CARPATSKY PETROLEUM INC.

CARDINAL RESOURCES PLC

CARDINAL RESOURCES PLC

February 17, 2005 13:50 ET

Carpatsky Petroleum Inc. Mails Information Circular for Shareholder Meeting to Approve Acquisition by Cardinal Resources Plc


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: CARPATSKY PETROLEUM INC.

AND CARDINAL RESOURCES PLC

FEBRUARY 17, 2005 - 13:50 ET

Carpatsky Petroleum Inc. Mails Information Circular
for Shareholder Meeting to Approve Acquisition by
Cardinal Resources Plc

LONDON, UNITED KINGDOM--(CCNMatthews - Feb. 17, 2005) - Cardinal
Resources Plc (Cardinal) and Carpatsky Petroleum Inc. (Carpatsky)
announced today that Carpatsky has mailed an information circular to its
shareholders in connection with a proposed acquisition of Carpatsky by
Cardinal through a share exchange reorganization. The Carpatsky
shareholder meeting to approve the reorganization is scheduled for March
9, 2005 and it is anticipated that the transaction will become effective
shortly after that date.

By the reorganization, Cardinal will acquire all of Carpatsky's common
shares, Carpatsky will become a wholly-owned subsidiary of Cardinal and
the former shareholders of Carpatsky will become holders of ordinary
shares of Cardinal on the basis of one-half of a Cardinal share for each
Carpatsky share. Following the reorganization, Cardinal shareholders and
the former Carpatsky shareholders will hold approximately 29% and 71%,
respectively, of the ordinary shares of Cardinal. So far as Carpatsky
and Cardinal are aware, no shareholder will beneficially own more than
7% of the Cardinal shares.

The reorganization will be effected through a plan of arrangement under
the Business Corporations Act (Alberta). It must be approved by
Carpatsky's shareholders, with the required level of approval being 66?%
of votes cast. No approval by Cardinal shareholders is required.

Carpatsky's board of directors has determined that, in its opinion, the
reorganization is in the best interests of Carpatsky and is fair from a
financial standpoint to the Carpatsky shareholders. The board of
directors unanimously recommends that Carpatsky shareholders vote in
favour of the reorganization.

Cardinal is a public company, incorporated in England, that was created
by Carpatsky to complete a U.S. $9.5 million private placement in early
2004, principally to U.K. institutional purchasers, and then acquire
Carpatsky. The issue price under the private placement was U.S. $0.60
(adjusted for a subsequent consolidation of Cardinal's shares). The
private placement enabled Cardinal and Carpatsky to update a reserve
report, prepare and initiate a work program at the Rudovsko
Chervonozavodske natural gas and condensate field in Eastern Ukraine
(the RC Field) and the Bitkov Babchenske oil field in Western Ukraine
(the Bitkov Field), organize the necessary financial and legal
information associated with a proposed stock exchange listing, settle
certain historic obligations, prepare for the reorganization and
finalize the recruitment of Cardinal's board of directors and management
team.

Carpatsky is an independent oil and gas exploration, development and
production company that operates in Ukraine. Carpatsky entered into a
joint activity agreement with the Ukraine state-owned oil and gas
company Ukrnafta in 1995 to develop the RC Field. The joint venture
company Ukrcarpatoil was formed with Ukrnafta in 1994 to develop the
Bitkov Field. Both the RC Field and the Bitkov Field are currently
producing oil and gas for Carpatsky. Expected net recoverable reserves
to Carpatsky from these two fields is 294.6 Bscfe of gas, or 49.1 MMBOE
of oil. The net present value of those reserves is $98.9 million at a
12% discount rate and $118.6 million at a 10% discount rate.

Carpatsky's common shares were suspended from trading by the TSX Venture
Exchange in July 2002 and then de-listed in June 2003 as a result of its
failure to file financial statements and to pay TSX-VE annual sustaining
fees. In addition, Carpatsky's securities were subjected to cease trade
orders issued by the Alberta and British Columbia Securities Commissions
because of its failure to file financial statements and send the
statements to its shareholders. Carpatsky did not have sufficient funds
to satisfy those obligations.

Carpatsky's information circular to shareholders in connection with the
reorganization has been filed with Canadian securities regulatory
authorities. The information circular contains a full description of
Carpatsky, Cardinal and the reorganization and includes a copy of the
arrangement agreement entered into between Carpatsky and Cardinal.
Carpatsky has also filed or will be filing various financial statements
and other documents so as to allow it to apply for revocation of the
securities commission cease trade orders. Included among the filings is
a Statement of Reserves Data and Other Information, Report of
Independent Qualified Reserves Evaluator and Report of Management and
Directors, as required under National Instrument 51-101 "Standards of
Disclosure for Oil and Gas Activities". All filings are available at
www.sedar.com.

This news release contains forward-looking information relating to
capital expenditures, future drilling and other matters. This
information is based on Carpatsky and Cardinal's current expectations
and assumptions as to a number of factors, including weather conditions,
availability of drilling rigs, drilling success, reserves and
production, ability to tie-in production, commodity prices, exchange
rates, interest rates, access to capital, general economic, industry and
political conditions. If those expectations and assumptions prove to be
incorrect, or factors change, then actual results could differ
materially from the forward-looking information contained in this news
release.

Not for distribution to United States newswire services or dissemination
in the United States.


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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Cardinal Resources Plc
    Robert J. Bensh
    Chairman and Chief Executive Officer
    + 44 207 936 5250
    or
    Carpatsky Petroleum Inc.
    Robert J. Bensh
    Chairman, President and Chief Executive Officer
    + 44 207 936 5250
    Email: rbensh@cardinal-uk.com