14th Sep 2007 07:00
Regal Petroleum PLC14 September 2007 Immediate Release 14 September 2007 REGAL PETROLEUM PLC ("Regal" or "the Company") Ukraine Partial Divestment The Company is pleased to announce that following the competitive partial divestment process run by Tristone Capital Limited on the Company's behalf in relationto the Mekhediviska-Golotvschinska ("MEX-GOL") and Svyrydivske ("SV") gas andcondensate fields in Ukraine, Regal has entered into an exclusive Memorandum ofUnderstanding ("MOU") with the private oil and gas company, MND Exploration andProduction Limited ("MND"). Under the terms of the proposed transaction, whichis for a 50% interest in the Ukrainian production assets, KKCG Oil and Gas BV,MND's holding company in The Netherlands, will invest a total US$330,000,000 inthe development of the MEX-GOL and SV fields. Audited proven and probable reserves in the MEX-GOL and SV fields are currentlyestimated to be 169 mmboe (RyderScott, 2005) and it is envisaged that development will require the drilling of a significant number of development wells inorder to achieve projected peak production rates and recovery of these reserves. The terms of the MOU allow the Company and MND to conduct due diligence andnegotiate transaction documentation on an exclusive basis, but it must bestressed however that, save in respect of certain matters, the MOU isnon-binding and conditional upon due diligence and the execution of transactiondocumentation. In addition, save as set out herein, the terms of the MOU remainconfidential. Regal's Chief Executive Officer, Neil Ritson, said: "The Regal assets in Ukrainehave attracted considerable interest from bidders and we are delighted that theproposed deal with MND will provide an immediate acceleration of activity andsustained investment. Having considered the merits of the proposals from allbidders covering a diverse range of capabilities we strongly believe that MNDoffers the best opportunity to realise shareholder value in our Ukrainianassets. MND has excellent technical and operational expertise and we feelconfident that working together in a jointly operated venture, Regal and MND,will create the greatest project value."The Company would like to stress that the signing of the MOU does not imply thatany transaction is certain to occur or that the proposed transaction will reachcompletion. For further information, please contact: Regal Tel: 020 7408 9500 Neil Ritson, Chief Executive OfficerFrank Scolaro, Chairman Evolution Securities Tel: 020 7071 4300Robert Collins Mirabaud Securities Tel: 020 7321 2508Pav Sanghera Buchanan Communications Tel: 020 7466 5000Bobby Morse Definitions: mmboe million barrels of oil equivalentboe barrels of oil equivalent In accordance with the guidelines of the AIM market of the London StockExchange, Neil Ritson BSc (Hons) Geophysics, FGS, Chief Executive Officer ofRegal Petroleum plc, is the qualified person that has reviewed the technical information contained in this press release. Further information on Regal and MND can be found on their respective websitesas follows:- Regal - www.regalpetroleum.co.uk MND - www.mnd-uk.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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