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   BESICORP LTD.
                                                    For Immediate Release




       Contact:       Susan Whitaker, Shareholder Relations
                      (914) 336-7700, x104


                      BESICORP LTD. SIGNS MERGER AGREEMENT

       KINGSTON, NEW YORK, October 11, 1999 -- BESICORP LTD. announced  today
       that it has entered  into an agreement and  plan of merger with  Besicorp
       Holdings, Ltd. and  Besi Acquisition Corp. to  effectuate a going private
       transaction.  The agreement is  being structured as a cash merger whereby
       Besi Acquisition Corp. will be merged into Besicorp Ltd., which will then
       be wholly-owned by Besicorp Holdings, Ltd. Michael F. Zinn, the President
       and  CEO  of  Besicorp Ltd., is  the President of  and  is in control of,
       Besicorp Holdings, Ltd. and Besi Acquisition Corp.

       Pursuant to the terms of the  agreement,  shareholders  of the Company at
       the time of the merger  (other  than  Besicorp  Holdings,  Ltd.  and Besi
       Acquisition  Corp.) will  receive  approximately  $58.70 in cash for each
       share of stock  that they own plus the right to receive  additional  cash
       distributions,  if any,  during the next  several  years in the event the
       surviving  corporation receives certain moneys. No assurance can be given
       that any such moneys will be received.

       The agreement  announced  today is the  culmination  of several months of
       negotiations  between  representatives of Michael F. Zinn and the special
       independent  committee  appointed by the  Company's  Board of  Directors.
       Negotiations  began in June 1999 when the Company  received an offer from
       Michael F. Zinn to purchase the business and assets of the Company.

       Effectuation of the merger is subject to the  satisfaction of a number of
       conditions,   including  approval  by  the  Company's  shareholders.   No
       assurance can be given that the merger will be effectuated.

       Besicorp specializes in the development of independent power projects and
       energy technologies.

       Certain  statements  contained  in  this  press  release  may  be  deemed
       forward-looking  statements. Such statements, and other matters addressed
       in this press release, involve a number of risks and uncertainties. Among
       the factors that could cause actual plans to differ materially from these
       statements  and other matters are the risks and other  factors  detailed,
       from time to time, in the










       Company's reports with the U.S. Securities and Exchange Commission.

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