Acquisition

Pan Andean Resources PLC
17 September 2003

Pan Andean has agreed to acquire total ownership of the

Korenek leases in the Danbury Dome area of Texas with

the purchase, from El Paso, of their 60% holding.



With this acquisition Pan Andean will own 100% of the Korenek and Vieman leases
covering 1029 acres. The consideration for the purchase is a cash payment of
$250,000 and an amicable settlement of significant outstanding legal disputes.
Completion is expected within five working days.



3D seismic analysis suggests that the blocks contain drilling prospects with
potential reserves of 75 billion cubic feet of gas at depths of 12,000 to 14,000
feet as well as the Golden Eye prospect at 17,000 feet estimated to contain up
to 100 billion cubic feet of gas. This potential is the equivalent to 30 million
barrels of oil.



John Teeling, the chairman, commented. 'This is a very good deal for both sides.
Danbury Dome is interesting at present with two discoveries this year adjacent
to our acreage one being the Zachary hit in which Pan Andean holds a 7%
interest.  This settlement has taken years to negotiate.  Pan Andean and El Paso
each acquired their interest in this acreage with ongoing legal problems that
have now been resolved.



Apart from the outstanding Golden Eye prospect we have identified three
drillable targets at shallower depths.  It is highly likely that we will involve
a partner in the drilling programme. At current gas prices this is a top class
addition to our portfolio'.


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