Operational update

23 May 2017

Urals Energy Public Company Limited

("Urals Energy", the "Company" or the "Group")

Operational update

The Board of Urals Energy (AIM:UEN), the independent exploration and production company with operations in Russia, is pleased to provide the following operational update.

Komi Republic

The Company announced on 10th April 2017 the spudding of its first well on its Ordymskiy block in the Komi Republic, held by its wholly owned subsidiary RK Oil. It had been expected that the target depth of 1,100 meters would be achieved in mid to late May 2017. The Company's drilling contractor, Vis-Mos Llc, a highly experienced drilling company in the Komi region, has had to proceed in the early stages of drilling more slowly than originally planned, due to hard mineral layers within the geological structure and delays in bringing additional equipment to the site due to the melting of winter roads and slow drying of the access ground roads. Operations can now proceed normally and it is expected that the target depth will be achieved by early July 2017 and completion will occur some two to three weeks later. The drilling contract is on a fixed sum basis and thus the delay will not cause additional expense to the Company.

Petrosakh

The Company announced on 18th April 2017, the spudding of well 130, with an intended target depth of 1,600 meters. Good progress has been made and drilling has reached 1,100 meters. The Company expects to reach the target depth by mid-June 2017. The drilling operation is being carried out by Urals own team and drilling rig.

Arctineft

The planned first shipment of approximately 30,000 tons of oil (237,000 barrels), is scheduled for the third week of June 2017.

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