Adm Energy Regulatory News (ADME)

Pan Pacific Aggregates plc

("PPA" or the "Company")

Trading Update

Pan Pacific Aggregates plc (AIM:PPA), a quarry operator in British Columbia, today announces a trading update.

Sales at the Quadling Quarry ("Quadling") in the last quarter have held up well and are ahead of management expectations. Despite adverse weather conditions in the area, Quadling's close proximity to Highway 1 continues to provide a competitive advantage with recent sales figures approaching levels seen in the summer months. The increase in Quadling's average sales price, which was established during the summer, has been sustained and sales of the higher specification materials have increased.

PPA has begun drilling into a higher quality core rock rather than the previous weathered stone at Quadling. This has resulted in down hole drilling for rock blasting which is more efficient and cost-effective than pioneering drilling. The Company has also established employee performance targets at Quadling. As a consequence of these two changes, Quadling's production costs have decreased; drilling and blasting costs have been reduced and the Company is producing a higher quality stone for crushing. This has resulted in improved gross margins and higher cash generation from the quarry.

The Company has advanced its negotiations to acquire the operating rights at the Shaw sand and gravel pit in Mission, British Columbia, and an extraction and operating agreement is currently with PPA for consideration. During the bidding process, PPA was selected as the preferred bidder ahead of six other operators, with the Company's overall package providing the highest net present value and a more attractive offer in overall terms.

The Board expects to finalise the terms of the agreement in favour of PPA in the first quarter of 2011. Following signature of an acceptable agreement, the Company anticipates operations to commence at Shaw Pit in the second quarter of 2011.

The Company continues to pursue its strategy in and around the Fraser Valley, British Columbia by developing a robust local position, both organically and through acquisition.

-Ends-

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