Revolving finance arrangement with Sberbank

Dissemination of a Regulatory Announcement that contains inside information according to REGULATION (EU) No 596/2014 (MAR).

Urals Energy PCL

(''Urals Energy'' or the ''Company'')

Revolving finance arrangement with Sberbank

The Board of Urals Energy PCL (AIM:UEN), the independent exploration and production company with operations in Russia, is pleased to announce that its subsidiary undertaking, JSC Petrosakh ("Petrosakh"), has entered into a new 18 month revolving working capital credit facility (the "Loan") with the Sakhalin branch of OJSC Sberbank of Russia ("Sberbank") under which Sberbank will provide, by way of several tranches, the sum of 300 million Russian Roubles (representing approximately US$4.6 million at prevailing exchange rates) to Petrosakh.

The key terms of the Loan are:

· repayable on 16 March 2018 (the agreement also provides for early repayment of the Loan by Petrosakh without incurring any penalties);

· interest chargeable at the rate of 13.0% plus 1%, subject to Petrosakh meeting monthly turnover targets and having minimum average cash balances in its bank account of 5% of the Loan's principal amount;

· secured by way of a pledge over property and cash flows from Petrosakh; and

· the agreement provides for a parent company guarantee from Urals Energy and a guarantee from Urals Energy's other operating subsidiary, Arcticneft.

The outstanding principal amount of the existing loan, entered into between Sberbank and Petrosakh in June 2015, is 148 million Russian Roubles. This amount is to be repaid to Sberbank out of Petrosakh's operating cash flows by 15 December 2016.

The proceeds of the new Loan will be used by the Company to finance fluctuations in working capital requirements at Petrosakh. The Board intends to use Petrosakh's operating cash flow to progress the 2017-2018 development programme of the recently acquired South Dagi license, as well as to fund the capital expenditure required to minimise the decline in current production at Petrosakh and upgrade its plant and equipment.

- Ends -

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