U.S. Energy Reports Initial Production From Beeler #2H Well

U.S. Energy Corp (the Company), announced the successful completion of the Beeler #2H well at a gross initial production rate of 859 BOE/D. The well had a 30 day average gross daily production rate of 797 BOE/D. The Beeler #2H is the Company's first participated well in Dimmit County, Texas targeting the Buda formation.

The Beeler #2H well was drilled to a total measured depth of 11,013 feet, including a 3,700 foot lateral. The well was completed open hole, without fracture stimulation. The well had an early 24 hour initial production rate of 859 BOE/D, which consisted of 761 barrels of oil, 56 barrels of natural gas liquids and 253 thousand cubic feet of natural gas, on a 25/64th choke. The Company participates in approximately 10,140 gross acres which are prospective for the Buda formation and has an approximate 30% working interest and an approximate 22.8% net revenue interest in the acreage.

"We are pleased to announce the initial results and the 30 day average daily production rate of our first Buda formation targeted well in South Texas," said Keith Larsen, CEO of U.S. Energy Corp. "We are scheduled to spud our second well to further delineate the acreage next month and plan to continue to test the acreage as results warrant," he added.