RIVERTON, WY–( EMWNews – April 2, 2008) – U.S. Energy Corp. (NASDAQ: USEG) today

announced the appointment of Fredrick Craft as the Project Manager and

Perry Anderson as Director of Community Relations for the Company’s “Lucky

Jack” molybdenum project in Gunnison County, Colorado.

Mr. Craft is a graduate of Montana College of Mineral Science and

Technology with a degree in Environmental Engineering and over 32 years of

experience in the mining industry involving management, engineering,

milling, permitting, safety and reclamation of mining operations. Mr.

Craft has been the Director of Environmental Affairs for U.S. Energy Corp.

since 1996.

Mr. Anderson will continue as the Director of Community Relations for the

Lucky Jack molybdenum project. A graduate of Oklahoma Baptist University

with a Business Administration Degree and a minor in History, Mr. Anderson

has 24 years of experience as a businessman and entrepreneur. He has been

active in the Gunnison community as a former Gunnison County Commissioner

and a member of the Chamber of Commerce, where he served on the tourism

committee and as Vice-President. He was active in these positions during a

downturn in the economy, focusing much of his efforts on economic recovery

and stimulus. Mr. Anderson previously served as the Community Liaison for

Kobex Resources.

U.S. Energy Corp. also plans to retain several members of the former Kobex

Resources technical team and to maintain local offices in Gunnison,

Colorado and at the Lucky Jack mine site.

The Company announced that its Board of Directors has approved a $5.0

million supplemental budget for the Lucky Jack Project for the remainder of

2008. These additional funds will allow the Company to continue, without

disruption, working with all of the various consulting firms that are in

the process of conducting numerous engineering and technical studies

pertinent to the filing of a Plan of Operations and advancement of mineral

delineation at the site.

U.S. Energy Corp. also announced that it has retained the law firm of Davis

Graham & Stubbs to provide legal and regulatory representation for the

Lucky Jack Project. With over 115 attorneys and 200 support staff

nationwide, Davis Graham & Stubbs has provided legal support to emerging

and established industries for the past 90 years. Its expertise includes,

but is not limited to environmental issues, mining, natural resources and

public lands law. Throughout its history, Davis Graham & Stubbs has ranked

as one of the most prominent law firms consistently offering high caliber

legal services in the Intermountain West on issues related to mineral

development.

Mark Larsen, President of U.S. Energy Corp, stated, “We are very pleased to

have individuals with Mr. Craft’s and Mr. Anderson’s abilities that can

assume the responsibilities as Project Manager and Director of Community

Relations at the Lucky Jack Project. Mr. Craft’s strong engineering

background and project management skills, Mr. Anderson’s extensive

community relations experience, the approval of our supplemental budget and

our excellent legal and regulatory representation will allow the Company to

continue moving forward with the development of this ‘world-class’

molybdenum project in a smooth and timely fashion.”

“We anticipate a seamless transition following Kobex’s withdrawal from the

project, and expect to utilize the core competencies of the team that Kobex

(as former project manager) assembled with our assistance,” noted Keith G.

Larsen, Chief Executive Officer of the Company. “The project staff and

consultants are highly competent and have achieved significant progress at

Lucky Jack regarding geology, geotechnical, permitting, community

relations, and engineering issues. With the team already in place, U.S.

Energy Corp. will continue with the permitting and advancement of this

project, which represents one of the highest-grade molybdenum mining

opportunities in the world.”

About U.S. Energy Corp.

U.S. Energy Corp. is a diversified natural resource company with interests

in molybdenum, oil and gas, gold, and real estate. While the Company’s

primary emphasis is investments in the natural resources sector, it is also

broadening its business interests to include cash-flow-generating

investments driven by surging growth created by energy and mining activity

in the intermountain west region of the United States.

The Company is headquartered in Riverton, Wyoming, and its common stock is

listed on The NASDAQ Capital Market under the symbol “USEG.”

Disclosure Regarding Mineral Resources Under SEC and Canadian Regulations;

and Forward-Looking Statements

The Company owns or may come to own stock in companies which are traded on

foreign exchanges, and may have agreements with some of these companies to

acquire and/or develop the Company’s mineral properties. An examples is

Sutter Gold Mining Inc. These other companies are subject to the reporting

requirements of other jurisdictions.

United States residents are cautioned that some of the information

available about our mineral properties, which is reported by the other

companies in foreign jurisdictions, may be materially different from what

the Company is permitted to disclose in the United States.

This news release includes statements which may constitute

“forward-looking” statements, usually containing the words “believe,”

“estimate,” “project,” “expect,” or similar expressions. These statements

are made pursuant to the safe harbor provision of the Private Securities

Litigation Reform Act of 1995. Forward-looking statements inherently

involve risks and uncertainties that could cause actual results to differ

materially from the forward-looking statements. Factors that would cause

or contribute to such differences include, but are not limited to, future

trends in mineral prices, the availability of capital, competitive factors,

and other risks. By making these forward-looking statements, the Company

undertakes no obligation to update these statements for revision or changes

after the date of this release.

For further information on the differences between the reporting

limitations of the United States, compared to reports filed in foreign

jurisdictions, and also concerning forward-looking statements, please see

the Company’s Form 10-K (“Disclosure Regarding Forward-Looking Statements”;

“Disclosure Regarding Mineral Resources under SEC and Canadian Regulation”;

and “Risk Factors”); and similar disclosures in the Company’s Forms 10-Q.