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Royale Energy Inc. (ROYL) is “One to Watch”

Founded in 1986, Royale Energy, Inc. is an independent energy company with headquarters in San Diego, California. They focus on the development, acquisition, exploration, and production of natural gas and oil in California, Texas, and the Rocky Mountains. For more than 20 years, the Company has been a leading independent producer of oil and natural gas. Royale Energy Inc. trades on the OTC Bulletin Board.

The Company’s main lines of business include the production and sale of natural gas and oil, and the acquisition of oil and gas interests and proved reserves. Their business also includes drilling of exploratory and developmental wells and sales of fractional working interests in the wells they drill. Royale Energy owns wells and leases in California’s Sacramento and San Joaquin basins, Utah, and in the Gulf Coast basins of Texas and Louisiana.

On Thursday, October 15, 2009, Royale Energy, Inc. announced that after reaching a total depth of 6,200 feet, they have set pipe on what they believe to be a significant new discovery. The Goddard 7-1 was located one mile north of the boundary of Royale Energy’s successful Lonestar field. They drilled the well to test significant 3D seismic amplitude at a previously unexplored depth. The well came across higher pressure at this depth than those produced in the Lonestar field, increasing the expected rate of gas recovery. The Goddard 7-1 commenced drilling on September 23, 2009. This new field discovery provides Royale Energy with significant new development opportunities to increase their production and natural gas reserves.

On Monday, Royale Energy Inc. announced the signing of a definitive agreement for the private placement of approximately $2 Million of common stock and warrants on October 16, 2009. The Company will use funds from the offering for working capital. This will allow them to speed up the drilling of wells in follow up to their recently announced discovery.

Royale Energy will now initiate the permit process for the Vann and Magnum prospects. They expect to begin drilling these before the end of next quarter. They announced that they would start the Wylie well this week.

Stephen Hosmer, Royale Energy’s Chief Financial Officer, said, “We are pleased at the confidence shown in this new discovery, and the timeliness at which we will now be able to follow up with additional drilling.”

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