OREANDA-NEWS. June 29, 2010. The Ministry of Environmental Protection of Ukraine issued an order requiring Regal Petroleum to suspend its operations in Ukraine, the Company announced June 28. Although the order is dated 30 March 2010, the Company received it on May 21, 2010. The Company representative has also pointed out that  this matter is of essentially  procedural nature.  Currently, Regal is engaged in an ongoing dialogue with the government, while continuing its business operations as usual.

Millennium Capital believes this news is negative for the Company. Although the situation is not clear yet, we are of the opinion that the potential dispute with the government poses an imminent threat to Regal’s operations in Ukraine, given the previous examples of Vanco and Cadogan. Assets in Ukraine are of primary importance to Regal, which makes the potential suspension in its development efforts highly detrimental for the Company’s financials and future prospects.