Loan Agreement

Rurelec PLC
09 March 2007

                                  Rurelec PLC

                          ('Rurelec' or 'the Company')

Rurelec PLC, the AIM quoted power developer and owner of power plants in Latin
America, today announces that Energia del Sur ('EdS'), Rurelec's Argentine power
generation business, has signed a loan agreement with Standard Bank of London
for US$18 million. The loan is believed to be the first financing for power
generation in Argentina since the Peso crash of 2001 and has a limited recourse
facility of five years for the conversion to combined cycle gas turbine ('CCGT')
operation of the existing 78 MW open cycle gas turbine gas-fired power plant in
Commodoro Rivadavia, Patagonia.

The CCGT conversion will add a further 60 MW of new high efficiency capacity by
the addition of a steam turbine powered by waste heat from the two open cycle
General Electric 6B gas turbines. Since the bulk of the steam for this
additional power capacity is produced from exhaust gases that would otherwise
just vent into the atmosphere, the new plant will be eligible for carbon credits
under the United Nations Clean Development Mechanism established under the Kyoto
Protocol. Total EdS capacity will be 138 MW when the CCGT conversion is
completed in 2008.

A combined cycle plant produces 40 per cent. less CO2 than a plant using the
same gas turbines in open cycle. A typical traditional coal fired power plant of
138 MW emits three times as much CO2 as a high efficiency combined cycle gas
fired power plant such as EdS.

The new 60 MW capacity at EdS is already well under construction and the
refurbished ABB steam turbine is already on site together with 96 containers of
equipment. In view of the unavailability of ground water for cooling in
Patagonia, which is typically dry and windy, EdS has acquired a state of the art
air cooling system from a decommissioned power plant in New Jersey, where the
steam turbine was also sourced.

The cost savings from the Rurelec policy of sourcing grey market equipment will
mean that EdS is one of the lowest cost CCGT plants in Latin America.

For further information, please contact:

Peter Earl
Managing Director                Tel. [phone]

Stewart Dick
Daniel Stewart & Company         Tel. [phone]




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