Urals Energy Radar Blip?

Members Only Post. *Not for General Release

“Urals Energy are an independent oil company in Russia with exploration and production operations in Sakhalin Island and Timan Pechora” So says the company blurb.

Get researching Urals Energy. So says BMD. There’s an awful lot going on over the next 12 months as the company look increasingly likely to be finally out of “Critical Care” and in Recovery.

Urals are set to finish 2012 with a flurry after just shipping 231,594 barrels of crude oil to Petraco thus further strengthening an already strengthening Company balance sheet. By my calculations they are now debt-free.

The new man at the helm, Alexei Maximov, has certainly made a huge difference both in & out of the Board-room. He has ushered in a new management team which has ripped through the whole company reviewing the operational base while implementing changes that are now beginning to bear fruit.

It was Maximov who faced down Petraco’s charge over Petrosakh which was a “pivotal point in the Urals’ recovery” & it was Maximov who won the Arbitration case against Vyatcheslav Rovneiko. Rovneiko is now liable to pay to Urals Energy the sum of US$3,730,000.Plus interest & costs.

For the first time in years Urals anticipate that they we will be free of all major debtors. This is what’s currently enabling them to crack on with stabilising & increasing production at both assets; Arcticneft increased to 128,249 barrels (H1 2011: 126,780 barrels. Petrosakh total production reached 233,484 barrels (H1 2011: 249,728).

According to DeGolyer & MacNaughton (D&M), the Company’s independent reserves auditors, as at 31 December 2007 the company had 2P (proved and probable) reserves of 58.5 mmboe. As at 30 June 2012 the Company had net debt of US$6.6 million (calculated as Long-term and Short-term debt plus finance lease obligations less cash in bank and less Loans issued to related parties). As of today I expect they are debt-free.


This months total production from both Petrosakh & Arctineft is running at 2140 bopd. Urals should now be debt-free. The changes that are being implemented should see the bopd continue to rise over the coming months as Urals implement new well drilling with existing well optimisation programs being rolled out over 2013
There’s also an “Anticipated tax break from 2013 for companies located in the far northern territories of Russia which will benefit the Company’s operations in Arcticneft”

They are a recovery stock which represent good value at the moment. I’l leave you with the last known comments from their Top man Alexei Maximov; “The board is happy to be close to turning the final page on Urals’ legacy issues, including, prevailing in court over the unfounded allegations of a former director. With an ongoing strong operational performance, Urals is moving full steam ahead to 2013 and we remain confident of our ability to further increase production on our existing acreage, whilst seeking new ways to create value for our shareholders.”

Get them on your watch-lists they should breach 10p some-where along the line. Possibly edging up to 18/20p depending on how high they can increase their bopd. They are off the radar at the moment but should come on screen soon enough.


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