Trading Update

UK Coal PLC
13 October 2006


13 October 2006


                                  UK COAL PLC

                          Third Quarter Trading Update


UK COAL, Britain's largest coal mining company, is issuing the following trading
update following the end of the third quarter to 30 September 2006.


The Group's property, power and surface mining businesses continue to develop
extremely well.


Deep mining      -     We announced with our interim results on 6 September 
                       that output from our deep mines was expected to be 
                       lower in the second half than the first at 4.5m tonnes,
                       due to a combination of factors that arose in July and 
                       August at four mines.

                       Although production has now recovered to the rate that 
                       we had anticipated at all mines except for Maltby, the 
                       disruption continued through most of September and the 
                       lost production of some 422,000 tonnes is not likely to 
                       be recovered in the fourth quarter. Accordingly, total 
                       second half output is now expected to be between 3.9 
                       and 4.1 million tonnes.

Surface mining   -     Stoney Heap has joined Maidens Hall in full production 
                       in September. Two further sites will commence 
                       production in the fourth quarter.  Planning decisions 
                       are awaited on four sites, which will underpin 2007
                       production.

Power            -     Following the acquisition of the licence to extract 
                       methane gas in September, planning approval has now 
                       been received for the installation of 12 MW of methane 
                       generation at the former Stillingfleet mine. This will
                       have an annual value of around £3.5 million. This, 
                       together with several new planning applications 
                       submitted covering 9 MW for the installation of wind 
                       turbines on former surface mines, represents further 
                       significant progress in the development of Harworth 
                       Power.


Property         -     Since the half year, in accordance with plan, sales of 
                       development plots realising profits of £1.2 million 
                       have been contracted and an auction of restored 
                       agricultural land will be undertaken next month which 
                       is anticipated to realise profits in excess of 
                       £2.5 million. Progress at our Advanced Manufacturing 
                       Park at Waverley continues with the agreement of one of 
                       our key occupiers on the park to undertake a second 
                       phase building of a further 30,000 sq. ft.

                       It is anticipated that, by the year end, Joint 
                       Development Agreements will be signed on a further 
                       three sites as part of our strategic partnering approach 
                       to realising full development value from the portfolio.

                       As announced with the half year results, it is planned 
                       that a full update covering the significant future 
                       prospects for the property portfolio will be given to 
                       analysts on 7 November 2006. The financial effect of 
                       progress achieved in our property activity will be 
                       disclosed in our annual valuation as at 31 December 2006.


The shortfall in deep mining output noted above will impact the Group's profit
and operating cash flow for the second half, and lead to a loss for the year as
a whole. Nonetheless, UKC remains on track to deliver substantial value to
shareholders. The Group continues to make good progress towards planning
approvals at a number of our key property sites and the deep mines will offer a
significantly improved financial profile over the next 15 months as we come to
the end of some of our legacy contracts and can access market pricing for most
of our output.



Enquiries:


Gavin Anderson & Company                             020 7554 1400

Ken Cronin
Kate Hill
Michael Turner






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