Response to Media Speculation

15 May 2007 13:24

Urals Energy Public Company Limited15 May 2007 Urals Energy Public Company Limited ("Urals Energy" or the "Company") Response to Media Speculation Urals Energy notes reports and comments today attributed to Oleg Mitvol, DeputyHead of Rosprirodnadzor, regarding accusations made by unnamed localenvironmentalists over alleged environmental violations by the Company. The Company has not received any official warning or notification with regard toviolations or Ministry investigations. Furthermore, the Company is confidentthat no violations have occurred and these accusations will be shown to be falseshould any examination take place. Urals Energy is committed to best practice in all of its production anddevelopment operations in Russia. The Group averaged production of around 10,000boepd in 2006 across its operations and is committed to further investment inRussia. The Group is currently targeting production of 50,000 boepd by 2013.This year Urals Energy will invest approximately US$93 million on thedevelopment of its assets. Across its eight different subsidiaries UralsEnergy's operations are routinely reviewed and inspected by the relevantMinistry agencies and in each case has received the necessary approvals. TheGroup operates all of its assets in accordance with Russian regulations andlegislation. Urals Energy published a reserves report by the independent reserves engineerDeGolyer & MacNaughton in April 2007, in accordance with SPE standards. Thisreport updated all of the Group's reserves including its gas reserves at theDulsiminskoye field. The Company notes that all of its reserves as well as thegas reserves attributed by DeGolyer & MacNaughton are less than the reservescertified by the GKZ, the Russian State Reserves Committee. Leonid Dyachenko, Chief Executive of Urals Energy, commented: "These allegations are without foundation. Urals Energy has an excellent trackrecord of compliance within all of its operating subsidiaries. We have offeredour full cooperation to the Ministry today to clear these misunderstandings andlook forward to working with them. I am confident that this issue will bequickly resolved." 15 May 2007 Enquiries: Pelham PRJames Henderson +44(0)20 7743 6673 +44(0) 777 4444 163Gavin Davis +44(0) 20 7743 6677 +44(0)79 1010 4660 This information is provided by RNS The company news service from the London Stock Exchange