Gulf of Mexico Acquisition

Sterling Energy PLC
16 April 2003



Sterling Energy plc is pleased to announce the completion of another deal
expected to add significantly to its revenues from gas production in the Gulf of
Mexico.

The company has signed a contract with American Coastal Energy Corporation
giving it a 60% interest in the Eugene Island 268 lease offshore Louisiana.
First production from the field is scheduled to commence by August, and at
current gas prices is expected to add around $250,000 per month to Sterling's
existing revenues.

Sterling will invest a total of $4.2m in the project, which will include its
share of the installation of a platform, pipeline and production facilities. The
platform is currently under construction and is due for installation in mid-May.
Drilling, completion and pipeline work is expected to take an additional month.
Recently acquired 3D seismic is being interpreted to determine drilling
locations for at least one and up to three step out locations and to assess
deeper targets.

Sterling Chief Executive Harry Wilson said: 'This deal demonstrates the benefits
of working in the Gulf of Mexico. Our local expertise, coupled with the speed at
which projects are brought to fruition mean we can quickly add significant value
at low cost and relatively low risk.'

Mr Wilson added: 'This investment is our first since raising £5m in December and
represents excellent value for money.  Our share of proven and probable reserves
is 4.0 billion cubic feet and the project is economically robust even at low gas
prices.  We expect to generate returns in excess of 50% from just the proven
reserves, paying back our investment in less than two years.  Low risk drilling
potential has also been identified which will add further value, and the
potential for a major deep gas play is being evaluated.'

Sterling's strategy is to acquire proven reserves in fields overlooked by
previous owners, using its technical and commercial expertise to unlock upside
value. Last month it announced that its revenues from the Gryphon #2 well
offshore Texas, acquired at no additional cost to the company, were running at
$300,000 per month.

This latest acquisition is part of an active programme planned for 2003 which
will see well recompletions and workovers intended to add further production and
cash flow from Sterling's other six producing properties in the Gulf of Mexico.
The company also owns a 100% working interest in a large exploration license
offshore Philippines.


For further information contact:

Harry Wilson, Chief Executive, Sterling Energy plc:                01582 462 121
Graeme Thomson, Finance Director, Sterling Energy plc:             01582 462 121
Allan Piper, First City Financial Public Relations:                020 7436 7486
                                                                   07050 203 304
Chris Callaway, Evolution Beeson Gregory:                          020 7071 4309



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