Business Update

UK Coal PLC
21 January 2003

                                                                 21 January 2003

                                  UK COAL PLC

UK COAL today confirmed that production at its Daw Mill Colliery in the West
Midlands has shown recent improvement, with outputs of 30,000 and 43,000 tonnes
in the last two weeks.

Since July 2002, production on the main face in the five-metre Warwickshire
Thick seam at Daw Mill has been affected severely by difficult geological
conditions which reduced output to around 5,000 tonnes a week.

Gordon McPhie, Chief Executive, commented: 'We continue to make steady progress
at Daw Mill and while there are likely to be further geological challenges in
the panel that we are working, we are cautiously optimistic that we are through
the worst of the geologically disturbed area.'


CONTACTS:

Gordon McPhie                    Chief Executive, UK COAL          01302 751 751
Liz Morley (Financial)           Gavin Anderson & Company          020 7554 1400
Stuart Oliver (Operational)                                        01525 381759




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