First International Project

Alkane Energy PLC
10 March 2003

10 March 2003


Alkane Energy Announces First International Coal Mine Methane Project

Alkane Energy ('Alkane'), the UK's leading commercial producer of Coal Mine
Methane ('CMM'), is pleased to announce its first international project in
Germany.

Alkane has entered into an agreement with A-TEC Anlagentechnik GmbH ('A-TEC')
and Pro2 Anlagentechnik GmbH ('Pro2') of Germany to develop a 2.7MW generation
facility in Gelsenkirchen in the Nordrhein-Westfalen region of Germany. The
project has access to 15.7km2 of licence area which incorporates several
abandoned mines. The contract period with A-TEC is ten years. The project is the
first of its type where Alkane will be generating and selling electricity.

Alkane expects project investment to be approximately €1.9m (£1.3m). The
investment will be in stages, the first involving the drilling of a borehole,
80% of the cost being refundable by the German government if the drilling is not
successful. The second and major stage of the investment is in the generating
equipment and will only take place after successful drilling and gas testing.

The project, expected to take 12 months to implement, may be expanded if the gas
flow is sufficient. A-TEC will contribute the licences and extract the gas and
Pro2 will supply the gas extraction and generation equipment to Alkane.  Alkane
will only pay for the gas used if the project as a whole is profitable.

Alkane will benefit from the significant support that CMM is given in Germany.
The Renewable Energy Law (Erneuerbare Energien Gesetz) in force within Germany
enables CMM-sourced electricity to have a guaranteed price of £46.00/MWh during
the period of the contract and the local network operator is obliged to purchase
it.  This is in contrast to the £17/MWh currently available under the New
Electricity Trading Arrangement (NETA) in the UK.

This project may be subject to shareholder approval.  The company and its
advisers are assessing the requirements with the UK Listing Authority and a
clarifying announcement will be made in the next few days.

Commenting on the announcement, David Cross, Alkane's Chief Executive said

'This is the first project for Alkane outside of the UK and we are looking
forward to further revenue streams being developed where Coal Mine Methane
capture is recognized as environmentally beneficial. Unfortunately, it also
underlines the disparity between the UK and Germany over the treatment of Coal
Mine Methane, a significant greenhouse gas and contributor to the climate change
problem.  This represents an important step for the company as we refocus our
activities into areas where it is possible to obtain a profitable return on the
capital invested'

Alkane will announce Preliminary Results on the 13th March and will give further
details of its future strategy and comment on the Energy White Paper released
last week.

For further information:

Alkane Energy plc
Dr Cameron Davies, Chairman                          01623 827927
David Cross, Chief Executive

Binns & Co PR
Judith Parry/Sophie Morton                           0113 242 1171
Dr Ben Willey                                        020 7786 9600



Editor's Notes:

Alkane Energy plc, the UK's leading commercial producer of coal mine methane ('
CMM') from abandoned coal mines, was listed on the main market of the London
Stock Exchange in December 2000.  At the same time the company raised £30m
through an institutional placing at a placing price of 90p.

Alkane has used its unique extraction concept in the development of four 'Green
Energy Parks' in the East Midlands & Yorkshire where CMM is captured from
abandoned coal mines and is sold to a third party for conversion of electricity
on site or sold as a fuel for industrial processes.

Alkane has licences to acreage in the UK covering 5,590 km(2), which include
over 300 abandoned coal mines, many of which hold the potential for CMM capture
and generation of electricity.

CMM is a noxious and dangerous gas which escapes into the environment from vents
on abandoned coal mines.  It is 23 times more damaging to the atmosphere that
carbon dioxide in terms of global warming.  Alkane's four capture projects
achieved an emissions reduction equivalent to 510,000 tonnes of CO2.  CMM
continues to escape to atmosphere for 100 years after a mine has been closed
off. The company's activities are therefore of great benefit to the environment.

Alkane has been severely hit by the collapse in wholesale electricity prices
caused by the NETA (New Energy Trading Arrangements), which has also been
mentioned as a contributory factor in the near-collapse of British Energy.  This
has not only forced the price at which Alkane can sell the gas it extracts down
to 6-8p per therm from the 12p previously, but also has made some smaller new
sites uneconomic.

Alkane is currently lobbying the government through ACMMO (the Association of
Coal Mine Methane Operators) for support in the development of this new
industry.   Full exemption from Climate Change Levy, which was announced in the
budget in April, has been incorporated in the Finance Act 2002 and EU state aid
clearance is awaited.

A-TEC  Anlagentechnik GmbH is based in Willich, Germany.  A-TEC is a commercial
producer of and licence holder for CMM extraction in Germany.

Pro2 Anlagentechnik GmbH was founded in 1994 and is also based in Willich,
Germany. Pro2 are a specialist provider of generating equipment to utilize
methane from sources other than conventional natural gas fields.


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