Settlement of Saipem Contracts

Regal Petroleum plc

("Regal" or the "Company")

16 December 2010

SETTLEMENT OF SAIPEM CONTRACTS

Regal, the AIM-listed oil and gas exploration and production group (symbol: RPT), published (pursuant to Rule 2.9 of the City Code on Takeovers and Mergers) an announcement on 10 December 2010, which was released via RNS on 13 December 2010, that it had reached agreement with its drilling rig contractor, Saipem SpA ("Saipem"), concerning various settlements of all liabilities and obligations with Saipem; subject to contract. The Company is pleased to announce that the terms, as detailed in the announcement on 13 December, have now been formally agreed.

For further information, please contact:

Regal Petroleum plc Tel: 020 7408 9500

K Henry, Chairman

R Wilde, Finance Director

Strand Hanson Limited Tel: 020 7409 3494

Simon Raggett / Rory Murphy

Citigate Dewe Rogerson Tel: 020 7638 9571

Martin Jackson / George Cazenove