Media Release

New Vale Coal purchase agreed

29 August 2006

New Vale Coal purchase agreed

Solid Energy New Zealand Ltd has reached a conditional agreement to purchase 100% of the privately-owned New Vale Coal Company Ltd, subject to Commerce Commission clearance. It is hoped that this will be obtained by the end of October.

New Vale, a long-established family owned business, operates the New Vale Mine which is located on the Waimumu lignite coal field in Eastern Southland. The mine produces more than 200,000 tonnes a year, supplying local industry including Fonterra's nearby Edendale Dairy factory.

Solid Energy plans to continue New Vale's mining operations and to retain the current workforce of 30 people. Both parties have briefed customers and other key stakeholders in the area.

For further information contact:

Vicki Blyth	Bret Highsted
Communications Director	General Manager
Solid Energy New Zealand Ltd	New Vale Coal Company Ltd
Tel: 03 345 6000	Tel: 03 208 9485
Mobile: 021 670 250	Mobile: 027 221 5796

Note to Editors:

Solid Energy currently owns and operates, in Southland, the Ohai Opencast Mine which currently produces about 180,000 tonnes per annum and is investigating the viability of reopening the former Mataura Opencast Mine to serve the South Island industrial market.