Nasdaq: USEG www.usnrg.com

Corporate Presentation August 20, 2014

Please carefully read the following disclaimer: The information discussed in this Presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”). All statements made in or in conjunction with this Presentation, other than statements of historical fact, are forward-looking statements. Examples of such statements in this Presentation may relate to planned capital expenditures for oil and gas exploration and development projects; cash expected to be available for continued work programs with all our industry partners, and for those projects as to which we do not presently have industry partners; recovered volumes and values of oil and gas approximating third-party estimates of oil and gas reserves; projected increases in oil and gas production; current and anticipated drilling and completion activities; anticipated production and price differentials and decline rates from initial production rates, over time, of the daily volume of oil and natural gas produced from wells completed in the Williston Basin and elsewhere; the relationship of national oil and gas natural prices to prices paid for such production in the Williston Basin and other areas in which we operate; expected well spacing for wells to be drilled; future cash flows and borrowings; pursuit of potential acquisition opportunities; our expected financial position; our business strategy; and other plans and objectives for future operations. These forward-looking statements are typically identified by their use of terms and phrases such as “may,” “expect,” “estimate,” “project,” “plan,” “believe,” “intend,” “achievable,” “anticipate,” “will,” “continue,” “potential,” “should,” “could,” and similar terms and phrases. Though we believe that the expectations reflected in these statements are reasonable, they do involve certain assumptions, risks and uncertainties. Results could differ materially from those anticipated in these statements as a result of numerous factors. Our future results will depend upon various other risks and uncertainties, including, but not limited to, those detailed in the section entitled “Risk Factors” in our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, and other filings we make with the Securities and Exchange Commission, all of which are incorporated by reference in this Presentation. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements made above, elsewhere in this Presentation and as incorporated from our public filings. All of such forward-looking statements are made as of the date of this Presentation, and except as otherwise required under securities laws, we do not assume a duty to update any forward-looking statement, whether as a result of new information, subsequent events or circumstances, changes in expectations or otherwise. Actual timing of drilling and completing wells, well performance and the anticipated number of gross and net wells could vary in each of these cases. Amounts budgeted for each regional drilling program are also subject to change based on a number of factors including, but not limited to, timing, well costs, drilling and completion success, availability of capital and weather-related issues. Anticipated well performance could also vary significantly from those modeled internally. Furthermore, funds allocated for specific drilling programs under the 2014 CAPEX budget may be re-allocated to other drilling programs if initial results are below expectations. IP rates, test results and similar data from exploration and development activities are not necessarily reflective of the production, reserves or cash flow that may ultimately be generated from the well in question. Our ability, or the ability of the relevant operator, to maintain expected levels of production from a well is subject to numerous risks and uncertainties, including those discussed and referenced above.

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Safe Harbor Disclosure

Market Data

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Independent E&P Company Focused on Exploring for and Producing Domestic Oil and Natural Gas

Exchange: NASDAQ

Ticker Symbol: USEG

Price per Share (8/15/2014) $4.02

Market Capitalization (8/15/2014) $112.14MM

Avg. Daily Trade Volume (1 yr.) 176,800

52 Week Price Range 1.82 - 5.08

Shares Outstanding (6/30/14) 27.90 MM

Total Shareholder Equity (6/30/14) $109.42 MM

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Six Months 2014 Total Net Production 221,592 BOE

Six Months 2014 Average Net Daily Production 1,224 BOE/D

Oil (Bbls % total) 75%

Natural Gas (Mcf % total) 19%

Natural Gas Liquids (Bbls % total) 6%

Proved Reserves (Year End 2013) 3.85 MBOE

Oil (Oil % total) 90%

Natural Gas (Mcf % total) 10%

PV-10* $115.1 MM

Gross Acreage 145,127**

Net Acreage 15,724**

Corporate Overview - Operations

* PV-10 is widely used in the oil and gas industry and is considered by institutional investors and professional analysts when comparing companies. However, PV-10 data is not an alternative to the standardized measure of discounted future net cash flows, which is calculated under GAAP and includes the effects of income taxes. Standardized measure was $104.9 million as of YE 2013. ** Presented as of June 30, 2014 – All oil and gas acreage

Six Months 2014 Highlights in Review

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• Two successive profitable quarters

• Continued delineation of Buda Limestone formation in South Texas

• Continued development of North Dakota assets

• June 2014 average daily production of 1,352 net BOE/D

• Continued focus on growth of production, revenues and reserves through acquisitions and the drill bit

Focused on Growth in the E&P Sector

Areas of Activity

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Core Areas of Focus: Williston Basin / South Texas Unconventional Resource Development

Austin Chalk / Eagle Ford Shale / Buda Limestone Formations

Bakken / Three Forks Formations

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Why North Dakota / Texas?

Source: EIA.gov, FT Advisors

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Why North Dakota / Texas?

Source: Institute for Energy Research, The Railroad Commission of Texas, FT Advisors

Time Required for Processing a Permit to Drill

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South Texas (Buda Limestone Formation) $12.6 MM

~12 Gross / ~3.15 Net Drill Locations

Williston Basin (Bakken & Three Forks Formations) $9.6 MM

~23 Gross / ~1.1 Net Drill Locations

Acquisitions / Accelerated Development Budget $8 MM

Total $30.2 MM

2014 Oil and Gas Capital Expenditures Plan Summary

• We have spent approximately $17.3 million to fund our 2014 oil and gas

drilling programs through June 30, 2014.

• The remaining $12.9 million is currently budgeted to be spent on

exploration, development and acquisition initiatives in South Texas

and in the Williston Basin of North Dakota.

E&P Assets

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North Dakota / Williston Basin Bakken Oil Production

Source: EIA.gov

Williston Basin Drilling Programs Bakken / Three Forks Formations

North Dakota:

Drilling programs in Williams, McKenzie and Mountrail Counties, North Dakota

• Interests in 57 participated drilling units (majority 1,280 acre spacing)

• 2,939 net participated acres

• Overall potential for 390* – 520** gross drilling locations

• ~15* - 20** net wells on a going forward basis

• Six months 2014 net daily production 669 BOE/D

• Actively seeking Williston Basin acquisitions

Montana:

• ~12.5% working interest in 29,788 gross (2,334 net) undeveloped acres prospective for the Bakken / Three Forks and conventional formations

• Located in Daniels, County Montana

• Monitoring regional development activity by industry peers

• Operator required to drill well test, core Bakken and Three Forks formations by 12/31/2015

*Assumes 3 Bakken and 3 Three Forks wells per formation, per 1280 acre unit **Assumes 4 Bakken and 4 Three Forks wells per formation, per 1280 acre unit 12

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Williston Basin Assets

• 87 Gross (10.1 net)

participated wells (6/30/2014)

• 2014 Regional CAPEX • $9.6 MM • ~23 Gross (1.1 net)

Wells

• ~390*-520** Gross Potential Locations

• ~15*-20** Net Potential Well Participation

*Assumes 3 Bakken and 3 Three Forks wells per formation, per 1280 acre unit **Assumes 4 Bakken and 4 Three Forks wells per formation, per 1280 acre unit

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Williston Basin Wells Status

Partnered with leading Williston Basin Operators

Well Name Operator Formation Spud Date

Working

Interest

Net Revenue

Interest Status

Hovde 33-4 #3H Statoil Bakken 10/28/2013 2.45% 1.94% Producing

Hovde 33-4 #4H Statoil Bakken 11/8/2013 2.45% 1.94% Producing

Lloyd 34-3 #3H Statoil Bakken 12/25/2013 2.15% 1.70% Producing

Caper 2-15-22H Emerald Oil Inc. Bakken 12/7/2013 0.73% 0.57% Producing

Pirate 2-2-11H Emerald Oil Inc. Bakken 2/24/2014 3.67% 2.82% Producing

Pirate 3-2-11H Emerald Oil Inc. Three Forks 1/3/2014 3.67% 2.82% Producing

Rita 24X-34A XTO Bakken 1/19/2014 0.20% 0.16% Producing

Rita 24X-34E XTO Bakken 1/19/2014 0.20% 0.16% Producing

Talon 3-9-4H Emerald Oil Inc. Bakken 3/7/2014 0.34% 0.27% Completion pending

Slugger 5-16-21H Emerald Oil Inc. Bakken 3/9/2014 0.37% 0.28% Completion pending

Talon 5-9-4H Emerald Oil Inc. Bakken 4/23/2014 0.34% 0.27% Completion pending

Slugger 3-16-21H Emerald Oil Inc. Bakken 6/5/2014 0.37% 0.28% Completion pending

Talon 6-9-4H Emerald Oil Inc. Three Forks 7/21/2014 0.34% 0.28% Drilling

Slugger 6-16-21H Emerald Oil Inc. Bakken 8/17/2014 0.37% 0.28% Scheduled to drill

Talon 7-9-4H Emerald Oil Inc. Bakken 9/13/2014 0.34% 0.28% Scheduled to drill

Slugger 7-16-21H Emerald Oil Inc. Bakken 10/10/2014 0.37% 0.28% Scheduled to drill

Average: 1.15% 0.90%

• Active drilling programs in Zavala and Dimmit Counties, Texas • Currently delineating Buda Limestone potential • Anticipate drilling Eagle Ford well Q1 2015 (new drilling and completion

technique) • 35,221 gross (9,130 net) participated acres

• Additional leasing opportunities in region • Acquired 12,100 gross (3,384 net) acres in Dimmit County, TX (Q2 2014) • Multiple formation potential

South Texas

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South Texas

La Salle

Frio

Dimmit

Zavala

Texas

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South Texas Multiple Formation Potential

Stacked hydrocarbon bearing formation potential in South Texas

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Booth-Tortuga Buda Activity Map

• 24,640 gross acres

• 5,740 net acres

• 16 gross producing Buda wells

• ~ 90% oil / 10% gas

• EURs: ~200-400 Mboe (may not apply to all wells)

• ~30* gross (~9* net) potential locations based on 320 acre spacing

• Q2 2014 average Buda production of 538 BOE/D net to USEG … anticipate continued production growth (Q3 2014)

* Subject to geological continuity & additional delineation of acreage and ultimate spacing configuration

#3H #5Hz #2H #1H

Dimmit

Zavala

Willerson Lease

Contango Operated

Legend

!A Non-Participated Buda Wells

Stat

Drilling

Producing

Scheduled

AMI Election

Newly Pooled Acreage

U.S. Enercorp

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Booth – Tortuga Buda Formation Well Status

• Last six Contango participated wells averaged 647 gross BOE/D during the initial 30 days of producing

• Last three Contango participated well costs reduced to ~$2.6 million per well from $4 million initially

• Three additional Buda wells with Contango scheduled to be drilled to round out our 2014 drilling

program, all three wells planned with 9,000’ plus laterals

• Two fracture stimulation completion initiatives in the Q2 2014 acreage block, one additional drill /

fracture stimulation this year in new prospect

Well Name Operator Spud Date Working Interest Net Revenue Interest Status

Beeler #2H Contango 4/5/2013 30.00% 22.50% Producing

Beeler #3H Contango 8/1/2013 30.00% 22.50% Producing

Willerson #1H U.S. Enercorp. 8/26/2013 15.00% 11.25% Producing

Beeler #4H Contango 9/19/2013 30.00% 22.88% Producing

Wood B Unit #1H Contango 12/2/2013 30.00% 22.50% Producing

Beeler #7H Contango 12/26/2013 30.00% 22.99% Producing

Beeler #8H Contango 2/6/2014 30.00% 22.50% Producing

Willerson #2H U.S. Enercorp. 2/3/2014 15.00% 11.25% Producing

Beeler #6H Contango 2/10/2014 30.00% 22.50% Producing

Beeler #5H ST Contango 3/25/2014 30.00% 22.50% Producing

Beeler Unit A #9H Contango 3/26/2014 30.00% 22.50% Producing

Beeler Unit D 16H Contango 4/18/2014 30.00% 22.50% Producing

Beeler # 17H Contango 5/13/2014 30.00% 22.50% Producing

Bruce Weaver #2H AMI Election 6/6/2014 7.50% 5.63% Producing

Beeler Unit F #19H Contango 6/10/2014 30.00% 22.50% Producing

Beeler Unit C #20H Contango 7/3/2014 30.00% 22.50% Producing

Bruce Weaver #1 RE AMI Election 8/12/2014 7.50% 5.63% Drilling

25.59% 19.24%

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Buda Economics

Potential Net Present Value*

Assumptions (Payout)

AFE $ 4,000,000

Oil Price (per Bbl) $ 100 Royalty 25.0%

Production Tax 4.6% Production Required for Payout (Bbls) 56,818

Revenue $ 5,681,818

Royalty (1,420,455)

Production Tax (261,364)

Net $ 4,000,000

320 Acre Spacing 160 Acre Spacing

Prospect Locations PV-10 (net) Locations PV-10 (net)

Booth-Tortuga 30 $ 120,000,000 60 $ 240,000,000

Big Wells 10 $ 20,000,000 20 $ 40,000,000

Total 40 $ 140,000,000 80 $ 280,000,000

* Figures and calculation are based on internal Company estimates. There is no assurance that the above illustrations will be representative of actual drilling locations, drilling results, estimated EUR’s or economics.

Net Oil Price $ 100.00 per Bbl

Net Gas Price $ 3.50 per MCF

Gross Production (EUR) 404,183 BBLs/Well

Prod Taxes 4.60% of gross revenue

Gross AFE $ 4,000,000 per well

LOE $ 10,000 per well /month

WI 30.0%

NRI 75.0% (to the 8/8ths)

IRR: 214% Overall Buda program to date: > 100% IRR Total Net Capex $ 1,200,000 per well

Total Net Revenues $ 7,107,449 per well

Total Net Cash Flow $ 5,148,506 per well

Assumptions (IRR)

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Eagle Ford Potential

Contango Operated • 20,257 gross (4,887 net) acres

in Zavala and Dimmit County, TX with Contango and U.S. Enercorp

• USEG has 30% WI (22.5% NRI) in Booth – Tortuga and Leona River prospects

• USEG has 15% WI (11.25% NRI) in Big Wells prospect

• Three Eagle Ford wells had an average initial production rate of 433 BOE/D (2011 – 2012)

• Well costs ~ $7 - $8 million

• Monitoring regional drilling and completion techniques

• Buda logs indicate Eagle Ford may hold further development potential at Booth - Tortuga

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Operational Results Austin Chalk / Eagle Ford / Buda Limestone

Source: U.S. Energy Corp.

-

100

200

300

400

500

600

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14

Avg

. B

OE/

D

South Texas Avg. Net BOE/D by Formation

Austin Chalk Eagle Ford Buda

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Production – All Oil & Gas Programs

Source: U.S. Energy Corp.

-

200

400

600

800

1,000

1,200

1,400

1,600

1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14

Avg

. B

OE/

D

Net BOE/D by Region

Gulf Coast Bakken South Texas

Financials

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Select Financial Data (6/30/14)

Financial Metrics per Share

Cash and Equivalents $0.15

Investment in Oil & Gas $3.08

Other Assets $1.24

Total Book Value of Assets $4.47

Strong Balance Sheet

Cash and Cash Equivalents $4,254

Total Assets $124,634

Long-Term Debt (net of current portion) $100 MM total credit facility - $24.5MM borrowing base with Wells Fargo

$8,000

Total Shareholder Equity $109,426

EBITDAX for the Six Months Ended June 30, 2014 $8,290

[ $ Thousands ]

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USEG Stock Performance

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

$4.5

$5.0

$5.5

Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14

Stock Price

0 K

500 K

1,000 K

1,500 K

Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14

Volume Average Daily Volume

~176,800 (1 yr.)

Market recognition of Buda drilling results

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Performance

0

$5 M

$10 M

$15 M

$20 M

$25 M

$30 M

$35 M

$40 M

2009 2010 2011 2012 2013

Oil & Gas Revenue

0

0.5 M

1.0 M

1.5 M

2.0 M

2.5 M

3.0 M

3.5 M

4.0 M

4.5 M

2009 2010 2011 2012 2013

Reserves (BOE)

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

2009 2010 2011 2012 2013

$

Tho

usa

nd

s

Cash Flow From Operations

0

$2 M

$4 M

$6 M

$8 M

$10 M

$12 M

2009 2010 2011 2012 2013

G&A Expense

CAGR 46%

CAGR 37% CAGR 28%

40% Decrease

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Summary

Catalysts:

• Refined focused on liquids rich resource plays and accretive value for our shareholders

• Active drilling programs in our core areas of focus; Williston basin and South Texas

• Strong balance sheet and liquidity for growth

• Dedicated management team; largest shareholder contingent (~6.6% / ~10.7% fully diluted)

• Buda limestone upside

• Encouraging results to date

• Exploration and development anticipated to be funded from cash flow

• Step out program currently underway to delineate extent of Buda pay

• Executing on 2014 growth plan

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Nasdaq: USEG www.usnrg.com

Shareholder Contact: NASDAQCM: USEG Headquarters: U.S. Energy Corp. 877 N. 8th W. Riverton, Wyoming 82501 P. 1-800-776-9271 F. 1-307-857-3050

Investor Relations: Reggie Larsen Director of Investor Relations P. 1-800-776-9271 M. 1-307-851-4043 Reggie@usnrg.com Web site: www.usrng.com