FOR IMMEDIATE RELEASE

Craig M. Hammett - Senior Vice President, Chief Financial Officer  402-341-4500
Craig S. Allen - Manager, Investor Relations                       402-341-4500
                              
  CalEnergy Announces That New York Appellate Court Orders
                      Korea First Bank
   To Honor Draws On Its Letter Of Credit For The Casecnan
                           Project
                              
     OMAHA, NEBRASKA, April 8, 1998 --- CalEnergy Company,
Inc. ("CalEnergy") (NYSE, PCX and LSE Symbol:  CE) announced
today that its Philippine subsidiary, CE Casecnan Water and
Energy Company, Inc. ("CE Casecnan"), received a unanimous
New York Appellate Court ruling in its favor in a letter of
credit dispute with Korea First Bank ("KFB").  The New York
Appellate Division unanimously denied KFB's appeal of a
summary judgment ruling requiring KFB to honor draws by CE
Casecnan on KFB's irrevocable standby letter of credit.  The
letter of credit was issued as financial security to support
the obligations of the construction contractors for the
Casecnan project under a turnkey construction contract.  The
turnkey construction contractors for the project (members of
the Hanbo Group) were terminated and replaced in May 1997 by
CE Casecnan due to multiple defaults, including insolvency,
at which time CE Casecnan made an initial draw under the KFB
letter of credit which was wrongfully dishonored by KFB.

     The Appeal Court's unanimous decision, which affirmed
summary judgment against KFB, with costs, ruled that KFB's
dishonor of draws under its letter of credit was "wrongful
as a matter of law."

     Pending this appeal decision, KFB had been required by
the trial court, and by stipulation of the parties, to
deposit funds relating to three draws under the letter of
credit in an interest-bearing New York bank account with an
independent financial institution.  The effect of the
Appellate Court decision is that KFB must now pay CE
Casecnan the principal amount of those three draws under the
letter of credit (totaling approximately U.S. $93 million)
plus accrued interest at nine percent per annum.

     A fourth draw under the letter of credit, reflecting
additional damages to CE Casecnan, raises the unpaid
principal amount of the draws under the KFB letter of credit
to $117.5 million.

     Craig M. Hammett, Chief Financial Officer of CE
Casecnan, stated, "Korea First Bank's failure to comply with
customary banking practices and honor its own irrevocable
standby letter of credit is virtually unprecedented in
international lending transactions.  Accordingly, we expect
KFB to promptly honor its court-ordered payment obligations
and avoid further damage to its credit standing and
international reputation which would result if KFB chooses
to engage in further frivolous delay tactics."

     CalEnergy, which manages and owns interests in over
5,000 net megawatts of power generation facilities in
operation, construction and development worldwide, currently
operates 20 generating facilities and also supplies and
distributes electricity and gas to 1.8 million customers.
                      www.calenergy.com
                              
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