Regal Petroleum plc has entered into a Memorandum of Understanding for the acquisition of PJSC Science and Production Concern Ukrnaftinvest ("UNI"), which holds the Belolisky and Alibeysk-Trapivska production licences in Ukraine.

The Memorandum is made between (1) the Company and (2) Ms Lidiia Chernysh and Bolaso Investments Limited, who each own 50% of the issued share capital of UNI.

UNI is a Ukrainian incorporated company, and its audited financial statements for the year ended 31 December 2018 show that its net assets as at 31 December 2018 were UAH 178.9 million and losses after tax for the year ended 31 December 2018 were UAH 0.7 million, with corresponding unaudited figures as at 30 June 2019 of net assets of UAH 179 million and net profits after tax of UAH 0.2 million.

UNI holds a 100% interest in each of the Licences, which are located in the Odessa region in south-western Ukraine. Each of the Licences was granted in August 2004 with a duration of 20 years, and it is intended that UNI will apply to extend the Licences under the applicable legislation to enable development of the assets. The Licences are prospective for oil, as well as gas, and have been the subject of exploration since the 1980s, with 24 wells having been drilled on the Licences since then. The Company has undertaken a detailed review of the available data on the Licences, and has estimated that there is a substantial Oil Initially In Place volume of approximately 675 MMboe. The Company and the Sellers are to agree a work programme to appraise the Licences, which will include the drilling of up to three wells, subject to satisfactory results of each well.

Link to Regal Petroleum Ukraine country profile