Urals Energy Plc Regulatory News (UEN)

5 February 2019

Urals Energy Public Company Limited

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

Shareholder update

The Board of Urals Energy PCL (AIM: UEN), the independent oil and gas exploration and production company with operations in Russia, is providing an update for its shareholders in respect of the extraordinary general meeting of the Company (the "EGM") convened for 11:00 a.m. (Cyprus time) on 22 February 2019 at the registered office of the Company at Glafkos Tower, Office 501, 5th floor, 3 Menandrou Street, Nicosia, CY-1066, Cyprus. A circular convening the EGM (the "Circular") was posted to shareholders on 31 December 2018 and the board of Urals Energy (the "Board") set out its reasons why shareholders should vote against the resolutions proposed at the EGM in the Circular.

Since the posting of the Circular the Company's nominated adviser has commenced its due diligence on the proposed directors (as required by the AIM Rules for Nominated Advisers). This due diligence is ongoing and further announcements will be made as appropriate.

The nominated adviser has met with the proposed alternative directors (the "Alternative Directors") and following this meeting the Board has been informed that the nominated adviser has written to the proposed Alternative Directors setting out the conditions that it requires to be satisfied (the "Conditions") in order for it to continue to act as the Company's nominated adviser should the resolutions be passed at the EGM. The Board has also been informed that the Proposed Directors are in discussion with the nominated adviser regarding the Conditions, but there can be no guarantee that the Conditions will be satisfied before the EGM.

The Company's nominated adviser has advised the Board that if the resolutions are passed at the EGM and that:

a) the Conditions are not satisfied; and/or

b) the nominated adviser's due diligence on the Alternative Directors has not completed to its satisfaction

then the nominated adviser will resign following the conclusion of the EGM.

In the event that the nominated adviser's resignation become effective, trading in the Company's shares on AIM will be suspended. If a new nominated adviser is not appointed within one month of such resignation, then trading in the Company's shares on AIM will be cancelled. Shareholders should be aware that under the AIM Rules for Nominated Advisers the obligations and responsibilities of a nominated adviser are owed solely to the London Stock Exchange plc.

The Board continue to recommend that shareholders vote against the resolutions proposed at the EGM for the reasons set out in the Company's circular dated 28 December 2018, a copy of which can be viewed on the Company's website, www.uralsenergy.com.

The Board also notes last week's publication by the Central Bank of the Russian Federation regarding the revocation of the banking licence of joint-stock company Kamchatsky Commercial Agroprombank ("Kamchatka Bank") and the appointment of a provisional administration to Kamchatka Bank for the period until the appointment of a receiver.

An English language version of the publication by the Central Bank of the Russian Federation can currently be accessed via the following link: https://www.cbr.ru/eng/press/PR/?file=31012019_125220eng2019-01-31T12_51_27.htm 

The Group does not have any significant cash deposits held with Kamchatka Bank. The Group has a total of Russian Roubles 125 million (equivalent to approximately US$1.9 million) in borrowings from Kamchatka Bank which are not due for repayment until September 2019 and January 2020.

At the end of January 2019, the Group completed the repayment, in a series of tranches, of a loan from Sberbank of Russian Roubles 300 million (equivalent to approximately US$4.6 million). The Group has outstanding loans from Sberbank of Russian Roubles 278 million (equivalent to approximately US$4.2 million).

Notwithstanding this repayment, the Board believes that the Group continues to face a substantial working capital deficit in the coming months, as outlined in its previous announcements.

The Company will make further announcements as and when appropriate.

- Ends -

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