Regal board forces out founder and chairman

Frank Timis, the executive chairman and founder of Regal Petroleum, was forced to resign yesterday after losing the support of its non-executive directors.

Frank Timis, the executive chairman and founder of Regal Petroleum, was forced to resign yesterday after losing the support of its non-executive directors.

Mr Timis's departure yesterday followed an admission last month from the oil and gas explorer that its much-hyped Greek oil prospect had turned out to be a dry well, causing a collapse in Regal shares. Over the weekend, it was reported that Mr Timis had been named in three criminal investigations in his native Romania, though some Romanian officials were quoted on Monday denying that Mr Timis was involved.

Bobby Morse, a spokesman for Regal, said: "It [the resignation] was a board decision and he [Mr Timis] went along with it. He had always said that, if it was in the best interests of shareholders, he would step down." It is understood that Bill Humphries, one of the two non-executive directors, was the prime mover behind Mr Timis's departure. Mr Humphries, who has long experience in the extractive industries sector, was abroad yesterday but "attended" an emergency board called for yesterday morning by phone.

Mr Humphries, who is managing director of Patagonia Gold, told the meeting that he was not prepared to stay on the board if Mr Timis retained his position. The other independent director, Lord St John of Bletso, the chairman of Spiritel, is understood to have supported that view.

"Frank [Timis] could have toughed it out and said he was staying but he agreed to go ... Bill [Humphries] took the view that since the Greek announcement, things had just got worse and worse. Serious damage was being done to the company. Something had to give," said one source.

Mr Humphries is prepared to replace Mr Timis as chairman but only if the company submits to a full review. This issue, on which there is no agreement as yet, is expected to be resolved in the next few days. The two remaining executive directors are Roger Phillips, the finance director, and Dr Rex Gaisford, the production director. Mr Timis retains an 8 per cent stake in Regal, which also has interests in Ukraine, Romania and Egypt.

A statement from Regal said Mr Timis, 41, had resigned "with immediate effect in order to devote more time to other business interests". Regal shares gained, closing up 6p at 73.5p - the stock hit a high of 501p earlier this year before the Greek disappointment.

Mr Timis has also floated two other companies on AIM: European Goldfields, in which he has a 19 per cent stake, and Sierra Leone Diamond Corporation, where he has a 60 per cent holding. Mr Timis is chairman of the diamond company. He also has a number of private business interests.

In 2003, Mr Timis was ousted from another company he had founded, a gold explorer called Gabriel Resources listed in Canada.

The broker that floated Regal in September 2002, Evolution Securities, has also attracted criticism though Evolution has insisted it acted properly. The broker said it would remain Regal's adviser "for the foreseeable future".