Trading Update

Rurelec PLC
22 November 2007


22nd November 2007

                                  Rurelec PLC

                          ('Rurelec' or 'the Company')

         Empresa Guaracachi Finalises Combined Cycle Expansion Project

Rurelec plc (AIM:RUR) announces today that its Bolivian subsidiary, Empresa
Guaracachi SA ('Guaracachi') has finalised its 96 MW combined cycle gas turbine
('CCGT') expansion project in Santa Cruz de la Sierra.

Guaracachi's CCGT project is the largest single power unit ever to be
constructed in Bolivia. At 96 MW of electric output, it will represent more than
10 per cent. of the country's peak demand when completed in early 2009 and it
will help alleviate power shortages which have been forecast during the next
eighteen months.

Guaracachi has signed contracts to acquire a steam turbine from Steag of Germany
which is now being reconditioned by Sulzer Hickham before delivery to Bolivia.
At the same time the Board of Guaracachi has approved the selection of IST of
Canada as preferred supplier for two heat recovery steam generators ('HRSGs')
which comprise the heart of the conversion project. Contract signature is
expected by the end of November.

Under the combined cycle conversion, the waste heat from two existing General
Electric 6FA gas turbines will be channelled through two new HRSGs to be
constructed on site, instead of being vented directly into the atmosphere. This
capture of heat from the existing power plant allows electricity to be produced
from the same natural gas as is currently used simply to fire the open cycle gas
turbines themselves, since the waste heat is converted to steam which in turn
powers a steam turbine synchronised to the two original gas turbines.

Compared with the current production in open cycle Guaracachi will generate
approximately 40 per cent. more electricity in combined cycle without any
increase in gas usage. This significant reduction in gas consumption in turn
reduces the new CCGT unit's emissions of CO2 for every hour of electricity
generated. For this reason, the project qualifies for certified emissions
reductions certificates, also known as 'carbon credits', under the Kyoto
Protocol of the United Nations Framework Agreement on Climate Change.

Financing Initiatives

At the same time as finalising the mechanics of the project, Guaracachi has
launched a series of important financing initiatives.

Today, Guaracachi has received confirmation that its planned domestic bond
placement programme of up to US$40 million has been authorised by the
Superintendencia de Pensiones, Valores y Seguros, the Bolivian financial market
regulator. The bonds, rated A+(Bol) by Fitch, will be placed with Bolivian
financial institutions by Credibolsa, the brokerage arm of Banco de Credito de
Peru. Placement of the first tranche of the bonds in an amount of US$20 million
is expected to be completed shortly. This first placement, which has been
authorised by the shareholders of the company, will have a maturity of 10 years
with principal payments of 33.33% in year 8, 33.33% in year 9 and 33.33% in year
10. The annual fixed interest rate will be 8.55%, which will be paid
semi-annually.

In parallel with the bond programme, Guaracachi has agreed outline terms with
Corporacion Andina de Fomento ('CAF') for a project loan of US$20 million for
the combined cycle conversion. This loan has received support from KfW, the
German development bank, which is providing a subsidised tranche of lending in
recognition of the importance of the CCGT project for the infrastructure
expansion of Bolivia. This is the first CCGT plant in Bolivia and it represents
a major development in the Bolivian interconnected system, introducing high
efficiency, complex thermal power generation into the system. Signature of the
proposed CAF and KfW loan is expected at a formal ceremony at the end of
November.

Guaracachi is also working closely with Rurelec to create a carbon financing
programme which will provide further project funding. This will utilise the
future revenues from the forward sale of carbon credits which will be generated
by the CCGT plant when it comes on line in the second quarter of 2009.

Peter Earl, Managing Director of Rurelec commented: 'Rurelec is continuing to
make substantial progress in Bolivia, and the completion of the CCGT expansion
is testament to this. The basic cost of the CCGT project is circa US$40 million,
or US$416,000 per MW of incremental capacity. This is a capital cost
considerably below industry standards and Rurelec is delighted at the
co-operation this represents between English and Bolivian power engineering and
finance teams. The final funding requirement will also include Bolivian VAT and
import duties as well as interest during construction. Taken together, these
items add a further US$10 million to the capital budget for the conversion and
take the total funding requirement of the CCGT project to US$50 million.'

For further information please contact:                            020 7793 5610

Peter Earl, CEO, Rurelec PLC
Paul Shackleton, Daniel Stewart                                    020 7776 6550
Simon Robinson, Park Green Communications                          0207 851 7480




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