exhibit10_1.htm


    
      

    

     

     

    

      877 North 8th West, Riverton, WY 
82501, Ph: (307) 856-9271, Fx: (307) 857-3050, www.usnrg.com


      


      


      For
Immediate Release

      


      


      U.S.
ENERGY CORP. ENGAGES SMH CAPITAL, INC. TO SEEK OIL AND GAS
ACQUISITIONS

      


       

      RIVERTON, Wyoming – March 4,
2009 – U.S. Energy Corp. (NASDAQ Capital Market:  “USEG”)
(“USE” or the “Company”), a natural resources exploration and development
company with interests in molybdenum, oil and gas, geothermal, and real estate
assets, today announced that it has engaged Houston, Texas-based SMH Capital
Inc. to act as a financial advisor in connection with the potential purchase or
acquisition of oil and gas assets.

       

       

      “With
overall continued market uncertainty and commodity prices remaining depressed we
believe now is the ideal time to enhance our acquisition strategy by working
closely with SMH to seek out high quality oil and gas assets,” stated Mark
Larsen, President of U.S. Energy Corp.  “It is our goal to reach a
production rate of 7000 MCFE/D by year end although we are not limiting our
corporate objectives in this endeavor.  By leveraging SMH’s contacts
and expertise, we intend to use our solid balance sheet to selectively and
efficiently access what we believe is a growing pool of attractively valued
exploration and production stage oil and gas assets,” he added.

       

      * * * *
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            Press
Release

            March 4,
2009

            Page  of
2 of 2

            


          

        

      


      About
SMH Capital Inc.

      


      SMH
Capital Investment Banking (www.smhib.com) is a full-service investment bank
providing middle-market companies with private placements and public offerings
of equity and debt securities, as well as financial-advisory services in
connection with mergers and acquisitions, restructuring and
recapitalizations.

      


      SMH
Capital is a registered broker-dealer and an affiliate of Sanders Morris Harris
Group (NASDAQ:SMHG) (member FINRA/SIPC).

      


      About
U.S. Energy Corp.

      


      U.S.
Energy Corp. is a diversified natural resource company with interests in
molybdenum, oil and gas, geothermal and real estate assets.  The
Company is headquartered in Riverton, Wyoming, and its common stock is listed on
The NASDAQ Capital Market under the symbol “USEG”.

       

      Note
Regarding Mcfe

       

      In this
press release, Mcfes are derived by converting oil to gas in the ratio of one
barrel of oil to six thousand cubic feet of gas (1 bbl:6 Mcf). One thousand
cubic feet of gas equivalent ("Mcfe") amounts may be misleading, particularly if
used in isolation.  A Mcfe conversion ratio of 1 bbl of oil to 6 Mcf
of natural gas is based on an energy equivalency conversion method primarily
applicable at the burner tip and does not represent a value of equivalency at
the well head.

      


      * * * *
*

      


      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 example 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.

      


      *
* * *.*

      


      For
further information, please contact:

      


      Reggie
Larsen

      Director
of Investor Relations

      U.S.
Energy Corp.

      1 800 776
9271

      Reggie@usnrg.com

      


      Nick
Hurst

      The
Equicom Group

      Investor
Relations

      403 538
4845

      nhurst@equicomgroup.com