07.07.2010
Resolution of Regal licences delayed due to ministry reshuffle

The new Minister of Environment of Ukraine will review the situation with Regal licences
only after the Ministry finalises all the key appointments.

Mr Mykola Zlochevsky, the new Minister of Environment of Ukraine, appointed last Friday
to replace Mr. Victor Boyko, speaking to Ukrainian Energy yesterday, confirmed that he
plans to consider the situation with Regal Petroleum licences only after the new ministry
executive team is formed and a new head of Geological office of Ukraine is appointed.

According to the Minister, he is planning to thoroughly study the report prepared in December
last year by the joint committee consisting of representatives of different ministry departments
that came to the conclusion that Regal breached the subsoil use agreement and based on
which his predecessor issued an order on 30th March 2010 suspending Regal’s licences.

According to Regal Petroleum, the Company received the order only on 21 May, but continued
operations and confirmed this in RNS on 28 June, after the story leaked to the press. Regal
obtained an injunction of a lowest instance court suspending the order on July 2 pending a
further hearing of the action in the District Administrative Court of Kiev. The action has been
brought by OJSC Ukrzakordongeologia, the company which purchases all of the gas produced
by Regal Petroleum under a long term gas offtake agreement.

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