OXS Oxus Gold

RNS Number:7363S
Oxus Gold PLC
12 March 2007


news release

For immediate release: 12 March 2007

                                 Oxus Gold plc

Oxus announces agreement in principle to transfer Kyrgyz and Romanian interests
                                 to KazakhGold

                            Dividend to be Declared

LONDON: 12 March 2007 - Oxus Gold plc ("Oxus" or the "Company") (OXS.L) is
pleased to announce that it has agreed in principle to sell to KazakhGold Group
Limited, subject to contract ("KazakhGold") (KZG.L):

-          its 100% interest in Norox Mining Company Limited, which company owns
           66.67% of Talas Gold Mining Company in Kyrgyzstan;

-          its 50% interest in the Romaltyn joint venture in Romania; and

-          certain exploration assets in Turkey currently owned by Oxus's 86% 
           owned subsidiary, Marakand Minerals Limited (MKD.L), subject to board
           approval from Marakand

for the issuance of 3,541,666 new ordinary shares in KazakhGold (currently
valued at approximately $72 million), plus deferred consideration of up to $80
million, payable in cash in instalments, provided that KazakhGold obtains the
requisite licence to enable it to continue with the development of the Jerooy
gold project in Kyrgyzstan. The proposed sale is subject to a number of
conditions, including completion of satisfactory due diligence, the receipt of
satisfactory independent valuations of the assets, the receipt of all necessary
regulatory approvals and consents, and completion of final legal documentation.

Oxus intends to distribute all or a large portion of the KazakhGold shares
arising from the transaction as a dividend to its shareholders and further
details will be supplied to shareholders in due course. The initial
consideration currently represents 7% of KazakhGold's outstanding share capital.

Darryl Norton has agreed to step down as a director of Oxus and to join the
board of KazkhGold as Joint Managing Director. In addition Steve Westhead and
Geoff McLoughlin, both of whom have been full time engaged on the Romaltyn joint
venture, will join KazakhGold as chief geologist and chief metallurgist
respectively.

Upon completion of the proposed sale, KazakhGold will acquire 100% of Norox
Mining Company Limited which in turn owns 66.67% of Talas Gold Mining Company in
Kyrgyzstan. Oxus has spent approximately $63 million on the Jerooy gold project
to date, including on the construction of a processing plant which is
approximately 80% complete. As previously announced, construction was suspended
in February 2006.

The Romaltyn joint venture in Romania, in which KazakhGold already has a 50%
interest, owns a gold processing plant in Baia Mare and certain exploration
licences. These assets were jointly acquired by Oxus and KazakhGold in January
2007 following a successful bid in open auction. Oxus has spent approximately
$3.8 million on the project to date, including its share of the purchase price.

The transfer of the Turkish exploration assets will be subject to KazakhGold's
assessment of the economic viability of such assets, the determination of an
appropriate fair market value to be paid to Marakand by Oxus and approval of the
Marakand board.

Oxus will continue to focus its efforts on the development of its producing gold
operations in Uzbekistan and to building the strategic alliance with Zeromax
GmbH. Apart from the ongoing oxide operations, it is intended to bring the
underground sulphides operation into production as soon as possible and to
expand Oxus's overall project base in Uzbekistan.

Bill Trew, CEO of Oxus, commented "We are delighted to be able to make this
announcement and, upon completion, we believe the transaction will represent a
win-win situation for our shareholders and also for the shareholders of
KazakhGold. These Kyrgyz and Romanian assets, together with the experience that
Darryl, Steve and Geoff will bring to the KazakhGold management team, will add
significant value to KazakhGold's already impressive Kazak asset base.

We believe this transaction with KazakhGold provides a satisfactory resolution
for Oxus of the difficult issues involved at Jerooy.  We will recover the funds
expended at Jerooy to date and will also have some further potential benefit
should KazakhGold be successful in obtaining the Jerooy mining licence. Oxus
will continue to focus on increasing its gold production in Uzbekistan and is
working closely with Zeromax in order to realise the full potential of the
Amantaytau Goldfields project and to evaluating other project opportunities in
Uzbekistan."

The deadline for subscription of the second tranche of new ordinary shares of
Oxus by Zeromax, announced on 30 November 2006, has been extended to the close
of business on 19 March 2007.

End


Contacts:

Oxus Gold plc
Richard Wilkins                                         Tel: +44 (0)20 7907 2000
website: www.Oxusgold.co.uk

Bankside Consultants Ltd.
Keith Irons/Oliver Winters                              Tel: +44 (0)20 7367 8873

Canaccord Adams Limited
Erin Needra                                             Tel: +44 (0) 7050 6755


                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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