Positive Drilling Results At Pace Coal Project 

DENVER, CO - American Power Corp. reported positive preliminary laboratory results of its exploration drilling program and the amendment of its prospecting permit to cover an additional nine drill locations corresponding to Phase III of its exploration drilling program at the Pace Coal Project in Judith Basin County, Montana.

Preliminary laboratory results for the five core samples of Phase I were received and showed a high energy content with a range of 11,462 and 18,224 BTU measured on a dry and ash free basis (DAF). Sulfur content ranged from 2.0% to 3.7% (DAF) while ash content ranged from 30.6% to 51.9% (DAF).

American Power has instructed Standard Laboratories, Inc. in Casper, Wyoming to prepare a washability study, including float/sink analysis to be performed on the coal cores, according to ASTM standards. The washability study will determine the amount of ash and sulfur content that could be reduced from the coal seam in order to improve its quality.

The Company's technical team is putting together a second set of core samples obtained from Phase II and will ship them to Standard Laboratories for analysis.

American Power had completed a total of 11,599 feet of drilling for Phases I and II of its exploration program. With regard to Phase II, the Company has completed 4,944 feet of drilling on 6 out of 8 drill locations. The Company expects Phase II to be completed imminently and will proceed with Phase III of the exploration program, weather conditions permitting.

Al Valencia, CEO, said, "We are very pleased that the laboratory results have corroborated the high BTU results obtained by Mobil Oil Corp in 1979. Given these results, our board of directors has decided to give green light to the immediate start of Phase III of our coal exploration program. Drilling efforts for Phase III will be concentrated in the eastern area of the property, where our team has identified the most promising results to date, both in terms of coal thickness and energy content."

The company's address is 16 Market Square Center, 1400 16th Street, Suite 400, Denver, CO 80202, 720-932-8389, fax: 720-932-8189, email: [email protected].