Pacific Asia China Energy Inc.

Pacific Asia China Energy Inc.

June 12, 2006 09:30 ET

Pacific Asia China Energy Inc. Reports Preliminary Results on Second CBM Well in China

KELOWNA, BRITISH COLUMBIA--(CCNMatthews - June 12, 2006) - PACIFIC ASIA CHINA ENERGY INC. ("PACE") (TSX VENTURE:PCE) announces preliminary results on the second of six test wells, ZY-01, at the Mayi East Block, which covers about 138 KM2 and situated in the Guizhou Baotian-Qingshan CBM main permit area of 970 KM2.

Drilling at ZY-01 was recently completed in the Longtan coal formation at a depth of 805 meters. Fifteen coal seams were cored in the sequence and eight seams exceeded 1 meter in thickness. The total combined thickness of net coal in these seams is 10.46 meters and the Number 29 seam contains net coal of 2.3 meters.

Early stage desorption data from 12 samples show a range of gas contents between 105 and 407 scf/t (3.3 to 12.7 m3/t) after 4 to 19 days of testing. These values will be exceeded as desorption will not be completed for several weeks. An injection/fall-off test on two target seams was unsuccessful due to the failure of packers during the test. The drilling and work programs are proceeding on schedule and preliminary results are similar to those previously achieved by the Coal Geology Exploration Bureau of Guizhou Province, and whose data was used by Sproule International Ltd. in their CBM resource analysis.

In early 2006, Sproule International Ltd., a geological and petroleum engineering consulting firm, conducted a study of the discovered CBM resources for the Boatian-Qingshan property in Guizhou. The study estimated The Most Likely Case volume estimate for the three target coal seams in the Longtan Formation was 5.2 TcF distributed over the entire permit area. The Sproule report, including a map of the area, can be viewed online as a public document on SEDAR.

Drilling of test holes ZY-02 and MY-03 in the Guizhou Mayi Block are underway. As well, Two-Dimensional Seismic programs are continuing and approximately 44 kms have been completed in the Mayi West and Mayi East areas of the exploration area.

At the Company's Huangshi project, drill test hole HS-02 is currently at a depth of 110 meters and drilling at HS-01 has just begun.

This news release was prepared on behalf of the Company by Dr. Marchioni, PhD, PGeol, V-P of Exploration. Dr. Marchioni is a qualified person as defined by National Instrument 43-101 and 51-101, and is responsible for reporting on the company's drilling programs in China.

This news release may contain forward-looking statements. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

PACIFIC ASIA CHINA ENERGY INC. is a Canadian based resource company specializing in the strategic development of Coal Bed Methane projects in China. Common Shares of PACIFIC ASIA CHINA ENERGY INC. are listed on the TSX Venture Exchange under the symbol "PCE".


Tunaye Sai, President

The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this news release.

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