Operational Update

10th November 2010

Urals Energy Public Company Limited

('Urals Energy' or the 'Company')

Operational update

Urals Energy, the Russian focused oil & gas exploration and production company, are today providing investors with an operational update.

The Board of the Company are pleased to report that the drilling of the side track well, 35b, at Petrosakh has now been completed and completion activities are being undertaken. Final flow rates will be announced next week once these have been fully assessed by the Company's management. Current daily levels of production at Petrosakh are 1,611 BOPD.

The loading of the second tanker in the amount of 25,999 metric tons at Arcticneft has also been completed. The price for the tanker was set at the level of the October average price of $82.744 and a premium of $1.020/bbl. The full tanker was shipped before 1st November 2010 therefore meaning the company paid export duty at a lower rate of $266.5/mt instead of $290.60/mt, which is the November average price.

Proceeds of the sale will be received within a week and a repayment of $3 million will be made to Petraco in line with amended debt repayment structure previously announced.

Further operational updates will be made as appropriate.

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