Re Agreement

Alkane Energy PLC
11 March 2002

11 March 2002



                          Alkane Energy plc ('Alkane')
                    Farm in to new acreage in South Wales

Alkane Energy plc, the UK's leading commercial producer of methane gas from
abandoned coal mines, is pleased to announce that it entered into a conditional
agreement to farm in to 500 km(2) of additional onshore acreage with coal mine
methane ('CMM') and coal bed methane ('CBM') potential in South Wales.

The acreage, PEDL 014, is currently under license to UK Gas Ltd.  Alkane will
pay a consideration of £100,000 cash on completion of the farm in.

An associated company of UK Gas Ltd, UK Methane Ltd, will assist Alkane in the
development of this acreage.  Subject to the successful development of CMM sites
with a combined generation capacity of 60MW, UK Methane Ltd will be issued with
a maximum of 800,000 Alkane shares, on a pro rata basis.  A relationship between
Alkane and UK Methane Ltd already exists as that company has acted as consultant
to Alkane in respect of its existing South Wales licenses.

The farm in is subject to the approval of the Secretary of State.

Alkane now holds a total of 29 onshore exploration licenses in the UK which give
it exclusive rights over an area of 5,816 km(2).  There are a total of nearly
400 abandoned coal mines on this acreage, many with CMM and CBM potential.

Commenting on the farm in, Executive Chairman, Dr. Cameron Davies, said:

' We are pleased to add this additional acreage to our portfolio as we believe
that it has valuable potential for CMM extraction'

Enquiries:
David Cross, Chief Executive                          Tel: [phone]
Alkane Energy

Judith Parry/ Sophie Morton                           Tel: [phone]
Binns & Co PR Ltd


                      This information is provided by RNS
            The company news service from the London Stock Exchange