Re Incineration Capacity

Shanks Group PLC
16 January 2002


Shanks Rationalises High Temperature Incineration Capacity

Waste management company Shanks Group plc announces a realignment of its UK
hazardous waste incineration capacity to reflect market demand following the
expiry in March 2002 of the original c.15,000 te/year contract to process Meat
and Bone Meal from the BSE crisis. This capacity reduction will take place at
its Pontypool facility and involve the loss of about 50 jobs. Meat and Bone
Meal will continue to be processed in the new lower cost facility at its
Fawley site.

An exceptional charge, expected to be less than £10 million, including asset
writedown, will be taken in the current year. The Group's trading performance
for the first nine months of the 2001/2 year was broadly in line with
expectations.

Shanks has recognised for some time the need to realign capacity unless
additional incineration volume was forthcoming to replace the original MBM
contract. The cost savings resulting from the capacity reduction are expected
to mitigate the loss of this contract and the recent deterioration in the
market.

For further information please contact:

John Shaughnessy, Group Head of External Relations

Tel. [phone]; e-mail: [e-mail]