Urals Energy Plc Regulatory News (UEN)

Urals Energy PCL

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

Alleged Debt Repayment Agreement

Following receipt by the Company of a requisition notice signed by Alpcot Capital Management Ltd and Fire East Corporation (together the "Requisitioners") on 25 September 2013, the Company issued a notice convening an extraordinary general meeting to be held on 27 January 2014 (the "EGM"). This was announced on 14 October 2013. Resolutions proposed by the Requisitioners to be considered at the EGM would, if approved by the Company's shareholders, remove the existing directors, save for Mr. Torbjorn Ranta, and appoint Mr. Maxim Barsky and Mr. Jonathan Kollek to the Company's board of directors. On 14 October 2013, the Company also announced that a credible third party (the "Potential Offeror") had approached the Company regarding a potential offer for up to 100 per cent. of the issued ordinary share capital of the Company.

The Company has recently received a facsimile copy of a purported 'Debt Repayment Agreement' (the "Alleged Agreement"), expressed to have been entered into in December 2010 between the Company and a Cyprus company owned by Mr. Vyatcheslav Rovneiko, UEN Cyprus Limited. Under the Alleged Agreement, the Company is expressed to be liable to pay UEN Cyprus Limited the sum of US$41,652,000 on 15 December 2013.

The Company has no reason to believe the Alleged Agreement to be a genuine document, and therefore does not accept that the Company could be bound by its terms. Prior to the Alleged Agreement's production, the Company had no knowledge of its existence whatsoever. The Company has no record of entering into such an agreement and the Alleged Agreement does not carry the Company's seal. In addition there are other inconsistencies in the Alleged Agreement and this has led the Board of Urals to conclude the Alleged Agreement is a forgery and an attempt by a third party to defraud the Company and, by extension, its shareholders. The Company has appointed a Committee of the Board to undertake an enquiry and take all available legal steps to establish the origin of the Alleged Agreement and to recommend all appropriate actions necessary to defend the Company, including any possible legal action.

The Alleged Agreement was passed to the Company's Chairman, Mr Andrew Shrager, following a conversation between Mr. Shrager and a Moscow based investment banker who stated that he was acting as an intermediary on behalf of Mr. Maxim Barsky and Mr. Dmitry Bosov (the owner of Alltech and Pechora LNG among other ventures). In this conversation the investment banker stated that Mr. Barsky and Mr. Bosov had acquired the benefit of the Alleged Agreement and that they would publicise the existence of the Alleged Agreement unless the directors of the Company (with the exception of Mr. Ranta) stood down immediately. Similar threats were made to Mr. Leonid Dyachenko and Mr. Alexei Ogarev (both directors of the Company) in a meeting held over the weekend with Mr. Barsky and Mr. Bosov in Moscow.

The Board believes that the most logical inference to draw from this sequence of events is that any disclosure of the Alleged Agreement, which, as stated above, the Board believes to be a forgery, would be intended to influence shareholders' decision making in respect of the resolutions to be proposed at the EGM. The Board intends to investigate fully the Alleged Agreement and will not hesitate to take appropriate legal action against any parties associated with it, including making appropriate reports to the serious fraud authorities in all applicable jurisdictions.

Further announcements will be made in due course.

- Ends -

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