Final Results

ALLIANCE RESOURCES PLC
12 August 1999



Alliance Resources PLC

Preliminary Results for the year ended 30 April 1999


Chairman's Statement

The past year began with high expectations with Alliance attempting to
implement its strategy to diversify into the international arena.  To that
end, we identified an opportunity to acquire 20% of the interest in 13
offshore blocks in the East Irish Sea which had been recently acquired by
Burlington Resources (Irish Sea) Limited from British Gas.  The acquisition
and subsequent development were proposed to be financed by the issue of $100
million of senior subordinated notes.  Your Board and its financial advisors
estimated the time necessary to complete the transaction at 90-120 days. 
Ultimately, that time frame more than doubled by which time the bond market
had shifted against Alliance and the then available terms for the originally
proposed senior subordinated notes were unacceptable to your Board.  The
Company eventually acquired a 10% interest in the East Irish Sea assets and
the project to develop those assets is ahead of schedule and proving to be
quite successful.

Total revenues from the Company's operations for the year ended 30 April 1999
were US$6.234 million compared to US$10.210 million for the year ended 30
April 1998.  Revenues decreased over the comparable period due to the effect
of lower realised product prices (net of the impact of the commodity price
hedges) and lower sales volumes.  The lower oil volumes were attributable to
the decision by management to curtail oil sales in the South Carlton Field due
to low product prices.  The revenues in the 1999 period also were negatively
impacted by property sales concluded during the prior two financial periods. 
Higher realised gas prices and higher oil volumes beneficially affected
revenues in the 1998 period.  On 15 May 1997, the existing commodity price
hedging arrangements were bought out with a loss of US$1.128 recognised in its
entirety in the year ended 30 April 1998 as a result of new agreements being
initiated on 23 October 1997.  Although sales volumes for the year ended 30
April 1999 were adversely affected by a continuing decline in volumes during
the initial nine months of the period, a remedial work program had a
beneficial impact on volumes during the last three months.

Total operating expenses increased to US$13.009 million for the year ended 30
April 1999 compared to US$11.234 million for the year ended 30 April 1998. 
Lease operating expenses decreased to US$3.073 million for the year ended 30
April 1999 compared to US$5.506 million for the year ended 30 April 1998.  The
year ended 30 April 1999 was impacted by the sale of non-operated,
non-strategic wells during the previous two financial periods.  Depreciation,
depletion and amortisation decreased to US$1.671 million for the year ended 30
April 1999 compared to US$2.598 million for the 1998 period due to lower
volumes.  Since the acquisition of the East Irish Sea Interests on 30 October
1998, development plans for the fields have become firmer, drilling results
have been received on three wells and significant progress has been made on
the development of the Dalton and Millom Fields.  This additional information
indicates that, while the aggregate reserve estimates at the time of the
acquisition are confirmed, the reserves are likely to be produced at a slower
rate than originally anticipated and that development costs are likely to be
in excess of those originally anticipated.  These factors have led to an
impairment in value of the East Irish Sea Interests.  A ceiling test using the
Directors' best estimate of the seasonally adjusted average price likely to be
realised (15 pence per therm), future capital and operating expenditures and
taxation and a discount rate of 10 percent per annum has led to a charge of
US$4.779 million.  General and administrative expenses were US$3.364 million
during the year ended 30 April 1998 compared to US$3.486 million for the year
ended 30 April 1999.

In summary, due to the above factors, the net loss for the ordinary
shareholders for the year ended 30 April 1999 increased to US$10.983 million
(US$0.28 per share) compared to a net loss of US$4.729 million (US$0.15 per
share) for the year ended 30 April 1998.

On 22nd July 1999 the Company announced that it had entered into a preliminary
agreement with American Rivers Oil Company ('AROC') under which AROC would
make a recommended share for share offer for Alliance subject to the
satisfaction of various pre-conditions.  AROC has historically engaged in the
oil and gas business, although it has now sold nearly all its oil and gas
properties.  AROC's common stock is currently quoted on the U.S. OTC Bulletin
Board.  If the offer is made and our shareholders accept the offer, our
shareholders would hold 98% and the shareholders of AROC would hold 2% of the
company.  After these transactions are completed, it is expected that the
shares of the new company will be on the U.S. OTC Bulletin Board and will not
be listed on the London Stock Exchange.  

In the opinion of your Board, this move was necessary in light of the
Company's experiences in closing the LaTex and Difco acquisitions as well as
the change in shareholder make-up resulting from those acquisitions.

Our goal is to increase shareholder value and although current industry
conditions are uncertain, we believe simplifying our structure will enable the
Company to better access and complete mergers and acquisitions which, in
addition to further development of our existing property portfolio, will
enable the Company to grow and meet its stated goal.  We would also like to
thank our dedicated employees for their efforts during the past year.  We are
fortunate to have the technical and administrative management capable of
managing our existing assets while pursuing and completing a complex
cross-border transaction like the acquisition of the East Irish Sea assets
which was accomplished during a period of staff reductions and salary
deferrals



Consolidated profit and loss account


                          Year ended           Year ended
                            30 April             30 April
                                1999                 1998
                              US$000               US$000


Turnover                      6,234                 8,982
 Cost of sales               (9,523)               (7,843)
                              ______               ______
                            
 Gross (loss)/profit         (3,289)                1,139
 Administrative expenses     (3,486)               (3,391)  
                              ______               ______

Operating loss including 
exceptional items-seenote 2) (6,775)              (2,252)

Gain(loss) on sale of 
fixed assets                     (9)                  35
                               ______              ______
Loss on ordinary activities 
before interest and tax       (6,784)              (2,217)

Other interest receivable 
and similar income                 26                  62

Interest payable and similar charges (including       
exceptional items - see note 2)(4,225)             (2,574)                    
                                 ______              ______
              
Loss on ordinary activities 
before taxation               (10,983)             (4,729)
Taxation                            -                   -
                                ______              ______
Loss on ordinary activities 
after taxation                 (10,983)             (4,729)
                                ______              ______
Loss transferred to reserves   (10,983)             (4,729)
                                ______              ______

Basic loss per share (dollars)   (0.28)              (0.15)
Adjusted loss per share (dollars)(0.25)              (0.15)       



Consolidated balance sheet
       
                              30 April               30 April
                                  1999                   1998
                                US$000                 US$000
Fixed assets
Tangible fixed assets           55,108                 29,808
                               _______                _______
                     
Current assets
 Debtors                         2,307                  3,323
 Cash at bank and in hand          286                    408
                               _______                _______
                                 2,593                  3,731

Creditors
Amounts falling due within 
one year                        (8,072)               (12,095)
                               _______                _______
Net current liabilities         (5,479)                (8,364)
                                _______               _______
 
Total assets less current 
liabilities                     49,629                 21,444                 
       
   
Creditors
  Amounts falling due after more than
  one year                     (39,962)               (17,710)
                               _______                _______
Net assets                      9,667                   3,734
                                                                
Capital and reserves
       Called up share capital 20,658                  20,114
       Share premium account   26,678                  19,812
       Shares to be issued      1,551                   1,551
       Other reserves          (4,363)                (13,900)          
       Profit and loss account(34,857)                (23,843)
                              _______                  ______
Shareholders' funds             9,667                   3,734
                                                                 

Analysis of shareholders' funds
  Equity                        9,667                   3,734
     Non-equity                     -                      -
                              _______                 _______
                                9,667                   3,734
                                                                 

Consolidated cash flow statement

                            
                          Year ended              Year  ended
                            30 April                 30 April
                                1999                     1998
                              US$000                   US$000


Net cash (outflow) from 
operating activities          (2,276)                  (3,612)

Returns on investments and 
servicing of finance          (4,098)                  (1,958)

Capital expenditure and 
financial investment            (917)                   3,322
Acquisitions and disposals   (22,088)                    (237)
                              ______                    ______
Net cash outflow before 
financing                    (29,379)                  (2,485)

Financing                     29,257                    2,820
                              ______                    ______
(Decrease)/increase in cash in 
the period                      (122)                     335
                                                                  
       
Reconciliation of net cash flow to movement in net debt              

Decrease)/increase in cash in 
the period                     (122)                      335

Cash inflow from increase 
in debt                     (22,897)                   (2,770)
 
Amortisation of debt issue 
costs and discount           (2,161)                     (813)
    
Debt issue costs and 
discount- cash                1,214                       386
 - non-cash                   3,727                        26
 
Interest capitalised              -                      (114)
Loans of acquired subsidiaries    -                       (85)
                             _______                   _______
Movement in net debt        (20,239)                   (3,035)
Net debt at beginning 
of period                   (19,437)                  (16,402)
                             _______                   _______
Net debt at end of period   (39,676)                  (19,437)
                                                                 

Notes

1. Basis of Preparation

Going concern

The Group continues to make losses, has negative cash flows, has substantial
capital commitments and continues to experience working capital deficits. 
Despite this, the Group has been able to secure financing to support its
operations to date though these arrangements entailed substantial repayments
due from 30 October 2000. 

The Group was not in compliance with certain covenants of its loan agreements
at 30 April 1999 but a waiver has been obtained for such violations prior to
the violations causing an event of default and which would have resulted in an
acceleration of the repayment of the loans.  The Group has also reached
agreement with its lenders to amend certain provisions of the loan agreement
to allow $5 million of additional borrowing capacity which has been utilised
since the year end, to defer the borrowing base redetermination from 31 July
1999 to 31 December 1999 and to extend the repayment of Tranche B ($25
million) to 31 July 2001.  The amendment, however, does not change the
scheduled repayment dates of Tranches A and C which commence on 30 October
2000.

The Group's continuation as a going concern is dependent upon its ability to
generate sufficient cash flow to meet its obligations on a timely basis, to
continue to comply with the terms of its borrowing agreements, to ultimately
attain profitability and, most importantly, to obtain such additional
financing or refinancing as will be required within the foreseeable future.

The Directors believe the Group has a business plan that, if successfully
executed, will achieve these objectives.  However, the achievement of the plan
will require, inter alia, that further financing or refinancing be obtained. 
While the directors have not entered into negotiations in respect of this,
they believe that it is reasonable to expect that it will be possible, though
there can be no certainty of this.  They have therefore continued to prepare
the financial statements on a going concern basis and no adjustment has been
made to the values or maturities of assets and liabilities which might result
from the application of the going concern basis being inappropriate.


2. Exceptional Items
                     
                       Year ended              Year ended
                         30 April                30 April
                             1999                    1998
                           US$000                  US$000

Operating profit:

Commodity price hedging 
activities       (i)           -                   (1,128)

Impairment of oil and 
gas properties  (ii)      (4,779)                       -
                           ______                   ______
                          (4,779)                  (1,128)
                                                                              
                            ______                   ______       
Non-operating items:

Interest payable and 
similar charges (iii)       (870)                       -
                           ______                   ______
                            (870)                       -
                           ______                   ______
Total exceptional items    (5,649)                  (1,128)
                           ______                   ______

Exceptional items arose as follows:

 (i) On 15 May 1997, the existing commodity price hedging agreements were
terminated through a buyout.  On 23 October 1997, new commodity price hedging
agreements were initiated.  The loss relating to the buyout was recognised in
its entirety in the year ended 30 April 1998.

(ii) The Group utilises the full cost method of accounting for its oil and gas
operations and, where there is an indication that a cost pool may have been
impaired, performs a ceiling test.

The East Irish Sea Interests were acquired on 30 October 1998 and subsequent
development activity has produced indications of such an impairment.  A
ceiling test was carried out using a gas price of 15 pence per therm and a
discount rate of 10 per cent per annum which resulted in a deficit of US$4.779
million which has been charged as an exceptional item.

(iii)  At the time of the East Irish Sea acquisition, the Group borrowings
were refinanced and the unamortised costs associated with the existing
facility were written off as an exceptional item.

3. Significant Differences between U.S. and U.K. Accounting Principles

The accounting policies used in the preparation of the financial statements
conform with U.K. generally accepted accounting principles ('U.K. GAAP') which
differ in certain respects from U.S. generally accepted accounting principles
('U.S. GAAP').  Differences which may have a significant effect on net loss
and shareholders' funds are set out below.
 
                           Year ended          Year ended
                        30 April 1999          April 1998
                               US$000              US$000
                           
Effect on net loss              
Net loss under U.K. GAAP      (10,983)             (4,729)
Ceiling test adjustment (a)   (23,481)                 -
Approximate net loss 
under U.S. GAAP               (34,464)             (4,729)
                            
                             30 April            30 April
                                 1999                1999
                               US$000              US$000

Effect on shareholders' funds              
Shareholders' funds under 
U.K. GAAP                       9,667               3,734
Adjustments              
 Ceiling test (a)             (23,481)                  -
Convertible subordinated 
unsecured loan notes (b)       (1,551)             (1,551)
              
Acquisition of Difco (c)       (1,272)                   -
                               _______              ______
                              (16,637)              2,183

(a) Under U.S. GAAP, ceiling tests are calculated using prices prevailing at
the year end.  Under U.K. GAAP, a reasonable assessment of future prices is
used.  At April 30, 1999, the spot price for gas in the U.K. was significantly
below management's reasonable expectation of future prices resulting in a
significantly greater charge under U.S. GAAP than under U.K. GAAP.

(b) Under U.S. GAAP, the convertible subordinated unsecured loan notes are
treated as a liability.  Under U.K. GAAP, the convertible subordinated
unsecured loan notes are included as part of the shareholders' equity as in
substance their terms are economically equivalent to warrants with a zero
strike price and Alliance has no obligation to transfer future economic
benefit to the holder of the loan notes.

(c) Under U.S. GAAP, the shares issued to the vendors of Difco are recorded at
the more readily determinable value.  Under U.K. GAAP, the shares are recorded
at the value of the underlying interest in the East Irish Sea Interests.

In addition, there are a number of other classification and disclosure
differences which do not impact net loss or shareholders' funds.

The financial information contained herein does not constitute the Company's
statutory accounts for the years ended 30 April 1999 or 1998. Statutory
accounts for the year ended 30 April 1998 have been delivered to the Registrar
of Companies and those for the year ended 30 April 1999 will be delivered
following the Company's next Annual General Meeting. The auditors have given
unqualified reports without statements under section 237(2) or (3) of the
Companies Act 1985 on both the 1999 and 1998 accounts.



Statement of Proved and Probable Oil and Gas Reserves

  
                             Oil                 Gas                Total    
                       thousands         millions of                 BOEs
                      of barrels          cubic feet            thousands


Net proved reserves 
disclosed at 1 May 1998    6,494              26,322              10,881

Changes during the year:
    Production              (278)             (1,402)               (512)
    Disposals               (134)               (943)               (291)
    Revisions              2,625              (6,534)              1,536
    Acquired                   -              73,870              12,312      
                            ______              ______             ______

Net proved reserves 
disclosed at 30 April 1999  8,707              91,313             23,926
                                                         

Of which:       
Proved developed producing     3,792            12,681              5,905
Proved developed behind pipe     817             6,658              1,927
Proved developed non-producing 1,392               180              1,422
Proved undeveloped primary     2,706            71,794             14,672
                              ______            ______             ______

Net proved reserves 
disclosed at 30 April 1999     8,707            91,313             23,926
                                                         
Net probable reserves 
disclosed at 30 April 1999         -             8,373              1,396
                                                         

Lee Keeling and Associates, Inc., an independent Oklahoma based consulting
company engaged in petroleum reservoir evaluation, carried out an evaluation
of the Group's proved and probable reserves as at 30 April 1999.