441)

Net current assets                               77,239           4,696          30,663

Total assets less current
liabilities                                     136,650          14,632          69,404

Provisions for liabilities and
charges                                          (1,302)           (100)         (1,253)

Minority interest                                (3,831)              -          (3,948)

Net assets                                      131,517          14,532          64,203

Capital and reserves
Called up share capital               5           9,568           4,737           8,212
Share premium                                   131,417          15,273          62,369
Merger reserve                                   (3,204)         (3,204)         (3,204)
Capital contributions                             7,477           7,477           7,477
Profit and loss account deficit                 (13,741)         (9,751)        (10,651)
Shareholders' funds - equity                    131,517          14,532          64,203


Regal Petroleum plc

Consolidated cash flow statement for the six months ended 30 June 2004

                                               Six months           Six months                Year
                                                    ended                ended               ended
                                                30-Jun-04            30-Jun-03           31-Dec-03
                                               (unaudited)          (unaudited)           (audited)
                                    Note             $000                 $000                $000

Net cash outflow from
operating activities                              (10,325)              (1,821)             (1,060)
Returns on investments and servicing of
finance
Interest received                                     840                   70                 280
Interest paid                                        (100)                   -                (130)

Net cash inflow from returns on
investments
and servicing of finance                              740                   70                 150

Capital expenditure and financial investment
Purchase of tangible fixed
assets                                            (22,827)              (4,049)            (16,766)
Sales of tangible fixed
assets                                                  2                   14                   -
                                                  (22,825)              (4,035)            (16,766)

Acquisition and disposals                             (58)                   -              (1,547)

Cash outflow before use of liquid
resources and financing                           (32,468)              (5,786)            (19,223)

Management of liquid resources and financing
Purchase of current asset
investments                                             -                    -              (3,168)

Financing
Proceeds from borrowings                               21                    -                   -
Repayment of borrowings                              (724)                (413)               (185)
Issues of ordinary share
capital                                            74,719                    -              44,626
Payment of expenses and commissions
on issue of ordinary shares                        (4,315)                   -              (2,601)
                                                   69,701                 (413)             41,840
Increase/(decrease) in cash                        37,233               (6,199)             19,449


Regal Petroleum plc

Notes forming part of the financial statements for the six months ended 30 June
2004

1.        Accounting policies and presentation of financial information

The interim accounts are unaudited and do not constitute statutory accounts as
defined in section 240 of the Companies Act 1985.

There have been no changes to the Group's accounting policies during the period.
The accounting polices are set out in the Annual Report and Accounts for the
year ended 31 December 2003, a copy of which has been filed with the Registrar
of Companies at Companies House in the United Kingdom.


2.        Turnover

                                            Six months       Six months            Year
                                                 ended            ended           ended
                                             30-Jun-04        30-Jun-03       31-Dec-03
                                            (unaudited)      (unaudited)       (audited)
                                                   $000            $000            $000
Oil sales                                         9,527               -           7,121
Other                                               694              69             229
Ukraine                                           3,212           1,228           2,844
                                                 13,433           1,228          10,194
                                                 13,433           1,228          10,194
Greece                                           10,221               -           7,350
Gas sales                                         1,616           1,088           2,545
Condensate sales                                  1,596              71             299

Analysis of turnover by activity:

Analysis of turnover by geographical
origin:

3.        Consolidated statement of total recognised gains and losses

                                             Six months      Six months            Year
                                                  ended           ended           ended
                                              30-Jun-04       30-Jun-03       31-Dec-03
                                             (unaudited)     (unaudited)       (audited)
                                                   $000            $000            $000

Loss for the period                              (2,498)         (1,382)         (2,908)
Exchange differences                               (592)           (138)            488
Total recognised gains and losses for
the period                                       (3,090)         (1,520)         (2,420)


4.        Loss per ordinary share

The calculation of basic and diluted loss per ordinary share has been based on
the loss for the period and 108,536,040 ordinary shares, being the average
number of shares in issue for the period to 30 June 2004.

5.        Share capital
                                                        Authorised
                           ----------------------------------------------------------------------
                               30-Jun-04          31-Dec-03           30-Jun-04         31-Dec-03
                              (unaudited)          (audited)         (unaudited)         (audited)
                                  Number             Number                $000              $000

Ordinary shares of 5p each
(Approximately 9c
each)                        200,000,000        200,000,000              18,137            17,905

                                             Allotted, called up and fully paid
                           ----------------------------------------------------------------------
                               30-Jun-04          31-Dec-03           30-Jun-04         31-Dec-03
                              (unaudited)         (audited)          (unaudited)         (audited)
                                  Number            Number                 $000              $000

Ordinary shares of 5p each
(Approximately 9c
each)                        115,439,868       100,541,534                9,568             8,212

On 23 March 2004 the Company issued 13,333,334 new ordinary shares at a price of
£3.00 per share as part of an institutional placement. The net proceeds of the
placing totalled £37.5 million. These funds were raised to develop the Group's
assets in Greece and Romania.

During the half year ended 30 June 2004 the Company issued 1,565,000 new
ordinary shares to various directors and employees of the Company in accordance
with the Company's option scheme. The total consideration received by the
Company was £1,079,225.

6.        Fair Value Review

During the second half of 2004 the Company will perform a final fair value
review on the acquisition of Eurotech Services S.A. (including Kavala Oil S.A.),
with any required adjustments being made in the 2004 annual accounts.

7.        Approval of Accounts

These interim accounts were approved by the Board of Directors on 24 September
2004.



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