RPT.L Regulatory News (RPT)

 3 March 2011

REGAL PETROLEUM PLC

("Regal" or the "Company")

RELATIONSHIP AGREEMENT WITH ENERGEES

The board of directors of Regal (the "Board") is pleased to note that the increased, recommended partial cash offer made by Energees Management Limited ("Energees Management") on 6 February 2011 (the "Offer") has today been declared wholly unconditional.

Further to the announcement made on 6 February 2011 by Regal and Energees Investments Limited ("Energees Investments"), the Company has entered into a relationship agreement with Energees Investments and JSC Smart Holding UA ("JSC Smart") (the "Relationship Agreement") and an orderly market agreement with Energees Management, Strand Hanson Limited and Merrill Lynch International (the "Orderly Market Agreement").

Relationship Agreement

The Relationship Agreement has been entered into to ensure that the business and affairs of the Company are managed by the Board, independently of Energees Investments, JSC Smart, their respective subsidiaries, any person or entity which controls either of them and any entity which is under common control with either of them (the "Smart Holding Group"). In particular, it provides that all transactions to be entered into with any member of the Smart Holding Group will be at arm's length and on a commercial basis and that any Directors appointed by Energees Investments (or who are otherwise interested in the Smart Holding Group) shall be precluded from voting on any resolution of the Board to approve any such transaction or arrangement (or to take any action to enforce the Company's rights under it). 

The Relationship Agreement also provides Energees Investments with the right to nominate certain representatives to be appointed as Directors of the Company. For so long as Energees Management or any member(s) of the Smart Holding Group, individually or jointly, continue to hold:

(1) not less than 50.1 per cent. of the issued share capital of the Company, Energees Investments shall be entitled to nominate three representatives to be appointed as Directors of the Company; and

(2) less than 50.1 per cent. but not less than 25 per cent. of the issued share capital of the Company, Energees Investments shall be entitled to nominate two representatives to be appointed as Directors of the Company.

Orderly Market Agreement

Under the Orderly Market Agreement, Energees Management has agreed not to dispose of any shares in the capital of the Company, for a period of 12 months' from the date that the increased partial offer has been declared wholly unconditional, save (subject to certain exceptions) where such disposal is effected through the Company's broker.

Exercise of Options under the LTIP

All of the outstanding options held by the following Directors and certain employees under the Company's Long Term Incentive Plan, have vested and have been exercised, pursuant to the change of control in the Company resulting from the Offer having been declared wholly unconditional. 

All such Directors and employees have accepted the Offer in respect of all of the ordinary shares issued to them on the exercise of their options. In common with all Regal shareholders, such acceptances are subject to being scaled down in accordance with the procedures set out in the offer document published by Energees Management on 6 February 2011. 

Application will be made for, in aggregate, 2,270,960 new ordinary shares to be admitted to trading on AIM, which is expected to occur no later than 8 March 2011. The new ordinary shares, when fully paid, will rank pari passu in all respects with the existing ordinary shares.

Total Voting Rights

In accordance with Rule 5.6 of the FSA's Disclosure and Transparency Rules, the Company's issued share capital comprises 320,637,836 ordinary shares of 5 pence each, with each share carrying the right to one vote. No shares are held in treasury. Accordingly, the total number of voting rights in the Company is 320,637,836 and this figure should be used by shareholders when calculating whether they are required to notify their interest in, or a change in their interest in, the share capital of the Company under the Disclosure and Transparency Rules.

Enquiries

For further information please contact:

Regal Petroleum plcKeith Henry, Chairman Telephone: +44 20 7408 9500Robert Wilde, Finance Director

Strand Hanson Limited(Nominated Adviser to Regal)

Simon Raggett Telephone: +44 20 7409 3494Rory Murphy

BofA Merrill Lynch

(Financial adviser to Regal)

Anya Weaving Telephone: +44 20 7996 1000Paul Frankfurt

Citigate Dewe Rogerson

Martin Jackson Telephone: +44 20 7638 9571

George Cazenove