Gujarat NRE Coke acquires 2nd coking coal mine in Australia

(July 04, 2005)

Gujarat NRE Coke Limited ("GNCL") is pleased to announce that their Australian joint venture company, Gujarat NRE FCGL Pty Ltd, has entered into an agreement to acquire the coal mining leases comprising the whole of old Avondale Colliery and part of Huntley Colliery in the Southern Coalfields of New South Wales, Australia. FCGL Industries Ltd, is also having substantial stake in the Australian joint venture.

The acquisition subject to ministerial approval also proposes to re-name the colliery, NRE No 2 Colliery.

The mining leases being transferred comprise of:

• approximately 5,500 ha within the Illawarra Coal Measures of the Sydney Basin;

• Wongawilli and Tongarra seams both of which have been mined previously in the adjoining leases, producing high fluidity low phos good quality hard coking coal;

• indicated recoverable reserves totalling approximately 96 million tonnes

In December,2004, Gujarat NRE Coke completed the acquisition of the NRE No. 1 Colliery which is located in close proximity to the proposed NRE No. 2 colliery.

The Vice Chairman & Managing Director of Gujarat NRE Coke, Mr Arun Jagatramka said �this strategic investment further strengthens the position of our company in the Southern Coalfields of New South Wales. The Southern Coalfields is renowned for producing high quality hard coking coal and the investment makes sense given its vicinity to our NRE No. 1 Colliery and the potential benefits of ownership in two nearby collieries.�

The Company has commenced work on preparation of the development application so that it can proceed to mining in the shortest possible timeframe. The acquisition and development of the mine will cost about 80 million AUD.

Gujarat NRE Coke was advised by Ernst & Young Mergers & Acquisitions Division as lead corporate finance advisors and Corrs Chambers Westgarth as legal advisors.